In mid-December 2008 this campaign for a "New Strategy" was launched. It was indicated that Microsoft desperately required a "New Strategy". In the initial posts it was indicated that the trend was moving towards SaaS, handheld, cloud computing and netbooks. It was stated that Microsoft was to focused on the cash cows and had to re-examine its business model.
This campaign stated that within the OS market, Microsoft was losing share to competitors. It was stated a "New Strategy" was necessary to offset the potential depletion of revenue from the company cash cows. It was this campaign's contention that Microsoft was required to allocate capital towards initiatives that would supplement a potential decrease in revenue.
Microsoft has released its quarterly results. Refer to: http://money.cnn.com/2009/04/23/technology/microsoft_earnings/index.htm?postversion=2009042316
At this time it might be appropriate to say to Mr. Ballmer "told you so".
According to the release, net income for the company has declined a staggering 32%. This is a significant number.
A large portion of this decline can be attributed to the increased trend with netbooks. This trend caused tremendous impact on the company. The Client division experienced a 16% decline in revenue. The division revenue declined from $4.03 billion to $3.4 billion. Perhaps the most telling with this loss is referenced by Joe Wilcox at Microsoft Watch. Mr. Wilcox states:
"More than 80 percent of Windows revenue comes from OEM sales. Windows licenses then are more transactional. By comparison, about 65 percent of Server and Tools revenue comes from annuity licensing contracts. The difference is important. Annuity customers pay up front, on annual basis, under two- or three-year contracts. These commitments help insulate Microsoft earnings against the highs and lows of the economy or product release cycles. The protection is great for Server and Tools, not so good for Client. Economic conditions demonstrate how dramatic is the difference between transactional and annuity licensing sales".
Refer to: http://www.microsoft-watch.com/content/corporate/microsoft_q3_2009_by_the_numbers.html
This campaign stated that it forwarded letters to Mr. Ballmer prior to launching the "New Strategy". It has been indicated that Investor Relations fowarded a email stating that the company has experienced growth and was focused. However, this campaign has continued to state that Microsoft is required to impliment a "New Strategy" that would insulate the company revenue and earnings from a decrease in OS sales. The campaign has indicated that the company is largely dependent on its OS for the majority of the company revenue. This reality is confirmed with the recent quarter release.
Could this be the initial signs of the campaign's predictions?
If Microsoft fails to adopt a "New Strategy" it is probable that this is only the beginning for the company. This campaign has referred to the trend towards cloud computing and mobile. It is interesting to note that Microsoft experienced losses in Online Services and Entertainment and Devices. This indicates that the company is failing in the primary growth trend sectors. This demostrates that the company is failing to maintain its cash cow OS revenue and consumers are spending on services that deal with "cloud computing". This also reaffirms the arguement outlined in "Could Microsoft be the Next General Motors". GM failed to recognise trends and eventually competitors stole market share in new markets. Microsoft is losing in OS and is failing in the new trend sectors. This could prove detrimental to the company.
Its' failing to compete with Google in online services. Unless Mr. Ballmer creates a game changing strategy that will increase share in this sector the company will fail to have a solid revenue base within this domain.
The Entertainment and Devices division has deployed over $9 billion and Xbox trails Wii and Playstation. The Zune was a complete failure. Its Win Mobile is also a dramatic failure despite massive spending.
Another article that gained attention is titled "The Top Ten Stocks to Short Sell", which is located at CBS Marketwatch. The article references the best companies to short-sell. What is alarming is that Microsoft is within this list. Refer to: http://www.marketwatch.com/news/story/story.aspx?guid=%7Bc114b945-f1b4-419d-a029-2ebcf725aaed%7D&link=http://247wallst.com/2009/04/26/the-top-ten-stocks-for-short-sellers-msftintcsirifaigc/
Now, this campaign is not advocating short-selling Microsoft. This campaign is seeking to force Microsoft management to adopt a "New Strategy". This "New Strategy" is located within this blog titled Edited "New Strategy".
The company has experienced a 32% decline. It is failing in Client, Online and Entertainment. The company shares have been referenced as one of the best shares to short-sell. These facts should be a serious "wake-up call" to Mr. Ballmer and The Board.
Who is holding Mr. Ballmer and The Board accountable for these results and the company failing to create shareholder value. If the company fails to impliment a game changing strategy, it will continue to experience a decline in OS. It will continue to experience a revenue decline in Client and consumers move towards netbooks. It could be threatened by IBM, Apple, Linux. There is another threat on the horizon if Oracle acquires Sun.
The company will continue to experience a loss in Online as Google expands it share and product mix. Additionally, Win Mobile through its alliances will fail to generate adequate revenue to offset the decline in OS revenue.
It is time for a "New Strategy". It is time to rally support and effect change.
To offer support though shares contact newstrategy4msft@gmail.com
We can be contacted at thecrandreagroup@hotmail.com
Monday, April 27, 2009
Sunday, April 19, 2009
R&D SPENDING REQUIRES FOCUS
In a recent article with InfoWorld this campaign is referenced. As with any activist campaign, it is understood that there will subsequently be opposition. There will naturally be groups, analysts and other parties that will fail to agree with an activist campaign.
With the Microsoft Subnet article, (refer to http://www.networkworld.com/community/node/38350 ),the campaign stated that Microsoft was required to pursue an acquisition of Sprint. Mr. McDonald stated that he preferred Research In Motion over Microsoft acquiring Sprint. Mr. Barnicle, an analyst with Pacific Crest Securities stated that he was oppossed to Microsoft pursuing a mobile acquisition.
The campaign conducted analysis and perceived that based on the trend towards handheld and the report by Citi analyst Mark Mahaney that Microsoft required an acquisition to better compete in this sector. In the same Microsoft Subnet article there are two oppossing views by both Mr. McDonald and Mr. Barnicle. However, as mentioned, this oppossition is natural. There is the old adage "You cannot please all the people all the time".
Where this campaign takes issue is when the premise of "The New Strategy" is not understood in its entirety and opinions are then expressed. The campaign was approached by an author seeking to conduct an interview concerning R&D spending with Microsoft. The interview was conducted and the article was published in the British magazine PC Plus.
The article states that Microsoft has increased its R&D spending. It also states that Microsoft is required to focus its R&D spending on creating products that secure consumer loyalty. The article refers to patent 7,296,946 which is a ring binder for containing pages. This is subsequently a waste of capital. The premise of the "New Strategy" was correctly and accurately communicated. (Since the article is not online it cannot be added to this post)
Recently, an article was posted on InfoWorld concerning this campaign and its "New Strategy" for Microsoft. Refer to http://www.infoworld.com/d/developer-world/increased-rd-spending-vital-software-industry-707
The article essentially is well written, well communicated, insightful, and worth reading. The issue is that it also fails to communicate the real intention of "The New Strategy".
Within the article Mr. McAllister makes reference to The Crandrea Group. However, with the article the author makes a couple of critical editorial mistakes. The author indicates:
"Up to this point it's hard to argue with Montgomery's findings. What bothers me, though, are the Crandrea Group's proposed solutions. "It is critical that Microsoft utilize its R&D budget and focus on improving its core products," reads the group's strategy statement. "Rather than deploying capital to create new products, it is crucial to direct capital to improving existing products to secure consumer confidence and loyalty."In other words, the problem isn't that Microsoft's attempts to innovate have failed. The problem is that Microsoft tried to innovate in the first place!Whither software innovation?See what I mean about investors focusing on short-term gain?"
The author fails to comprehend the core of the "New Strategy" for Microsoft. Throughout the activist campaign it has been communicated that a long-term shareholder value strategy was being pursued. The campaign indicated that it was seeking to obtain analysis from MSFT employees to edit and revise the "New Strategy".
It was indicated that MSFT employees could provide the greatest analysis to ensure a long-term strategy was pursued. Subsequently, the campaign is not seeking a short-term band-aid approach, but rather, it is seeking to pursue a long-term strategy. In the post the author is referring to, it is indicated that the "New Strategy" is seeking the following:
"It is critical that Microsoft utilize its R&D budget and focus on improving its core products," reads the group's strategy statement. "Rather than deploying capital to create new products, it is crucial to direct capital to improving existing products to secure consumer confidence and loyalty."
MSFT employees confirmed that MSFT currently and historically has produced poor products. Employees referred to MSN, Zune, Vista. MSFT employees indicated that MSFT is losing loyalty in OS and is failing to be competitive with MSN, and Zune.
Poor company image was confirmed by Mr. Barnicle in the Microsoft Subnet article. This is the primary reason that "The New Strategy" focuses on improving brand perception. This leads into the necessity for Microsoft to improve its brand perception not only through advertising and marketing, but, it is also required to adopt this mentality within its R&D spending.
The "New Strategy" which was edited and revised by MSFT employees specified that focusing on the core was essential. If the company is committing $9 billion on R&D, instead of pursuing new innovation it should concentrate capital towards improving existing products. It was communicated that it should not role out new products until it masters existing products. The campaign based on MSFT employee feedback is not oppossed to R&D spending. However, it is oppossed to deploying capital towards initiatives that will fail to secure revenue and consumer confidence.
Deploying capital towards improving core products is fundamental. This is demonstrated in the Apple ads. A pretend Bill Gates is dividing capital between advertising and improving products. Mac suggests "is that enough" at this point Bill places more money in the advertising pile. MSFT is perceived as creating poor products. Therefore, what employees have indicated is that if the company is going to improve its image, enhance revenue, secure consumers, it has to do what the Apple ad suggests and place capital towards improving existing products. Refer to : http://www.youtube.com/watch?v=MimCZikP8cY
Microsoft has to ensure that Win 7 delivers on its promises and is better than Vista. If it fails, then more consumers will abandon MSFT for other operating systems. Therefore, the campaign is stating "to improve the company, it must improve the "core". Subsequently, this is not a short-term goal, but, it is a long-term necessity. Microsoft is required to ensure that its OS is not "a" operating system but rather it needs to ensure that its "the" operating system.
Consumers have for several years complained about poor products. If the company is deploying $9 billion, a portion of that is required to be allocated to improve the "core" products, and not just seek new innovation. Therefore, if the company has committed to deploy $9 billion in R&D, instead of deploying the entire budget towards useless patents, it is imparative that a portion of that $9 billion be allocated towards ensuring WIN7 is not just a updated Vista.
It essentially reverts to the April 3 post on this blog "Microsoft Requires an Image Makeover". If the company image is battered then "Goal" Number One, the main directive needs to be "Improve the Image". However, as outlined in the April 3 post, Microsoft continues to fail.
Refer to http://www.marketwatch.com/news/story/microsofts-ad-counter-offensive-against-apple/story.aspx?guid=%7B95EC30F8%2DC0B7%2D4AF6%2DBD7E%2D3B0E27905B4C%7D&dist=TQP_Mod_mktwN Also refer to the link within the above post or follow:http://www.marketwatch.com/News/Story/microsoft-needs-help-mad-men/story.aspx?guid=%7B3F67FAE3%2D4733%2D4BC3%2DB30A%2D143EAA9399C6%7D
In the above report the author refers to the notion that through these commercials Microsoft is ultimately admitting that it is Number 2. This is not going to improve Microsoft. It is perhaps the worst move possible to further damage the company image. In essence it is Microsoft admitting defeat. To improve the company image it has to demonstrate through advertising that it is Number One. It has to demonstrate that it has the superior OS not Apple. However, this campaign also has stated that advertising this statement is not enough. To state it is "Number One" then not deliver on the promise is counter-productive. Microsoft is also required to have the "Number One" product.
