KARL Marx never had to use Windows 8 but he got it right when he said that under capitalism “all that is solid melts into air”. That’s an elegant way of saying that profits depend on market share, and market share depends on inventing new products that the consumer has to buy.
Hey presto, we now have Windows 9, the latest version of Microsoft’s operating system, which is getting an early public outing next week, ahead of its full launch next year.
The word on the street is that having annoyed so many of its core customers with its half-baked version 8, Microsoft may rebrand its iconic product as “Threshold”. Memo to new Microsoft chief executive Satya Nadella: history is littered with the bones of companies that thought changing the brand name was all you needed to persuade customers that the product was more to their liking. Or the market into believing the enterprise had a strategy for dealing with the competition (in this case Google and Apple).
Microsoft has to move away from relying on Windows for PCs as its core business. The stand-alone PC is being killed off by smartphones and tablets, with the result that Windows now powers only 14 per cent of computing devices being sold. Hyderabad-born Nadella wants to do battle directly with Google and Apple under the slogan “mobile first, cloud first!” I can hear Marx responding: “Consumer comrades! You have nothing to lose but your PCs!”
Unfortunately, the capitalist shareholders can lose their shirts if Nadella can’t navigate Microsoft from being a semi-monopoly into a consumer-friendly purveyor of services – such as storing documents in the cloud (ie Microsoft’s giant data storage farms). Nadella is only the third CEO since Bill Gates founded Microsoft nearly four decades ago. He has a flamboyant way with words: “We will reinvent productivity to empower every person and every organisation on the planet to do more and achieve more. That is our moonshot.”
On the other hand, since he took over from Steve Ballmer in February, Nadella has cut thousands of jobs and spent some $2.5 billion (£1.5bn) buying Minecraft, a popular video game that works on Apple’s iPad and smartphones that use the Google Android operating system (which is most on the planet). Investors seem impressed. Microsoft shares are up this year.
Joking aside, Apple’s the hardcore stock
IF PROOF were needed just how sensitive is the global mass market for computing and communications devices, ponder what happened to Apple on Thursday. It saw $23bn wiped off its market cap after widespread ridicule on social networking sites regarding the new iPhone 6 and 6 Plus. Critics poured scorn at the phones’ alleged tendency to bend when sat on.
However, while enjoying a joke at Apple’s expense, let’s get real. Apple was the largest contributor to the S&P 500’s growth last month as shares in the tech giant hit an all-time high of $101 per share. A four-point drop is hardly a crisis. In fact, the market jitters regarding Apple underline the company’s relevance compared, say, to Microsoft. Practically nobody cares any more about new releases of Windows or Office. Mind you, it is difficult to sit on Windows Office. Or drop it down the loo, as I did with my phone. A waterproof smartphone, anyone?