NEW YORK (TheStreet) -- There's a myth a handful of Redmond loyalists and like, three people who follow tech want to believe. The myth that Satya Nadella has (or soon will) profoundly change Microsoft (MSFT - Get Report). With Steve Ballmer playing the role of an uncool Mark Cuban, Nadella faces the impossible task of fixing the mess Ballmer left.
And, while he's as cerebral, jargon-laden and not like Ballmer as the next guy, Nadella's probably not the person to pull off the impossible.
Here'a verbal specimen to illustrate the larger point:
To his credit, Nadella obviously buys into an argument I've been making incessantly here at TheStreet: Without compelling consumer hardware offerings, you're screwed with businesses. Because consumer preference ultimately dictates enterprise choice. It doesn't matter what you do in software and services, behind the scenes, with servers or whatever; unless you're Google (GOOG - Get Report) you're toast without hardware. That's why we have seen pretty much every mobile/computing race morph into one with two horses -- Android/Chrome and Apple (AAPL - Get Report).
And that's why Microsoft has no choice but to continue -- feebly -- coming after Apple. Even though it knows it should, it simply can't let the Surface Tablet die. Without it, it's even more as good as dead than it is now. So the marketing geniuses at Microsoft will try (and fail) to revive the PC vs. Mac wars via a device it clearly doesn't understand. But it won't work. Because Apple and Google have the consumer base covered. Because of this, Apple and Google have made incredible inroads with the enterprise and education markets. Each will continue to improve their own offerings, partnering in areas where they either lack or don't have the (wonk, wonk!) core competency to go it alone.
If Nadella has any sense, he'll exit the hardware market outside of Xbox. Microsoft and its PC partners have been pushing all-in-one devices literally for years now. They have yet to catch on.
No matter how Microsoft markets them, they will not catch on. Because it's simply not in Microsoft's DNA to understand something Tim Cook, Apple and, most importantly, computing consumers know so well: The smartphone, tablet, laptop and desktop personal computers create and facilitate distinct experiences. That's why Apple devices just feel right and just work right out of the box both as physical entities and engines for creativity, work and play. Microsoft dumbs down the entire proposition of using a device by arguing that you can do everything with just one. Despite this, consumers have spoken, yet Microsoft refuses to shut up.
If Nadella really is smart and the right guy to be Microsoft CEO, he'll tear down Steve Ballmer's entire legacy right now. Cancel this dead and tired foray into hardware, better integrate Xbox with the things Microsoft actually does well and beg Apple and Google to be one of the "software partners" that will help power the next generation of iOS-, Mac-, Android- and Chrome-powered devices. That's the only route Microsoft has left if it wants to sustain its waning empire.
Make no mistake, none of this is Nadella's fault. It's all on Ballmer. But it is Nadella's job to recognize reality and act accordingly -- all the way, not halfway.
--Written by Rocco Pendola in Santa Monica, Calif.
09/08/14 - 08:30 AM EDT
09/06/14 - 08:00 AM EDT
09/05/14 - 08:19 AM EDT
09/04/14 - 08:44 AM EDT
09/02/14 - 08:50 AM EDT
08/29/15 - 10:32 AM EDT
08/28/15 - 21:00 PM EDT
08/28/15 - 21:00 PM EDT
08/27/15 - 08:32 AM EDT
08/26/15 - 08:51 AM EDT
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
Trifecta Stocks analyzes over 4,000 equities weekly to find the elite 1% of stocks that pass rigorous quantitative, fundamental and technical tests.
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
Bryan Ashenberg, using sophisticated stock screening and fundamental research, identifies potentially explosive small and mid-cap stocks.
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.