Microsoft Will Never Be Apple
Microsoft Corporation (NASDAQ:MSFT) is apparently offering Samsung $1 billion in exchanging for putting some of its effort into a Windows Phone 8 device. The Redmond, Washington company recently paid more than $7 billion for the Nokia Corporation (NYSE:NOK) devices division. It appears that an own-brand mobile phone is not enough for Microsoft Corporation (NASDAQ:MST), and it’s no wonder.
The quest to emulate Apple is one that Microsoft Corporation (NASDAQ:MSFT) appears to have involved itself in for more than half a decade. That’s a very simplistic way of understanding the Microsoft mission however. The company will never be Apple, but it’s not because of lack of ability. Microsoft is not trying to copy the Cupertino company, though the trappings of its business suggest otherwise.
After the changes in the computer market over the last five years Microsoft Corporation (NASDAQ:MSFT) has suffered. The firm saw that its potential Windows licensing revenue was being spent elsewhere. Businesses were waiting longer between upgrades, consumers were opting to keep an old computer and buy a new smart phone or tablet.
The Microsoft response to the problem was an obvious one, pump development money into mobile operating systems. Windows 8 arrived alongside Windows Phone 8. Microsoft soon went one step further and released its own range of tablets. Just months ago the company’s intention to jump into the smart phone market became apparent. Shifting towards hardware appears to be a move to borrow a business plan from Apple Inc. (NASDAQ:AAPL), but that’s not what’s happening.
The story that Microsoft Corporation (NASDAQ:MSFT) is just copying Apple is an easy one to push, but it’s simply not true. The company has its own business in mind. Microsoft is its own company, and its plans are more apparent with the Samsung offer.
Microsoft Doesn’t Want To Be Apple
Microsoft is a software company, and that hasn’t changed with its latest acquisition. It’s always been a software company. That’s where the margins are. Apple Inc. (NASDAQ:AAPL) is a hardware company, but it has used software, like iOS and Final Cut, in order to drive sales of its devices. Microsoft is trying to drive sales of hardware to move software licenses.
Microsoft Corporation (NASDAQ:MSFT) will aim at business in order to achieve this, and the company has already seen better than expected returns in the market. The latest earnings report from Redmond showed that cloud enterprise services are doing particularly well. That will help to drive sales of the company’s devices, but not just the ones it makes itself. Microsoft wants other companies to sell Windows 8 devices.
That already happens with the tablet and desktop versions of the operating system, but Windows Phone 8 is in a sad state. Microsoft Corporation (NASDAQ:MSFT) will drive sales of its devices until the market catches on and begins to offer them. Windows Phone 8 may become the standard in business, and companies like Samsung will not be able to ignore the market forever.
Disclosure: Author represents that he has no position in any stocks mentioned in this article at the time this article was submitted.