Brand expert Rob Frankel states that the new commercials by Microsoft will prove detrimental to the company. Refer to: http://www.newsfactor.com/story.xhtml?story_id=65597&full_skip=1
It stands to reason that this focus is required to be translated into R&D spending. Microsoft employees, consumers and reporters have indicated that in various markets Microsoft is not "Number One". Reports also indicate that in OS, although its still "Number One" it is losing share. The long-term required "Goal" of Microsoft is to deliver on its promise, improve its image and produce superior products. This will improve the company image. As a result of improving the image marketshare will follow. Subsequently, this will increase revenue and the long-term health and stability of the company.
What the campaign is stating is simply "image focus" is required in advertising and R&D spending. If you commit $9 billion, a portion is required to be spent on improving the core. Microsoft has to spend capital on making the best OS available to consumers. This will gain consumer loyalty. It will prevent further erosion of share towards consumers switching to Mac OS. This is a long-term strategy that will improve the company image.
Microsoft is required to spend a portion of the $9 billion on improving its online platform. It has to improve this division. It is required to get focus and spend capital that threatens Google's marketshare. Historically, Microsoft has deployed capital and after several years has failed to increase its marketshare. Refer to http://www.pcworld.com/article/161222/report_microsoft_us_search_share_hits_12month_low.html?tk=rss_news
What this campaign is stating is "focus" and deploy capital that will finally cause Google executives to sweat as oppossed to laugh at Microsoft's efforts.
In Mr. McAllister's article it states "See what I mean about investors focusing on short-term gain?"
This campaign is focused on long-term gain. If Microsoft continues deploying tremendous capital towards R&D and continues to produce poor products the end result will be wasted capital. However, if it adopts focus on improving the core products and improve the company image it will ultimately result in long-term gain.
To offer support in the form of shares contact newstrategy4msft@gmail.com
We can be contacted at thecrandreagroup@hotmail.com
With the Microsoft Subnet article, (refer to http://www.networkworld.com/community/node/38350 ),the campaign stated that Microsoft was required to pursue an acquisition of Sprint. Mr. McDonald stated that he preferred Research In Motion over Microsoft acquiring Sprint. Mr. Barnicle, an analyst with Pacific Crest Securities stated that he was oppossed to Microsoft pursuing a mobile acquisition.
The campaign conducted analysis and perceived that based on the trend towards handheld and the report by Citi analyst Mark Mahaney that Microsoft required an acquisition to better compete in this sector. In the same Microsoft Subnet article there are two oppossing views by both Mr. McDonald and Mr. Barnicle. However, as mentioned, this oppossition is natural. There is the old adage "You cannot please all the people all the time".
Where this campaign takes issue is when the premise of "The New Strategy" is not understood in its entirety and opinions are then expressed. The campaign was approached by an author seeking to conduct an interview concerning R&D spending with Microsoft. The interview was conducted and the article was published in the British magazine PC Plus.
The article states that Microsoft has increased its R&D spending. It also states that Microsoft is required to focus its R&D spending on creating products that secure consumer loyalty. The article refers to patent 7,296,946 which is a ring binder for containing pages. This is subsequently a waste of capital. The premise of the "New Strategy" was correctly and accurately communicated. (Since the article is not online it cannot be added to this post)
Recently, an article was posted on InfoWorld concerning this campaign and its "New Strategy" for Microsoft. Refer to http://www.infoworld.com/d/developer-world/increased-rd-spending-vital-software-industry-707
The article essentially is well written, well communicated, insightful, and worth reading. The issue is that it also fails to communicate the real intention of "The New Strategy".
Within the article Mr. McAllister makes reference to The Crandrea Group. However, with the article the author makes a couple of critical editorial mistakes. The author indicates:
"Up to this point it's hard to argue with Montgomery's findings. What bothers me, though, are the Crandrea Group's proposed solutions. "It is critical that Microsoft utilize its R&D budget and focus on improving its core products," reads the group's strategy statement. "Rather than deploying capital to create new products, it is crucial to direct capital to improving existing products to secure consumer confidence and loyalty."In other words, the problem isn't that Microsoft's attempts to innovate have failed. The problem is that Microsoft tried to innovate in the first place!Whither software innovation?See what I mean about investors focusing on short-term gain?"
The author fails to comprehend the core of the "New Strategy" for Microsoft. Throughout the activist campaign it has been communicated that a long-term shareholder value strategy was being pursued. The campaign indicated that it was seeking to obtain analysis from MSFT employees to edit and revise the "New Strategy".
It was indicated that MSFT employees could provide the greatest analysis to ensure a long-term strategy was pursued. Subsequently, the campaign is not seeking a short-term band-aid approach, but rather, it is seeking to pursue a long-term strategy. In the post the author is referring to, it is indicated that the "New Strategy" is seeking the following:
"It is critical that Microsoft utilize its R&D budget and focus on improving its core products," reads the group's strategy statement. "Rather than deploying capital to create new products, it is crucial to direct capital to improving existing products to secure consumer confidence and loyalty."
MSFT employees confirmed that MSFT currently and historically has produced poor products. Employees referred to MSN, Zune, Vista. MSFT employees indicated that MSFT is losing loyalty in OS and is failing to be competitive with MSN, and Zune.
Poor company image was confirmed by Mr. Barnicle in the Microsoft Subnet article. This is the primary reason that "The New Strategy" focuses on improving brand perception. This leads into the necessity for Microsoft to improve its brand perception not only through advertising and marketing, but, it is also required to adopt this mentality within its R&D spending.
The "New Strategy" which was edited and revised by MSFT employees specified that focusing on the core was essential. If the company is committing $9 billion on R&D, instead of pursuing new innovation it should concentrate capital towards improving existing products. It was communicated that it should not role out new products until it masters existing products. The campaign based on MSFT employee feedback is not oppossed to R&D spending. However, it is oppossed to deploying capital towards initiatives that will fail to secure revenue and consumer confidence.
Deploying capital towards improving core products is fundamental. This is demonstrated in the Apple ads. A pretend Bill Gates is dividing capital between advertising and improving products. Mac suggests "is that enough" at this point Bill places more money in the advertising pile. MSFT is perceived as creating poor products. Therefore, what employees have indicated is that if the company is going to improve its image, enhance revenue, secure consumers, it has to do what the Apple ad suggests and place capital towards improving existing products. Refer to : http://www.youtube.com/watch?v=MimCZikP8cY
Microsoft has to ensure that Win 7 delivers on its promises and is better than Vista. If it fails, then more consumers will abandon MSFT for other operating systems. Therefore, the campaign is stating "to improve the company, it must improve the "core". Subsequently, this is not a short-term goal, but, it is a long-term necessity. Microsoft is required to ensure that its OS is not "a" operating system but rather it needs to ensure that its "the" operating system.
Consumers have for several years complained about poor products. If the company is deploying $9 billion, a portion of that is required to be allocated to improve the "core" products, and not just seek new innovation. Therefore, if the company has committed to deploy $9 billion in R&D, instead of deploying the entire budget towards useless patents, it is imparative that a portion of that $9 billion be allocated towards ensuring WIN7 is not just a updated Vista.
It essentially reverts to the April 3 post on this blog "Microsoft Requires an Image Makeover". If the company image is battered then "Goal" Number One, the main directive needs to be "Improve the Image". However, as outlined in the April 3 post, Microsoft continues to fail.
Refer to http://www.marketwatch.com/news/story/microsofts-ad-counter-offensive-against-apple/story.aspx?guid=%7B95EC30F8%2DC0B7%2D4AF6%2DBD7E%2D3B0E27905B4C%7D&dist=TQP_Mod_mktwN Also refer to the link within the above post or follow:http://www.marketwatch.com/News/Story/microsoft-needs-help-mad-men/story.aspx?guid=%7B3F67FAE3%2D4733%2D4BC3%2DB30A%2D143EAA9399C6%7D
In the above report the author refers to the notion that through these commercials Microsoft is ultimately admitting that it is Number 2. This is not going to improve Microsoft. It is perhaps the worst move possible to further damage the company image. In essence it is Microsoft admitting defeat. To improve the company image it has to demonstrate through advertising that it is Number One. It has to demonstrate that it has the superior OS not Apple. However, this campaign also has stated that advertising this statement is not enough. To state it is "Number One" then not deliver on the promise is counter-productive. Microsoft is also required to have the "Number One" product.
Brand expert Rob Frankel states that the new commercials by Microsoft will prove detrimental to the company. Refer to: http://www.newsfactor.com/story.xhtml?story_id=65597&full_skip=1
It stands to reason that this focus is required to be translated into R&D spending. Microsoft employees, consumers and reporters have indicated that in various markets Microsoft is not "Number One". Reports also indicate that in OS, although its still "Number One" it is losing share. The long-term required "Goal" of Microsoft is to deliver on its promise, improve its image and produce superior products. This will improve the company image. As a result of improving the image marketshare will follow. Subsequently, this will increase revenue and the long-term health and stability of the company.
What the campaign is stating is simply "image focus" is required in advertising and R&D spending. If you commit $9 billion, a portion is required to be spent on improving the core. Microsoft has to spend capital on making the best OS available to consumers. This will gain consumer loyalty. It will prevent further erosion of share towards consumers switching to Mac OS. This is a long-term strategy that will improve the company image.
Microsoft is required to spend a portion of the $9 billion on improving its online platform. It has to improve this division. It is required to get focus and spend capital that threatens Google's marketshare. Historically, Microsoft has deployed capital and after several years has failed to increase its marketshare. Refer to http://www.pcworld.com/article/161222/report_microsoft_us_search_share_hits_12month_low.html?tk=rss_news
What this campaign is stating is "focus" and deploy capital that will finally cause Google executives to sweat as oppossed to laugh at Microsoft's efforts.
In Mr. McAllister's article it states "See what I mean about investors focusing on short-term gain?"
This campaign is focused on long-term gain. If Microsoft continues deploying tremendous capital towards R&D and continues to produce poor products the end result will be wasted capital. However, if it adopts focus on improving the core products and improve the company image it will ultimately result in long-term gain.
To offer support in the form of shares contact newstrategy4msft@gmail.com
We can be contacted at thecrandreagroup@hotmail.com
Monday, April 13, 2009
"Edited" New Strategy
Typically, after obtaining feedback in regards to the length of previous posts, this campaign is attempting to refrain from long posts. However, for the purpose of providing the "New Strategy" in its entirety, this post will be longer.
It has been indicated that this campaign was seeking to use a tactic similar to Ironfire Capital and its "Plan B" for Yahoo. Ironfire used wiki's to enable shareholders to edit and revise the "Plan B".
