15 Ways Microsoft Can Reinvent Itself for the Post-Gates Era
A computer on every desk and in every home, running Microsoft software. That, Bill Gates has often said, is the vision on which he and Paul Allen founded their software company in 1975. There's debate over when the mantra was first articulated--the earliest known instances
Today, as Gates prepares to step down from day-to-day management of the company, another fact is clear: The modern Microsoft remains a company in search of a second act. True, it remains one of the world's most profitable enterprises, raking in more dough in its 2007 fiscal year than Apple, Google, Yahoo, Oracle, and Adobe combined. But the cracks in the Microsoft hegemony aren't just showing, they're growing.
On the Web, it's Google, not Microsoft, that inspires the blend of awe and fear that Gates and company commanded in the 1990s--and Microsoft's answer, the attempted acquisition of Yahoo, fizzled. The company's attempts to extend Windows
So here's some unsolicited advice for Microsoft--15 steps that can help the company thrive in the years ahead. Some of these ideas are clearly part of its game plan already; others, it would likely reject out of hand. And hey, certain points conflict with others in the list. Unlike
The Big Picture
1. Stop trying to be everything to everybody. Microsoft makes software and services for everyone from humongous companies to little kids. It provides applications for PCs, servers, industrial devices, phones, GPS units, and cars. It's trying to be a major force in online advertising. It manufactures gaming consoles and audio players and mice and keyboards and touch-sensitive tables, and owns part of a cable news channel. No company on the planet could do all these things well, and Microsoft doesn't even do many of them profitably. Rather than jumping on every imaginable bandwagon, it would be smart to focus on core businesses such as operating systems, productivity applications and services, and programming tools. Possible role model: IBM, which is so disciplined about the opportunities it pursues that it decided to exit the PC business it created.
2. Upgrade continuously, not once every few years.
Windows Vista is a tad stale in part because it feels like its features were determined years ago, in an earlier era of computing--which they were. That's a by-product of Microsoft's decades-old approach to software development and distribution. Google, by contrast, can push out fresh new features onto the Web almost as quickly as it can think of them. Even if Microsoft's bread-and-butter products remain desktop applications rather than Web-based services, they need to move to a model of ongoing evolution rather than once-in-awhile revolutions. Couldn't Microsoft Update evolve from a tedious patching system to a cool way to make Windows, Office, and other applications better on a day-by-day basis?
3. Be innovative--no, seriously. The marketing message from Redmond would have you believe that Microsoft and innovation are practically synonymous. In fact, the company is more mimic than innovator: When Apple put a tiny "Designed in California" on the backside of every iPod, it was inevitable that the Zune would sport an equally microscopic "Hello from Seattle." It might do wonders for the company's reputation if it appointed a Chief Innovation Officer whose duties would include ruthlessly killing everything that smacks of pointless imitation.
4. Treat customers like kings, not peons. Microsoft rolls out copy-protection technologies that cause headaches for paying customers, then tells those customers it's doing so for their own good. It insists on doing away with Windows XP when there are legions of users who still want it. Even its corporate motto--"Your Potential. Our Passion"--is patronizing. The company that utterly dominated the computing world could get away with that attitude; the one which faces real competition on all fronts will have to treat customers and potential customers with more respect.
How It  Should Evolve
5. Make Windows a seamless desktop-Web experience. Desktop software has its advantages, and so do Web-based services. Future versions of Windows would be most powerful if they were a little bit of both. And maybe they will be: In February 2007, Bill Gates told Newsweek about an appealing, "user-centric"
7. Split Windows in two. Long-term, the world needs a fundamentally new version of Windows. But the uproar over Microsoft's plans to kill off Windows XP shows that lots of folks just want a version of the OS that's familiar and compatible. The company already sells more than 20 versions of the operating system--so why not make both groups of people happy by offering both a legacy edition and a Windows that's new from the ground up?
8. Make Windows more boring. MS-DOS was a simple, unglamorous piece of software that focused on being a solid platform for applications from Microsoft and other companies. As Windows has added tools for digital photography, entertainment, and communications, it's become more complex and less satisfying. I'd love to think that Microsoft might go back to basics with future versions of Windows, but one of the first public demos of Windows 7 involved a new version of Windows Paint. That's not a great sign. Microsoft should concentrate on making the OS more reliable and
9. Make Windows Mobile the flagship. It's obvious that tomorrow's PC will be the descendant of today's smart phones. That's why Apple reinvented OS X as a mobile operating system for the iPhone. And if Windows can't adapt to that world, it'll die. But Windows Vista is too bloated to run well on cheap laptops, let alone phones, and there's nothing cutting-edge about Windows Mobile 6.1. Rumor has it that the first edition of Windows Mobile rewritten from scratch will be version 8, which supposedly won't show up for years. Wouldn't sooner be better?
Applications: Office and Beyond
10. Leapfrog Google Docs. Once upon a time, Microsoft productivity apps such as Word, Excel, and PowerPoint were also-rans compared
11. Bundle Office with an online suite. Microsoft has approached the world of online productivity so cautiously in part because it's worried about murdering one of its cash cows: The same people who pay hundreds of dollars for a copy of Office think that online suites should be free. Why not give those paying customers a great Web version of Office as part of the deal? It might help show the world that essential Net-based tools are indeed worth real money.
12. Make the Office file formats indispensable on the Web. The file formats for Word, Excel, and PowerPoint are among Microsoft's most valuable properties--even the Office 2007 ones that the company has published as open standards. They'd be an even more powerful asset if they were as widely used on the Web as Adobe's omnipresent PDF. How about a unified Office file viewer--ideally with some basic editing features--that would be
13. Take a studio approach to software. Microsoft Game Studios, the company's game title arm, is run as a loose federation of developers, some started by Microsoft, some acquired by it, and some independent. Examples include Bungie (Halo), Ensemble (Age of Empires), Rare (Viva Pinata), and Lionhead (Black and White). End result: The average Microsoft-published game is arguably more interesting than the average Microsoft-published productivity application. If the company applied the same system to productivity software, it might unleash an explosion of creativity.
14. Build Internet Explorer on top of Firefox.
15. Be a leading iPhone developer. "To create a new standard takes something that's not just a little bit different...It takes something that's really new and captures people's imaginations," said Bill Gates in 1984. He wasn't talking up a Microsoft product--he was raving about the then-new Apple Macintosh. And despite the fact that the Mac competed head-on with PCs running DOS (and later Windows), Microsoft was smart enough to establish itself as a major Mac developer.
Got more recommendations for the post-Gates Microsoft? Share them by leaving a comment. Microsoft may well manage to remain the world's largest software company for years to come, but it's going to need all the good ideas it can get.
Harry McCracken is a former editor in chief of PC World. He's developing his own technology site, technologizer.com.