Is this how Microsoft finally beats Apple?


Somewhere in the deluge of pink slips at Nokia (NYSE: NOK) — 10,000 layoffs for the Finnish handset maker in the coming months, to be sure — Microsoft‘s (Nasdaq: MSFT) dreams of mobile domination are taking a heady blow.

Wasn’t it Microsoft that promised Nokia billions to champion its Windows Phone platform last year? Wasn’t last month’s rollout of the Lumia 900 with a massive marketing campaign supposed to give Mr. Softy a shot at narrowing the growing gap that separates Google‘s (Nasdaq: GOOG) Android and Apple‘s (Nasdaq: AAPL) iOS from the rest of the competition?

Well, if the company that was once the largest handset maker on the planet is cutting costs after agreeing to champion Windows Phone, it’s safe to say Microsoft is going to have a very hard time making a dent in the booming smartphone space, where consumers seem to be happy with just two mobile operating system flavours.

The IDC Worldwide Quarterly Mobile Phone Tracker report that called for Microsoft to overtake Apple in mobile market share by 2016 seems woefully obsolete. If Microsoft wants to carve into Apple’s empire, smartphones may not be the easiest way in.

Take two tablets and call me in the morning
Now that Apple’s WWDC 12 powwow has come and gone, Microsoft is  taking to the California stage.  Everyone seems to agree on why the company is gathering tech bloggers and financial journalists into a big room — and it’s not just to try to convince them that Vista and the Zune weren’t flops. Windows 8 is the company’s best shot at making an impact when it comes to tablets, and we’ll be seeing exactly what tablets powered by the company’s upcoming operating system can do.

Microsoft is slow, but it’s not stupid. It realises that PCs and laptop sales have stalled globally, and it’s not just because of teetering economies. Consumers are flocking to tablets and smartphones as “good enough” computing devices, and it doesn’t end there.  Apple’s iPad is replacing textbooks in classrooms, reservation platforms at restaurants, and even wine-list menus at fine dining establishments. If Microsoft doesn’t act soon, “good enough” computing is going to be “Good! Enough!” for the masses.

Microsoft has been designing Windows 8 from the ground up with touchscreen devices in mind. The mouse, navigational keys, and QWERTY keyboards aren’t going away, but touch is a necessary component given the hundreds of millions of iOS and Android devices that have been sold in just the past few years. If Windows 8 lives up to its touch-centric billing, Microsoft will be ahead of Apple for a change, with a single operating system that replaces the dual MacOS and iOS universes.

The new wave of laptops that double as detachable tablets will belong to Microsoft, and it will be Apple chasing Mr. Softy for once.

See you on the other side 
There are plenty of ways for Microsoft to blow this, of course.  As slick as Windows 8 may be on tablets, it’s going to be hard to get manufacturers on board when Android is available for free. Even freely available, Android is lagging in tablet popularity to Apple’s new iPad, failing to duplicate the platform’s market leadership in wireless phones.

Microsoft’s questions don’t end there. What about apps? What if it’s buggy? What if it’s too late?

The company has been surprisingly humbled in its smartphone endeavors, giving developers financial incentives to port popular titles to its operating system. That’s the kind of attitude that will make it relevant initially. Maybe the company has learned from Research In Motion‘s (Nasdaq: RIMM) mistakes, where the BlackBerry maker figured that having tens of millions of enterprise-minded smartphone owners would turn its struggling PlayBook tablet into a hit.

Microsoft is a long shot here, but it seems to know where it’s aiming — and what’s at stake. Never underestimate the potential of a hungry company that is cash-rich and self-aware.

If you’re in the market for some high yielding ASX shares, look no further than our “Secure Your Future with 3 Rock-Solid Dividend Stocks” report. In this free report, we’ve put together our best ideas for investors who are looking for solid companies with high dividends and good growth potential. Click here now to find out the names of our three favourite income ideas. But hurry – the report is free for only a limited time.

 More reading

The Motley Fools purpose is to help the world invest, better. Take Stock is The Motley Fool’s free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. Click here now to request your free subscription, whilst it’s still available. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

A version of this article, written by Rick Aristotle Munarriz, originally appeared on fool.com

OUR #1 DIVIDEND PICK FOR 2016...

Forget BHP and Woolworths. This "dirt cheap" company is growing like gangbusters, and trading on a 5.6% dividend yield, FULLY FRANKED (8% gross). With interest rates set to stay at these low levels for years to come, for hungry investors, including SMSFs, this ASX company could be the "holy grail" of dividend plays for 2016.

Enter your email below to discover the name, code and a full investment analysis in our brand-new FREE report, “The Motley Fool’s Top Dividend Stock for 2016.”

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our https://www.fool.com.au/financial-services-guide">Financial Services Guide (FSG) for more information.