Innovation + Innovation = ?

Kevin Turner, Microsoft’s Chief Operating Officer, took to the stage of the Microsoft World Partner Conference with a collection of remarkable rallying cries.

He spoke passionately about the level of innovation by Microsoft last year, how they’re ‘doubling up’ on innovation this year and what the focus will be on, and he threw in a nice bit of competitor bashing to round it all off.

FY13 – the year of innovation

The last 12 months have been the biggest launch period in Microsoft history, and their biggest launch of the lot, the Windows 8 operating system, was a significant change from what has gone before.

Microsoft certainly received a lot of feedback on it – mainly centered around intuition (or lack thereof) – things which they aim to fix with the Windows 8.1 update.  Nevertheless, It was the first cohesive touch interface which spread across PCs, tablets and smartphones.  And that’s the key – Microsoft’s strategy is to create a seamless business experience, across every tool you use for work.

Here’s a couple of stats as rattled off by Kevin on the epic year for Microsoft:

• Office 365 has become the fastest growing product ever released by Microsoft.
• Azure is growing at a rate of 150%
• There are 460 million msn customers that use it on a regular basis
• 48 million Xbox Live customers
• Skype accounts for a third of all international phone traffic (I was particularly impressed by that one)
• 400 million people use outlook.com
• 250 million people use Sky Drive, with 1 billion documents and 11 billion photos stored on it.  This is growing rapidly.

Here’s an interesting stat – 89% of Microsoft’s existing business customers are still not yet using any products in the Microsoft cloud (primarily Office 365, Windows Azure, Windows Intune and Windows CRM).

That’s a massive opportunity, but there seems to be more barriers to adoption than in the consumer world.  I guess the question is, are these barriers real or are they more perceived?

FY14 – the year of… more innovation

For the 2014 fiscal year, Microsoft doesn’t seem to be letting their foot off the gas too much.  Kevin said that he has challenged himself to make this year even more innovational (that’s not a real word but it seems appropriate) than the last.

Here are Kevin Turner’s key objectives for this year:

1. Win in mobility – both tablets and phones
2. Accelerate customers’ move to the Cloud
3. Competing to win – going on the offense!
4. Customer satisfaction – taking this to a new level

And you begin to get a pretty clear picture.  They seem to be very focussed on achieving their ultimate goal of transforming from a software company, to a services and devices company (albeit Microsoft’s services can be delivered through any device).

They are also building more Microsoft stores to enable more one to one interaction with customers, and they are not going to be shy in defending themselves from those who say they can’t get to where they want to be.

Competitor attack

Kevin was pretty brazen when it came to positioning Microsoft up against the questions posed by their competitors (which have pretty much suggested they don’t have a cat in hell’s chance at keeping up in a ‘post-PC’ world).  Here’s a summary of his stance on the competition:

On Google:

Kevin called Google to task on their privacy policies – talking about a flaw with their Android system that could potentially let hackers take over devices that house the operating system.  He also talked about Microsoft’s campaign called ‘Scroogled’ (http://www.scroogled.com/).  Check out the video – pretty interesting stuff!

On Apple: 

Microsoft is now the third biggest player in the smartphone market – albeit a distant one.   They are committed to extending their reach in the mobile market and it seems the strategy is to do this one country at a time.

Our chief executive David Stonehouse bought a Nokia Lumia 925 at the conference, based on Microsoft’s philosophy of one operating system; multiple devices – he’s currently writing a guest blog on his thoughts so far and as an iPad and iPhone user it will be interesting to hear his perspective.

On security:

Kevin brought up a report carried out by a third party company called Secunia. This tracks the number of vulnerabilities from the biggest technology companies.

This past year, the non-Microsoft vulnerabilities accounted for 86% of the vulnerabilities in the most popular programs.  Google had the most, then Apple, then Adobe. After that it’s Mozilla, and then it’s Microsoft.

That’s a massive turnaround, as previously Apple was seen as almost immune from attack. Microsoft are wanting to drive the current number of their own vulnerabilities (131) down this year.

Opportunities

The biggest message that I took from Kevin’s speech is that the device market (since Windows became available on tablets and on mobiles) has grown from 330 million, to now 2.9 billion devices in use.

The opportunities with the amount of devices, and an increasingly mobile workforce who demand to access business and consumer apps on the move, is massive.  And it’s the consistency of ‘one experience’ that is important for the ‘always-on, always-connected’ mindset of today.

Take for example technologies like Smart Glass, which lets you watch a movie on any device – so if you started watching it on your phone, you can pause it, then immediately resume it on your tablet or TV, and all the motions are consistent across each device.

Here’s a key section taken from Steve Ballmer’s 3000 word memo to Microsoft employees, incidentally released the morning after as Kevin Turner gave his talk.  I think this really shines a light on Microsoft’s renewed focus:

“Microsoft has the clear opportunity to offer consumers a unified experience across all aspects of their life, whether the screen is a small wearable, a phone, a tablet, an 85-inch display or other screens and devices we have not yet imagined.”

Although Steve is talking about consumers here, the ‘one experience’ is just as valuable, if not more so, for businesses.

Microsoft will continue to invest in this ecosystem which supports the four key trends talked about in Steve Ballmer’s opening keynote – Cloud, Big Data, Mobility, and Social.  The opportunities are massive, and I’m sure there will be lots more to talk about in the coming months.