Nadella is just what Microsoft needs

Satya Nadella has been a boon to Microsoft and, indirectly, India. At a time when many Americans are leaning towards placing new restrictions on the H-1B visa, Nadella has decidedly shown that America benefits by importing the “best and the brightest”.

Sundar Pichai might prove to become another icon in this realm but most people don’t know much about him, other than the fact that he heads Google.

This is not the case with Nadella. He is a case study for MBA students and business leaders about what to do when you are entrusted with the reins of the world’s largest software company and how you could change it for the better.

Under Steve Ballmer, a pure marketing expert with little knowledge of technology, Microsoft kept fighting the same battles over and over again.

Eager to protect the company’s dominance in two important franchises — Operating Systems and Office — he made enemies with everyone — customers, partners, bootleggers and even governments.

Paying for bundled software Customers were forced to pay to upgrade to new versions of software, older versions of which would become unsupported after a few years. The OS was missing key features unthinkable in any other product. For example, to protect their computers from increasing virus and malware threats, consumers had to pay extra to buy antivirus packages from third-party companies. This is similar to a car manufacturer selling a vehicle with no inbuilt locking mechanism — how silly!

Ballmer used the ubiquity of Microsoft to force people to adopt other company products. Unpopular programs would get bundled with the OS and be designed to be so entangled with it that one would need an advanced technology degree simply to uninstall them.

Remember the antitrust settlement that Microsoft entered into worldwide, simply to make it easier for people to get rid of Internet Explorer? And two of Ballmer’s biggest acquisitions — Skype and Nokia — turned out to be duds. Don’t forget that he offered to buy Yahoo! for $45 billion in 2008. Seriously, what was he thinking?

Brilliance of Win 10 In the last four weeks, I upgraded all three of my home computers to Win 10. And this is when I saw Nadella’s genius come to light.

First of all, the upgrade was free. In one stroke, Nadella took the billions that the company was wasting to fight software piracy worldwide and wisely reinvested those resources into making a better product. After all, even bootleggers cannot compete with something that is free.

The move was a tacit acknowledgement that Android became dominant only because Google offered it for free — and so, if Microsoft had to retain dominance in the shrinking PC market, Nadella had to make his OS free as well.

Next, Nadella used his experience with the cloud to deliver the product to customers’ desktops directly. There were no more messy DVDs and complicated product keys to safeguard.

Microsoft already knew which PCs worldwide had legal installations — so Nadella pushed the Win 10 upgrade seamlessly, from the cloud, into those desktops. As of the last week of August, 75 million devices had the new software.

That Nadella is a genius with the cloud is evident from how flawlessly the upgrades happened. On each of the three machines, all I had to do was to click through three to five prompts — the software did the rest.

There was nothing to back up, no hard drives to partition, and no techno mumbo-jumbo to deal with. My grandmother could have done this just as well.

Staying relevant (Note to Pichai at Google — if you don’t restructure your contracts with device makers to automatically push through newer versions of Android to customers’ devices, you will open yourself to competition and perhaps, irrelevance.

Wait, this has already happened. Cyanogenmod, a free, community-built distribution of Android gives customers, not device manufacturers, a say in the all important upgrade process).

Nadella’s cloud experience was evident in the way the new OS gently reminds you about Office 365. The message is clear.

Customers no longer need to worry about their Word, Excel and PowerPoint becoming incompatible with modern versions. Pay Microsoft a small licence fee ($35 per year in the US) and the company will automatically keep all of your Office programs up to date with the latest security updates.

Unbundling of software was a breeze. I didn’t want to use Edge, Microsoft’s new web browser.

All I had to do was to right click on the Edge icon and click on “Unpin this program from the taskbar”. Done.

Was this the company that fought unbundling down to its very existence as recently as in 2001?

And Win 10 comes with its own locks. Windows Defender is a state of the art anti-virus and malware program built into the OS and, because it is free, more of the world’s machines are now more resistant to hacks.

Reimagining a giant Anti-virus product makers will scare you into buying needless protection but don’t fall for those tricks. If you follow common-sense safety steps (not opening attachments from unknown sources, not visiting rogue websites, keeping your OS software always updated), Windows Defender is plenty adequate for 95 per cent of the world’s PC users.

Satya Nadella has taken a once-arrogant, stodgy American giant and transformed it into a nimble company that people can like.

If it took an Indian to do it, so much the better.

The writer is MD, Rao Advisors LLC

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