It has been mentioned in previous posts that this campaign was seeking to obtain insight and analysis from Microsoft employees to edit and revise the "New Strategy" for Microsoft. The "New Strategy" is edited. It has evolved modestly from when we launched the campaign. It fails to involve Microsoft acquiring Sprint. Instead in now involves Microsoft acquiring Research In Motion.
It also will focus on improving effeciencies with Research and Development spending. Below is the edited version of the "New Strategy".
NEW STRATEGY FOR MICROSOFT
1)Steve Ballmer is required to be replaced as CEO of Microsoft.
It has been communicated by reporters, analysts and Microsoft employees that Mr. Ballmer is required to resign. It is the fundamental responsibility of the Board to ensure that it acts within the best interest of shareholders.
a)During Mr. Ballmer’s tenure an acquisition of Yahoo was pursued. Mr. Ballmer pursued a 65%premium bid for Yahoo valued at $45 billion. An analyst with Goldman Sachs stated this was the stupidest move the company history. According to a recent report the company commands only 8% of the search sector. This is despite massive spending with acquisitions and R&D.
The largest dilemma with the Yahoo bid decision was the lack of strategy and correct communication. During a meeting with analysts Mr. Ballmer when confronted with acquiring Yahoo stated that Microsoft prefers organic growth. Less than one year after this statement Mr. Ballmer pursues a Board approved 65% premium bid for Yahoo.
In 2005, Microsoft generated online advertising revenue of $1.5 billion. In 2007, Microsoft reported revenue of $2 billion. In 2005, Microsoft controlled 8% of the market share. However, in 2007, it appears that it had declined to approximately 6% market share.
Currently, as indicated in a recent PC World report Microsoft controls only 8%. Therefore, despite various acquisitions within this sector there is minimal improvement. According to reports, the company in 2008 within Online services experienced a loss of $468 million. However, Google commands over 60% market share and generates in excess of $20 billion in revenue and $4 billion in net income.
b) Microsoft is failing within the Web 2.0 sector. Mr. Ballmer has tried to put Microsoft into the Web 2.0 game but his efforts-to-date haven't been very effective. Microsoft isn't a leader in Web 2.0.
c) Mr. Ballmer during his tenure deployed $40 billion towards share buybacks. Despite this massive expenditure the shares have remained flat. The most disconcerting event with this failed expenditure is the announcement by Mr. Ballmer that Microsoft intends to deploy an additional $40 billion through to 2013 on share buybacks.
d) During Mr. Ballmer’s tenure the company shares have remained flat and stagnant for a long-term period of approximately eight years. In 2004, at a shareholder meeting when confronted with a stagnant share price Mr. Ballmer indicated that the company had plans and subsequently the shares would take care of itself. Despite this statement and Mr. Ballmer’s plans, the shares have continued to remain flat and fail to create shareholder value. During Mr. Ballmer’s tenure Microsoft has lost $300 billion in shareholder value.
During Mr. Ballmer’s tenure he has presided over massive spending, poor decisions, poor execution of plans, failed to communicate strategy to shareholders and employees, has failed to create shareholder value and is responsible for Microsoft losing $300 billion in market value. This subsequently leads to a no-confidence with Mr. Ballmer.
2) Microsoft is required to improve its image and brand perception. Today more than ever before, it is essential to establish a powerful brand to enable a successful and profitable business, and position your company as a differentiated thought leader. It is important to consider your companies’ brand as a critical asset to your business. Your brand is more than a graphical mark. It is an investment that you make in your customer relationships. Brand equity is your return on that investment. Your brand is also a promise to your customers.
The primary role of your brand is to establish & enhance customer relationships to create attention, loyalty and drive business results. Building a unique brand identity is the key to acquiring and retaining this attention and loyalty. Successful branding sets your firm apart from the competition, and therefore, makes your company products and services more desirable and valuable to your target prospects and customers.
Over time, your brand image and brand reputation will lead to committed relationships with your customers. This is because a consistent image builds familiarity. Familiarity strengthens relationships, and relationships build revenue. Ultimately, branding builds your market place reputation and drives improved financial performance to the bottom line.
Microsoft has failed to establish a brand that attracts and maintains consumer loyalty. Through failures such as Vista, Microsoft Mobile, and Zune it has failed to deliver on its promises to consumers. Subsequently, the company has failed to enhance customer relationships. Ultimately, this will result in a negative impact with improving financial performance and building revenue.
Brand Expert Rob Frankel has indicated that "Microsoft has no brand strategy. Never did. They have an identity, but no brand strategy. As a result, Microsoft is never proactive, but always reactive to its competition." Therefore, it is imperative that Microsoft fire its current advertising agency Crispin.
Microsoft is required to allocate capital towards establishing a brand identity and positive brand perception that will secure consumer loyalty and propel revenue growth.
3) Microsoft is required to improve R&D spending. Microsoft's strategy (and, therefore, its technological developments) are directed only at extracting more and more money from the customer, and at continuing to do so in the future. The customers' needs are irrelevant.
Subsequently, this mentality has resulted in poor brand perception. This campaign obtained the following comment from a Microsoft employee “Microsoft responds to one thing: the painful pressure of market realities. If we can sell you garbage and get away with it, we will sell you garbage”.
One of the fundamental dilemmas with Microsoft is that consumers complain that the company roles out products that are satisfactory. As one MSFT employee stated “MSFT has its hand on everything BUT a grip on nothing”.
It is critical that Microsoft utilize its R&D budget and focus on improving its core products. Rather than deploying capital to create new products, it is crucial to direct capital to improving existing products to secure consumer confidence and loyalty. Without this as a “goal” Microsoft could deploy $9 billion on R&D and still fail to capture consumer loyalty.
OS X is built on a solid, high performance, secure BSD UNIX foundation. LINUX is based on a solid, high performance, secure kernel. MS Windows, immature technolgies and never properly modernized. Poor performance. NO security. Weak development tools.
By focusing on its current core products, the company will deploy capital to ensure that the core products are superior and therefore will capture consumer confidence and loyalty. This will unlock shareholder value through increasing brand perception and consumer loyalty.
Through focusing on the core and establishing the core products functionality, consumer friendly this will capture consumers. Subsequently, market share will increase in within the core product sectors.
b) First and foremost, get rid of the existing, dysfunctional senior management. Now. Unless the senior management people are engineers and have a patent or several to their name, they have no place managing engineers.
Microsoft was a software engineering company first, so they have to get management on board with that NOW! There is a fundamental difference in mindset between engineers and business/accounting types and until the senior management team at MS recognizes this again, the company is lost.
Therefore, Microsoft has committed to lay off employees to satisfy Wall Street. Rather than lay off developers, engineers, instead MSFT is required to lay off managers that are not engineers and promote engineers into managerial roles.
To put it succinctly, the people at the top are too far removed from both the people in the trenches and the customers who buy their products. With that many layers of “middle management”, the message either way gets lost and no one has a clear sense of what is going on. They even have exercises in that very issue and they don’t learn from it. What good does it do if you follow process to the letter while producing the wrong product?”
Therefore, although this campaign fails to approve layoffs, since Microsoft has committed to layoff employees, it is integral that it layoff managers that are “middle management “ and not engineers. This will produce respect within the R&D labs. It will create vision and direction. It will improve efficiencies and reduce spending on process. This will make R&D spending efficient and ensure innovation is pursued. Ultimately, this will reduce wasted capital on process, and create a greater return on investment through innovation.
4) Microsoft is required to abandon its share buyback plan. Microsoft has disclosed its plans to buy back stocks of worth $40 billion. The company will buy back its shares from investors and it will be the biggest single buy-back plan in history.
The analysts are claiming that this move is an attempt by the company to sustain its share price drop which has gone down almost 30% this year. According to reports, the plan will help company to renew its share price which has declined sharply due to its failed $47.5billion bid to buy the internet portal Yahoo.
The company has never been in debt since its establishment and at the end of June this year, currently the company has approximately $23.7billion. The company was following a buy back 2004 plan which started as a $30billion project and was later boosted by another $10 billion. The new buy-back, which will run until 2013, is the single biggest share buy-back in history. The new program will expire on September 30, 2013.
The original buyback plan resulted in the company deploying $40 billion in capital. Despite deploying $40 billion in capital the shares remained stagnant. In 2004, the company shares were trading at approximately $25 per share. During the next four years and deploying $40 billion the shares remained flat. In 2008, the shares were still trading at approximately $25 per share. Therefore, this strategy failed to prove beneficial for shareholders.
The $40B buyback over 5 years continues what they've done in the past. This averages $8B a year and over the last 12 months they've bought back $9B. It will prove to have a similar effect as the previous initiative. It will result in the company deploying $40 billion without having an effect on the share price.
The company is required to abandon its share buyback plan and allocate the deployment of capital to acquisition growth. This will prove a superior utilization of capital and create a greater long-term return to shareholders. It will prove to have a greater return on investment then the proposed share buyback plan.
5)Microsoft is required to increase market share in search and advertising. According to PC Plus Magazine Microsoft currently controls approximately 8% of this sector.
Microsoft is required to enter negotiations with Yahoo to complete a search deal. This will enable Microsoft to command approximately 30% of the market.
Microsoft is required to acquire Ask.com. This company has potentially better algorithms than Google. However, the company lacks market presence. Microsoft through acquiring a search deal with Yahoo and acquiring the technology from Ask would be able to integrate the two acquisitions to compliment its current platform.
These acquisitions would provide Microsoft with potentially better technology than Google and with the combined ‘search’ from Yahoo, would enable Microsoft to become a viable competitor within the search and advertising sector.
6) Microsoft is required to acquire Research In Motion. Wireless delivery definitely has to be examined. Citi analyst Mark Mahaney states Microsoft's recent deal to provide search to Verizon mobile users won't be a winner for Microsoft, as it will require each user to conduct 17 searches per month on their phones in the next five years just to break even.
Microsoft is required to acquire RIM. RIM is a company with a good degree of loyal "addict" mindshare, which provides a more profitable moat with less price elasticity than multiple alliances. It would boost the MS image, even if it requires a more significant investment. And MS' recent difficulties attracting new customers wouldn't hurt as much here, because of the loyal user base and the inherent attractiveness of the RIM platform to those who consider themselves more "business people" than "technologists".
Absent a telco willing to pay Microsoft for new customers (AT&T / Apple iphone), if Microsoft is intent on operating in the mobile space, it is necessary to be disruptive in the market. What Microsoft has done so far hasn't been resoundingly successful. RIM is viable because they've been running a successful service business -- along the lines of the cloud computing model -- for an extended time.
Another reason to avoid alliances with Sprint, and Verizon as well, is that those companies use CDMA cellular technology, as opposed to the GSM technology in use in most other countries.
Consider that Microsoft already owns Danger, maker of the Sidekick. Acquiring the Blackberry platform would mean that Microsoft would have presence in both the "youthful consumer" and "business" segments of the cellular communication device market.
We are seeking to rally support and effect change. We are seeking to establish a coalition of frustrated Microsoft shareholders to effect change.
