Why Microsoft Shareholders Should be Very Concerned

This weeks Partner’s conference has once again exposed Microsoft’s complete lack of any credible consumer strategy. On the one hand Ballmer claims he’s going to leave no “stone unturned” competing with Apple. Yet on the same day he also states that Microsoft’s own Windows 8 hardware “Surface is just a design point.” Note to Steve: Those are two mutually incompatible objectives.

If Ballmer really is serious about competing with Apple then Microsoft will need to control its own hardware destiny – in pcs, tablets and smartphones – and be completely committed to that strategy. Unfortunately that will also require a willingness to throw the OEM partner community under the bus. Protecting OEMs while aggressively competing with Apple are incompatible strategies. A textbook case of the Innovators dilemma.

Shareholders are likely to pay a very high price if Ballmer continues to believe the fantasy that he can accomplish both these competing objectives and still be successful in the consumer business.