Bill Gates: Windows Phone strategy was 'a mistake'

'Not satisfied' that Microsoft isn't leading in phones

By Neil McAllister in San Francisco • Get more from this author

Posted in Management, 18th February 2013 22:39 GMT

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Microsoft chairman Bill Gates may be devoting more time to running his philanthropic foundation than to day-to-day operations in Redmond these days, but that doesn't mean he's satisfied with how things are going at the company he founded, particularly where mobility is concerned.

In an interview with CBS This Morning's Charlie Rose on Monday, Gates admitted he wasn't pleased with Microsoft's performance in the mobile market, going as far as to characterize the company's smartphone strategy as "a mistake."

"We didn't miss cell phones," Gates said. "But the way that we went about it didn't allow us to get the leadership, so it's clearly a mistake."

Mind you, to say that Microsoft isn't leading with Windows Phone is a bit of an understatement. According to recent research from comScore, Microsoft's share of the smartphone market actually shrunk during the three months ending December 2012, leaving it with a paltry 2.9 per cent.

That was less than half the share commanded by BlackBerry during the same period – a company to which pundits routinely feel compelled to attach such adjectives as "struggling," "embattled," "beleaguered," and so on.

In 2011, Microsoft CEO Steve Ballmer confidently told a meeting of financial analysts that he had high hopes that Windows Phone would soon become the third most popular smartphone platform. But given the market performance of Windows Phone 8 so far, even that comparatively meager milestone still looks out of reach.

Gates stopped short of pinning Windows Phone's poor sales on Microsoft's CEO, however, arguing that Microsoft has accomplished lots of important things under Ballmer's tenure, even if securing a dominant position in smartphones wasn't one of them.

"He and I are two of the most self-critical people you can imagine," Gates said. "There were a lot of amazing things that Steve's leadership got done with the company in the last year. Windows 8 is key to the future ... the Surface computer ... Bing, people have seen is a better search product ... the Xbox ... But is it enough? No. He and I are not satisfied that, in terms of breakthrough things, that we're doing everything possible." ®

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Posted Monday 18th February 2013 23:14 GMT

Pet Peeve

Gates quote

"There were a lot of amazing things that Steve's leadership got done with the company in the last year."

Anyone have an idea what he could possibly be talking about here? ANYONE?

I don't have a giant hate boner for microsoft - I use their stuff every day, and some of it is quite good (win7, server 2008, excel). But Ballmer has to face it - there is no line of business that was started after he took over that has gone ANYWHERE, and there have been a number of what should be career-ending failures (zune, kin, VISTA, and win 8 desktop, likely to be the next OS that everybody skips). I've read articles that even his own employees have a barely positive approval rating of the guy.

I assume that Gates has insisted to the board that Ballmer is in charge as long as he wants to be. 10 out of 10 for loyalty to a friend, minus several million for good thinking.

Posted Tuesday 19th February 2013 07:59 GMT

No it hasn't! God I HATE how people try to rewrite history to make MSFT this evil genius when at best they were bumbling henchmen. Here is what happened folks from somebody who is gotta more grey than Gandalf and was there since the days of the Altair, ready?

DOS was insider dealing thanks to Billy's mom but more importantly DR dropped the ball and blew off IBM, you'll see "the other guy does something REALLY stupid" quickly becomes a theme with MSFT. Apple was taken over by one bad CEO after another that flooded the channel with confusing products so MSFT was able to capitalize thanks to the "gang of nine" and the MHz wars. WordPerfect ruled the market but then decided "Meh Windows won't be big, no worries" and put out a half baked DOS based WordPerfect that crashed more than it ran, again giving MSFT a free shot.

Somebody at Netscape decided to do a full rewrite on the browser just as things were heating up, the result was a crashing mess called NS 4 that had people going out and downloading IE because while it wasn't as nice at least they could look at 2 websites in a row without crashing. beOS tied their OS first to a failed AT&T CPU, then one failing or dying chip after another and by the time somebody realized "Hey we should be on X86!" it was too late as Windows was everywhere and WinXP was around the corner.

You look at the entire history of MSFT and every win is followed by the sentence "And then the competitor did something REALLY REALLY dumb" which gave them a free shot. X360? PS3's $600 price tag scared off a LOT of folks. DirectX become the gaming platform? Khronos drops the ball with OpenGL and after much infighting decides they care only about CAD and doesn't bother keeping up with the latest GPU tech forcing the GPU makers to use "shims" which gives it worse performance.

Which brings us to today as so far neither Google nor Apple has done anything truly facepalming dumb so MSFT has gone nowhere in mobile. MSFT's only real strength has been to take obvious openings handed them by the competition and run with them, no stupid move by competitor? No chance of MSFT getting ahead because innovation and smart design has never been the strength of the house of Redmond. All the "EEE" and other schemes were frankly MSFT trying to justify their success in a way that didn't sound like "We bumbled into a lucky break" which again and again that is ALL that has happened. Linux gains no share when they put out the Vista bomb because at that very moment the Linux devs decide to shoot the OS in the face by throwing out the DEs and sound subsystem for alpha quality garbage. Again and again its not MSFT being smart, its the other guy being pants wettingly DUMB.

Posted Monday 18th February 2013 23:58 GMT

GrantB

wow

"There were a lot of amazing things that Steve's leadership got done with the company in the last year"

Amazing.. is like saying 'interesting'. Amazingly good or amazingly bad?

Lets look at Steve's amazing leadership...

"Windows 8 is key to the future"

All they had to do was roll out a slightly faster/better version of Win7 and they would have sold as much or more than Windows 8 has. Perhaps even had a version of Windows optimised for touch or an option built in for defaulting to Touch/TIFKAM or Classic styles, but forcing TIFKAM on buyers has not really gone down well has it?

" ... the Surface computer"

Which one? The RT models look to have failed in the market. Pro versions are tainted with the same brush, but too early to tell. Amazingly well? - I don't think so.

" ... Bing, people have seen is a better search product"

Even if that were true, despite being the default in Windows, people are still actively switching back to Google and other engines. End result is billions being poured into a search engine sink hole by MS for little result. Look at complaints by Yahoo about the switch to Bing being a failure.

" ... the Xbox"

Success at great cost I guess, but in the last year? Been overtaken by PS3, and nothing really done by Balmer, no great hype yet or vision outlined for future Xboxen, so pretty hard to call that amazing by any stretch.

Windows Phone can only be considered an amazing fail given the time and money poured into something that is only a port of Windows (in theory).

So "amazing things that Steve's leadership got done"?

"breakthrough things"?

I would say that Gates would have to be thinking long and hard about dropping Balmer.

Posted Monday 18th February 2013 23:08 GMT

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