To offer support through shares contact:
newstrategy4msft@gmail.com
We can be contacted at thecrandreagroup@hotmail.com
Refer to:
http://www.youtube.com/watch?v=JnJeJPsmOAk
or
http://www.youtube.com/watch?v=Sbo6bvl-7Sk&feature=channel
Final Note:
The youtube videos were recorded with a live webcam. The initial web cam file was visually fine. However,when downloaded onto youtube the streaming or timing is a couple of seconds off. I apoligise. Subsequently, this is the reason for the two links. Based on my discontent with the first link, a second attempt was completed. In the future, a video recorder will be utilized to hopefully improve the quality. Additionally, on the first youtube page (JNJEPsmOAK) is a link to Ironfire Capital titled "Yahoo!Shareholders in favor of Selling". This will provide information concerning the success of this campaign against Yahoo.
It has been indicated that this campaign was seeking to use a tactic similar to Ironfire Capital and its "Plan B" for Yahoo. Ironfire used wiki's to enable shareholders to edit and revise the "Plan B".
It has been mentioned in previous posts that this campaign was seeking to obtain insight and analysis from Microsoft employees to edit and revise the "New Strategy" for Microsoft. The "New Strategy" is edited. It has evolved modestly from when we launched the campaign. It fails to involve Microsoft acquiring Sprint. Instead in now involves Microsoft acquiring Research In Motion.
It also will focus on improving effeciencies with Research and Development spending. Below is the edited version of the "New Strategy".
NEW STRATEGY FOR MICROSOFT
1)Steve Ballmer is required to be replaced as CEO of Microsoft.
It has been communicated by reporters, analysts and Microsoft employees that Mr. Ballmer is required to resign. It is the fundamental responsibility of the Board to ensure that it acts within the best interest of shareholders.
a)During Mr. Ballmer’s tenure an acquisition of Yahoo was pursued. Mr. Ballmer pursued a 65%premium bid for Yahoo valued at $45 billion. An analyst with Goldman Sachs stated this was the stupidest move the company history. According to a recent report the company commands only 8% of the search sector. This is despite massive spending with acquisitions and R&D.
The largest dilemma with the Yahoo bid decision was the lack of strategy and correct communication. During a meeting with analysts Mr. Ballmer when confronted with acquiring Yahoo stated that Microsoft prefers organic growth. Less than one year after this statement Mr. Ballmer pursues a Board approved 65% premium bid for Yahoo.
In 2005, Microsoft generated online advertising revenue of $1.5 billion. In 2007, Microsoft reported revenue of $2 billion. In 2005, Microsoft controlled 8% of the market share. However, in 2007, it appears that it had declined to approximately 6% market share.
Currently, as indicated in a recent PC World report Microsoft controls only 8%. Therefore, despite various acquisitions within this sector there is minimal improvement. According to reports, the company in 2008 within Online services experienced a loss of $468 million. However, Google commands over 60% market share and generates in excess of $20 billion in revenue and $4 billion in net income.
b) Microsoft is failing within the Web 2.0 sector. Mr. Ballmer has tried to put Microsoft into the Web 2.0 game but his efforts-to-date haven't been very effective. Microsoft isn't a leader in Web 2.0.
c) Mr. Ballmer during his tenure deployed $40 billion towards share buybacks. Despite this massive expenditure the shares have remained flat. The most disconcerting event with this failed expenditure is the announcement by Mr. Ballmer that Microsoft intends to deploy an additional $40 billion through to 2013 on share buybacks.
d) During Mr. Ballmer’s tenure the company shares have remained flat and stagnant for a long-term period of approximately eight years. In 2004, at a shareholder meeting when confronted with a stagnant share price Mr. Ballmer indicated that the company had plans and subsequently the shares would take care of itself. Despite this statement and Mr. Ballmer’s plans, the shares have continued to remain flat and fail to create shareholder value. During Mr. Ballmer’s tenure Microsoft has lost $300 billion in shareholder value.
During Mr. Ballmer’s tenure he has presided over massive spending, poor decisions, poor execution of plans, failed to communicate strategy to shareholders and employees, has failed to create shareholder value and is responsible for Microsoft losing $300 billion in market value. This subsequently leads to a no-confidence with Mr. Ballmer.
2) Microsoft is required to improve its image and brand perception. Today more than ever before, it is essential to establish a powerful brand to enable a successful and profitable business, and position your company as a differentiated thought leader. It is important to consider your companies’ brand as a critical asset to your business. Your brand is more than a graphical mark. It is an investment that you make in your customer relationships. Brand equity is your return on that investment. Your brand is also a promise to your customers.
The primary role of your brand is to establish & enhance customer relationships to create attention, loyalty and drive business results. Building a unique brand identity is the key to acquiring and retaining this attention and loyalty. Successful branding sets your firm apart from the competition, and therefore, makes your company products and services more desirable and valuable to your target prospects and customers.
Over time, your brand image and brand reputation will lead to committed relationships with your customers. This is because a consistent image builds familiarity. Familiarity strengthens relationships, and relationships build revenue. Ultimately, branding builds your market place reputation and drives improved financial performance to the bottom line.
Microsoft has failed to establish a brand that attracts and maintains consumer loyalty. Through failures such as Vista, Microsoft Mobile, and Zune it has failed to deliver on its promises to consumers. Subsequently, the company has failed to enhance customer relationships. Ultimately, this will result in a negative impact with improving financial performance and building revenue.
Brand Expert Rob Frankel has indicated that "Microsoft has no brand strategy. Never did. They have an identity, but no brand strategy. As a result, Microsoft is never proactive, but always reactive to its competition." Therefore, it is imperative that Microsoft fire its current advertising agency Crispin.
Microsoft is required to allocate capital towards establishing a brand identity and positive brand perception that will secure consumer loyalty and propel revenue growth.
3) Microsoft is required to improve R&D spending. Microsoft's strategy (and, therefore, its technological developments) are directed only at extracting more and more money from the customer, and at continuing to do so in the future. The customers' needs are irrelevant.
Subsequently, this mentality has resulted in poor brand perception. This campaign obtained the following comment from a Microsoft employee “Microsoft responds to one thing: the painful pressure of market realities. If we can sell you garbage and get away with it, we will sell you garbage”.
One of the fundamental dilemmas with Microsoft is that consumers complain that the company roles out products that are satisfactory. As one MSFT employee stated “MSFT has its hand on everything BUT a grip on nothing”.
It is critical that Microsoft utilize its R&D budget and focus on improving its core products. Rather than deploying capital to create new products, it is crucial to direct capital to improving existing products to secure consumer confidence and loyalty. Without this as a “goal” Microsoft could deploy $9 billion on R&D and still fail to capture consumer loyalty.
OS X is built on a solid, high performance, secure BSD UNIX foundation. LINUX is based on a solid, high performance, secure kernel. MS Windows, immature technolgies and never properly modernized. Poor performance. NO security. Weak development tools.
By focusing on its current core products, the company will deploy capital to ensure that the core products are superior and therefore will capture consumer confidence and loyalty. This will unlock shareholder value through increasing brand perception and consumer loyalty.
Through focusing on the core and establishing the core products functionality, consumer friendly this will capture consumers. Subsequently, market share will increase in within the core product sectors.
b) First and foremost, get rid of the existing, dysfunctional senior management. Now. Unless the senior management people are engineers and have a patent or several to their name, they have no place managing engineers.
Microsoft was a software engineering company first, so they have to get management on board with that NOW! There is a fundamental difference in mindset between engineers and business/accounting types and until the senior management team at MS recognizes this again, the company is lost.
Therefore, Microsoft has committed to lay off employees to satisfy Wall Street. Rather than lay off developers, engineers, instead MSFT is required to lay off managers that are not engineers and promote engineers into managerial roles.
To put it succinctly, the people at the top are too far removed from both the people in the trenches and the customers who buy their products. With that many layers of “middle management”, the message either way gets lost and no one has a clear sense of what is going on. They even have exercises in that very issue and they don’t learn from it. What good does it do if you follow process to the letter while producing the wrong product?”
Therefore, although this campaign fails to approve layoffs, since Microsoft has committed to layoff employees, it is integral that it layoff managers that are “middle management “ and not engineers. This will produce respect within the R&D labs. It will create vision and direction. It will improve efficiencies and reduce spending on process. This will make R&D spending efficient and ensure innovation is pursued. Ultimately, this will reduce wasted capital on process, and create a greater return on investment through innovation.
4) Microsoft is required to abandon its share buyback plan. Microsoft has disclosed its plans to buy back stocks of worth $40 billion. The company will buy back its shares from investors and it will be the biggest single buy-back plan in history.
The analysts are claiming that this move is an attempt by the company to sustain its share price drop which has gone down almost 30% this year. According to reports, the plan will help company to renew its share price which has declined sharply due to its failed $47.5billion bid to buy the internet portal Yahoo.
The company has never been in debt since its establishment and at the end of June this year, currently the company has approximately $23.7billion. The company was following a buy back 2004 plan which started as a $30billion project and was later boosted by another $10 billion. The new buy-back, which will run until 2013, is the single biggest share buy-back in history. The new program will expire on September 30, 2013.
The original buyback plan resulted in the company deploying $40 billion in capital. Despite deploying $40 billion in capital the shares remained stagnant. In 2004, the company shares were trading at approximately $25 per share. During the next four years and deploying $40 billion the shares remained flat. In 2008, the shares were still trading at approximately $25 per share. Therefore, this strategy failed to prove beneficial for shareholders.
The $40B buyback over 5 years continues what they've done in the past. This averages $8B a year and over the last 12 months they've bought back $9B. It will prove to have a similar effect as the previous initiative. It will result in the company deploying $40 billion without having an effect on the share price.
The company is required to abandon its share buyback plan and allocate the deployment of capital to acquisition growth. This will prove a superior utilization of capital and create a greater long-term return to shareholders. It will prove to have a greater return on investment then the proposed share buyback plan.
5)Microsoft is required to increase market share in search and advertising. According to PC Plus Magazine Microsoft currently controls approximately 8% of this sector.
Microsoft is required to enter negotiations with Yahoo to complete a search deal. This will enable Microsoft to command approximately 30% of the market.
Microsoft is required to acquire Ask.com. This company has potentially better algorithms than Google. However, the company lacks market presence. Microsoft through acquiring a search deal with Yahoo and acquiring the technology from Ask would be able to integrate the two acquisitions to compliment its current platform.
These acquisitions would provide Microsoft with potentially better technology than Google and with the combined ‘search’ from Yahoo, would enable Microsoft to become a viable competitor within the search and advertising sector.
6) Microsoft is required to acquire Research In Motion. Wireless delivery definitely has to be examined. Citi analyst Mark Mahaney states Microsoft's recent deal to provide search to Verizon mobile users won't be a winner for Microsoft, as it will require each user to conduct 17 searches per month on their phones in the next five years just to break even.
Microsoft is required to acquire RIM. RIM is a company with a good degree of loyal "addict" mindshare, which provides a more profitable moat with less price elasticity than multiple alliances. It would boost the MS image, even if it requires a more significant investment. And MS' recent difficulties attracting new customers wouldn't hurt as much here, because of the loyal user base and the inherent attractiveness of the RIM platform to those who consider themselves more "business people" than "technologists".
