Microsoft Corporation (NASDAQ:MSFT) has certainly been a tech company that has found itself prominent in the headlines in the days since the Labor Day weekend. What has most dominated the headlines was the announcement that Steve Ballmer secured a Microsoft reunion with Stephen Elop with the $7 billion purchase of Nokia Corporation (ADR) (NYSE:NOK).
Whether this deeper integration of Microsoft Windows Phone operating system with the Nokia stable of handsets could only be measured as a successful gamble well after Ballmer rides off into the retirement sunset, this transaction has certainly shaken up the smartphone market, even if it seems that things may not necessarily change on the outside. But Microsoft Corporation (NASDAQ:MSFT) is not resting on its laurels at this point, as a couple new items about Redmond have crossed our desk on this week.
Microsoft Corporation (MSFT) Hopes This Makes Sweet Music
One of the news items coming out of Microsoft Corporation (NASDAQ:MSFT) was reported Monday by Ryan Nakashima of the Associated Press, who wrote about Redmond trying to follow through on Ballmer’s previous comments about becoming a “devices and services company” by announcing that it was going to offer its Xbox Music streaming service for free via the Internet. The bonus? Interested users do not need to have Windows 8 in order to use the service.
Michael Turits, an analyst at Raymond James, said, “They’ve said they’re going to be a devices and services company. We know they want to be a device company since they’re buying the Nokia phone division,” he said. “This kind of thing gives more credibility to the idea they’ll be more of a services company as well.”
Jerry Johnson, general manager of Xbox Music for Microsoft Corporation (NASDAQ:MSFT), said that the goal of this is to show the benefits of this service, which is pre-installed on Windows 8 PCs and users can access their favorite and playlists across all Windows-based devices – even smartphones. “To actually build that ecosystem, we need to bring people into it,” Johnson said.
Can Microsoft Surface in Tablet Market With Latest Device?
Microsoft Corporation (NASDAQ:MSFT) has not exactly made a dent in the tablet marketplace, when it debuted its first hardware device with the Surface tablet last fall. In fact, sales of the device were so bad that Microsoft recently reported a write-off of about $900 million just for unsold Surface inventory. Was it the quality of the device or the fact that there were other Windows tablet in the marketplace that diluted the numbers? Based on the continued dominance of Android- and iOS- powered tablets in the marketplace, the answer could be the former.
So what to do for an encore? Well, why not put out a new edition of the Surface tablet, of course! Bill Bennett of Geekzone reports this week that Microsoft Corporation (NASDAQ:MSFT) has announced a media event for September 23, at which the company is expected to reveal second-generation Surface tablets, the Surface 2 and the Surface 2 Pro.
These new devices are rumored to perhaps run the new Windows 8.1 operating system when they hit store shelves in mid-October, which correlates with the official launch date of the Windows 8 update.
If you were an investor in Microsoft Corporation (NASDAQ:MSFT), like fund managers Jeffrey Ubben or Jim Chanos, what is your take on these news items? Is Microsoft on a positive trajectory at last, or will it take Ballmer’s departure to bring about positive vibes?