Several news items today seemed to be piling on the “Microsoft is Dying” bandwagon, but just last week the company’s CEO Steve Ballmer told shareholder that Microsoft is seeing “fantastic demand” for its touch-screen PCs and tablets and Ballmer always seems optimistic about the company’s future. That’s part of a CEO’s job, at least to appear optimistic in public. But reality tells a very different tale. Microsoft has been losing market share in a number of its products and every time news of PC, tablet or smartphone trends are announced it just gets worse for Microsoft.
Just the Facts Ma’am
Anyone with even a passing interest in the news has seen many reports of the decline of the PC at the hands of tablets and smartphones. For the third quarter of this year, PC sales were down 14% in the United States and 8% worldwide. Meanwhile Apple took a bite and sold 14 million iPads and 4.9 million Macs. But, that’s just the news most consumers pay attention to, and that’s bad enough.
Enterprises are Embracing Apple Like Never Before
Adding salt to Microsoft’s wounds is the fact that lots of those iPads are infiltrating what was once Microsoft-only turf. Big business used to shun the iPhone and iPad, terrified of its security risks for corporate networks. Apparently businesses are cracking that code in droves because iPads can been seen in the hands of corporate employees at even the largest of companies these days, and it’s not only sales people using them to show nice presentations. One big example is Barclays Bank, which recently bought 8,500 iPads, which is thought to be among the biggest single purchases of tablets in all of the United Kingdom.
Let’s Talk Mobile
Microsoft is not in the dark to trends and hard data, so they anticipated the current move from PCs to mobile and introduced Windows Phone. The reaction has been a resounding, “Yawn.” International Data Corporation (IDC) research shows that Windows Phone market penetration is a paltry 2% and nobody is expecting a surge in popularity or sales any time soon. The phone itself is a brick, and not very slick compared to offerings from Samsung, Motorola and others. Nobody concerned with looking cool would be caught dead with a Windows Phone. They all carry iPhones. That has been Apple’s currency forever, but they are moving beyond just the ‘want to look cool’ crowd.
Microsoft Marketing is So 1984
The television and print advertising for Windows Phone, and the Surface match the cool factor of the products themselves. They all look like they were produced in the 1980s. Microsoft has even gone so far as to use morphed versions of their logo colors that look like a palette of pastels. Pastel colors and a lead dancer in their television ads wearing what looks like a class of 1984 alum’s Friday best don’t exactly grab young consumers attention.
If Current Trends Continue, Microsoft Might Not
There are even more areas where Microsoft is losing market share and if they don’t do something on a large scale to change direction, their competition is going to eat their lunch. They’ve already started nibbling and they’re hungry. The PC market is in decline, but it is still present. The tablet and smartphone market is the future. If they don’t make a paradigm shift soon, Microsoft may be history.