Absent a telco willing to pay Microsoft for new customers (AT&T / Apple iphone), if Microsoft is intent on operating in the mobile space, it is necessary to be disruptive in the market. What Microsoft has done so far hasn't been resoundingly successful. RIM is viable because they've been running a successful service business -- along the lines of the cloud computing model -- for an extended time.
Another reason to avoid alliances with Sprint, and Verizon as well, is that those companies use CDMA cellular technology, as opposed to the GSM technology in use in most other countries.
Consider that Microsoft already owns Danger, maker of the Sidekick. Acquiring the Blackberry platform would mean that Microsoft would have presence in both the "youthful consumer" and "business" segments of the cellular communication device market.
We are seeking to rally support and effect change. We are seeking to establish a coalition of frustrated Microsoft shareholders to effect change.
To offer support through shares contact:
newstrategy4msft@gmail.com
We can be contacted at thecrandreagroup@hotmail.com
Refer to:
http://www.youtube.com/watch?v=JnJeJPsmOAk
or
http://www.youtube.com/watch?v=Sbo6bvl-7Sk&feature=channel
Final Note:
The youtube videos were recorded with a live webcam. The initial web cam file was visually fine. However,when downloaded onto youtube the streaming or timing is a couple of seconds off. I apoligise. Subsequently, this is the reason for the two links. Based on my discontent with the first link, a second attempt was completed. In the future, a video recorder will be utilized to hopefully improve the quality. Additionally, on the first youtube page (JNJEPsmOAK) is a link to Ironfire Capital titled "Yahoo!Shareholders in favor of Selling". This will provide information concerning the success of this campaign against Yahoo.
Monday, April 6, 2009
Letter to the Board
In this post we are going to simply post a copy of the letter we have forwarded to Microsoft's Board of Directors.
Attention: Board Of Directors
Events have fatally undermined investor confidence in Microsoft (MSFT) CEO Steve Ballmer. With Microsoft share price now down in 5 months, and stagnant for a deacde, we call upon the MSFT Board of Directors to immediately seek the resignation of CEO Mr. Ballmer. Absent prompt action to remove Mr. Ballmer, we will have no choice but to call upon MSFT shareholders to join us at MSFT upcoming annual meeting in voting against Mr. Ballmer, and the Board of Directors which is responsible for CEO succession.
According to the Microsoft website the Board of Directors “oversees the company's business affairs and integrity, works with management to determine the company's mission and long-term strategy, performs the annual CEO evaluation, oversees CEO succession planning, oversees internal controls over financial reporting, and assesses company risks and strategies for risk mitigation”.
Based on the above definition the Board has failed to deliver on its mandate. The company has failed to display a long-term strategy and based on Mr. Ballmer’s decisions during his tenure the Board has failed in correctly evaluating the CEO and pursuing a succession plan.
It has been communicated by reporters, analysts and Microsoft employees that Mr. Ballmer is required to resign. It is the fundamental responsibility of the Board to ensure that it acts within the best interest of shareholders.
During Mr. Ballmer’s tenure an acquisition of Yahoo was pursued. Mr. Ballmer pursued a 65%premium bid for Yahoo valued at $45 billion. An analyst with Goldman Sachs stated this was the stupidest move in the company history. According to a recent report the company commands only 8% of the search sector. This is despite massive spending with acquisitions and R&D.
The largest dilemma with the Yahoo bid decision was the lack of strategy and correct communication. During a meeting with analysts Mr. Ballmer when confronted with acquiring Yahoo stated that Microsoft prefers organic growth. Less than one year after this statement Mr. Ballmer pursues a Board approved 65% premium bid for Yahoo.
Microsoft has engaged in massive R&D spending. Pacific Crest Securities analyst Mr. Barnicle states that Microsoft is required to examine its R&D spending. Despite the massive expenditure the company fails to be innovative. Microsoft mobile, and MSN are all failing within their respective sectors.
Mr. Ballmer during his tenure deployed $40 billion towards share buybacks. Despite this massive expenditure the shares have remained flat. The most disconcerting event with this failed expenditure is the announcement by Mr. Ballmer that Microsoft intends to deploy an additional $40 billion through to 2013 on share buybacks.
During Mr. Ballmer’s tenure the company shares have remained flat and stagnant for a long-term period of approximately eight years. In 2004, at a shareholder meeting when confronted with a stagnant share price Mr. Ballmer indicated that the company had plans and subsequently the shares would take care of itself. Despite this statement and Mr. Ballmer’s plans, the shares have continued to remain flat and fail to create shareholder value. During Mr. Ballmer’s tenure Microsoft has lost $300 billion in shareholder value.
During Mr. Ballmer’s tenure he has presided over massive spending, poor decisions, poor execution of plans, failed to communicate strategy to shareholders and employees, has failed to create shareholder value and is responsible for Microsoft losing $300 billion in market value. This subsequently leads to a no-confidence with Mr. Ballmer.
While we believe shareholders are entitled to a full explanation of what the board knew, when it knew it, and whether it approved of Mr. Ballmer’s disastrous decisions, it is more important in our view that the board do what is necessary to restore investor confidence. Removing Mr. Ballmer as CEO is necessary first step in this challenging process.
According to a recent poll of Microsoft employees conducted by GlassDoor, only 44% of the company employees approve of Mr. Ballmer. A review of the blogs Mini-Microsoft and MSFTextreme will aptly demonstrate the resignation of Mr. Ballmer is required for the future success of the company.
Corporate governance at Microsoft serves several purposes:
•To establish and preserve management accountability to Microsoft's owners by appropriately distributing rights and responsibilities among Microsoft Board members, managers, and shareholders.
•To provide a structure through which management and the Board set objectives and monitor performance.
•To strengthen and safeguard our culture of business integrity and responsible business practices.
•To encourage the efficient use of resources, and to require accountability for stewardship of those resources.
The campaign has obtained feedback from Microsoft employees. The primary consensus of employees is that Mr. Ballmer is required to resign. The campaign obtained this comment from a Microsoft employee.
"The elephant in the boardroom is Ballmer's relationship with Gates. Ballmer is the best friend and college buddy of the founder, chairman and biggest shareholder of the company. Ballmer probably can't be fired unless Gates wants him to be fired. And Gates is a loyal friend. Ballmer is also a board member and major shareholder, with 4 percent of the company (Bill Gates himself owns less than 10 percent). It's an unhealthy situation for Microsoft and its shareholders."
Regardless of the fact that Mr. Gates and Mr. Ballmer are friends, Microsoft is a business. Subsequently, the most significant word within the above statement is the word “Boardroom”. It is a boardroom that is required to act within the best interest of its shareholders. Numerous shareholders are demanding the resignation of Mr. Ballmer. During his tenure the shares have remained stagnant.
Based on the detailed duties of the Board of Directors it seems evident that it has failed to execute effectively in respect to its duties. Shareholders have witnessed a tremendous loss in value and the shares have remained stagnant. The current management has failed to set objectives, realistically monitor performance and engage in efficient use of its resources. Therefore, this results in the immediate and necessary resignation of Mr. Ballmer. Failure to encourage his resignation will therefore result in the current Board of Directors being held accountable for failing to act in the interest of Microsoft shareholders and its employees.
To offer support in the form of shares for voting contact
newstrategy4msft@gmail.com
We can be contacted at thecrandreagroup@hotmail.com
Attention: Board Of Directors
Events have fatally undermined investor confidence in Microsoft (MSFT) CEO Steve Ballmer. With Microsoft share price now down in 5 months, and stagnant for a deacde, we call upon the MSFT Board of Directors to immediately seek the resignation of CEO Mr. Ballmer. Absent prompt action to remove Mr. Ballmer, we will have no choice but to call upon MSFT shareholders to join us at MSFT upcoming annual meeting in voting against Mr. Ballmer, and the Board of Directors which is responsible for CEO succession.
According to the Microsoft website the Board of Directors “oversees the company's business affairs and integrity, works with management to determine the company's mission and long-term strategy, performs the annual CEO evaluation, oversees CEO succession planning, oversees internal controls over financial reporting, and assesses company risks and strategies for risk mitigation”.
Based on the above definition the Board has failed to deliver on its mandate. The company has failed to display a long-term strategy and based on Mr. Ballmer’s decisions during his tenure the Board has failed in correctly evaluating the CEO and pursuing a succession plan.
It has been communicated by reporters, analysts and Microsoft employees that Mr. Ballmer is required to resign. It is the fundamental responsibility of the Board to ensure that it acts within the best interest of shareholders.
During Mr. Ballmer’s tenure an acquisition of Yahoo was pursued. Mr. Ballmer pursued a 65%premium bid for Yahoo valued at $45 billion. An analyst with Goldman Sachs stated this was the stupidest move in the company history. According to a recent report the company commands only 8% of the search sector. This is despite massive spending with acquisitions and R&D.
The largest dilemma with the Yahoo bid decision was the lack of strategy and correct communication. During a meeting with analysts Mr. Ballmer when confronted with acquiring Yahoo stated that Microsoft prefers organic growth. Less than one year after this statement Mr. Ballmer pursues a Board approved 65% premium bid for Yahoo.
Microsoft has engaged in massive R&D spending. Pacific Crest Securities analyst Mr. Barnicle states that Microsoft is required to examine its R&D spending. Despite the massive expenditure the company fails to be innovative. Microsoft mobile, and MSN are all failing within their respective sectors.
Mr. Ballmer during his tenure deployed $40 billion towards share buybacks. Despite this massive expenditure the shares have remained flat. The most disconcerting event with this failed expenditure is the announcement by Mr. Ballmer that Microsoft intends to deploy an additional $40 billion through to 2013 on share buybacks.
During Mr. Ballmer’s tenure the company shares have remained flat and stagnant for a long-term period of approximately eight years. In 2004, at a shareholder meeting when confronted with a stagnant share price Mr. Ballmer indicated that the company had plans and subsequently the shares would take care of itself. Despite this statement and Mr. Ballmer’s plans, the shares have continued to remain flat and fail to create shareholder value. During Mr. Ballmer’s tenure Microsoft has lost $300 billion in shareholder value.
During Mr. Ballmer’s tenure he has presided over massive spending, poor decisions, poor execution of plans, failed to communicate strategy to shareholders and employees, has failed to create shareholder value and is responsible for Microsoft losing $300 billion in market value. This subsequently leads to a no-confidence with Mr. Ballmer.
While we believe shareholders are entitled to a full explanation of what the board knew, when it knew it, and whether it approved of Mr. Ballmer’s disastrous decisions, it is more important in our view that the board do what is necessary to restore investor confidence. Removing Mr. Ballmer as CEO is necessary first step in this challenging process.
According to a recent poll of Microsoft employees conducted by GlassDoor, only 44% of the company employees approve of Mr. Ballmer. A review of the blogs Mini-Microsoft and MSFTextreme will aptly demonstrate the resignation of Mr. Ballmer is required for the future success of the company.
Corporate governance at Microsoft serves several purposes:
•To establish and preserve management accountability to Microsoft's owners by appropriately distributing rights and responsibilities among Microsoft Board members, managers, and shareholders.
