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Microsoft Corporation (MSFT): This Clearly Isn’t Working

Microsoft Corporation (MSFT)The moment I take a look at the beautiful Windows 8 UI, I am reminded of the advert released by Microsoft Corporation (NASDAQ:MSFT) before its launch, featuring Lenka and having its primary theme as “Everything at once.” The company has done well in justifying that theme with an integrated and intuitive operating system that offers a wonderful user experience.

Encouraging results

Microsoft Corporation (NASDAQ:MSFT) reported record earnings of $6.06 billion for the third quarter of FY13 on revenues of $20.49 billion. Significant growth was observed in company’s cloud computing product, Office 365 with net seat additions up 5 times over the prior year. Microsoft Corporation (NASDAQ:MSFT) also released upgrade package for Office, giving greater mobility to the existing software.

Something is still wrong

All of this appears to be a good painting that has been fantastically conceived and executed. However, this perfect picture is blemished by the performance of Windows 8 that failed to attract users as expected. Even though Microsoft Corporation (NASDAQ:MSFT) went “all in” to make Windows 8 a revolutionary product that would enhance computing experience for end users, it failed to enchant users and experts alike.

The exact numbers for Windows 8 have not been released by the company, but revenue for the Windows division provides some clue about its performance. This article does well to bring out Microsoft Corporation (NASDAQ:MSFT)’s attempts to popularize Windows 8 after a lackluster launch last year. The company was desperate to get existing users upgraded to the new operating system by offering upgrade packages as cheap as $14.99 last year.

Windows 8, Windows RT and more

The main objective behind Windows 8 was to revive the popularity and sales of PC devices, Microsoft Corporation (NASDAQ:MSFT)’s core competency. Windows 8 was positioned as a revolutionary product that would change user’s desktop experience and enhance sales for PC and laptop devices. The new OS however, witnessed a lackluster launch followed by low adoption rates mainly on account of a score of changes pushed down on the users at one go. After all, it seems having “everything at once” has not worked too well for the company.

Sometime back, the company launched Windows RT, having the same features as Windows 8, built for ultra thin PC devices and tablets running on ARM processors and meant to be a challenge to Android and iOS mobile devices. Again, the OS failed to capture users’ attention due to a lack of stellar apps, among other things. Microsoft Corporation (NASDAQ:MSFT) marketed Windows RT as a version of Windows 8, but users were disappointed when they found out significant differences between them. As a result, Windows RT had two holes in the bag: lack of apps for mobile devices, and a distorted customer perception, to bring down its sales.

As per latest reports, users spend most of the time on apps while using their handsets. Apple Inc. (NASDAQ:AAPL)’s iOS is the undisputed leader when it comes to a collection of apps that range from small utility apps like calculators to high entertainment graphic games. In February, Apple Inc. (NASDAQ:AAPL) had more than 8 hundred thousand apps in the app store. Google Inc (NASDAQ:GOOG)’s play store featured a collection of 7 hundred thousand apps during that time. When compared to Windows store’s app count of just 50,000, these figures seem gigantic.

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