Microsoft’s Next Big Move Is on its Way!
Axilia is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
It all started in the year 1980 when Paul Allen and Bill Gates decided to enter the Operating Systems business with their own version of UNIX, called Xenix. But what made Microsoft (NASDAQ: MSFT) famous was the purchase of CP/M clone called 86-DOS, which they rebranded as MS-DOS. After this, Microsoft dominated the OS market. Later they came out with a graphical extension for MS-DOS called Microsoft Windows. This marked the beginning of the Windows era.
Windows 95 was launched during the internet boom. It featured preemptive multi-tasking, a completely new user interface, and an internet browser. From there on Microsoft kept releasing various versions of Windows and dominated the OS market. The latest version of the OS is called Windows 8. It has been designed to run on both traditional PCs like Desktops and Laptops, and at the same time on the new touch enabled devices like Touch Pads and Smartphones.
Microsoft, the software giant, is now getting into the Hardware business too. The first step to this began with the development and launch of a tablet called Microsoft Surface. This tablet runs on both Windows 8 and Windows RT (A special version of Windows 8, designed specifically for tablets). Early sales of the tablets were good; however, recently sales have declined.
Next in line from Microsoft is a smartphone under the same brand name Surface. We know that Apple and Google have done this earlier. Apple’s (NASDAQ: AAPL) iPhone is a revolutionary product. It changed the Mobile phone industry. From the original iPhone to the latest iPhone 5, Apple has come a long way. Today iPhone is a status symbol. Since the release of iPhone the share price of Apple increased from $190 to $700 before falling back to $580.
**Source: http://www.nasdaq.com/symbol/aapl/interactive-chart
Google (NASDAQ: GOOG) is another software giant that got into Hardware business with Nexus One Smart Phone. This was not a big hit, but its Operating System, Android, was. Today, Android is the most widely used Mobile phone Operating System across the globe. With so many other OEMs selling Android devices and minting money, Google has once again come up with its Nexus series of devices (this time tablets). The Nexus series of devices will be purely Android based and will enjoy the benefits of getting Android updates first. It is for us to wait and watch if these will be a hit or not.
Microsoft has, apparently, signed up with iPhone manufacturer Foxconn to build its handset. This information was reported by Digitimes. Digitimes is the same company that leaked the screen size of iPhone 5 before its release and also the exact specifications of iPad mini. Hence, this information cannot be discarded. Post report we saw a slight increase in the share price of Microsoft.
**Source: http://www.nasdaq.com/symbol/msft/interactive-chart
It is believed that Microsoft got into the hardware business due to lack of robust hardware from many of its OEMs. Hence, it came up with the Surface Tablet. When it comes to smartphones, however, we have Nokia (NYSE: NOK) with its Lumia series, a powerful and beautiful Windows 8 based phone. We know that when it comes to Phone Hardware, Nokia is one of the best. Lumia 820 and Lumia 920 are the latest release from Nokia. The Lumia series is in great demand. In Germany all the available Lumia 920 devices were sold within the first few hours of availability. The USA has also seen millions of customers waiting for more phones to arrive. Thus when Microsoft comes out with its own smart phone it will be in direct competition with Nokia and other OEMs.
However, if Microsoft’s new smartphone is better than the existing phones and if they are able to generate profits from this, then the share price of Microsoft may rise well above $33. Also the early reactions during the release of this phone may give an opportunity to book profits for traders. Microsoft has always been in high regard in the eyes of the investors and traders. If played well, this stock can give a good return in the near future.
Will they be able to lure the customers away from other players in the market and sell their own product? Will the sale of the new Surface phones surpass that of iPhone and Samsung’s Galaxy series? Will the Surface phones be given any special treatment, from Microsoft, over the other phones running on Windows 8? Only time will tell. Let’s wait and watch.
axilia88 has no positions in the stocks mentioned above. The Motley Fool owns shares of Apple, Google, and Microsoft. Motley Fool newsletter services recommend Apple, Google, and Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. Is this post wrong? Click here. Think you can do better? Join us and write your own!
