Microsoft exec admits new reality: Market share no longer 90% — it’s 14%

turner

Kevin Turner, Microsoft’s chief operating officer, at the Worldwide Partner Conference in Washington, D.C., this morning (via webcast).

For many years, Microsoft was viewed as the dominant PC operating system vendor, with more than 90 percent market share on desktops and notebooks.

But the rise of computing on tablets and smartphones has turned the PC market into one slice of a much larger pie, and Microsoft chief operating officer Kevin Turner this morning told the company’s partners that they have to look at the world differently. Even though Microsoft still has 90 percent of the PC market, he said, the important figure is 14 percent, taking into account the entire world of devices.

“The reality is the world’s shifted, the world’s evolved,” said Turner at the company’s Worldwide Partner Conference in Washington, D.C. “We now measure ourself by total device space. We have a much bigger opportunity than we’ve ever had in the past to grow our business, but we have to rethink how we look at our business.”

Here’s the slide he showed on the big screen at the event.

screenshot_35

Turner echoed Microsoft CEO Satya Nadella, saying that Microsoft and its partners need to embrace a challenger mindset. This is a major philosophical change under Nadella’s leadership, and it’s manifesting itself in a variety of ways, including Microsoft being more open to releasing its apps across non-Windows devices such as the iPad and Android.

Turner said that means focusing on disruption, differentiation and speed across a variety of devices, leveraging Microsoft’s strength in cloud computing. Talking about Microsoft Azure and Office 365, he said the company has “tremendous cloud momentum.”

“It’s off the hook,” he said.

At the same time, Turner said the company is still focused on Windows, talking about the company’s efforts to create a common set of developer tools and a shared API and app store across all forms of Windows-based devices, from smartphones to PCs and Perceptive Pixel screens.

The event is ongoing, available here via webcast.

  • BiggerBernard

    14% and sinking hopefully.

    • GoodNPlenty333

      Oh please, Apple is the new Microsoft these days. They haven’t done anything noteworthy in years. Companies get complacent as soon as they gain significant market share and there are no viable competitors.

      The more competitors that are vying more market the better off consumers will be.

      • http://www.newser.com/user/52007115/1/chas-m.html chas_m

        By your definition of “noteworthy,” Neither Microsoft nor Google have done anything noteworthy in at least the last 20 years. Apple may not reinvent the world quite on your schedule, but the reason they are the most valuable company in the world with influence far in excess of their market share is because they do, in fact, do a lot of noteworthy things pretty much continuously. Not everything goes according to plan of course but that’s kind of one of the reasons I like them: they still take chances instead of say tying their fortunes to the one thing they had a hit with in the 80s like MS, or endlessly investing in new (or copied) devices and services (most of which flop, actually) that just feed that one thing they invented in the 90s, like Google and Amazon.

        • Dan

          I think you need to revalue the situation. Google just surpassed Apple as the most valuable tech company and the innovation in Project Ara, Android wear, Android Auto, and it’s constant evolution of Android would be to differ. Also Google is making advancement in robotics. So slow your roll on you love affair with Apple.

          • https://flowboard.com/ Brent Brookler

            Dan – Not taking any sides ‘officially’ in this debate, but AAPL market cap > GOOG market cap. Not sure how you are quantifying valuable.

          • boop

            Doesn’t it change from day to day?

        • GoodNPlenty333

          They still take chances? Are you serious? The only thing they’ve done in the last five years is the the IPad smaller, and the IPhone bigger. That sums up Apple since Steve Jobs left.

      • Nic

        I think google is closer to the new MS than Apple…

    • Bone Wilder

      Indeed! Grace us with the tales of how your life will be better without MS. We will drink mead, be merry with many women, and tip fedoras all night as we rejoice over such great triumph.

    • gerdi bot

      We had a dev conference the other week , there was a speaker there, he started his talk by saying “If any of you have preference to a company or programming language get the f–k out and change your job to marketing” .. i think he summed up the whole religious retardation that so many fanboi’s attached to their technology , like little children with their favorite toy.

      • Lee Fyock

        If you don’t have a preference of what technology you use every single day, you must care about absolutely nothing.

        • gerdi bot

          what?? what the fuck are you talking about. Please if you would rationalize your statement.

          • Lee Fyock

            Chill, no need for profanity.

            What I’m saying is that I can’t imagine having no preference to a company or programming language. You don’t have a preference of programming in BASIC vs C#? Ruby vs. COBOL? No preference on Android vs. iOS, for something you use 100 times each day? That’s like not caring whether you get fish when you ordered a hamburger. No preference.

            I can understand feeling that you shouldn’t have a religious attachment to your phone’s OS, but I can’t imagine not having a preference.

          • gerdi bot

            Sorry i should not have sworn.. You said “you must care about absolutely nothing” which seems like a bit of a leap from having a preference to a language.

