Microsoft's Retail Therapy Won't Solve Problems

REDMOND, Wash. (TheStreet) -- At Microsoft's(MSFT Quote) Worldwide Partner Conference in July, chief operating officer Kevin Turner promised the company would open stores right next to Apple's(AAPL Quote).

A Microsoft spokeswoman says the company's first stores in Mission Viejo, Calif., and Scottsdale, Ariz., aren't promotional, Halloween store-style one-offs for the Windows 7 launch, but a big jump into brick-and-mortar retail. Microsoft may want to consider a new mission statement as well: We'll have what they're having.

"Microsoft executives preach about Microsoft innovation, but all they've done is become superb copiers and even that's not working so well anymore," says Charlie Wolf, an analyst at Needham & Co. "In the Apple stores, Apple sells a ton of Apple products, but what's Microsoft going to sell?"

Microsoft has plenty of products to line its store shelves. Originality just isn't one of them. The stores will likely stock the Xbox 360, whose predecessor, the Xbox, was released after Nintendo(NTDOY Quote) had already manufactured three different game consoles and Sony(SNE Quote) was already a console into its PlayStation series. The Xbox was trounced by the PlayStation 2 in sales and the 360 has been a regular runner-up to Nintendo's Wii (until September, when it finished third behind the Wii and PS3, according to NPD Group).

The stores also will stock the Zune, which came on the scene in 2006 after Apple cycled through five generations of its original iPod and several variations of its Mini, Nano and Shuffle derivatives. For the flakes who say the Zune isn't as cute as the iPod, its 3 million sales are just that when compared with the 220 million iPods sold to date.