Microsoft’s (MSFT) long-term success was formed on a platform leader advantage established in the 1980s, with its Windows operating system and Office productivity suite accepted as the industry standard. Now with software compatibility across multiple operating systems and growing usage of smartphones and tablets, competitors such as Apple (AAPL) and Google (GOOG) are pushing Microsoft off its edge. Microsoft’s core business is tied heavily to PC usage and licensing of Windows operating systems and servers. Their reluctance in releasing an iOS version of Microsoft Office Suite is costing the company lost market share in addition to lost revenue.
A desire for seamless compatibility between electronics is growing, as usage between smartphones, tablets and laptops/desktop computers is more intertwined than ever. The only company that currently offers seamless integration of both hardware and software across all three device types is Apple. Microsoft needs to make a few strategic moves to either continue pursuing their software dominance, or to be a competitive hardware provider. With the company’s small 3% stake in the smartphone market, slow entry into the tablet market, and dissatisfaction with Windows 8, Microsoft could be facing the tipping point of having once dominated the industry.