Kill Windows Phone or risk dying, analyst tells Microsoft


The most prominent example of that "strategy tax" has been Microsoft's refusal to offer Office on Apple's iPadiPad or Android tablets. Most experts believe that Microsoft has withheld Office from rivals' tablets as a strategic move to protect Windows and the tablets that it and its OEM partners sell. Microsoft also gives preferential treatment to Windows Phones, bundling Office Mobile, a subset of Office on the desktop, free with handsets running the operating system. But Android and iOS users must, if they want the same functionality, subscribe to Office 365. Alles zu iPad auf

In other words, Thompson sees Microsoft continuing to withhold services from rival platforms or making customers with Android or iOS phones pay for something Windows Phone owners get for free, missing out on the revenue the services would generate if the company wasn't using them as a carrot for its own hardware.

And the temptation to continue the practice will be enormous. Not only will Microsoft have reason to sacrifice service ubiquity -- it will naturally want its $7.2 billion investment to pay off -- but the revenue per unit from sales of a device will always be higher than the revenue per user from sales of services. It will be simply too tempting to drive devices at the expense of services.

Long before Microsoft bought Nokia, or even announced its corporate restructuring this summer, clues abounded that the company would try to mimic Apple -- with its high margins on hardware -- rather than GoogleGoogle, which relies on a service-based business model, in its case, advertising, to generate revenue. Alles zu Google auf

"It's incredibly telling," said Thompson, "that [Steven] Sinofsky was not allowed to go to Apple or Google, but was allowed to go to Box, which could threaten [Microsoft] five years down the road.

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