Business challenges facing by Microsoft?

According toFontana’s (2008) article, what are some of the business challenges facing Microsoft? List three ways they might overcome the challenges 

Business challenges facing by Microsoft 

As per the report fromFontana’s (2008), there are were many business challenges faced by Microsoft. A financial report from Microsoft proves that the cash reserves have dropped from $60 billion in 2004 to $37 billion in 2007 and even the profits has came down when compared to previous financial year reports. All these variances may be because of many challenges faced by Microsoft these days and few of them are listed below

Microsoft with out Gates 

Microsoft has been suffering from the news that Bill Gates is going to replaced by Steve Ballmer. This decision is implemented before almost 130 Senior Leaders.

Gates is going to resign from Microsoft on July 1st and there could be chances, where he can offer his services to Microsoft offline. Following are some of the impacts shown on Microsoft with out Gates 


  • It has failed badly to gain a deal with Yahoo and as a result Google has achieved this deal
  • Online advertising done by Microsoft has proved by worthless when compared with Google. 


Performance ofVistaoperating system has proved to a major factor, that is pulling back the revenues of Microsoft. Many technical issues with Vista OS are the main reasons for its low marketing value. Latest version ofVistaproved is a disaster at customer satisfaction end and marketing end. Microsoft is planning to release the first service pack in February and its planning to make much revenue from its latest release. ( 

Impact of Google 

While the Microsoft is busy to promoteVistain the market, Google has thrown its impact and proved be a deadly competitor to Microsoft. Google has introduced many inbuilt packages like spreadsheet, documents and email software’s and all these are proved to be true competitor for many products of Microsoft. Google offers many packages that were free of cost, and charge a minimal amount for email packages.


To over come these sorts of business issues, Microsoft should come up with innovative business plans and few of them could as below 

Concentrate on Income from out of US 

Microsoft should concentrate on income from out of US. Microsoft has lot of reputation over countries like Central and Eastern Europe and Latin America, as well as countries likeVietnam. As per internal reports of Microsoft, there are many users across the globe who is interested in Windows, apart from US, where these guys are interested in using multiple technologies and operating systems. 

Much Focus on Online Adverting 

The main reason behind Google success is that it focuses on Online Advertising. In general all the users across online will be aware of Google and its innovative products that were being launched regularly and this area where Microsoft was lagging. Microsoft should take this issue serious and focus its attention on Online Adverting of its products and even Bill Gates promise3d to spend a couple of hours weekly on this Online Adverting area of Microsoft. 


Improve Searching Capabilities and Maintaining better Brand value 

As discussed, Microsoft has failed to establish a deal with Yahoo. Yahoo has opted Google to combine some of its search features with Google and if this clicks, Microsoft could really go back in many issues. Improvising the search capabilities of Microsoft is the only option available. Including typical search features like Video search and visual search may definitely bring some fruits in future. 

Microsoft has a good brand name for its Windows operating systems. Windows Vista is proved to be with many technical flaws, where the users are loosing their confidence on brand value of Microsoft. When compared to other operating systems, a very less number of PC’s are shipped with thisVistaoperating system. Microsoft should concentrate on these types of issues and make sure that the further release of Windows should retain its previous brand value.

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