Microsoft seems on the brink of announcing a major enhancement to its operating system lines, namely merging them into a single OS that could bring big benefits for corporate users.
The next version of Windows will pull together the company's three Windows OSes Windows for PCs and tablets, Windows Phone and Xbox One to enable apps that span all types of devices and that are available in a single Microsoft store, CEO Satya Nadella told investors and journalists during the company's Q4 earnings meeting this week.
While this is something he has talked about before, this time he gave it some immediacy. "We look forward to sharing more about our next major wave of Windows enhancements in the coming months," he says, according to a Seeking Alpha transcript of the conference call. He didn't say how many months.
The company already announced support for Universal Apps that can be written to the Windows Runtime architecture, and have the bulk of the code reused for an app that runs on all other Windows devices. Combined with developer support to write such apps and buying into Microsoft cloud services like Office 365, OneDrive for Business and Azure could give businesses new apps that workers can access and sync from anywhere so long as they have Internet connections.
This earlier description fits with what Nadella said during the earnings call. "We will streamline the next version of Windows from three operating systems into one single converged operating system for screens of all sizes," he says, with the new aspect being the promise of even tighter convergence coming with the next version of Windows.
He also promises to unify the Microsoft apps stores currently Windows and Windows Phone have separate ones in hopes of attracting more developers by creating a bigger market for each universal application.
That's different from the description on Microsoft's Universal Apps site for developers, which says customers can buy different versions of the same application (what Microsoft calls a single application identity) at the two stores with a single purchase: "In terms of the Store experience, customers will benefit from an app identity shared across the Windows Store and the Windows Phone Store. Shared identity means that if they purchase [an] app from the Windows Store, they are capable of installing it on a device from the Windows Phone Store using the same Microsoft account without having to purchase the app again."
Nadella updated this description during the financial call: "We will unify our stores, commerce and developer platforms to drive a more coherent user experience and a broader developer opportunity."
Attracting developers to write for Windows Phone has been a challenge because both Android and Apple phones are much more popular, making it more profitable for app developers to focus on those operating systems rather than Windows Phone. But Nadella says unifying its operating systems to support Universal Apps will open up a vast new market. There are more than 300 million Windows customers worldwide, he says, controlling more than 90% of the PC market, according to some counts.
By contrast, Windows Phone controls only 4% of the U.S. phone market, Nadella says.
Nadella says later in the earnings call that the unification of the engineering teams behind the Microsoft operating systems is enabling the blending of today's three operating systems into on scheme that supports universal apps.
Meanwhile, Nadella says Microsoft will forge ahead with making phones, Surface tablets and Xboxes despite criticism by some financial analysts that they ought not to. But he acknowledges that they warrant special attention in order to maintain profitability and overall value for the company.
For example, the company is trimming back its investment in Xbox by closing its Xbox entertainment studios and focusing instead on just games. Similar care will be given to phones, he says, by rationalizing the models of phones it will sell based on its acquisition of Nokia. And the company will refine its Surface tablets to showcase unique aspects of Windows 8.1, such as note-taking, that devices by other vendors don't do as well, he says.
"Our approach to first party hardware going forward is clear," he says. "At times, we will develop new categories like we did with Surface and we will responsibly make the market for Windows phone. However, we are not in the hardware for hardware sake, and the first party device portfolio will be aligned to our strategic direction as the productivity and platform company."