•To provide a structure through which management and the Board set objectives and monitor performance.
•To strengthen and safeguard our culture of business integrity and responsible business practices.
•To encourage the efficient use of resources, and to require accountability for stewardship of those resources.
The campaign has obtained feedback from Microsoft employees. The primary consensus of employees is that Mr. Ballmer is required to resign. The campaign obtained this comment from a Microsoft employee.
"The elephant in the boardroom is Ballmer's relationship with Gates. Ballmer is the best friend and college buddy of the founder, chairman and biggest shareholder of the company. Ballmer probably can't be fired unless Gates wants him to be fired. And Gates is a loyal friend. Ballmer is also a board member and major shareholder, with 4 percent of the company (Bill Gates himself owns less than 10 percent). It's an unhealthy situation for Microsoft and its shareholders."
Regardless of the fact that Mr. Gates and Mr. Ballmer are friends, Microsoft is a business. Subsequently, the most significant word within the above statement is the word “Boardroom”. It is a boardroom that is required to act within the best interest of its shareholders. Numerous shareholders are demanding the resignation of Mr. Ballmer. During his tenure the shares have remained stagnant.
Based on the detailed duties of the Board of Directors it seems evident that it has failed to execute effectively in respect to its duties. Shareholders have witnessed a tremendous loss in value and the shares have remained stagnant. The current management has failed to set objectives, realistically monitor performance and engage in efficient use of its resources. Therefore, this results in the immediate and necessary resignation of Mr. Ballmer. Failure to encourage his resignation will therefore result in the current Board of Directors being held accountable for failing to act in the interest of Microsoft shareholders and its employees.
To offer support in the form of shares for voting contact
newstrategy4msft@gmail.com
We can be contacted at thecrandreagroup@hotmail.com
Elephant in the Boardroom
In the comment section of "Who Will Lead Microsoft" is this anonymous comment:
"The elephant in the boardroom is Ballmer's relationship with Gates. Ballmer is the best friend and college buddy of the founder, chairman and biggest shareholder of the company. Ballmer probably can't be fired unless Gates wants him to be fired. And Gates is a loyal friend. Ballmer is also a board member and major shareholder, with 4 percent of the company (Bill Gates himself owns less than 10 percent). It's an unhealthy situation for Microsoft and its shareholders."
When this campaign was launched we were aware of Mr. Gates and Mr. Ballmer being significant shareholders. However, it is the final statement within the above comment that can provide tremendous discussion. Ultimately, there are numerous unhealthy situations for Microsoft and its shareholders.
This campaign has addressed some of the unhealthy situations for Microsoft. The campaign has provided analysis of the financial situations confronting the company. The loss of OS share, the growing popularity of the Internet (search and advertising) and the dominance of Google. The introduction of netbooks, SaaS and handhelds.
Microsoft is lost and floundering. The company lacks vision and direction. This campaign has referred to the ill-conceived Yahoo bid. Massive spending. This campaign has referred to the numerous acquisitions, massive R&D spending and the $40 billion deployed on share buybacks. Microsoft has for several decades controlled a massive amount of cash. However, it has failed to elevate the share price. Ultimately, capital without vision and direction fails to be an asset. In Microsoft's case it has become a liability.
There was a period when it was innovative and a darling of Wall Street. However, those days are long gone. Microsoft has been replaced by Apple and Google. Refer to:
In addition to this campaign's analysis there are numerous Wall Street analysts referring to Microsoft's loss of share. However, there are also numerous internal situations that confront Microsoft. This leads to the next point.
In the post "Could Microsoft Become the Next General Motors" this campaign provides a qualitative analysis of additional Microsoft dilemmas. A simple review of MSFTextreme or Mini-Microsoft and it becomes clear that numerous employees are frustrated with the company. The company is confronted with poor employee morale.
The company is also confronted with poor company image. Microsoft has lost consumer loyalty through poor products (such as Windows that freeze, Zune, MSN and the failure of Vista). It has also been the target of Apple through advertising. Microsoft's campaign has failed to improve the company image. Brand expert Rob Frankel states that the new commercials by Microsoft will prove detrimental to the company. Refer to: http://www.newsfactor.com/story.xhtml?story_id=65597&full_skip=1
There is still the elephant in the room. ( This is a term referring to a big problem that often fails to be addressed). Mr. Ballmer is a friend of founder and shareholder Mr. Gates. Granted they are friends. However, friendship aside, business is business. Reality check for Mr. Gates and Mr. Ballmer is simply--Microsoft is a business. Therefore, as a business there requires accountability. This leads to the next point.
Mr. Gates and Mr. Ballmer are substantial shareholders. However, as a business there are also numerous other shareholders. This includes both small shareholders and large institutions. For a decade shareholders have witnessed the shares remain stagnant. Refer to: http://seekingalpha.com/article/63975-lots-of-overlap-between-top-yahoo-microsoft-shareholders
Shareholders have every right to ask management tough questions. They also have every right as stakeholders in the company to demand change. This leads to the final point.
There is without a doubt a elephant in the room. However, the room we are referring to is not Mr. Gates livingroom. That is the place for friendship. The place we are referring to is the Boardroom. As mentioned, this is a place of business. Refer to: http://itmanagement.earthweb.com/columns/executive_tech/article.php/11282_3745546_2
According to the Microsoft website is the following:
Corporate governance at Microsoft serves several purposes:
1)To establish and preserve management accountability to Microsoft's owners by appropriately distributing rights and responsibilities among Microsoft Board members, managers, and shareholders.
1)To establish and preserve management accountability to Microsoft's owners by appropriately distributing rights and responsibilities among Microsoft Board members, managers, and shareholders.
2)To encourage the efficient use of resources, and to require accountability for stewardship of those resources.
Since Mr. Ballmer has failed in the effecient use of resources, the above states that it requires accountabilty for stewardship. Therefore, the Board is required to address its mandate and preserve management accoutability to Microsoft's owners.
Mr. Ballmer has failed in effecient use of resources. Massive spending on acquisitions that have failed to increase share. Massive spending on R&D that have failed to translate into innovation. Massive spending on share buybacks that have failed to elevate the share price. Massive spending on advertisements that have failed to improve the battered company image.
Perhaps the biggest resource Mr. Ballmer failed to utilize was Microsoft employees. Mr. Ballmer failed to use talented employees to propel innovation. Mr. Ballmer failed to listen to employees who have for years on blogs such as Mini-Microsoft indicated that Mr. Ballmer refuses to listen.
This campaign's belief is simple. A CEO who refuses to have a open door to their employees needs to be shown the door. Granted that typically CEO's are intelligent individuals, it is the employees that are in the trenches and failure by a CEO to listen to employees leads to the failure of the company.
The Board of Directors is required to act within the best interest of the company and its owner's. Numerous employees and shareholders have stated that Mr. Ballmer is required to resign. Despite that fact that there is a elephant in the room, it is still a Boardroom, and therefore the Board is required to act in the interest of shareholders. The Board is accountable to act in the interest of shareholders. Therefore, they are required to remove the elephant and ultimately remove Mr. Ballmer.
This campaign is seeking to rally support through shares. Through rallying votes, shareholders have the potential to force the Board to address the elephant in the room and remove Mr. Ballmer. Failure by the Board to comply and act in the interest of shareholders, places accountability on the Board. If they fail to remove Mr.Ballmer then subsequently the Board should be removed at the next shareholder meeting as shareholders exercise their vote against the Board.
To offer support through shares contact
We can be contacted at thecrandreagroup@hotmail.com
Sunday, April 5, 2009
Former Microsoft Employee Interview
This campaign was previously interviewed for an article with Microsoft Subnet. The campaign was asked a series of questions which were used for the article. Refer to http://www.networkworld.com/community/node/38350
At the time of the report we decided to post the entire interview on this blog. This was to provide the reader with access to the entire interview as opposssed to a condensed version for the article. The entire interview was posted on this blog simply titled "Microsoft Subnet Interview".
The campaign has indicated that a former employee has agreed to provide an interview with Microsoft Subnet. This report is still forthcoming. In the interm we thought it would be interesting to direct the same questions to the former employee that Microsoft Subnet asked the campaign.
This will subsequently result in a series of posts consisting of the questions and answers presented to a former Microsoft employee.
1)Who are you and what is your relationship to Microsoft?(Do you work for the company, or used to work for the company?
Answer:Former employee, no longer work for MS.
2)In your opinion, besides Apple, what companies compare to Microsoft to indicate that Microsoft stock is underperforming in the same period? (Oracle? IBM? CA? Symantec? Google?)
Answer: IBM & Apple are the two that most closely match MS in breadth and depth of offerings. Google, while the lead competitor in search, is primarily focused in that one area and doesn't have the breadth of offerings to make it a fair comparison.
Refer to http://www.marketwatch.com/quotes/msft
for comparison refer to:
http://www.marketwatch.com/quotes/aapl
and
http://www.marketwatch.com/quotes/ibm
(Notice that Microsoft with $60 billion in revenue has a market cap of approximately $166 billion. However its nemesis Apple with half Microsoft's revenue at $32 billion has a market cap of $103 billion. Microsoft's P/E is 10 while Apple is 21)
3)You note Microsoft's failed attempt to buy Yahoo as a poor decision regarding how to spend its capital. That deal didn't actually go through, as we all know, but what are your thoughts on other Microsoft acquisitions over the past few years? Tellme (2007), for instance, seems particularly promising as does DATAllegro in 2008. What kinds of technologies would you like to see Microsoft buy?
Answer: It's not that the acquisitions don't make some degree of sense, it's just that they don't seem to make sense for MS. The bigger question is what does MS plan to do, and in that context do these acquisitions fit? The impression that MS leaves one with is that they're a kid in a candy store, not knowing what to buy and as a result, they buy anything and everything. They don't show purpose and direction in their acquisitions.
Refer to: http://en.wikipedia.org/wiki/List_of_companies_acquired_by_Microsoft_Corporation
What do you think the problem is between buying a promising technology and showing Wall Street how that buy indicates growth potential?
Answer: See my previous answer for the majority of this answer. To follow on, MS has a lousy track record of delivering on the promise of the technology acquired from an acquisition. If MS could deliver on that promise, the answers to Wall Street would be easy and obvious. Because MS has no sense of direction and purpose, Wall Street doesn't see where these acquisitions "fit" into some semblance of a plan (nor does anyone else for that matter) and that makes people anxious.
In the second post for this series the former employee will provide further insight. This will include if leadership should be replaced, if Microsoft should acquire RIM and also analysis of Microsoft's R&D spending.
To offer support though offering shares for vote contact:
newstrategy4msft@gmail.com
We can be contacted at thecrandreagroup@hotmail.com
At the time of the report we decided to post the entire interview on this blog. This was to provide the reader with access to the entire interview as opposssed to a condensed version for the article. The entire interview was posted on this blog simply titled "Microsoft Subnet Interview".
The campaign has indicated that a former employee has agreed to provide an interview with Microsoft Subnet. This report is still forthcoming. In the interm we thought it would be interesting to direct the same questions to the former employee that Microsoft Subnet asked the campaign.
