Act 3: In which Microsoft builds the consumer company its users deserve

Somewhere in a rainy Seattle, Microsoft insiders are pondering a long-overdue decision: who its new leader should be. As the company heads into its third act in terms of leadership and management structures, it must reflect on the direction the play must take.

For the tech giant, 2013 could easily be erased and the world wouldn’t care. It had big plans that have not quite panned out the way the company needed it to. Windows 8 didn’t gain the traction that was expected and the much-talked-about foray into the world of tablets with the updated Surface left a lot to be desired. There was so much discontent with things at the Redmond-based company that its CEO had to leave. Perhaps the most interesting thing to happen to the company last year was the purchase of Nokia’s ailing devices arm. What it will do to bring that in competitive reach of iPhone and Android offerings remains to be seen, but we are hopeful.

However, in spite of itself, Microsoft’s stock didn’t do too badly, rising 35.45% in 2013. On paper, Microsoft is and continues to be a very successful business. The company’s strong enterprise business has made up for all its consumer failings – but these failings are significant. More competition will rise from the industry and soon even enterprise won’t be enough for the company to hide behind. In 2014, a new way forward must be devised.

Micronaissance: Consumer services in or out?

Many consumers are getting frustrated with Microsoft. While the Windows Phone is one of the better operating systems on the market, it is not marketed to the consumer. The fatal flaw in Microsoft’s way of thinking is that it is convinced that everyone also wants to use their mobile device for work and business.

Making it rain with enterprise is all good and well, but it’s not going to give Microsoft what it really wants. It wants idolization, it wants a cultish following, it wants consumers that care enough about its products to defend it blindingly. In effect, all Microsoft really wants is for the users to care enough to love it. But until Microsoft gets its consumer products right, it won’t get the adoration it’s after.

For fans of Microsoft (because, contrary to popular belief, they do exist), what we hope for is a Micronaissance: a shift in culture and perhaps a return to the old stomping ground as a tech company on the cutting edge. This may very well be the year we see the Surface Mini, a necessary play for the tech veteran. Most tablet device manufacturers have launched smaller tablets to compete with the iPad Mini and the Nexus 7. If Microsoft wants to really compete in the tablet space it needs a small device and a device that the consumer wants to use.

The close-to-US$7.4-billion deal to acquire Nokia has already injected much-needed energy into Microsoft’s sluggish mobile offerings. Right now it is hard to see Microsoft unseating Apple or Google but it can finally compete in a space it has lagged in for so long.

2014 is poised to be the year Microsoft takes its devices arm to the next level. The company has seen success in the devices business with X-box, due to an understanding of the consumer, and there is no reason why it shouldn’t replicate that with mobile.

Then there is Bing and its other services. Mail has received a fresh and exciting redesign that makes it a pleasure to use and other services are coming along. However, it is time for the dream of search to come to an end. Bing is a poor man’s Google and its design is very indicative of an old Google before UX became a thing.

Micronaissance: which way now?

Inevitably what will happen in 2014 for this company depends on the person who is picked to usher in the third act. The challenge for the new CEO is to figure out a way to avoid BlackBerry’s fate. The problem with companies with enterprise money (and this was the case with BlackBerry) is that they settle into complacency. It is quite easy for Microsoft to carry on as is as long as the books balance and investors see some profit.

A very long time ago, Microsoft gave consumers a fun, user-friendly and affordable OS and it kept innovating. Now, many years later, market competition has left the company that pioneered an industry complacent about its dominance. While Apple was busy building a product that the user would love and use, it focused on connecting the business world. A good path, but it left its consumer side defenceless.

Perhaps Microsoft’s third act will give us the consumer company we have all be waiting for.