Microsoft has acquired two iOS applications — Acompli (email) and Sunrise* (calendar) — for about $300 million. Those acquisitions are good for the founders (and their investors). Some might see it as a sign of a new Microsoft — aggressive and quick in trying to turnover a new leaf. To me, they are all of that, but more importantly indicative of the much deeper cultural rot facing Microsoft and its now not so new chief executive, Satya Nadella.
“He’s hit all the low-hanging fruit — that said, these things were not easy to do — but now he has to address all the long-term issues,” Brad Silverberg, a former Microsoft executive-turned-venture capitalist told Bloomberg Business in an interview. Spot on — and these two acquisitions are just a perfect example of these long term challenges.
It is a pretty damning indictment that Microsoft had to spend hundreds of millions on front end apps for its own platform –Microsoft Exchange — and it should send alarm bells ringing. Exchange is something Microsoft understands better than most and it should in theory be able to develop good apps as front end for it. And yet, it has to go seeking help elsewhere. Mind you, this is not some new technology and neither it it a new market (like Minecraft) focused on a new demographic. In the mobile OS sweepstakes, Microsoft has been left eating dust by iOS and Android.
If Yahoo’s birdshot like acquisitions and lack of product direction indicate a company struggling to find a toehold in the ever shifting attention game at an institutional level; then these two acquisitions point to Microsoft’s institutional unease & discomfort with mobile and how it intersects with people. Just as Yahoo’s shopping spree isn’t going to fix its cultural challenges, buying companies won’t make a believer out of Microsoft’s rank-and-file. If they were believers, by now Microsoft would have more to show for its efforts. So, in the end, Microsoft might find a very strong toehold in the cloud, but gathering clouds over its mobile future are decidedly dark.