This will subsequently result in a series of posts consisting of the questions and answers presented to a former Microsoft employee.
1)Who are you and what is your relationship to Microsoft?(Do you work for the company, or used to work for the company?
Answer:Former employee, no longer work for MS.
2)In your opinion, besides Apple, what companies compare to Microsoft to indicate that Microsoft stock is underperforming in the same period? (Oracle? IBM? CA? Symantec? Google?)
Answer: IBM & Apple are the two that most closely match MS in breadth and depth of offerings. Google, while the lead competitor in search, is primarily focused in that one area and doesn't have the breadth of offerings to make it a fair comparison.
Refer to http://www.marketwatch.com/quotes/msft
for comparison refer to:
http://www.marketwatch.com/quotes/aapl
and
http://www.marketwatch.com/quotes/ibm
(Notice that Microsoft with $60 billion in revenue has a market cap of approximately $166 billion. However its nemesis Apple with half Microsoft's revenue at $32 billion has a market cap of $103 billion. Microsoft's P/E is 10 while Apple is 21)
3)You note Microsoft's failed attempt to buy Yahoo as a poor decision regarding how to spend its capital. That deal didn't actually go through, as we all know, but what are your thoughts on other Microsoft acquisitions over the past few years? Tellme (2007), for instance, seems particularly promising as does DATAllegro in 2008. What kinds of technologies would you like to see Microsoft buy?
Answer: It's not that the acquisitions don't make some degree of sense, it's just that they don't seem to make sense for MS. The bigger question is what does MS plan to do, and in that context do these acquisitions fit? The impression that MS leaves one with is that they're a kid in a candy store, not knowing what to buy and as a result, they buy anything and everything. They don't show purpose and direction in their acquisitions.
Refer to: http://en.wikipedia.org/wiki/List_of_companies_acquired_by_Microsoft_Corporation
What do you think the problem is between buying a promising technology and showing Wall Street how that buy indicates growth potential?
Answer: See my previous answer for the majority of this answer. To follow on, MS has a lousy track record of delivering on the promise of the technology acquired from an acquisition. If MS could deliver on that promise, the answers to Wall Street would be easy and obvious. Because MS has no sense of direction and purpose, Wall Street doesn't see where these acquisitions "fit" into some semblance of a plan (nor does anyone else for that matter) and that makes people anxious.
In the second post for this series the former employee will provide further insight. This will include if leadership should be replaced, if Microsoft should acquire RIM and also analysis of Microsoft's R&D spending.
To offer support though offering shares for vote contact:
newstrategy4msft@gmail.com
We can be contacted at thecrandreagroup@hotmail.com
Friday, April 3, 2009
Microsoft Requires Image Makeover
In a Microsoft SubNet article Mr. Barnicle of Pacific Crest Securities states that the company biggest problem is its image. Refer to http://www.networkworld.com/community/node/38350
Microsoft’s image has been battered. The public’s perception is that the I’m a PC ads and the Seinfeld ads failed to capture the consumer and improve the company image. In the comment section of the previous post "Who Will Lead Microsoft" is this following link: http://www.pcmag.com/article2/0,2817,2344107,00.asp
Apple has through their advertising openly targeted Microsoft. Microsoft in a effort to improve its image hired the hot new agency Crispin. This firm has created a series of campaigns which have included comedian Jerry Seinfeld. However, the commercials have failed to capture consumers. Refer to http://www.marketwatch.com/news/story/microsofts-ad-counter-offensive-against-apple/story.aspx?guid=%7B95EC30F8%2DC0B7%2D4AF6%2DBD7E%2D3B0E27905B4C%7D&dist=TQP_Mod_mktwN
Also refer to the link within the above post or follow:http://www.marketwatch.com/News/Story/microsoft-needs-help-mad-men/story.aspx?guid=%7B3F67FAE3%2D4733%2D4BC3%2DB30A%2D143EAA9399C6%7D
In the above report the author refers to the notion that through these commercials Microsoft is ultimately admitting that it is Number 2. This is not going to improve Microsoft. It is perhaps the worst move possible to further damage the company image. In essence it is Microsoft admitting defeat.
Could someone have stepped into the ring with Mohamed Ali and said I am "cool" and you are a "nerd" therefore I am going to win?
Mohamed Ali would reply "I move like a butterfly and sting like a Bee". Let's get a reality check. Ali was the world champ, and unless you are strong enough the "cool" component is not relevent. Unless you were the strongest and biggest, Ali was going to punish you in the ring.
This campaign has mentioned that Microsoft is losing share to Apple. However, Microsoft still controls over 80% of the OS market share. It is still the champ. But, through these commercials the company is essentially saying "we are the chumps". It should be saying "we are bigger, we are stronger, and as the Queen song says "WE ARE THE CHAMPIONS OF THE WORLD".
Why should Microsoft concede its the "nerd" when in reality it's the "BIG" kid on the block?
Refer to: http://www.newsfactor.com/story.xhtml?story_id=65597&full_skip=1
Within the above CBS Marketwatch report the author refers to the former Win95 commercials. These commercials captured the consumers attention. It caused consumers to desire the product.
This campaign has created a series of commercials that will dramatically improve the company image.
Advertisements
1)The scene begins with Adam and Eve walking through the Garden of Eden. Eve is about to pick an Apple from the tree.
A voice then states “Resist the temptation. Resist the Apple”. The screen then shows the Microsoft logo with the words
Microsoft. The Better Choice. Always.
2)The scene begins with two kids sitting in a school cafeteria. Both the boys are opening their lunches. Boy 1 states “What do you have?”
Boy 2 replies “I have cake what do you have?”
Boy 1 states “I have an Apple, do you want to trade?”
A voice then states “Resist the temptation. Resist the Apple”.
The screen then appears showing the Microsoft logo with the following:
Microsoft. The Better Choice. Always.
3)It will open with a scene from the Walt Disney movie “Wild Hogs”. It will show the character Dudley displaying his Apple tattoo.
The dialogue continues as follows: Dudley- “I’m a biker, dude! I got a tat!”
Doug- “It’s an Apple…”
Dudley- “I know. Trademarked. But what are they gonna say?
A voice then states “Resist the temptation. Resist the Apple”. The screen then appears showing the Microsoft logo:
Microsoft. The Better Choice. Always
4) It will open with a scene from the Walt Disney movie “Wild Hogs”. Dudley is sitting in a restaurant and states “Mac, open Internet please”.
Computer responds: Command Unknown
Dudley: I think I have to search “alternative specs”.
Computer: Searching “alternative sex”.
Edit the clip to end with the Mac computer overheating with smoke coming out of it. Screen then appears showing:
Microsoft. The Better Choice. Always
Refer to http://movies.yahoo.com/movie/1809426511/trailer
Prior to the launch of Windows 7 Microsoft will present the following two advertisements.
1)It will present a commercial similar to Win95 commercial Refer to http://www.youtube.com/watch?v=5VPFKnBYOSI
This commercial has the song “Start Me Up”. It was a commercial that captured attention. It created consumer reaction. It created a positive image. Win95 was associated with the song and was for lack of better terminology “cool”. The commercial will follow a similar format. However, it will be filmed with New footage. The commercial will end with the screen showing:
Windows 7. Start it Up.
2)It will follow a format similar to Win95 and the above Windows 7 format. However, it will incorporate the Beatles song “Got to Get You Into My Life”. Refer to http://www.youtube.com/watch?v=22H1ciSvVm8
The format will follow the Win95 commercial format. It will involve the Beatles song. The screen will then appear showing the following:
Windows 7. Get It Into Your Life.
3)Following the same format as the above two commercials it will include the Queen song "We are the Champions". It will demonstrate the product and what it can do. However, in the song is the line "they are the losers". At that point of the song it will show a "Mac" on the screen. The commercial ends and the screen shows the Microsoft logo and states:
Windows 7. Be A Champion.
Microsoft is confronted with a battered image. Based on the response of consumers with Microsoft's previous commercials the company is failing desperately in its efforts to improve its image. The consensus is that Crispin is failing to improve Microsoft's already battered image. Joe Wilcox of Microsoft Watch states that the company is required to fire Crispin.
The company is required to get consumers excited about Microsoft products. Microsoft needs to approach presenting its brand similar to a movie premier. It needs to excite the consumer to the point they can no longer wait. This is what the company did with Win95. Consumers have stated that it has become a dinosour. It's time the company get back to its roots. Show the consumers that this is STILL THE NUMBER ONE software company in the world and we mean business.
One of the most powerful and most mandatory necessities for the company is to instill consumer confidence and improve brand image. Improving brand image will unlock a tremendous amount with shareholder value. A large pert of the low company share price is directly linked to brand perception. However, it is integral to ensure that the product delivers on the promises to ensure brand perception.
Prior to launching these commercials, based on Microsoft employee feedback, it is integral to ensure the product is revised and ready for consumers. Failure to deliver a superior product will prove counter-productive for the advertising commercials. Microsoft through advertising and proving its still "Number One" will improve the company image and brand perception.
Ultimately this will unlock shareholder value.
To demonstrate support through offering shares for vote contact: newstrategy4msft@gmail.com
We can be contacted at thecrandreagroup@hotmail.com
Microsoft’s image has been battered. The public’s perception is that the I’m a PC ads and the Seinfeld ads failed to capture the consumer and improve the company image. In the comment section of the previous post "Who Will Lead Microsoft" is this following link: http://www.pcmag.com/article2/0,2817,2344107,00.asp
Apple has through their advertising openly targeted Microsoft. Microsoft in a effort to improve its image hired the hot new agency Crispin. This firm has created a series of campaigns which have included comedian Jerry Seinfeld. However, the commercials have failed to capture consumers. Refer to http://www.marketwatch.com/news/story/microsofts-ad-counter-offensive-against-apple/story.aspx?guid=%7B95EC30F8%2DC0B7%2D4AF6%2DBD7E%2D3B0E27905B4C%7D&dist=TQP_Mod_mktwN
Also refer to the link within the above post or follow:http://www.marketwatch.com/News/Story/microsoft-needs-help-mad-men/story.aspx?guid=%7B3F67FAE3%2D4733%2D4BC3%2DB30A%2D143EAA9399C6%7D
In the above report the author refers to the notion that through these commercials Microsoft is ultimately admitting that it is Number 2. This is not going to improve Microsoft. It is perhaps the worst move possible to further damage the company image. In essence it is Microsoft admitting defeat.
Could someone have stepped into the ring with Mohamed Ali and said I am "cool" and you are a "nerd" therefore I am going to win?
Mohamed Ali would reply "I move like a butterfly and sting like a Bee". Let's get a reality check. Ali was the world champ, and unless you are strong enough the "cool" component is not relevent. Unless you were the strongest and biggest, Ali was going to punish you in the ring.
This campaign has mentioned that Microsoft is losing share to Apple. However, Microsoft still controls over 80% of the OS market share. It is still the champ. But, through these commercials the company is essentially saying "we are the chumps". It should be saying "we are bigger, we are stronger, and as the Queen song says "WE ARE THE CHAMPIONS OF THE WORLD".
