New Microsoft boss advised: Pick your battles

Many think Nadella needs to focus on catering for businesses to regain momentum. Photo / AFP

As new Microsoft boss Satya Nadella looks for ways to revive the company, part of the problem will be the huge scale of the business. Microsoft has more than 100,000 employees worldwide and offers everything from the Xbox to servers for business customers - known as its enterprise clients.

"They will need to pick their battles", says Peter Bauer, chief executive of email systems provider Mimecast, a Microsoft partner.

Many think Nadella needs to focus on catering for businesses to regain momentum.

Investors have called for consumer-facing parts of the business such as Bing and Xbox to be spun off, and the purchase of Nokia's handset division seems increasingly difficult to defend.

"The side of their business that's more profitable and more sustainable is the enterprise side," says Philip Letts, chief executive of the services platform blur.

If it does decide to aggressively target business customers, Microsoft faces stiff competition.

"The die is cast in terms of the shift of enterprise IT moving into the cloud," says Bauer. "The cloud is Google's paradigm, not yet Microsoft's. (Expect a) monumental battle for hearts, minds and dollars."

However, Microsoft is still highly profitable, making US$21.8 billion ($26.4 billion) last year. Mike Tobin, chief executive of the data centre provider Telecity, says: "Microsoft has always been a stellar company with real long-term cash generation. They don't need to replicate (anyone)."

- Independent