            The point the speaker was make is that being religious zealous in the tech industry ( which is extremely common ) goes nothing to further development. If you have a preference you can become complacent . Clients and devs want was is best .. whether that is obj-c or node.js. Its all based on your project , your experience and the needs of the client. The “care” that you talk of should have more to do with how one make make a living while still being passionate about their work. If that means sticking with one technology and preaching it to everyone else , then thats cool, but that is more a sales job

            We should be more critical of technologies for technological reasons , not emotional ones. I understand though, flash devs have been having quite a hard time lately and if you are making 100k a month using x technology you sure has heck have a good reason to want to keep

  • Bill

    Only 5, perhaps 10, years too late with that realization.

  • Charles – The Great and Powerf

    14% of devices? How about Radios? Cars? Refridgerators? I doubt if Windows is on those devices. Come on lets get realistic about market share. I mean I have a pocket knife thats never heard of windows, thats gotta count too. Come on. Really? Devices? You need to define the market before you can analyze it. Lest we forget that Microsoft licenses >50% of mobile device with the advent of Open Source Android (Nothing to do with Google but I appreciate them putting an app store up and contributing apps). But it wasn’t until Microsoft implemented thier patented inventions on Android that it had any success. And it was the fastest way to dominate Apple. And it has. 3 more years and Microsoft will have a 90% licensing on Mobile. Apple will be begging for money again.

    • MS Titanic

      The Microsoft execs say they are the challengers in a new market reality, but you – a fanboy in denial – still say no it isn’t so. Just who to believe.

    • Sasha

      Definition: General computing devices where users can run and install a variety of different software packages.

    • jack

      @disqus_pHV1NJ16oz:disqus keep sucking that Microsoft D.

    • Fabio

      Microsoft in my car and all of Ford’s cars that support voice commands. So pelase don’t post ignorant statements without any knowledge of case. Whenever you have a number based on real research, post it. Otherwise stop whining.

    • Dave

      My car’s satnav runs windows CE. There are internet fridges that run an OS. There are also cashpoint ATMs still running windows xp.
      The cheap model nokia windows phones have a decent market share in parts of south America and Eastern Europe, but you can’t predict what will happen in the future

  • guest

    This should freak investors out.

    • http://www.facebook.com/revi.bennett Revben Chase Da Kingdom

      yeah they .75% up today

    • mberticus

      I wouldn’t think so. Microsoft has gone from a saturated market to one with a ton of growth potential. Consumers are fickle. If Microsoft could build an elegant simple integrated mobile experience with a killer phone then they could begin to grow that slice. First step would be to fire all designers involved in live-tiles metro non-sense. Just make a clean break and go back to something very very simple.

      • designfail

        I actually once met one of the designers who worked on W8 UX. He was totally perplexed that I thought it was ugly and he talked about clean design language bla. I knew back then that they never investigated if consumers would agree.

        • User_01

          I am a consumer who likes the W8 UX. Made me switch away from my iPhone.

      • Fabio

        I have to agree with you. There is a great potential of growth on those numbers, a clear opportunity to act.

  • http://blog.calbucci.com/ Marcelo Calbucci

    This is a much bolder statement than the entire memo from Satya. It basically puts Microsoft in a follower position. For some employees this might be shocking, but in the 90s Microsoft loved to be the “under-dog” and go after competitors. It was very successful being the “fast follower”. It went from zero market-share in many established categories (desktop OS, server OS, DB, email server, word processing, email client, gaming, web browser, etc.) and it either dominated or became a top 2 player on those categories. The difference between then and now is that in the 90s being fast meant shipping a product in 18-24 month cycles, with Service Packs / Patches every 6-months or so. Now, being fast is a non-stop shipping cycle. Parts of Microsoft have already embraced this m.o., like the team under Scott Guthrie. But many parts of the org are still trying to justify the old-way (plan-build-test-ship waterfall) and have a much harder time keeping up with the pace of innovation, from big and small competitors. Either way, it will be an exciting time for Microsoft and the verdict will take at least 3 years.

    • User_01

      With the addition of the device unit from Nokia will make things interesting. That division was able to bring robust world consumer products to market in fast clips.

  • Josh Belzman

    Using the same definition, what % market share do Apple, Google and Samsung have? Just curious.

    • ucandisqusthis

      Android is the operating system running on over 50% of devices if you lump smartphones, tablets, laptops and PCs all together.

      “Google” is doing well on all of those platforms and on devices from MS, Apple, Samsung and everyone else, regardless of operating system. Not sure that’s a comparison that can easily be made and it doesn’t really align with Android (i.e. Google may easily profit more from an iOS user than an Android user).

      Apple and Samsung are significant but still smaller than the 14% that Microsoft claims.

      http://techcrunch.com/2014/07/06/gartner-device-shipments-break-2-4b-units-in-2014-tablets-to-overtake-pc-sales-in-2015/

  • me

    Bigger story is he finally shaved that dumb mustache.

