Microsoft’s Consumer Blindness

An interesting article appeared at the New York Times last weekend, highlighting a problem that’s been pretty clear now for a number of years: Microsoft is losing the consumer game. Go read it. It’s well worth it.

Specifically, the young consumer. The Kin, Microsoft’s attempt to create a smart phone for the youth market, is but the latest example of this, but it’s a particularly enlightening one. (The Kin website appears to still be active). When it comes to targeting the consumerespecially the younger setMicrosoft is hit-and-miss, and more often miss. For its Xbox and Xbox 360, which gave gamers exactly what they wanted (massive power, awesome graphics, hit titles), there are the Zunes, the Kins, the Windows ME, Bob (and its evil twin, MS Comic Sans)… It’s like a bunch of 40- or 50-something marketing executives trying to figure out what the “kids” want, and missing badly.

I’m reminded of the scene from the Hard Days Night movie when George Harrison gets “captured” by a clueless marketing executive who doesn’t recognize the Beatle sitting in front of him. But I digress.

Microsoft’s record in its core businessesoperating systems and business softwareis better. Windows and Office are near-ubiquitous and only a little bit less indispensible, but there are cracks showing even in this firmament, as the Times article points out, as younger geeks gravitate toward open source and startup busiensses find cheaper alternatives that a bunch of seat licenses for Microsoft Office.

There’s an argument to be made here that Microsoft is spending so much energy trying to be all things to all people, that it’s putting its core business at risk. I know Bing is innovative, but, come on, you’re about eight years too late on this, and attempts to make “to bing” a verb like “to google” is, as the kids would say, lame.

Mini-Microsoft has had a few things to say about Microsoft’s misson creep over the years, but one has only to look at the debacle that was Windows Vista for evidence of this. Yanking the Kin from the market two months after launch isn’t the potential catastrophe that Vista was flirting dangerously with, but it was still an embarrassing setback.

Microsoft’s recent reorganization in the consumer products division seems to be a belated recognition of the fact that things are not going smoothly, and that there might be too many captains fighting over the wheel of the S.S. Redmond. If we don’t see some further evidence of deep thinking on where Microsoft should be focusing its efforts, then I suspect that we’ll have some more Kins to be unkind about.

UPDATE 7/7/10: It appears another round of layoffs are under way at Microsoft, but according to TechFlash, this looks more like their annual end-of-fiscal-year pruning rather than a reorganization.