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Satya Nadella: 'We Clearly Missed the Mobile Phone' (mashable.com)

At the Wall Street Journal's WSJD Live conference, Microsoft CEO Satya Nadella admitted that Microsoft has largely failed in making a dent in the mobile hardware business. Nadella, who took over the command of Microsoft from Steve Ballmer in February 2014, however added that the company is now focused on doing well in new categories and also building new categories. He said:We clearly missed the mobile phone, there's no question. Our goal now is to make sure we grow new categories. We have devices which are phones today but the place where we are focused on, given where the market is, is what is the unique thing that our phone can do. We have a phone that in fact can replace your PC, the same way we have a tablet that can replace your laptop. Those are the categories that we want to go create. If anything, the lesson learned for us, was thinking of PC as the hub for all things for all time to come. It was perhaps one for the bigger mistakes we made.

27 of 245 comments (clear)

  1. First Post by Anonymous Coward · · Score: 5, Funny

    Sent from my Windows phone.

    1. Re: First Post by Anonymous Coward · · Score: 5, Funny

      Liar! No one has a Windows Phone!

    2. Re:First Post by peragrin · · Score: 5, Interesting
      And how old is that phone?

      There'sno chance that the iPhone is going to get any significant market share. No chance. It's a $500 subsidized item. They may make a lot of money. But if you actually take a look at the 1.3 billion phones that get sold, I'd prefer to have our software in 60 percent or 70 percent or 80 percent of them, than I would to have 2 percent or 3 percent, which is what Apple might get,". Steve ballmer in a 2007 interview with USA Today.

      Microsoft didn't even see it coming.

      --
      i thought once I was found, but it was only a dream.
    3. Re:First Post by paiute · · Score: 4, Funny

      Microsoft didn't even see it coming.

      Microsoft is a lot like Wile E. Coyote. We can see that the anvil is going to land squarely on them, but they never seem to be able to look far enough into the future to see it themselves.

      --
      If Slashdot were chemistry it would look like this:Cadaverine
    4. Re:First Post by Rob+Y. · · Score: 4, Interesting

      Microsoft didn't 'miss' the iPhone - since their basic business model had always been to sit back and copy whatever big new thing Apple (or anybody else, for that matter) came up with - and count on tie-ins to the desktop to make their copy succeed. What they missed was Android, which swooped in and stole the OEM market from them. By the time they were ready to move the app barrier to entry was too big. That said, Blackberry missed Android too - they failed from a leadership position.

      They failed with their iPod clone too - but for a different reason. iPods were fairly cheap, and they tied your music collection to the Apple ecosystem. And iPods worked with Windows as well as anything else - i.e., they were cheap enough and limited enough in functionality that MS couldn't leverage Windows to out-compete Apple.

      --
      Posted from my Android phone. Oh, I can change this? There, that's better...
    5. Re:First Post by TemporalBeing · · Score: 2

      More to the point, Microsoft never sticks to a product line long enough to warrant investment in it.

      True.

      Microsoft had the leading smartphone OS before it was called a smartphone (remember PocketPC's ?), before RIM's blackberry became the de-facto business device.

      False. PocketPC was a desktop clone for small device form factors that sucked so bad it was hilarious. Sure if you wanted Win95/NT4 on a phone it'd have been great...but then, you had to use a stylus to do anything as that was your mouse, and it required a full keyboard. Could it be considered a Smart Phone? Yes, but it absolutely sucked and never really had a very big market share - no where near majority by any means.

      Palm and then RIM won b/c they actually did stuff the user cared about in easy to use manners.

      Google set their eyes specifically on overtaking RIM and Apple came up and offered something compelling that wasn't a stuffy old blackberry clone.

      Yes, Google and Apple aimed at displacing RIM b/c RIM was the de facto standard for anything more than a basic cell phone. If you wanted email, you got a Blackberry. RIM would probably still be a leader in the market if they hadn't screwed up with a highly centralized network design and had a 1 week network outage - which led to a lot of execs getting iPhones and demanding that their IT departments integrate the iPhone so they could use it; both Apple and Google exploited that, though Apple was the clear winner having a superior and flashier product that the Exec's loved.

      The end result is that Apple is the Market Leader for the Smartphone, if you're not doing it Apple's way, you are doing it wrong. Google recognized that and changed Android from knocking off Blackberry to knocking off iOS, Nokia meanwhile kept on trucking out phones that appealed to people who didn't care about smartphones. Microsoft's killed it's own market share in order to push Windows Phone 7, then 8, and now 10. Each time halving their market share. So they went from 11% in 2001 to 0.7%.