  • User_01

    Is it that there is an explosion on how many devices are now in the so call “MARKET”. Its not a market loss when the market it self has increased exponentially. Bigger market means more growth.

  • morgan cox

    Really surprising seeing as most tax payers around the world are forced to fund Microsoft.

    (we have a choice – either fund Microsoft or go to jail) thanks to
    the monopoly they got in the mid 90′s when no real competition existed
    so they can afford to build a mighty patent war chest that hinders
    innovation and technological process for mankind. They use anti
    competitive techniques to ensure real competition can never exist.

    We work hard so that Microsoft’s patent lawyers can go on legal jollies…

    Every hospital/school/police force uses MIcrosoft windows on their desktops – in 2014 this is insane.

    And soon councils, Schools, police force are going to be using OUR
    MONEY to upgrade their shitty systems to run Windows 8, they will likely
    have to also spend more of OUR MONEY upgrading their PC’s to run the
    shit that is Windows 8.

    Microsoft unlike many other patent trolsl are seriously damaging society for everyone and WE all have to pay for it.

    i.e – they Lobbied the UK government so they would abandon their commitment to open standards

    http://thenextweb.com/uk/2012/01/09/uk-government-reportedly-caves-in-to-microsoft-on-open-standards-it-policy/

    Total and utter evil cunts, a malign influence on all our lives.

    The tactics they use now are the same as the end of the 90′s –

    http://en.wikipedia.org/wiki/Halloween_Documents

    They are using these same tactics now

    http://thevarguy.com/open-source-application-software-companies/halloween-documents-microsofts-anti-linux-strategy-15-yea

    • A. P.

      You mean those anti-trust lawsuits where Microsoft paid more than 3 000 000 000 € (that’s 3 thousand millions to europeans, or 3 Billions to the americans) to the European Union for just one case (there were more, some parallel in the US) ?

      Yeah, they had shitty business practices (like most companies, unfortunately) and they did not get away from it (unlike most companies, unfortunately).

  • Earthling

    I think Microsoft should look up what actually happened to Challenger. That’s where their mobile platform is heading, an explosion into clouds.

  • Salty_Swede

    So does this mean the anti-trust suits worked or that they were never really necessary in the first place?

  • Greg Colborne

    Holy already 14%

    Which was at 0.4% in 2012

    Windows 8 Mobile world has been declared the fastest growing platform in the world

  • Greg Colborne
  • Henriette Phoolish

    Microsoft is doomed and its total demise can’t come soon enough. We don’t want Microsoft in new markets or increasing their market share because if they do, they will make us all pay an EA and everyone will be dominated by SAM audits. Lets not even talk about lack of innovation over the last 20 years.

  • maamoua

    This guy & the rest of MSFT leadership are nothing but caretakers mediocre bureocrates. They lake imagination, innovative ideas & above all any leadership qualities. For quite sometime, everyone, inside & outside MSFT were aware of the decreased market share and the overall disruptive innovation nature of today’s market. If MSFT needs to maintain its relevancy in the market & have a stable future, they need to change the ideocracy that runs it as a dysfunctional unit.

  • Sean

    Maybe they could regain some of that lost market share in the PC market by moving back towards windows 7, and not the abysmal failure that is windows 8

  • Sten2005

    Microsoft CEO Satya Nadella won’t even reply to the open letter calling for the VB6 programming language to be open sourced.

    With arrogance like that to it’s existing customers is there any doubt why Microsoft is failing to gain new customers.

  • penguinApricot

    “We have to rethink the way we look at our business “.

    Thanks COO, you’ve earn’t your million dollar bonus with that brain-wave.

    How about you just give us your practical plan in point format,
    and if it doesn’t work by the end of the year we throw you in jail.

  • BoloMKXXVIII

    90% of the desktop market is like saying you own 90% market share of buggy whips. Microsoft has been trailing the market since Bill Gates handed over control to Balmer. Hopefully the new CEO will be able to do something to keep Microsoft relevent in today’s environment.

  • Timothy

    OK, so 90% to 14% *if you include an entirely different market segment.* The speech is good as a motivation tactic internally, but it’s not exactly news. You could just as easily get skewed numbers like this back in 2004 if you lumped in Symbian.

  • fgyqwegfiweg

    This BS means nothing. “Device” can be anything! from microwave till Google farm, so what? DESKTOP is still occupied by Windows and nobody even plan to shift somewhere else (inc. me :) ). Windows is more-less stable, full of drivers and external gadgets, so why I should worry about sh***ty tablets??

  • Carlos Osuna

    First they ignore you –> Red Hat

    then they laugh at you –> XXXX is the year of the Linux Desktop… NOT

    then they fight you –> Windows Phone 7/8/8.1, Windows 8

    then you win…

    Congrats Linux, you’ve come a long way and Microsoft has finally acknowledge it.

    http://www.dailymotion.com/video/x4tays_ibm-linux-commercial-prodigy_tech

    “What you’ve learned, we all have learned”