Microsoft Becomes Most Interesting Stock in the World

Microsoft windows 8By Dana Blankenhorn

NEW YORK -- When I last wrote about Microsoft's (MSFT) Windows 8, I described its Metro user interface as "one interface to rule them all," because it can be adapted to PCs, tablets, phones, and even game machines.

I suggested it might do for Microsoft what Linux did for IBM (IBM): unify disparate product lines. But it turns out it's more than that. Metro is making Microsoft the most interesting stock in the world.

That's because, according to former Apple (AAPL) and Palm executive Michael Mace, this is the most important rollout Microsoft has had since Windows 3.0 more than 20 years ago, and an entire industry is on the line.

There are three possible outcomes:
  1. Microsoft wins and extends its desktop dominance into phones, online services, tablets and social networking.
  2. Microsoft loses, and becomes vulnerable to desktops using other operating systems such as Apple's Macs and Google's (GOOG) Chromebooks.
  3. Meh. Users resist upgrading, and we go on as we have been.
All three outcomes are possible, and investors don't know where to place their bets. Also, "meh" may be the worst outcome of all.

The main Metro screen will be filled with Microsoft products, Mace writes, and efforts by competitors to put their own brand identities on their "tiles," which replace icons, will tend to look shabby.

The old Start menu is disappearing -- users will be pressed to learn a new way of doing things. And forget about restarts -- even turning the thing off is going to be a trial.

It's true that the old Windows 7 interface will remain available, much as MS-DOS compatibility remained in Windows 3.0. (Don't remember DOS? Ask your dad.) But users, and developers, will be strongly pushed toward Metro. Either you like Metro or you don't.

I was already a tech reporter when Windows 3.0 came out. Although a version of Windows had been out for four years, this was the first one that worked.

Windows 3.0 basically forced IBM out of the PC business, made Apple marginal for a decade, and gave us Microsoft Office, pushing out older application vendors like Lotus, WordPerfect and Ashton-Tate.

You can see a version of Metro on the Lumia 900, which Nokia(NOK_) is advertising with the tag line "the smart phone beta test is over!"

It's a funny ad, and stars former Saturday Night Live funnyman Chris Parnell, best known these days for playing Dr. Leo Spaceman (pronounced "speh-che-min"), a walking malpractice suit of supreme self-confidence, even self-delusion. (An interesting choice.)

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Why will "meh" be the worst possible outcome? Because it would leave Microsoft's biggest OEMs, Hewlett-Packard (HPQ) and Dell (DELL), vulnerable to Chinese competitors such as Lenovo that can better handle today's value pricing.

It would prevent these American companies from gaining a toehold in the tablet market. Something has to change, in other words, or Microsoft's whole ecosystem, including Nokia, goes down in flames.

Mace wrote in his blog post that he did a search comparing "I hate Windows 8" and "I love Windows 8."

Hate outran love by 3-1.


But my own Googlefight on those same two terms showed love outrunning hate by nearly 30-1, and a straight comparison of the terms on Google.com had love outrunning hate 15-1. (Mace later wrote to say he got it wrong.)

But we don't really know. Microsoft is doing a slow, controlled rollout, and the current view may be down to PR -- it may all be marketing hype. We won't know the result of all this until the fall, after the software is officially released.

Microsoft has been a sort of widows-and-orphans stock for a decade, bouncing between $25 and $30 a share. Those days are ending. It will either rise or fall with Metro. Which way will it go? Your guess is as good as mine.

At the time of publication, Blankenhorn held shares of Microsoft, Apple and Google.

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7 Comments

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gamay9

I disagree. The most interesting stock is the Green Bay Packers. You can buy as little as one share, don't have to pay a broker's commission, it will never rise or fall in price and it looks good framed and hanging on your study wall. It is worth its' weight in Green and Gold even if you are not a Packer fan - no other team sells shares.

May 31 2012 at 3:16 PM Report abuse rate up rate down Reply
jabber_wolf

Macs are NOT PCs
Sorry but they are machines for those who are simple, do simple things, and do not collaborate with software.
( and no working on one thing and emailing it back and for is not what I mean by collaborate by software).
The best jobs macs do, are to be used as ENDPOINTS, to then REMOTE to platforms ( usually by MS) to then do work. This especially goes for tablets ( which are like endpoints that have games and can browses too).

MS is interesting because they still have around 90% of the market
MS is interesting because they still have around 95% of the business market.
MS is interesting because they have the only path to having all devices under 1 OS and to share between them with the same services.
MS is interesting because most businesses use MS EXCHANGE for their email collaboration and use activsync to do so ( this is the technology that APPLE is leased to be able to be tolerated in the workplace)
MS is interesting because they might by RIM which would allow them to have access to the RIM network for all their WP7 phones which would be immediate response as well as save battery life. They could combine RIM ( their BES server) into a module or combine with Exchange.

MS has sooooooooo many things going for it at the moment with clear path.
Apple: just has some toys and gadgets for amusement and nothing else.

May 31 2012 at 2:39 PM Report abuse rate up rate down Reply
speedking8899

Issuing corporate stock is a way for the organization to get money for free. Its all based on the idea of greed of both the organization and the stockholder, however, sometimes the stockholder takes a bath and then realizes how much of a sheep they are to the mindless wall street sales clucks. Once they get you in the market, you never get out without getting burned. You get 'positioned' so no matter which way you turn, you lose. The only ones who make money are the brokerage houses. What if everyone just doesn't buy stock anymore, no matter what the temptation or carrot that is dangled from the corporation is. This stock market is just a game for pseudo-intellectual gamblers. Its no different than betting at OTB or going to the casino.

May 31 2012 at 1:09 PM Report abuse rate up rate down Reply
locustent

Substitute "Vista" for "Metro" in the article and see whether it changes your confidence in Microsoft. We've heard this all before.

May 31 2012 at 12:43 PM Report abuse +1 rate up rate down Reply
YourFtr

Gates doesn't really seem to know the future; because he keeps a finger in every Pie. Whichever Pie breaks on Top;
then Microsoft can throw all it's weight behind it.

May 31 2012 at 12:02 PM Report abuse +1 rate up rate down Reply
YourFtr

The Operating Systems will never be any good until the User Runs the OS; not the OS Runs the User.

May 31 2012 at 11:59 AM Report abuse rate up rate down Reply
Gumby

If Microsoft lost, then there will be declining numbers of PCs or Macs. Not many can afford Macs as PCs , you know.. Macs is for the airheads with oodles of money to blow. PCs is price competitive. It is still an open question on whether many are abandoning desktop computers for good. maybe!! Everyone seems to be happy with smaller screens that they can take with them anywhere instead of being tethered to a desktop, you know? Many has very thin fingers and is able to manipulate tiny on screen keyboards unlike my thick farmer type fingers or mechanics fingers. I am all thumbs so I guess I will be stuck with desktops for the rest of my life!!

May 31 2012 at 10:17 AM Report abuse +1 rate up rate down Reply