There is a line from the movie, “The Fighter” where Mick Ward (played by Mark Wahlberg) says to his brother Dickie (played by Christian Bale), “You ain't me, all right. You can't be me. You had a hard enough time being you.”

Elliot Markowitz

September 6, 2013

3 Min Read
Microsoft Is Not Apple, and It Never Will Be

There is a line from the movie, “The Fighter” where Mick Ward (played by Mark Wahlberg) says to his brother Dickie (played by Christian Bale), “You ain’t me, all right. You can’t be me. You had a hard enough time being you.”

That line reminds me of Microsoft and Apple. For the last five years Microsoft has been chasing Apple, specifically in the mobile market, trying to beat the company by emulating it, and the Nokia acquisition is just another step down that same road. Well, Microsoft isn’t Apple. It can’t be Apple. It had a hard enough time being Microsoft. And for solution providers, the latest developments going on at Redmond is certainly worrisome.

After trying to partner on development for about three years, Microsoft and Nokia decided it would be better for the software giant to buy the mobile phone company for $7 billion. It is no secret that Apple has cleaned Microsoft’s—and everyone else’s—clock in the smartphone and table markets, and Microsoft is looking to the Nokia acquisition to close that gap, quickly.

Wall Street wasn’t exactly convinced, with Microsoft’s stock closing down 5 percent on the news. Nokia’s stock, however, jumped about 30 percent. That’s not really uncommon when an acquisition is announced, since integration issues usually result in some future write-offs.

But there is a lot more going on at Microsoft than just acquisition integration hurdles.

The bigger issue, especially for solution providers, is the timing of the whole thing. Microsoft’s strength has always been its army of channel partners, but this relationship has been strained over the past few years as the company has played catchup in the cloud and mobile arenas, leaving its channel partners without competitive offerings or, worse, out of the equation altogether. Regardless, Microsoft’s channel is still stronger than Apple’s ever will be.

But Microsoft is facing so many large issues that it seems as though its channel relations will be on the back burner for quite some time. This is concerning.

Before the announcement of the Nokia deal, Microsoft CEO Steve Ballmer publicly revealed he would be stepping down within the coming year. Changing CEOs while going through a sizable acquisition is not an ideal position for any company. In published reports, Ballmer insists the Nokia deal was in motion before his announcement, but does that make things better? It doesn’t change the fact that the company’s leadership will be occupied with a CEO search while it brings Nokia into the fold. A lot can go wrong.

Also, in a conference call with analysts, Ballmer said Microsoft needs to become more of a hardware maker rather than a software maker. “For us to really fulfill the vision of what we can do for our customers, we have evolved our thinking,” he said.

Microsoft has been successful because of its software past, not its hardware products. It has more than $70 billion in cash still on hand after the Nokia deal because of its software roots, not its failed hardware attempts. It built a loyal channel based on its operating system and margins. Take a look at all old hardware tech giants—IBM, HP, Dell—and how are they positioned today?

Now to be fair, the mobile device hardware market is different than the PC hardware market, but history has a habit of repeating itself. Software development has always led this industry and always will.

No one can blame Microsoft for trying to catch up in the mobile market. However, with Windows 8 fighting for air and a new CEO on the way, I have to question the timing. I also have to question the company’s long-term commitment to the channel as it tries to be more like Apple and morph into a hardware maker. The next 12 months will certainly prove interesting for both Microsoft and its solution provider partners.

Knock ’em alive!

Read more about:

AgentsMSPsVARs/SIs

About the Author(s)

Elliot Markowitz

Elliot Markowitz is a veteran in channel publishing. He served as an editor at CRN for 11 years, was editorial director of webcasts and events at Ziff Davis, and also built the webcast group as editorial director at Nielsen Business Media. He's served in senior leadership roles across several channel brands.

Free Newsletters for the Channel
Register for Your Free Newsletter Now

You May Also Like