Nadella faces big challenge in mobile tech

The appointment of Satya Nadella as the new Microsoft CEO would strengthen its push towards cloud computing and emerging markets, but questions still remain over how the company plans to stay relevant in the future as consumers veer towards alternative technology options.

Amongst a host of tech titans wishing him good luck, NR Narayana Murthy, Chairman of Infosys and a good friend of Bill Gates, said the company (Microsoft), India and the world needs him. This need is being increasingly felt at a time when the shift from desktops to other mobile computing devices that do not use Microsoft software has impacted its business model of selling licences and building products around their software.

Analysts that Business Line spoke to felt that the two-decade-old veteran who built the $20-billion Windows Azure business, which focuses on selling software and services to companies globally will push towards bringing different Microsoft businesses, its employees and partners under a single umbrella i.e. - how to be technologically relevant.

“Over the last several years, he has helped build the cloud practice and his next big challenge would be to accelerate business that can come from mobiles and tablets,” said Praveen Bhadada, Director, Market Expansion, Zinnov.

Industry watchers point to some of the recent initiatives by the company that point to this direction.

In December, Microsoft introduced a cloud-computing based operating system, which would help a technology user use same set of applications such as word documents or games across devices such as phones and tablets. Called the Cloud OS Network, it is a worldwide group of 25 cloud computing service providers like Capgemini, Fujitsu, SingTel and others who will take Microsoft’s offerings to corporates globally taking on the likes of SAP, Salesforce.com and Oracle.

At the time of this launch, Srikanth Karnakota, Director – Server and Cloud Business, Microsoft who reports to Nadella, told Business Line that the broader Microsoft strategy in the future would be around staying relevant and being consistent across all devices and form factors.

This comes at a time when users are increasingly going in for non-Microsoft products, opting for Android on phones and open source solutions in enterprises globally.

Analysts point out that while Microsoft has been trying to change, it still needs to wake up and smell the coffee. “The market is going to adopt cloud computing and mobile technologies and enterprises will be big spenders,” said Sanchit Vir Gogia, Analyst at Greyhound Research.

Nadella understand this. After he took over, he sent a letter to employees asking them to prioritise ‘innovation’ and help drive cultural change.

“It will be interesting to see how Microsoft makes its product portfolio be more relevant to customers, drive ecosystem partnerships for modern technologies and strengthen its position against competitors globally,” said Bhadada.

Going forward, Microsoft wants to be a devices and services company and in line with this strategy bought out Nokia and launched a new version of Xbox.

“How devices business pans out considering Google selling off Motorola will be interesting to watch,” said Gogia.