Microsoft began to suffer when they forgot that they are a software company. They were believing that they are a Windows/Office company. Those cash cows were milked to death, additionally killing everything else along the way. At some point (way later than they should have) they understood what was happening and where it leads. The solution is going back to software (and its cloud form). Sell anything, target everything. Develop for widest possible audience, but also pursue niche markets. Like Microsoft did in the '80. Another point is developer attraction. They need "cool", and this kind of hardcore hacking is cool. The new Microsoft wants to sell any software/service, no matter the hardware nor the OS. To transform from the old Microsoft to the new version, they need cool software. And who can make this happen? Cool developers.

The bigger picture for MS now is building out Azure. They don't care what OS you are running on Azure as long as you aren't using AWS. You know Azure is forecast to exceed the revenues of Windows and Office by 2020, right?

They are shifting away on their reliance of selling the OS to make their money. Putting "Windows" first was part of what was tearing Microsoft apart from the inside and was looking to leave it in the past. They no longer put that much weight on selling Windows licenses. I hear Windows 10 is even going to be a free upgrade, a la OSX.

So what they gain from all of this is getting back into the ring. It also polarizes Windows to a desktop OS (where it belongs) vs Server OS.

There is no more growth (as in ever) in the desktop PC space. It's a mature market as far as the eye can see. Upgrade cycles continue to slow.

Mobile and Cloud are where everything is happening. Amazon own(ed?) Cloud, Apple & Google own Mobile. Whole generations are growing up without using Microsoft tech even in developed countries. Which of the major tech companies to arise in the past 10 years use a Microsoft tech stack? (hint: none)

Microsoft tried to take on mobile with Windows Phone 7 and Windows 8 (Surface, Windows ARM, etc). They were all duds more or less and Microsoft was at risk of becoming completely irrelevant.

I think Microsoft's leadership (including Bill & Balmer) took a long, hard look and realized that Mobile has already past the hockey stick growth phase. At that point only the one or two competitors seen as leaders survive; Apple and Google have already won.

They were also at risk of Amazon and other hosting providers eating away at their server business by making it easier to deploy servers at the infrastructure level. Microsoft also critically lost developer mindshare; despite C# being a much better language than Java (and Oracle's mis-steps creating enormous opportunity) no one gave a shit.

There's a thing that happens in large organizations where a leader can become boxed in and unable to change direction. Balmer was clearly in that position and as someone who deeply cared about Microsoft he stepped down and gave Nadela the reigns. You can also bet Bill is backing him or he'd never be able to get away with making such drastic changes.

So what does Microsoft gain? Getting people to use their software. They'll never own the Mobile OS, so may as well accept it and move on.

People don't want to run Windows Servers? fine, run Linux on Azure. They might as well take your money since they sure aren't going to get you to switch. Why did they push Mobile Services so heavily for iOS? Why do they have Android SDKs? Because if they can't own the Mobile OS, they can at least grab a piece by being a really easy to use back-end for the app ecosystems.

And why open-source C# (Roslyn) and the CLR stack? Capitalize on Oracle's lawsuits over Java and Sun/Oracle's mismanagement of Java (and the years of stagnation Java suffered, though that has changed recently). They'd rather sell you developer tools, or make sure that cool new open-source projects start using C# so it makes it more natural to support Windows in addition to *nix/Mac.

Now that it's all MIT licensed and contains full patent promises I consider Mono a completely legit fork. That means even if Microsoft dropped it all tomorrow, Mono could still continue unfazed.

> Which of the major tech companies to arise in the past 10 years use a Microsoft tech stack? (hint: none)

Game studios.

> Which of the major tech companies to arise in the past 10 years use a Microsoft tech stack? (hint: none)

I think that maybe StackExchange qualifies

One of the StackExchange co-founders was an ex-Microsofter.

Which links with one of the previous posts about Microsoft wanting to be "cool" to developers again. The bright sparks who will go on to found massive tech firms might join a big tech firm first for a few years - odds are they will keep a good relationship with them in their new venture. If all the startups are being founded by ex-Google, ex-Apple, ex-Facebook folk then that will only further harm Microsoft.

