Foley on Microsoft

10 Biggest Microsoft Surprises of 2013

If you're a Microsoft watcher -- or even just playing one on the Interweb -- I bet you'd agree 2013 was an above-average year for surprises coming out of Redmond.

• By Mary Jo Foley
• 12/18/2013

Beyond CEO Steve Ballmer announcing he will be stepping down earlier than expected, here are the top 10 surprises that came down from Redmond this year:

1. Start Button returns: Microsoft's Windows team finally got the message users aren't that excited about Windows 8's new user interface. They capitulated and brought back the Start Button, though not the Start Menu.
   
   
2. Office 365 thrives: When Microsoft said it would let customers rent Office by subscribing to Office 365 Home Premium for $100 a year instead of buying it once, many predicted customers would reject the dramatic shift. The carrots Microsoft added to sweeten the deal did the trick. Redmond let users install Office 2013 apps on up to five PCs and Macs plus iPhone/Android support via Office Mobile, and it has already managed to sell 2 million subscriptions to its Home Premium service.
   
   
3. Touch out of touch: As holiday 2013 approaches, touch amazingly is still not ubiquitous on Windows PCs and devices. Given Microsoft execs telegraphed Windows 8 would be a touch-first OS a year or two ahead of its launch in October 2012, this slow ramp is even more baffling.
   
   
4. Universally awful battery life on Windows machines: Why do the latest systems based on Intel's new Haswell processor get such inferior battery life compared to Macs running the same processor? Microsoft execs recently told hardware news and reviews site AnandTech.com it's because of the numerous sensors for touch. Intel's Bay Trail chip and ARM processors like Tegra 4 may offer us long-suffering users slightly better results, according to early tests, but the trade-off is processing power. Battery life is among the top considerations of many users, including yours truly.
   
   
5. No one answering Windows Phone: The Windows Phone team kicked off 2013 with the "shut up and ship" motto. They weren't kidding -- on the shutting up part, at least. The team delivered three relatively minor OS updates since October 2012. Yet Windows Phone is starting to gain more traction, especially in the lower-end market, though it's still a distant third behind Android phones and iPhone.
   
   
6. Microsoft acquires Nokia's handset and services business: About 80 percent of the Windows Phone handsets sold to date are Nokia-made. Couldn't Microsoft have continued to reap the benefits of that relationship without becoming a phone manufacturer?
   
   
7. The $900 million Surface RT write-down: When a company won't disclose sales data for a given piece of hardware, it's safe to assume it's not taking the world by storm. The Surfaces have innovative features. Their premium pricing and continued lack of must-have, Metro-style apps tailor-made for them are limiting their appeal, though.
   
   
8. Enterprise carries Redmond: Microsoft's less sexy enterprise products -- SQL Server, SharePoint, System Center, Windows Server and the like -- represented a key percentage of sales, but the company's revelation that it accounted for an overwhelming 55-plus percent was larger than most realized.
   
   
9. Bing's not just a search engine, the Softies (finally) concede: It's increasingly an integrated and integral part of almost every Microsoft product and service, at some level. At its Worldwide Partner Conference this year, execs finally said what some of us knew already: Bing is a developer platform, both for Microsoft's teams and third parties.
   
   
10. Microsoft's latest reorg is surprisingly sensible: Not everyone -- and especially not some of the aforementioned institutional investors pressuring Microsoft to sell off its consumer businesses -- was upbeat about Microsoft's most recent corporate reorg. It does make a lot of sense to bring the various OS teams, the various services and apps teams, and the new hardware units together as engineering orgs, supported by central marketing, legal and so on. What took them so long?

What surprises do you suppose are in store for 2014?