Wednesday, October 10, 2012

Microsoft Corporation (NASDAQ:MSFT) Plans to Change Strategy

Microsoft Corporation(NASDAQ:MSFT) is now taking a leaf out of the book of its long-time rival Apple and focussing more on hardware and online services.

This was revealed in the annual letter to shareholders by Chief Executive Steve Ballmer published on Tuesday.
.The letter also lends credence to recent rumours that the Redmond-based software company may be planning to launch its own smartphone following on its entry into the tablet PC segment with the launch of Surface tablet.

Microsoft already has a track record in hardware in the form of its XBox gaming console.

"There will be times when we build specific devices for specific purposes, as we have chosen to do with Xbox and the recently announced Microsoft Surface," wrote Ballmer.

Ballmer said that the company would continue to work with its traditional hardware partners such as Dell, Samsung and HTC but Microsoft's role as only the software provider would change.

"It impacts how we run the company, how we develop new experiences, and how we take products to market for both consumers and businesses," he wrote.

The declining sales of traditional personal computers, a majority of which run on Microsoft’s Windows operating system, has made the company rethink its strategies. The stagnant computer sales have had an effect on Ballmer’s bonus as well, which was lower in 2012 compared to last year.

The world is rapidly moving a mobile ecosystem where Apple has already firmly established itself.

Ballmer's letter to the company’s shareholders suggests that Microsoft may also be changing its strategy and relying less on selling operating software.

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