Poor, slow-footed old Microsoft. It just can't adapt to changing times or keep up with more innovative, agile and forward-looking companies like Apple and Google.
That's been the way many of us have thought of Microsoft for a long time. But it may be our thinking that's old and outdated.
On a day in late January, everything changed. Microsoft unveiled its latest pre-release version of Windows 10 and showed off new holographic technology. And it showed that these days if you're looking for innovation, you'll find it up north in Washington, at Microsoft's Redmond headquarters.
Microsoft's inability to innovate in the past had nothing to do with the company failing to invest in research and development. Microsoft has long been a leader in R&D. The latest European Union report on R&D spending puts Microsoft well ahead of both Google and Apple -- $10.6 billion annually versus $6.7 billion for Google and $3.5 billion for Apple, according to the most recent figures.
The issue, instead, has been a lack of will to turn research into useful, innovative products. Several years ago, Reuters published an in-depth look at the state of Microsoft and found that, unsurprisingly, Microsoft's R&D spending "has not brought the breakthroughs it should." Reuters quoted Don Dodge, a former "startup evangelist" at Microsoft who now works for Google, as saying, "Comparing Microsoft to Apple over the past 10 years in terms of innovation, new products and completely new businesses, the differences are pretty obvious. What did Microsoft investors get in return for their investment of over $75 billion in R&D and acquisitions?"
The problem, the article went on to say, was that Microsoft suffered from the classic "innovator's dilemma" that occurs when a business cares more about protecting its existing markets than about creating new ones, fearful that new markets may eat into existing revenue streams.
That's no longer the case. Under Satya Nadella, Microsoft has felt free to risk cannibalizing existing revenue. The first hints of that came when Nadella gave the go-ahead to release a version of Office for the iPad. In the past, the company had refused to do that, worrying that if Office were available for the iPad, there would be less reason for people to buy Windows-based tablets.
With January's demonstration of the new holograph technology, Nadella seemed to be saying, "We're not going to worry about that sort of thing anymore."
I don't think I'm reading too much into it. The HoloLens technology on display was something new and exciting. It's a set of wraparound glasses that let you see and interact with augmented-reality 3D holograms. You can also build your own holograms using a Microsoft toolset, and print out the results with 3D printers. Google Glass doesn't even come close to the amazing things you can do with Windows HoloLens.
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