      Microsoft screwed up and lost it's foothold in the mobile scene. Had they never dumped the PocketPC, they might be market leaders today.

      Well, if Microsoft hadn't abandoned PocketPC (aka Windows Mobile) then yes they'd probably have a bigger market share, but it'd still be a pittance compared to Apple and Google. As I said, PocketPC was basically the Windows Desktop in a small form factor - it would not be able to compete with Android or iOS. It also didn't have updates of any kind - builds were done by hardware vendors (not Microsoft) and there was no AppStore kind of thing for it. What you got when the device shipped is what it had when you retired it.

      But that was always the Microsoft motive operandi - everything was focused around the Windows Desktop Environment or was an extension of it. For mobile, they put out PocketPC/WindowsMobile to exand Windows Desktop to mobile/small form factors; they put out Windows Server to push Windows Desktop into the Server Room; then extended Windows Desktop into the XBox to capture game consoles; they put out Windows 10 IoT to capture things like RasperryPi's (accessible and programmable only via Visual Studios, no direct user-interface).

      No, Microsoft has not really learned the lesson of the failed Windows Phone experiment - that they won't ever hold the entire market, that people don't want Windows on everything. They're done a bit better with Azure and responding with LInux capabilities on it - but it still runs on top of Windows and all the overhead that incurs.

      --
      Truth is like the sun. You can shut it out for a time, but it ain't goin' away. - Elvis Presley (source: imdb.com)
  2. Yeah: like pushing their crap onto captive markets by Anonymous Coward · · Score: 2, Insightful

    Making the deal with the bosses to force the sheep to follow along (schools here in Germany are a good example).

    That's what Microsoft was always good at. Wine and dine the decision makers. The ones who, lastly, don't have to put up with their crap, since it's their secretary who does it for them.

  3. No you don't by 110010001000 · · Score: 5, Insightful

    "We have a phone that in fact can replace your PC"

    No. You don't. Because that isn't possible to do. The fact that this guy even said that means he is clueless about mobile. He needs to be replaced.

    1. Re:No you don't by Kjella · · Score: 2

      No. You don't. Because that isn't possible to do. The fact that this guy even said that means he is clueless about mobile. He needs to be replaced.

      Ah our resident doofus. If he said he had a PC to replace your phone, obviously he'd be clueless. A phone to replace your PC? Why not, for most people their phone now has way more power than the PC had ten years ago, it just has bigger input/output devices. Microsoft could make a x86 phone with a HDMI/DisplayPort/USB dock (or just an USB-C cable hookup) and it'd make a perfectly satisfactory PC for most people. His problem will be that nobody wants the phone side of it, they want their iApps or Google Play-apps.

      --
      Live today, because you never know what tomorrow brings
    2. Re:No you don't by Archangel+Michael · · Score: 4, Insightful

      The problem with Microsoft, is that they view themselves as a "Windows" company. I've said this for years, and was laughed at a long time ago. They are still a "Windows" company. Everything they do, they try to tie into "Windows" regardless of whether or not it fits that product. In the end, they will be a Windows company.

      Their mistake, is thinking "Windows" when they should have been thinking "Technology"

      --
      Agent K: A *person* is smart. People are dumb, stupid, panicky animals, and you know it.
    3. Re:No you don't by ooloorie · · Score: 2

      "...the same way we have a tablet that can replace your laptop"

      They can both be used as trays for serving drinks?

    4. Re:No you don't by DickBreath · · Score: 5, Insightful

      Xbox = Windows
      Data Center = Windows
      Phones = Windows
      Tablets = Windows

      But what does the rest of the world use to run GPS navigators, cameras, routers, set top boxes, thermostats, wrist watches, super computers, and more? That would be Linux.

      What do developers use? Linux. Microsoft admitted as much when they said the reason for bash on Windows was to lure developers back.

      Maybe you shouldn't have driven developers away with Windows Surface, a whole new App API, and your crappy app store. Oh, but Surface also drove OEMs away because it back stabbed them by competing directly with them on hardware. And Surface drove users away, because it sucked. Wow. Developers, OEMs and Users. What a master stroke the Surface was!

      --

      I'll see your senator, and I'll raise you two judges.
    5. Re:No you don't by DickBreath · · Score: 2

      Azure. It's the name of a color. A shade of blue. It's the color of acrid blue smoke belched by an old engine that is dying.

      --

      I'll see your senator, and I'll raise you two judges.
    6. Re:No you don't by TemporalBeing · · Score: 2

      GPS navigators

      Windows actually. My last Tomtom crashed spectacularly to a CE desktop. Admittedly that was a while ago.

