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Microsoft should sell Office and Windows to boost cloud business, former executive says

Former Microsoft executive Satya Nadella has been given some advice: split off Windows and Office and focus on Azure, the company’s cloud computing crown jewel. In an interview with CNBC, Ben Slivka, a 14-year Microsoft veteran who departed in 1999, gave Nadella unsolicited advice, saying, “The appropriate thing probably is to invest the future on the cloud.”

Courtesy: CNBC

“People in charge of the Windows company put mobile OS developers in a box and limited what they could accomplish,” Slivka stated. “They had their ‘Start’ button and all that other nonsense.” Microsoft’s mobile strategy has been relaunched three times. Manufacturers and inventors of cellphones finally gave up.”

Satya Nadella took over as CEO of Microsoft in 2014, at a critical juncture in the company’s history, and has done an outstanding job, on par with – if not bettering – Tim Cook at Apple. Since then, Microsoft’s stock has increased from roughly $36 to $315, where it currently stands, with a gain of 51% in 2021 alone, outperforming the S&P 500’s 27% gain. To achieve this turnaround, Nadella refocused Microsoft on reconsidering how Office and Windows fit into the company’s larger services business; one-time payments were phased out in favour of recurring monthly (or yearly) prices for access to Windows and Office 365.

According to analysts contacted by CNBC, splitting out Windows and Office would be a bad idea. Nadella has created major and much-needed synergies among Microsoft’s many businesses, so that the success of one promotes the success of the others. Removing two of Microsoft’s most important and long-running products would almost certainly have a detrimental influence on Azure and other services that may be combined and sold to businesses.

Max Slater-Robins has been following the emergence of the IT giants, trends in enterprise and SaaS companies, and much more for nearly a decade at numerous publications. He is originally from Suffolk and now resides in London. He enjoys a good night out as well as treks in the countryside.

Microsoft wrote down $7.6 billion in assets in 2015 as part of its $9.5 billion acquisition of Nokia devices and services. After the market share fell below 1%, it decided to stop supporting Windows 10 Mobile four years later.In the past, Microsoft has been willing to sell off parts of its business. In 2015, the business sold Bing mapping capabilities to Uber, and the following year, it sold Nokia feature-phone assets to Foxconn and HMD Global for $350 million, as well as spinning out images startup Vexcel.

 

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