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| Windows Phone OS in HTC Hardware |
Microsoft took an enormous step forward this morning. It unveiled a free version of its Windows operating system.
Revealed at the company’s annual software developer conference in San
Francisco, this new OS is called Windows for Internet of Things, and
Microsoft will license it for free when hardware makers use the software
on devices with screens smaller than nine inches. The door is still
open for the company to charge Windows licensing fees for PCs, tablets,
and other larger devices, but Microsoft will compete head-on with
Android — Google’s free mobile operating system — on smartphones and
wearables.
It’s a big, bold move, but it’s one that Microsoft needed to make.
Because the code behind Android is open source, anyone can use it
without paying a penny, and that has made life difficult for Microsoft
in recent years, as the company continued to charge manufacturers about
$10 for its Windows Phone operating system on each smartphone and
tablet. In a world where Apple is also pushing operating system prices
towards zero, Microsoft must forgo its licensing fees just to get
Windows onto a more substantial number of devices.
Presumably, Windows for Internet of Things will use the same code
base as Windows Phone 8, and Microsoft says it will only run mobile
apps, not desktop software. But today, the company also announced a new
system for building applications that can run on both Windows and
Windows Phone as well as XBoxes. So there could be ways of bridging that
gap. It’s not clear whether home users and independent developers — and
not just commercial hardware makers — will be able to download and
install the new operating system on their own devices.
There was no talk about open sourcing the Windows code base, a la
Android. That means serious hackers can’t get into the guts of the
operating system — and ensure the code is sound and secure — and it
probably means that this new version of Windows won’t spread nearly as
far or as fast as Android. But the move does show that Microsoft is
serious about competing in the mobile market, and that the company is
slowly shifting its business strategy, so that it relies more on revenue
from cloud services instead of OS licensing. In other words, it’s
transforming itself into a company that operates more like Google.
The transition won’t be easy. Windows has always been a cash cow for
Microsoft. It makes sense for the company to keep some of that revenue
for now, especially on the desktop, where it faces less competition. But
the cloud is where the industry is headed. Everything from Apple
consumer service iCloud to IBM’s enterprise cloud services like
SoftLayer is pointing in that direction. For its part, Microsoft now has
a number of cloud services services that can lead the way into the
future, ranging from Skype and OneDrive for consumers and professionals,
to enterprise services such as Azure, Dynamics CRM, and Office 365.
Convincing people to buy from Microsoft and not one of its myriad
competitors will be a challenge in itself. But at least Microsoft
realizes what it has to do.