      As pointed out, TomTom is a Linux-based GPS; AFAIK they have only ever delivered Linux-based devices. So you're probably confusing your devices, or you had a really really old TomTom that is nothing like their products over the last 10+ years, but I highly doubt that. (FWIW, TomTom made the news back in the early 2000's b/c MS sued them over FAT FS patents since they used Linux and a FAT/vFAT FS.)

      cameras

      Mostly just a bit of custom code, unless you count that one camera Samsung made that runs Android, but then you should also count that camera with a Gigapixel sensor that runs full blow Windows 7 on it.

      routers, set top boxes

      Yep and yep.

      thermostats

      Errr nope.

      wrist watches

      Errr what?

      Look there's a lot of things in Linux, but don't pretend it's on every device in the house. There's an awful lot of custom code out there and for many of the above if they are running on Linux it's typically the type of device you end up throwing away because it's slow and clunky to use (though no where near as slow as it would be running on Windows, and no prizes for guessing why I don't use that old Tomtom anymore)

      Linux actually runs on a lot of stuff you wouldn't even imagine it runs on - and the devices are not slow. The majority of set-top boxes now run Linux; there's a lot of "smart" devices (refrigerators, microwaves, etc) that run Linux. Many of these same devices also use Qt - which has an extremely presence in the embedded world (go figure).

      Now, while those devices may run Linux they don't necessarily run it in the same way you think. They might run a minimal (f.e busybox) or custom user land that may not resemble anything you would think of as Linux.

      --
      Truth is like the sun. You can shut it out for a time, but it ain't goin' away. - Elvis Presley (source: imdb.com)
  4. Developers, developers, developers by undulato · · Score: 4, Interesting

    Microsoft misses because they don't engage developers - they said (Balmer famously said) it was all about developers but they really actually don't give a shit as long as the big corps still pay their licence fees. See XNA, see engagement over mobile, seeing the pathetic attempts at outreach with their bizspark programme. They do not care about providing an innovative, interesting and exciting platform for software developers to work on. It's a shame because I like Windows Phone as a platform but without spending a lot more money on developer engagement and support it was always going to fail.

    1. Re:Developers, developers, developers by DickBreath · · Score: 2

      Microsoft misses because developers, and everyone else knows that the era of monopolists is past. Before, during and after Microsoft's heyday, people have always wanted the security of a 2nd source for everything. The software lock in phenomena that created IBM's and then Microsoft's (and Apple's) empire is a temporary quirk of history. One that predates the rise of open source. Open source is not yet done rising. It may be slower to rise, but it's rise never stops. It isn't beholden to short term management thinking. Marketing schedules. If there is internal bickering, forks can be created so that the Windows 8 approach loses out without being forced down everyone's throat as a bold experiment created by someone who fancies themselves a designer but knows little about how people use computers to do actual work.

      --

      I'll see your senator, and I'll raise you two judges.
    2. Re:Developers, developers, developers by stephanruby · · Score: 2

      I disagree with that. Spending money on developer engagement wasn't their problem. Their developer tools were great and they are still great. Plus, they spent a ton of money on developers (which I was one of).

      One problem was that when their app store came out, they modeled it after the iOS App store. For instance, they wanted to charge $99 a year for a developer account (although, that fee was waived initially). They locked down their platform, as they wanted everything to be published and only available through their app store so they could charge a 30% commission on it.

      At the very same time, Android was already growing like crazy, and Google didn't have any of those developer demands attached to it. A developer account on the Android Market/Google Play had/has a one-time fee (not a yearly fee) of $25 (for as many apps as you want). Google didn't force you to pass through their app store to publish your application (in that way, it was a lot like the old Windows Mobile store). And the 32% commission (not 30%) it extracted from applications published on its app store went to the carriers (technically, 30% went to the carriers and only 2% went to Google if Google Wallet was used instead of carrier billing). So as a mobile app developer, you knew that carriers would keep on recommending Android phones to its customers and that the market share of Android was only going to grow even more (even if the iPhone was arguably a much better phone at the time).

  5. Making sense by ErichTheRed · · Score: 5, Insightful

    The only thing I hope is that now that Nadella actually said those words, they're going to stop trying to turn their operating systems into an iOS or Android clone. Saying they're done with Windows Phone unburdens them from having to try to revive Windows Store and the Universal Apps model. I am very skeptical about whether they'd do this, but they could also (shock! horror!) completely separate PC mode and tablet mode, and make Windows behave more like a desktop OS when run on PC hardware. Just doing that one change would probably convert the last Windows 7 holdouts.

