Microsoft: 'We're the underdogs now'

1st Feb 2013 | 15:20

Microsoft: 'We're the underdogs now'

Frank Shaw tells us how Microsoft plans to claw back the market in 2013

What comes after Windows 8?

Talking to Frank Shaw, it seems that Microsoft is starting 2013 in combative mode. "If I'm going to have a party with my Facebook friends, it looks like a lot of fun. I have a lot of Facebook friends. And then a party with my Google+ friends, I could probably have in a rowboat…" says Microsoft's comms chief (full job title: corporate vice president, corporate communications).

Microsoft could reasonably take a breather this year after the effort of shipping Windows 8 and Windows Phone and refreshing almost its entire product line in 2012. That, however, is not the plan. Shaw gives us a few hints about the coming year – and some clues to understanding Microsoft's wider strategy. "2013 is going to be a big year," he promises. "Yes, we shipped a bunch of stuff in 2012 but there's more coming."

"We've got some new stuff coming from Bing that is interesting and provocative and continues to move the needle in terms of how people think about search. And you have the work that we are doing with Skype. The move of Office to the cloud, Office as a subscription service for consumers and all the things that come with that; it's a big deal. And with Xbox we have more we're going to do. We're certainly not done with thinking about the living room and we'll have more to say about that as the year goes through."

Into the Blue?

One criticism of Microsoft is that it's failed to produce an integrated product line like Google's, and has consequently fallen behind. That is an issue that 2013 will address, says Shaw. "Across Windows and Windows Phone there is this entire ecosystem that really has received a jolt of adrenaline. We always think about the launch of Windows as the starting line.

Is 2013 the year Microsoft takes the living room?

"There's more new hardware, there's more new applications, you see momentum in the app store, people are starting to look at it and say, 'Wow, that's pretty cool. I can do things with it I couldn't do before and now I'm going to experiment and bring new things in.' I think you'll see a ton of that over the next year."

Unsurprisingly, he wouldn't give us any specifics about Windows Blue (the possible codename for Windows 9) or even if we'll see new versions of Windows more frequently. "I don't know that I have anything new to say there. You have certainly seen across a variety of our products a cadence that looks like that; Windows Phone is a good for example of that. When we're ready to talk about how that looks more broadly we will, but right now you just have to look at what we've done in those areas."

Improving by jumps

But more frequent updates (something Microsoft is also doing with services like Bing and SkyDrive) wouldn't mean only getting incremental improvements and sacrificing big innovations, he maintains. "It's like this concept of punctuated equilibrium. You get a series of improvements and then you have to find a way of punctuating them and having a jump, and then you start that improvement cycle again. You have to plan for both.

"Sometimes those jumps are enabled by new hardware capability or by new demand that we see in the marketplace or something that we want to create. You have to think really carefully about how you consistently improve the product that you have, and how do you make that big jump forward and when you make that big jump forward, how do you do it in a way that is not discontinuous with your users."

In those terms, Windows 8 is one of the big jumps forward (and opinion is obviously divided on the discontinuity part). "It is a significant shift. Windows over time has improved in really significant ways; Windows 8 is a jump in terms of the touch-first focus and some of the new platform elements. So you make that jump and you start that drive again to make it better, make it better, make it better… More apps, more hardware, more functionality built in.

"But there's always this moment when you make the jump and everybody looks at that and says 'that makes me nervous' or 'that change is hard'. We certainly see some of that as well. But we're committed to building not just for the next month but for the next 18 months, 36 months - whatever the time is on this new platform."

'We aspire to be a learning company'

With the Windows interface still highly disputed, we wondered whether a future version of Windows might change the controversial elements. "I think when you are asking people to learn new things, whether it's Start or the ribbon in Office, you have to be committed to your course. But being committed to your course also means you continue to take input and feedback and react to it the appropriate ways.

Is 2013 the year Microsoft takes the living room?

"When you have as many users as we do, you get phenomenal feedback. [Sometimes] they say how much they love you! And then some of it is feedback like, 'Jeez, have you thought about this?' Sometimes we have thought about it and sometimes we should take a look at what we can do in that specific case. We don't ever want to say we're not taking feedback any more."

The amount of feedback Microsoft has been getting about Windows 8 is a question of scale, he points out. "The thing that people miss sometimes: we sold 60 million licenses to Windows users and if 1 per cent of those users are disgruntled in some way, that's a big overall number. The beauty of the world today is that everybody has a voice. In the past some of those conversations took place for any product but they weren't visible. And now we live in this transparent world where everything is visible and people with a concern can express it very loudly. And that's good! It's good to have input - but you always have to calibrate. Is this universal input, is this an edge case? How do we think about this? All our products have many, many users and so we get lots and lots of feedback that we have to judge."

Taking on Google

One thing we'll definitely see more of this year is Microsoft giving Google a hard time. It's no accident that Shaw calls new developments in Bing "provocative". Remember the Gmail Man video? "There are places where we are underdogs," he says. "And we're either real underdogs, as we are in Bing, or we're perceptual underdogs. There are people out there who think we are not doing as well as we are."

Being the underdog forces Microsoft to innovate: "If you have an entrenched market leader like Google is in search and you have a different point of view, you have to break through on that.

"And you can't just break through against people who already use you; you have to break through against people who use the other guy. And to do that have to say why you are different and why you are better. And that also means that you have to be willing to be more comparative in how you do that. You've seen that with the Bing it on Google challenge. We know that when people do this in a blind test that they like what we've done and we have to break the habit that people have built up and show them there is a different way."

And that's where the Google+ rowboat comes in: "There's the work we've done with Facebook and real social search." Facebook chose Bing over Google when choosing a search partner for its new Graph Search, and Facebook is where you probably have your real friends, Shaw suggests - and rather more of them than on Google+. (Although he notes, "Google is working very hard to pull people into that Google+ ecosystem. They are committed to getting people to sign up to that thing…")

Will we get more of the self-deprecating Internet Explorer ads? "The best thing about the Internet Explorer ads is reading the comments and the stories. It was like, 'Are we paying these people to make these comments? Because they are making our point way better than we did.' We were not. People liked it and they responded to it."

A refreshed MS

It's not just that the ads are funny. It's that they show how Microsoft has changed. "The thing is - we have learned some lessons. Every company makes mistakes, every single company in the world. We aspire to be a learning company. We look at decisions we made and they might have been good decisions at the time but they weren't over time the right decisions and we say we're going to do it differently. IE is a great example of that."

Not everyone takes those changes at face value, leading to some interesting gymnastics as supporters of the open web find themselves on the same side as Microsoft. "I think it's interesting that we are advocates of the open web and people are like 'huh?' People are having some trouble with that but it's true. People should be willing to accept we're doing this because we've learned and we've grown and it's good for everybody."

Is it frustrating for Microsoft to do the right thing and still have people be suspicious? "It's understandable. Perceptions change over time. We've been pretty consistent and hopefully people will look at us in what we're doing and not necessarily why they think we might doing that."

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