I think this comment is spot on. MS is a loooong way from losing the enterprise, but that isn't where the money (or growth as you pointed out) is anymore. They really have nothing to lose from going open, so they're best bet is to get in bed everywhere they can so they have a position to work from later if they happen to develop some advantage.

Apple is killing it on all fronts it competes on, but I wonder, will people continue to pay $800 for a new phone every 2 years, $2500 for a new laptop every 3 years? My intuition says no, but from what I read, Apple is taking more and more market share where it matters, in 1st world countries where there are actually profits to be had. I used to slag on iOs because it was so limited and primitive, but the reality is, they're probably strategically releasing features when they choose to, it's not like they're not smart enough to figure it out. If they're lazy, they could just let Google do all the expensive proving out of features, and then release a better version constantly a year behind and make a killing. Kind of like what Microsoft did for so long, except Apple has much higher volumes.

To answer my own question, I guess it injects life into C# and perhaps enables them to sell more Visual Studio and maybe brings developers back into the Windows platform ecosystem. Even so, it does so at the cost of Windows server licences and potentially starts to erode the need to run Windows servers at all.

Leads me to think back to when Steve Jobs came back to Apple and one of the first things he did was kill all the Apple-licensed Mac clones.

My guess is that they want to sell two things: Azure and Windows Phone via Xamarin.

Say open-sourcing .NET convinces a team or a startup to write their new app in C#. When it comes time to deploy to production, maybe they'll use Azure. VS has some Azure integrations to make it easy.

Now the team needs to write a mobile app. They have the option of using C# with Xamarin. Conveniently, you write Windows Phone apps in C# too, so maybe the team decides to target all three platforms instead of just the major two since they can get so much code reuse. A phone platform is really about the amount and quality of applications.

Sun was never able to monetize Java very well, but MS is in a little different circumstance since it has a cloud service and a mobile OS and hardware.

This. It also applies to the enterprise, all those in house data centres that are ripe to be migrated over to Azure.

Microsoft care an awful lot less that you migrated your Oracle server to Linux if you run that server on Azure...

That I my speculation as well.. when the company I work for migrated from rented hosting to cloud for easier growth, they went Azure because the existing software is all in .Net on windows... Even though new software is targetting Linux, we're staying on Azure mainly for entropy.

It's a valid strategy for keeping their corporate customers.. they have that developer mindshare, and can reduce the systems employees (SysAdmins, DBAs, etc) to boot... Too many corporate environments have dev and admin groups that are combative to eachother... "The Cloud" offers advantages in many of those environments.

I'm not saying it's for everyone, but I can see the appeal on several levels. Though working with some of the azure tools via node, it's not as bright as MS makes it out to be.

Visual Studio 2013 Community Edition is a 100% free 100% fully featured VS.

They are definitely not trying to sell windows or vs licenses with these types of moves, give away the platform and good tools and they will make it popular and make you a lot of money in other ways.

Unless it works flawlessly under Wine, you still need to run it within a Windows desktop.

A Windows 8.1 Pro OEM license costs around $150, which if you're building a FreeBSD desktop from scratch won't come included in the purchase price.

Sure, and that is a fair point, I was just responding to the "sell more visual studio", but of course driving the windows ecosystem in some ways (online, os, whatever) is their stated goal.

I think MS is responding to an existential crisis.

MS seemingly got blindsided by mobile. When it comes to a consumer who is personally engaging with a computing device nowadays and not just doing it for a job, a huge number of eyes are now glued to a device that doesn't use a Microsoft operating system, apps not written in a Microsoft language, utilizing backend services not running Microsoft servers. They own a good part of the boring corporate world people mostly dislike and a decent share of gaming, but consoles are fairly evenly split and their desktop gaming monopoly is only riding on a continually dwindling amount of momentum (a large chunk of games are multi-platform releases, desktop Windows and the Xbox are popular but not necessary for gaming to continue).

They are hoping to sell more Azure services on the back of all this.