Microsoft’s Path Dependent Strategy

Microsoft CEO Satya Nadella, interviewed by Mary Jo Foley:

Universal Windows apps are going to be written because you want to have those apps used on the desktop. The reason why anybody would want to write universal apps is not because of our three percent share in phones. It’s because a billion consumers are going to have a Start Menu, which is going to have your app. You start the journey there and take them to multiple places. Their app can go to the phone. They can go to HoloLens. They can go to Xbox. You talk to somebody like Airbnb. It might be more attractive, given our three percent share on phone, for them to actually build something for the desktop and for the Xbox.

And by the way, when we hook them on that, we have a phone app. This strategy is path dependent, which is a term I use that means where you start is not where you end up. And therein lies a lot of the nuance. The fundamental truth for developers is they will build if there are users. And in our case the truth is we have users on desktop.

Universal Windows apps is an ambitious vision. I am not convinced universal Windows apps will be competitive against Android and iOS apps. Android and iOS apps are coded and compiled to run efficiently on specific hardware and on specific operating systems. That’s why Android and iOS apps are almost always faster, and therefore offer a better user experience, than their ‘equivalent’ web apps. On iOS Apple is trying to further differentiate how we interact with apps on iPhone 6 and smaller iPhones, iPhone 6 Plus, and iPads. The differentiation makes it more difficult for iOS developers, but it also gives them an opportunity to fine tune the experience. Can universal Windows apps be as fine tuned? It would be a great achievement, but I have my doubts.

In general Microsoft’s approach will be always this dual-use focus, or this multi-focus. What we can uniquely do is bridge consumer to enterprise. That’s in our DNA.

Multi-focus? Sounds paradoxical. Perhaps Nadella is trying to convey the idea of multi-level strategy?: time (short-term, mid-term, long-term), market (broad & horizontal, verticals), devices. Regardless of his semantic inaccuracies I think Nadella’s focus is singular: Windows. Azure, Office, etc. all end up strengthening Windows. Windows can be thought of as Microsoft’s neural network. Everything else is built on top of it and adds skeletal structure or muscular strength.