The introduction of Chrome OS net book might be creating market speculation that Windows is starting to lose the operating system game. But I think Microsoft has a great opportunity to be a leader in the cloud based operating system as well. As per Google's claim, Chrome OS seems to be all about simplicity, running all that user wants through a single application - the Chrome browser. The point that Google could be missing here is the versatility that most of the users currently are used to. The users would be certainly restricted from performing certain functions or running certain applications on a Chrome OS. Additionally, Google might be too early into the game of web-based OS considering the fact that the penetration of internet has still a long way to go.
But still cloud based OS market is nothing to ignore because the future market potential for personal computers most probably lie there and the size of the net book pie might be growing tremendously and growing towards cloud based net book. Apparently Microsoft has been doing well with Windows 7 and with its add-on cloud based applications such as Skydrive. This is all done to retain the PC and laptop users running Windows, but in future it might get costly to retain the size of the PC/laptop pie. Thus growing the net book market will be a smarter strategy. Given Microsoft's strong position in the OS market in desktop PCs, along with several presences in cloud computing through Office online, Skydrive and Windows Azure for application developers on cloud computing, Microsoft has a considerable installed base to begin with. Rather than losing the current PC users who might migrate to Google Chrome OS in future, Microsoft should try to migrate these users to Microsoft cloud based OS. There is a great window of opportunity here to be in the market at the right time when the world is ready to fully embrace cloud-based computing and Window should make sure not to miss it and should make sure to have a strong foothold in the cloud-based net book market.
Since cloud based net books offer benefits of saving on software/plug-ins implementation costs and storage, customer who value these benefits will be ready to pay a premium for these net books than what they pay for an average net book available currently in the market. Microsoft currently has the highest market share in case of corporate users and these are the users who will be ready to pay a premium for a cloud based net book, so Microsoft should leverage this customer base.
Windows should works on a lean OS that does not overload and slowdown the net book. Microsoft can try to keep the look and feel of the Windows OS to enable a seamless transition for the current PC users but it should not forget that it is a completely new paradigm shift and should start working on the design from the scratch to match up the performance of Chrome OS. Apple might not remain silent for too long and with the iPad tablet's strong foothold it might be easier for Apple to enter the cloud-based market. But whatsoever, Microsoft has a strong installed base with the cloud offerings and can leverage the existing relationship with the net book manufacturers.
The next big piece is the pricing of the operating system. Google is offering Chrome operating system for free and it is apparent that it will be tough game for Microsoft if it charges the operating system. Though it is a game changer, Microsoft can partner with the net book manufacturers and share the profit margin on the net book based on sales numbers but bundle the operating system with the net book for free. Also, Microsoft can charge for additional application bundles or version upgrades or can offer the whole operating system on subscription basis. Fact here is that since Microsoft's core business is licensing, selling it for free is not going to be a sustainable model but users will be ready to pay for a product with premium quality. Thus Microsoft should keep the product quality in mind and should leverage the current market share and installed base and come with a killer operating system and introduce at the right time.
An additional important factor for Microsoft is the marketing communication and this needs your significant attention. Currently Microsoft offers great cloud based application on Skydrive with 25GB of free space and it enables users to create edit their documents online with OneNote application. But not even 10% of current PC users are aware of these features. So in addition to offering a best in class cloud-based net book product, Microsoft should make tangible changes in the way the company communicates if the company wants the customers to perceive Microsoft as a change maker!
No comments:
Post a Comment