The End and Beginning of Microsoft’s Mobile Strategy

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The End and Beginning of Microsoft’s Mobile Strategy

While it wasn’t quite conventional wisdom to question Microsoft’s decision to acquire Nokia two years ago, there was certainly no shortage of skeptics. Those naysayers are now gleefully searching for the Finnish translation of “I told you so.”

But I wouldn’t count Microsoft out just yet. As a wise man once said: “This is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning.”

The Nokia write-down — and the associated and heartbreaking layoffs — puts a huge exclamation point at the end of one era for Microsoft (heckofa job, Stevie). But a new era has clearly begun. Microsoft’s mobile strategy is dead: long live Microsoft’s mobile strategy.

Microsoft’s current share of the mobile OS market isn’t small, per se. More like it’s barely detectable by the most precise instruments known to science (2.7% at last count). But Redmond’s strategery seems to involve more subtlety than simply striving for OS dominance.

Picture this vision of the future for Microsoft:

– Microsoft maintains its strong position as the development ecosystem of choice for enterprise-class development

– Azure continues its technical evolution and market share growth. Azure is Microsoft’s not-so-secret weapon in the mobile war: while Amazon’s AWS is still the dominant player when thinking of the mobile world, Microsoft isn’t fighting Amazon, it’s fighting Google and Apple — neither of which has as strong an offering as Azure. Microsoft’s ability to provide robust cloud infrastructure to serve as the back-end to mobile applications across all platforms is a differentiator Apple and Google can’t currently match.

– Cross-platform mobile development matures and becomes the norm via .NET and tools like Xamarin (or the next generation similar tool); enterprises leverage the same skill sets and tools (TFS, Visual Studio) that they do for non-mobile development. Meanwhile, Microsoft continues steps to ‘open source’ .NET and the surrounding ecosystem, further broadening the platform’s appeal to developers.

– Much to everyone’s surprise, Microsoft has quietly become quite a competent app developer on the iOS and Android platforms independent of its traditional Windows applications. We can expect this trend to continue and expand as Microsoft continues its push to drive its existing core applications – and new ones – onto all platforms. With the recent Cyanogen agreement, we now have a world where top-tier Android handsets will ship with Microsoft Office and other Microsoft apps instead of Google’s; truly through-the-looking-glass stuff.

– Microsoft continues to push the Windows 10 / universal app vision; as the line between PC, “PC”, “laptop” and “tablet” blurs — a process Microsoft is consciously accelerating with Continuum — Surface and its future descendants is a strong player for enterprise mobility.

If Microsoft can achieve all of the above — all of which seem plausible and a few of which seem inevitable — does it actually really matter that much if Windows Phone still doesn’t achieve significant market share? And remember: the mobile market is fickle and turns on a dime. In Q1 2009 Android’s market share was basically zero: just two years later in Q1 2011 it was 35%. It is entirely imaginable that while Windows Phone has – thus far – lost the war for this generation of phones badly, the next generation, or the one after that, could easily flip in their favor.

So take a moment to mourn for the old Microsoft, where the CEO could blithely declare “there’s no chance that the iPhone is going to get any significant market share” and dismiss Google as “not a real company.” Good times, Steve, good times. But the game has changed now, and with the Nokia write-down, Satya Nadella’s New Microsoft may finally be leaving the last vestiges of the old regime behind. Redmond’s future has never been more uncertain — but it’s certain to be interesting.