Microsoft, the software cum hardware giant has gone through several ups and down. With a valuation of over a trillion dollars, it’s one of the big five American IT companies. However, the journey to success hasn’t been smooth sailing, with plenty of hiccups along the way. Microsoft has transitioned from being a purely hardware company to now focusing on its core competency of delivering great software and services. As the company celebrates its 50th anniversary, here’s a look at all the times Microsoft fumbled and missed a major opportunity.
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11 Times Microsoft Missed An Opportunity
1. Internet Explorer: The Browser for Installing Another Browser
Microsoft’s Internet Explorer was the go-to browser back in the day. Before Chrome, Firefox, and Brave, Internet Explorer’s “e” icon captivated our hearts. However, Microsoft’s beloved browser failed to catch up the competition and became the subject of memes. Despite the company’s attempt to modernize the browser with IE 9 and 10, it became infamous due to its slow loading speed.
2. Bing: The Google Killer We Wanted
To compete with Google, Microsoft created its search engine called Bing. You would imagine that it would be easy for someone like Microsoft with crazy resources, to take on Google Search, but it isn’t that easy. It was a colossal failure that even Microsoft CEO Satya acknowledged in a recent interview, saying the company failed to recognize “the biggest business model on the web”.
3. Hotmail: Not So Hot After All
Hotmail, founded by Sabeer Bhatia in 1996, gained a lot of momentum for being a free email service back in the day. After reaching millions of users within its first year of inception, Microsoft bought Hotmail in December 1997 for $400 million. It eventually became the largest email service in the world despite facing security breaches. Google launched Gmail in 2004 which disrupted the market with larger storage and innovative features unheard of in those days.
Despite Microsoft’s first-mover advantage and timely updates, it simply couldn’t match Gmail, leading to a decline in Hotmail’s market share. Furthermore, the company even integrated MSN messenger and Windows Live, but eventually, it had to rebrand Hotmail as Outlook.com. It was the missed opportunity by Microsoft to replace Google once and for all.
4. Zune: Spotify for Millenials
Remember Zune? The portable music player that Microsoft introduced to compete with the iPod? Well, MS doesn’t want you to remember, either. Unveiled in 2006, Zune was another missed opportunity by Microsoft in its effort to prop up an iPod competitor. Despite having a cool user interface and wireless music sharing, it simply couldn’t catch up to the already dominant iPod.
The reason? Well, Microsoft was late to the party, as always. Launching a product in a segment five years after Apple, which had already established itself with a strong brand value and ecosystem around its iTunes store. The lacklustre marketing failed to woo potential iPod buyers to switch to Zune despite having superior audio quality and design. This eventually led Microsoft to ditch the product while highlighting its failure to sway consumers.
5. Cortana: The Siri Competitor That Couldn’t Be
Cortana was one of the biggest missed opportunities for Microsoft. Introduced in 2014, they wanted to catch up with Siri and Alexa. Unveiled with Windows Phone 8.1 (another embrassement), this personal assistant couldn’t catch up with its Halo namesake. Despite being voiced by the same voice artist, it wasn’t up to par, and even Master Chief would be disappointed. It failed to even perform basic tasks and provided outdated information.
Moreover, Microsoft’s forced integration of the assistant with Windows further irritated users as it took up space in the taskbar and sent useless notifications. The lack of adoption of Windows Phones eventually led the company to retire Cortana in 2023 and it was one of the biggest missed opportunity for Microsoft.
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6. Windows Vista: The Worst Windows Ever
With Windows XP turning out to be a massive hit, many fans were looking forward to the next version of Windows. Windows Vista was intended to be the next leap forward with a new aero design and an attempt to infuse modernity into the design language. However, this change was met with criticism due to the numerous bugs and high hardware requirements. Similar to TPM in Windows 11, Vista’s aero design required a lot of processing power, which resulted in a sluggish experience for most users.
Microsoft’s “Vista capable” program also misled users to an extent by allowing manufacturers to label underpowered machines as Vista compatible. Moreover, many applications from Windows XP were incompatible with Vista which slowed down its adoption for enterprise and business users. Vista later introduced the infamous UAC (User Access Control) which was dubbed as annoying for its intrusive notifications. Despite the new search and multimedia features, Vista remained a blot due to the high hardware requirements, compatibility issues, and unnecessary security measures.