Why should Microsoft concede its the "nerd" when in reality it's the "BIG" kid on the block?
Refer to: http://www.newsfactor.com/story.xhtml?story_id=65597&full_skip=1
Within the above CBS Marketwatch report the author refers to the former Win95 commercials. These commercials captured the consumers attention. It caused consumers to desire the product.
This campaign has created a series of commercials that will dramatically improve the company image.
Advertisements
1)The scene begins with Adam and Eve walking through the Garden of Eden. Eve is about to pick an Apple from the tree.
A voice then states “Resist the temptation. Resist the Apple”. The screen then shows the Microsoft logo with the words
Microsoft. The Better Choice. Always.
2)The scene begins with two kids sitting in a school cafeteria. Both the boys are opening their lunches. Boy 1 states “What do you have?”
Boy 2 replies “I have cake what do you have?”
Boy 1 states “I have an Apple, do you want to trade?”
A voice then states “Resist the temptation. Resist the Apple”.
The screen then appears showing the Microsoft logo with the following:
Microsoft. The Better Choice. Always.
3)It will open with a scene from the Walt Disney movie “Wild Hogs”. It will show the character Dudley displaying his Apple tattoo.
The dialogue continues as follows: Dudley- “I’m a biker, dude! I got a tat!”
Doug- “It’s an Apple…”
Dudley- “I know. Trademarked. But what are they gonna say?
A voice then states “Resist the temptation. Resist the Apple”. The screen then appears showing the Microsoft logo:
Microsoft. The Better Choice. Always
4) It will open with a scene from the Walt Disney movie “Wild Hogs”. Dudley is sitting in a restaurant and states “Mac, open Internet please”.
Computer responds: Command Unknown
Dudley: I think I have to search “alternative specs”.
Computer: Searching “alternative sex”.
Edit the clip to end with the Mac computer overheating with smoke coming out of it. Screen then appears showing:
Microsoft. The Better Choice. Always
Refer to http://movies.yahoo.com/movie/1809426511/trailer
Prior to the launch of Windows 7 Microsoft will present the following two advertisements.
1)It will present a commercial similar to Win95 commercial Refer to http://www.youtube.com/watch?v=5VPFKnBYOSI
This commercial has the song “Start Me Up”. It was a commercial that captured attention. It created consumer reaction. It created a positive image. Win95 was associated with the song and was for lack of better terminology “cool”. The commercial will follow a similar format. However, it will be filmed with New footage. The commercial will end with the screen showing:
Windows 7. Start it Up.
2)It will follow a format similar to Win95 and the above Windows 7 format. However, it will incorporate the Beatles song “Got to Get You Into My Life”. Refer to http://www.youtube.com/watch?v=22H1ciSvVm8
The format will follow the Win95 commercial format. It will involve the Beatles song. The screen will then appear showing the following:
Windows 7. Get It Into Your Life.
3)Following the same format as the above two commercials it will include the Queen song "We are the Champions". It will demonstrate the product and what it can do. However, in the song is the line "they are the losers". At that point of the song it will show a "Mac" on the screen. The commercial ends and the screen shows the Microsoft logo and states:
Windows 7. Be A Champion.
Microsoft is confronted with a battered image. Based on the response of consumers with Microsoft's previous commercials the company is failing desperately in its efforts to improve its image. The consensus is that Crispin is failing to improve Microsoft's already battered image. Joe Wilcox of Microsoft Watch states that the company is required to fire Crispin.
The company is required to get consumers excited about Microsoft products. Microsoft needs to approach presenting its brand similar to a movie premier. It needs to excite the consumer to the point they can no longer wait. This is what the company did with Win95. Consumers have stated that it has become a dinosour. It's time the company get back to its roots. Show the consumers that this is STILL THE NUMBER ONE software company in the world and we mean business.
One of the most powerful and most mandatory necessities for the company is to instill consumer confidence and improve brand image. Improving brand image will unlock a tremendous amount with shareholder value. A large pert of the low company share price is directly linked to brand perception. However, it is integral to ensure that the product delivers on the promises to ensure brand perception.
Prior to launching these commercials, based on Microsoft employee feedback, it is integral to ensure the product is revised and ready for consumers. Failure to deliver a superior product will prove counter-productive for the advertising commercials. Microsoft through advertising and proving its still "Number One" will improve the company image and brand perception.
Ultimately this will unlock shareholder value.
To demonstrate support through offering shares for vote contact: newstrategy4msft@gmail.com
We can be contacted at thecrandreagroup@hotmail.com
Thursday, April 2, 2009
Who Will Lead Microsoft
There have been various posts and articles refering to the notion that Mr. Ballmer needs to resign. Refer to: http://www.extremetech.com/article2/0,2845,2317347,00.asp
And refer to: http://itmanagement.earthweb.com/columns/executive_tech/article.php/11282_3745546_2/Why-Steve-Ballmer-Should-Resign.htm
Numerous comments on this blog refer to the fact that regardless the strategy the campaign creates "Mr. Ballmer is the wrong candidate to execute the strategy". It has been indicated on this blog that Mr. Ballmer needs to resign. Here is a comment extracted from this site:
"Until true leadership is shown at the highest levels of that company, I don't expect things to change. Until that change happens, morale will continue to sink and that more than anything else will be the undoing of Microsoft. Lots of discussion can be had about where the company should go and what they should do, but the single biggest step that needs to occur is replacing Steve Ballmer".
On the Mini Microsoft blog there is a recent comment refering to starting a poll to remove Mr. Ballmer. Numerous shareholders and Microsoft employees are advocating for Mr. Ballmer to resign.
This campaign obtained a comment refering to a survey conducted by GlassDoor. This survey indicated that 56% of MSFT employees failed to support Mr. Ballmer. Refer to: http://blogs.zdnet.com/BTL/?p=14121
The dilemma that occurs is if Mr. Ballmer resigns who will then lead Microsoft?
This campaign has obtained comments from employees of Microsoft stating that it requires a leader that will command respect. It has also been stated that it requires a leader that can foster communication. It has been communicated that employees fail to respect Mr. Ballmer and also to many are apt to simply "yes man" him when in reality it demands employees to have the ability to say "no". It has been stated that many employees are afraid of being the next Mark Lukovsky. Refer to: http://www.theregister.co.uk/2005/09/05/chair_chucking/
The campaign has obtained comments stating that a "fish rots from the head" and this is the demise of Microsoft. Based on comments on Mini Microsoft this statement appears true. There are also comments that the leader needs to be a team player. Willing to take a "bullet" or "go down with the ship". Comments from Microsoft employees state that through the layoffs Mr. Ballmer failed to display these characteristics. Its been stated that he is more like a King saying "let them eat cake".
Comments also indicate that the leader has to inject vision. Understand technology. Foster passion for Microsoft products with employees. Improve morale. Re-establish the core and focus on building a solid foundation. Enhance the share price. Improve performance reviews. Improve the company image better then the failed Crispin generated commercials.
Mr. Ballmer has obviously failed at accomplishing these desired goals. However, eventhough Mr. Ballmer failed to fill expectations, based on the above comments the replacement has "Big" shoes to fill.
This ultimately results in the same question. Who will lead Microsoft back to being a leading company?
In a 2008 CNet article Mary Jo Foley presents a list of potential candidates. Refer to http://news.cnet.com/8301-10784_3-9932237-7.html
This campaign has also obtained names such as Brian Valentine and Paul Maritz. There have also been comments regarding Kevin Johnson. Refer to: http://247wallst.com/2008/07/24/microsofts-msft/
It is without dispute that Mr. Ballmer is not the right candidate to lead Microsoft. However, if shareholders lead a no-confidence or if shareholders hold the Board accountable and force Mr. Ballmer to resign, who will lead Microsoft?
We would like suggestions.
We can be contacted at thecrandreagroup@hotmail.com
To demonstrate support through offering shares for votes:
newstrategy4msft@gmail.com
And refer to: http://itmanagement.earthweb.com/columns/executive_tech/article.php/11282_3745546_2/Why-Steve-Ballmer-Should-Resign.htm
Numerous comments on this blog refer to the fact that regardless the strategy the campaign creates "Mr. Ballmer is the wrong candidate to execute the strategy". It has been indicated on this blog that Mr. Ballmer needs to resign. Here is a comment extracted from this site:
"Until true leadership is shown at the highest levels of that company, I don't expect things to change. Until that change happens, morale will continue to sink and that more than anything else will be the undoing of Microsoft. Lots of discussion can be had about where the company should go and what they should do, but the single biggest step that needs to occur is replacing Steve Ballmer".
On the Mini Microsoft blog there is a recent comment refering to starting a poll to remove Mr. Ballmer. Numerous shareholders and Microsoft employees are advocating for Mr. Ballmer to resign.
This campaign obtained a comment refering to a survey conducted by GlassDoor. This survey indicated that 56% of MSFT employees failed to support Mr. Ballmer. Refer to: http://blogs.zdnet.com/BTL/?p=14121
The dilemma that occurs is if Mr. Ballmer resigns who will then lead Microsoft?
This campaign has obtained comments from employees of Microsoft stating that it requires a leader that will command respect. It has also been stated that it requires a leader that can foster communication. It has been communicated that employees fail to respect Mr. Ballmer and also to many are apt to simply "yes man" him when in reality it demands employees to have the ability to say "no". It has been stated that many employees are afraid of being the next Mark Lukovsky. Refer to: http://www.theregister.co.uk/2005/09/05/chair_chucking/
The campaign has obtained comments stating that a "fish rots from the head" and this is the demise of Microsoft. Based on comments on Mini Microsoft this statement appears true. There are also comments that the leader needs to be a team player. Willing to take a "bullet" or "go down with the ship". Comments from Microsoft employees state that through the layoffs Mr. Ballmer failed to display these characteristics. Its been stated that he is more like a King saying "let them eat cake".
Comments also indicate that the leader has to inject vision. Understand technology. Foster passion for Microsoft products with employees. Improve morale. Re-establish the core and focus on building a solid foundation. Enhance the share price. Improve performance reviews. Improve the company image better then the failed Crispin generated commercials.
Mr. Ballmer has obviously failed at accomplishing these desired goals. However, eventhough Mr. Ballmer failed to fill expectations, based on the above comments the replacement has "Big" shoes to fill.
This ultimately results in the same question. Who will lead Microsoft back to being a leading company?
In a 2008 CNet article Mary Jo Foley presents a list of potential candidates. Refer to http://news.cnet.com/8301-10784_3-9932237-7.html
This campaign has also obtained names such as Brian Valentine and Paul Maritz. There have also been comments regarding Kevin Johnson. Refer to: http://247wallst.com/2008/07/24/microsofts-msft/
It is without dispute that Mr. Ballmer is not the right candidate to lead Microsoft. However, if shareholders lead a no-confidence or if shareholders hold the Board accountable and force Mr. Ballmer to resign, who will lead Microsoft?
We would like suggestions.
We can be contacted at thecrandreagroup@hotmail.com
To demonstrate support through offering shares for votes:
newstrategy4msft@gmail.com
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