Microsoft – Trojan Horse

Apps for Android signal a real change in strategy.

• Microsoft Garage is a skunkworks inside Microsoft known for being a geeky haven, and it has just released three free apps for Android.
• These apps are free and feature no internal purchases meaning that there is no direct means by which these apps can be monetised.
• I suspect that I am seeing the beginning of a strategy to push the Microsoft ecosystem across every platform, extending its reach way beyond the devices that it makes in house.
• Three apps have been launched:
  • 1) Torque. This is an Android Wear application that removes the need to say “OK Google” to activate the voice recognition.
  • Instead users twist their wrists towards them in order to activate the voice function.
  • This raises the possibility of the voice recognition being activated by accident, but I would hope that this has been extensively tested prior to release.
  • Critically, the app returns search results from Bing rather than Google.  
  • 2) Next Lock Screen. This is an app that is aimed at professionals with Android devices.
  • The idea here is to place the most relevant and important information on the lock screen with direct links to the relevant functions.
  • For example if is there is a call to be made on the calendar, this information with the number will be displayed on the lock screen and the user can directly from there.
  • This app will clearly work best with productivity applications, which again shows signs of pushing the Microsoft Digital Work ecosystem onto Android devices.
  • 3) Journeys & Notes. This is location based blogging app that allows the user to log a journey and share it with other users.
  • This is essentially a specialised social networking application whose success will very much depend on how good it is and how many users can be enticed to log their journeys on it.
• The question is why would Microsoft waste its time and money on developing for Android?
• The idea here is to draw users into the Windows ecosystem.
• If users begin to realise that Bing is not as bad as everyone thinks and they begin putting that together with Skype, Here, Minecraft and XBox, they will be spending more of their Digital Lives with Microsoft.
• At some point there is a chance that they might decide to switch to a Windows product if it can deliver these services in an easier, more fun and useful way.
• At the moment this is a big ask as these assets remain disparate services randomly scattered throughout the Microsoft empire and they don’t really know anything about each other.
• They need to be integrated to be more aware of each other such that a better quality service that is more coherent and useful to the user is offered.
• Furthermore, if Microsoft ever decides to go down the monetisation by advertising route, this will be essential to achieve decent monetisation.
• I think that more and more of Microsoft’s ecosystem will be made available for both Android and iOS over time making the Microsoft ecosystem available to everyone who wants it even if they don’t have a Microsoft device.
• This is yet another sign of how much Microsoft is changing.
• The old “Windows, Windows, Windows” mantra is gone to be replaced with a strategy of making the services so good that users turn up of their own accord.
• This is the right strategy but now it all comes down to execution which is somewhere where Microsoft has struggled to date.
• I am hopeful that Nadella will now turn his attention to making it al happen.
• Microsoft remains, along with Google and Apple, one of my top choices for investing in the mobile ecosystem at the moment.