The Microsoft Investor is a daily report from SAI. Sign up here to receive it by email.
MSFT Flat As Tech Rises
The market is stabilizing just above the flatline after the Richmond Fed missed and existing home sales came in in-line. Shares of MSFT are flat. Catalysts for the stock include Windows 8, Windows Server 8, Office 15 and Windows Phone 8; expansion in the smartphone market with primary hardware partner Nokia; strides in cloud computing; profitability in the online business, including integration of Skype; and continued evolution of Kinect and next generation Xbox. The stock currently trades at 7.4x Enterprise Value / TTM Free Cash Flow.Google Now Paying Microsoft A licence For Motorola Phones (Bloomberg)
Microsoft won a federal trade ruling that will force Motorola to alter software on some of its Android-based mobile phones to keep bringing them into the U.S. A U.S. International Trade Commission judge found that Motorola infringed a patent covering a program by Microsoft called ActiveSync, which lets users generate meeting requests among a group. “We hope that now Motorola will be willing to join the vast majority of Android device makers selling phones in the U.S. by taking a licence to our patents,” said David Howard, Microsoft’s deputy general counsel. I bet. That’s how they are making money in mobile.
Windows Tablet Makers Can’t Compete With Apple On Price (Extreme Tech)
Hardware manufacturers are struggling to create Windows 8 on ARM devices that are competitively priced against Apple’s iPad and Amazon’s Kindle Fire. The reason? OEMs have to pay Microsoft $90-100 for a Windows 8 licence. While a $90-100 figure sounds a little bit on the high side, it doesn’t really matter. Even at $10 or $20, Microsoft (and OEMs) would be hard pressed to compete; Apple effectively gives iOS away and Amazon gets Android for free. Microsoft has to charge for Windows 8 and Windows RT because it’s a software company. If it didn’t, it wouldn’t make any money, which shareholders might see as a bit of a problem.
Here’s The Size Of The Market Microsoft Is Targeting With Windows 8 (BI Intelligence)
Windows 8 is two operating systems in one. The centrepiece is a new interface, code-named Metro, that was designed for touch screens. Apps are represented as big colourful squares, and it features a system of sliding horizontal and vertical menu screens that was first designed for the ill-fated Zune HD music player, and later adapted to Windows Phone. Windows 8 will also feature a classic-style desktop interface that looks and works a lot like traditional Windows. The goal is to provide a single operating system that works equally well on all kinds of portable computers; laptops, tablets, or convertible hybrids.
Microsoft Claims Windows Phone Has More Market Share Than iPhone In China (WMPoweruser)
When Microsoft announced at the launch of Windows Phone Tango handsets in China that passing the iPhone in that market was just an interim goal on the way to overtaking Android, it did seem rather ridiculous. However, Michel van der Bel, COO Greater China Region at Microsoft says now that a mere 2 months after the launch Windows Phone 7 handsets already have a 7% market share in China, ahead of the 6% for the iPhone. Android still dominates the Chinese mobile market with a market share of around 69%. In terms of the app battle, Bell admitted that Windows Phone was behind.
Microsoft Quietly Launches Its Social Network, Why Is Anyone’s Guess (VentureBeat)
Microsoft has officially launched an “experimental” social networking site called So.cl (pronounced “Social”), which combines facets of social networking, search and media sharing. Previously, So.cl was only available to students studying information and design at the University of Washington, Syracuse and NYU. The project is now open to anyone who wants to give it a shot. The layout closely resembles Google+, but it also takes ideas from Facebook, Twitter and Pinterest. Imitation is the best form of flattery. Will you try So.cl?
Did Chrome Just Pass IE To Becoming The Most Popular Browser? (TIME)
Fresh stats from web analytics company StatCounter have Chrome edging past Internet Explorer in market share, at least for a week. It’s a landmark moment in web history; the fall of IE and the rise of Chrome. Except this is one of numerous companies which releases browser market-share figures, and there’s no consensus on the precise breakdown and there are enormous disparities. StatCounter’s figures (for May 14-20) are based on 3 million sites that use StatCounter’s analytics service and 15 billion monthly pageviews. But there’s Clicky, Net Applications, W3Counter, etc. Most of the others have IE still reigning as king.
Microsoft Copying Apple’s Retail Presence In Everything But Customers (PCMike)
What’s the difference between a Microsoft retail store and an Apple retail store? The Apple store has customers. The slick Microsoft store in Atlanta’s Buckhead area has a video wall, clean design, a genius bar look alike and employees wearing name tags and brightly coloured shirts. They even copied the floor colour. It’s just that nobody seems to be interested in Windows phones and computers. While a few customers did go in, they did a 180 and walked out within a minute or two. If this store is any indication of how the others are doing, you gotta wonder how long Microsoft will keep the stores open. Hopefully the tablets will bring some buzz.
Microsoft To Launch EC2 Rival, Again (Wired)
rumour has it that Microsoft is just two weeks away from launching a competitor to Amazon’s popular EC2 service. This seems like big news, until you consider that Microsoft already offers a competitor to Amazon EC2: Azure. The service already offers raw virtual servers, much like Amazon does, and Azure has offered these virtual servers for nearly a year and a half. It’s just that right now they only run Windows. It appears to be that Microsoft’s Azure cloud will finally offer Linux, and Microsoft may paint this as an entirely new service. The move is telling in an effort to attract the new breed of developer who grew up on Linux and other open source tools.
Do You Agree That Ballmer Is The Worst CEO? (Scoople)
In our last post we highlighted a Forbes article pegging Steve Ballmer as the worst CEO of any publicly traded company. A resounding 75% of you agreed.