7. Windows 8, 8.1, and Windows RT: Cool Concept, Flawed Execution
After the failure of Windows Vista, Microsoft took another shot to shake up the operating system in its biggest revamp yet. With Windows 8, Microsoft wanted to make the OS compatible with touch-screen devices. The company also wanted to streamline the design language for both Windows phones and laptops with those cool live tiles. Since convertible and 2-in-1 devices were on the rise, MS thought it was a good idea to remove the most familiar and loved feature, the Start menu from Windows. It had the opposite effect; instead of gaining users, the new user interface was confusing and annoying for typical keyboard and mouse users.
While the company did fix it by bringing the start menu in Windows 8.1, the damage was already done. Moreover, it also highlighted Microsoft’s failure to create an ecosystem between Windows Phone and Windows OS, just like Apple did. It was the second-biggest Windows failure after Vista, and the company dropped support for it in January 2023.
8. Windows Phone: Bring Back Those Live Tiles
With Apple launching the first iPhone in 2007 and Google following suit in 2008, Microsoft was simply caught sleeping. Let us not forget that Steve Ballmer, the former Microsoft CEO, mocked the iPhone by straightaway dismissing it as a failure and calling it the most expensive phone in the world. He also believed that business users wouldn’t shift to the iPhone due to the lack of a physical keyboard and claimed that it wouldn’t capture significant market share.
Microsoft finally stepped up and introduced Windows Mobile. With its amazing live tiles and funky designs, the company hoped that Android or iOS users would adopt its operating system. It seems like the company’s disastrous luck from Windows 8 also carried onto its mobile platform as it shared the same design. Due to being late to the party, as always, Microsoft simply couldn’t catch up to Android or iOS.
This meant that the platform was dead on arrival, and developers had little incentive to create apps for the platform. The lack of apps deterred potential buyers, while the lack of users meant devs didn’t want to waste their time on an OS with a tiny market share. The Windows Phone was stuck in a perpetual loop until it eventually died in 2017 and was one of the biggest missed opportunity for Microsoft.
9. Nokia Acquisition: The Death of an Iconic Brand
Apart from the catastrophe of the Windows Phone, Microsoft adopted the motto “If I’m going down, I’m taking you with me”. In a last-ditch attempt to save the platform, the company purchased Nokia in 2013 after an initial partnership to manufacture Windows phones. Nokia’s Lumia series initially seemed promising but still couldn’t rival the likes of the iPhone or Samsung’s S series. With its iconic square slab styled design, funky colors, and Nokia branding, these did certainly capture the attention of users but did not move the needle in terms of market share. Phones like the Nokia Lumia 1020 were the first modern phones to boast a 48-megapixel sensor.
However, just like every product/service, Microsoft had to discontinue Lumia in 2016, just two years after unveiling its Nokia branded phone. Sadly, it was the software and not the hardware that killed Nokia as the Windows Phone was limiting its appeal. The lack of apps, a proper ecosystem and new features meant its market share dropped below 1 per cent in 2016. While Nokia’s mobile division remains with Microsoft, it sold the brand to HD for $350 million, just three years after its purchase.
10. Surface Lineup: Not So Good on the Surface
In 2012, Microsoft decided it was time to compete with the MacBook with its Surface lineup. It included everything from tablets, laptops, PCs and even foldable phones. With its hardware, Microsoft wanted to follow Apple’s philosophy of offering the best experience by having control over both software and hardware. Since its inception, the Surface lineup has expanded to an all-in-one computer, the Surface Studio, and a 2-in-1 convertible with innovative design.
Despite Microsoft’s attempt, the high pricing and failure to catch up with other competitors haven’t exactly made it an easy-to-recommend product. The Surface RT, the company’s first tablet, ran on Windows 8 RT (discussed above). The company’s inability to communicate that it couldn’t run x86 apps meant that several buyers bought a device only to discover that their favorite apps didn’t work. It was a monumental failure for the company, leading to a whopping $900 million writedown for the product.
The Surface Duo 2 fixed these to an extent, only for Microsoft to abandon it. Surface remains the biggest missed opportunity for Microsoft to take the fight to Macbook and other Windows laptops.
11. Games for Windows Live: The Steam Competitor That Lost Steam
What if told you Microsoft managed to create a storefront just like Valve? Yes, that’s right, Windows Live, similar to Steam, offered features like achievements, games store, chats, friends list and more. While the company initially required a subscription for multiplayer, it introduced free multiplayer. The Windows Live service also enabled crossplay between Windows and Xbox 360 players in certain games.
Why did it fail? Well, for starters, developers had to pay Microsoft for Games for Windows Live. The technical issues and negative reception within the gaming community resulted in issues long after the service was defunct. Other products under the Windows Live, such as Windows Live Messenger and Hotmail, evolved into Skype and Hotmail. Games for Windows Live simply couldn’t take off and was nowhere close to Steam.
