Microsoft has engaged in talks to invest $1-3 billion as Dell moves from being a publicly traded company to being privately held. So what’s up Microsoft’s sleeve as the software giant moves toward investment in a hardware company?
Microsoft has taken some hits over the past year, and may have alienated many of its professional relationships by creating the Surface, its own tablet. Overnight, partners became competitors. Microsoft also alienated a substantial section of its consumers with the complete redesign of its operating system. Comments like, “Where is the Start menu!?” became common in threads discussing the new operating system. While the move was supposed to bring the design of its computer and mobile software closer together, the pushback was substantial.
So with this new move into potential hardware investment, what could Microsoft be planning? There is certainly potential to further alienate business partners by becoming even more competitive. However this move could be a result of Microsoft getting into the business of building hardware. As partners-turned-competitors seek to distance themselves from Microsoft software, Microsoft could be seeking to develop a built-in captive audience.
Investment into Dell will give Microsoft the ability to influence software components installed from the factory on new machines. For an investment of a couple billion dollars, Microsoft could be buying built-in consumers for their software products. And the move could be seen as evidence that the development of Microsoft’s Surface tablet did more damage than they were expecting to their business relationships. However, the move could also just be Microsoft continuing to seek a wider audience.
It is likely however that Microsoft is still most interested in protecting their software products with a broad enough consumer base to sustain them into the future.