    That said, this is a very expensive "oops." What I see doing engineering work for Windows shops is the need to monetize everything else -- Azure is being pushed extremely hard, and this is where Microsoft is going to make all their money in the future. All new features are Azure-first these days and backported to the packaged products. What's probably going to happen is that they're going to make it so cumbersome to run on-premises Windows Server and other Microsoft products that most companies will just throw their hands up and move everything they own to Azure. After that, they're locked in permanently and Microsoft will enter its new phase as the 21st Century IBM. Just like IBM collecting monthly mainframe revenue, they'll collect monthly fees from Azure customers, who will be even more dependent on Microsoft than they are now.

    The other super-smart thing they've done is realize that the OS wars are over. You can run Linux in Azure as a first-class citizen. They do this to compete with AWS, but they also know that being OS-agnostic long term allows them to keep collecting revenue perpetually. I just hope they redeploy the Windows Phone people who are still there to new projects instead of throwing another few thousand techies onto the unemployment pyre.

    1. Re:Making sense by thegarbz · · Score: 3, Insightful

      they're going to stop trying to turn their operating systems into an iOS or Android clone

      They said exactly the opposite. They said they're giving up on Mobile phones and focusing on other areas. Other areas being crossover tablet devices in which they are doing quite well while to the disgust of everyone butchering their OS in the process.

      Expect more of this not less as MS pulls back from mobile phones.

  6. Re:We missed the mobile phnoe so... by DickBreath · · Score: 2, Informative

    It is childish and unprofessional to call it spyware. The proper grown up name for it is Windows 10.

    --

    I'll see your senator, and I'll raise you two judges.
  7. Sure you missed it by aglider · · Score: 2

    By about 10 Yeats at least! Think about Blackberries and Palms! Then we had the iPhones and the Androids on 2008 and you were still sleeping! You are waking up too late and missed the school bus!

    --
    Sent as ripples into the electromagnetic field. No single photon has been harmed in the process.
    1. Re:Sure you missed it by DickBreath · · Score: 4, Insightful

      Microsoft laughed at the iPhone. No vision at all.

      But then, Microsoft (Bill Gates) said (in 1995) that the internet was a fad. That should make you think about how much vision they have. It's in their DNA to be only a monopolist. They can't compete in any open market. That is why everything must be always tied back to Windows.

      --

      I'll see your senator, and I'll raise you two judges.
  8. Depends on what you do by sjbe · · Score: 2

    No. You don't. Because that isn't possible to do.

    That depends entirely on what you plan to do with it. There absolutely are some people who can replace a PC with a smartphone or a tablet because the smartphone/tablet competently does everything they did with the PC. While it isn't true for me personally I have family members that have ditched the PC completely because their tablet does everything they needed from a PC and it's easier to use for them. Even for me a smartphone has replaced a lot of what I used to do primarily on a PC.

    The fact that this guy even said that means he is clueless about mobile. He needs to be replaced.

    "Clueless"? Ummm... no. Far be it from me to defend Microsoft or their CEO but clueless is not a word I'd use in regards to them. I'm pretty sure he has more of a clue about the mobile market than you do.

  9. A Phone to Replace my PC? by BECoole · · Score: 2

    Yes, when phones come with 24" screens!

  10. Dear Microsoft.... by Lumpy · · Score: 2, Insightful

    Stop FUCKING AROUND with stupid shit like phones.
    Make your OS not suck, Stop trying to make the server OS into a desktop.
    And make your other software work better and faster

    --
    Do not look at laser with remaining good eye.
  11. They didn't miss it by Anonymous Coward · · Score: 3, Interesting

    They completely failed despite trying for many years. I'm not talking about what they've done post iPhone and iPad; they were making Windows XP based tablets and Windows CE based phones back in the early 00s and similar products even earlier. Nobody wanted to use them. I hate Apple's arrogance and elitism but they did succeed at something that Microsoft failed.

    That's why I'm pretty skeptical about their ability to build "new categories." It seems much more likely they'll fuck around with some tech and produce something that completely misses the point, and then Apple, Google, or some new upstart will come along and do it correctly

  12. Compatibility vs. Nimbleness by Tablizer · · Score: 2

    Microsoft had to choose between compatibility or nimble and compact.

    When they competed purely on nimbleness, their mobile apps were not be sufficiently compatible with Windows desktop software to make anyone choose them over competitors, who were cheaper and more nimble.

    When they competed purely on compatibility, then the device was expensive, bloated, and had short battery life because it had to copy too much of the desktop to be compatible.

    When they tried the middle ground, they sucked enough at both of these factors to not be compelling to consumers.

    They cannot compete with smaller companies on price, features, battery life etc. because they are big bureaucratic behemoth.