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Job No. 1 for New Microsoft CEO: Fix Mobile and Windows Business

Nadella gets to integrate the Nokia phone business as well.


Fixing Microsoft’s weak mobile business will be Satya Nadella’s top job as Microsoft’s new CEO.

Microsoft has already taken a number of steps in this direction — putting one person in charge of Windows and Windows Phone, moving the two operating systems to a common core and, of course, announcing the big Nokia purchase.

But that’s just the beginning.

For all the effort Microsoft has invested into Windows Phone over the past couple of years, its global market share remains in the single digits and it continues to be an afterthought for most mobile developers who are focused instead on iOS and Android.

Even on Microsoft’s traditional home turf of the PC, the company faces increasing pressure. The Mac has been gaining share for years now and Google has started to make some inroads with Chromebooks, especially with schools and businesses.

“There’s a challenge in mobile computing,” Bill Gates acknowledged in a video released on Tuesday.

None of these issues are new for Microsoft. Terry Myerson, who led the Windows Phone efforts, has been in charge of both the phone and PC businesses since a reorganization last year and has been focused on creating a plan to address these challenges.

It will be very interesting to see what Microsoft has to say in April when it holds its Build developer conference in San Francisco, where the company typically talks about the future of its operating systems and where it wants Windows to go.

For the moment, Microsoft has three mobile and PC operating systems: Windows Phone, Windows RT and Windows 8. Windows devices executive Julie Larson-Green made comments last year that were widely interpreted to mean that even Microsoft thinks that is too many flavors.

Windows 8 runs on traditional PC processors while both Windows RT and Windows Phone can run on the kinds of ARM-based chips typically used in phones and tablets. Windows RT, which is used on Microsoft’s Surface and Nokia’s Lumia 2520 tablets, has been poorly received in the market and can only run the kinds of new-style Windows apps that debuted with Windows 8.

Windows Phone, meanwhile, has won critical praise, but lacks the scale to attract full attention from developers. Consolidating the mobile operating systems could make the combined platform more attractive to developers.

Nadella, meanwhile, is also about to inherit the challenge of integrating Nokia’s phone business into the company. With Nokia, Microsoft will gain a whole lot of experience making and selling phones. It also has the opportunity to more tightly integrate its hardware and software efforts.

However, Microsoft appears not to want to go too far in that direction, insisting it needs and wants support from other phone makers. It remains to be seen how appealing that is to phone makers such as Samsung, HTC, Sony, Huawei and ZTE. Microsoft rival Google, for instance, is in the process of jettisoning its phone hardware business Motorola.

The most important task for Nadella, Myerson and the rest of the Microsoft team is to once again create software and devices that consumers, and not just IT administrators, actually want to buy.

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