The end of Windows
Hooooold on. Ben Thompson isn't actually predicting the end of Microsoft's cash cow just yet - but he is predicting that it plays a much less important role in the company's future:
If culture flows from success, then it follows that an attempt to change culture is far easier to accomplish when the most obvious indicator of success — one that has a direct impact on employee pocket-books — is moving up-and-to-the-right. What is fascinating to consider, though, is that Microsoft's stock is up not only because the company has a vision that it is delivering on quarter-after-quarter, but also because the stock was depressed in the first place.
To put it another way, Nadella's shift to a post-Windows Microsoft is the right one; to have done the same a decade sooner would have been better. It also, though, may have been impossible, simply because Windows was still the biggest part of the business, and it's not clear the markets would have tolerated an explicit shift before it was painfully obvious it was necessary; without a rising stock price, Nadella's mission would have been much more challenging if not impossible.
He's slightly wrong (in our view) on a couple of points, though. Firstly, he says that Office365 remains a pinnacle of Microsoft's three-decade-successful vendor lock-in, which is correct, but think about it this way: Office365 is the gateway drug to Microsoft's broader offering (SharePoint et al) on the cloud. Secondly, the company's Azure cloud unit is chasing Amazon and IBM for cloud revenue, generating several billion in each quarter. Other commentators have the view that Azure is the business unit to watch.
Whatever. The company is changing, and that's a good thing. Thompson doesn't mention XBox though, which increasingly looks out on a limb in Microsoft's open, new world.