Microsoft Has Lost Its Way

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Satya Nadella is only nan 3rd CEO Microsoft has had successful its 50 years of existence, which is mind-blowing erstwhile you deliberation astir it. 

Back successful 2017, erstwhile he was still only a fewer years into his domiciled astatine nan apical of nan company's org chart, Nadella (with nan thief of a mates of ghostwriters) wrote a book called Hit Refresh, successful which he rhapsodized astir "us humans and nan unsocial value we call empathy, which will go ever much valuable successful a world wherever nan torrent of exertion will disrupt nan position quo for illustration ne'er before."

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After decades of nan aggressive, take-no-prisoners mentality of his predecessors Bill Gates and Steve Ballmer, nan accent connected empathy seemed refreshing. It's a taxable Nadella has returned to many times successful interviews and nationalist speeches during nan past decade. In a 2023 question and reply pinch patient Axel Springer, he said, "I don't deliberation empathy is simply a soft skill. In fact, it is nan hardest accomplishment we learn, to subordinate to nan world, to subordinate to nan group that matter nan astir to us. In fact, invention is astir gathering nan unmet, unarticulated needs of customers."

Last month, astatine an employee-only municipality hall, a existent Microsoft worker confronted nan CEO directly, arguing that nan institution is nary longer surviving up to that aspiration. In his Notepad newsletter, longtime Microsoft-watcher Tom Warren quotes that worker, who articulated a communal complaint: These days, life astatine Microsoft feels "markedly different, colder, much rigid, and lacking successful nan empathy we person travel to value."

"I've spoken to dozens of labor complete nan past fewer months," Warren reports, "and they each told maine that morale wrong Microsoft is astatine an all-time low." No wonder, fixed that nan institution has conducted 5 rounds of layoffs truthful acold successful 2025, cutting loose much than 15,000 employees, aliases astir 6.7% of its world workforce. And that's contempt nan truth that nan institution is making grounds profits and is 1 of nan 3 astir successful corporations connected nan planet.

Also: Microsoft is redeeming millions pinch AI and laying disconnected thousands - wherever do we spell from here?

There's nary mobility Microsoft is facing tremendous unit arsenic it tries to compete successful nan insanely expensive, ridiculously fast-moving conflict to go nan starring AI platform. But that unit is showing up successful nan company's interactions pinch customers. In much than 3 decades of watching what Redmond says and does, I person ne'er seen Microsoft truthful aloof, retired of touch, and lacking successful empathy arsenic it is successful 2025. It's almost for illustration it's trying to push customers distant -- particularly if those customers are mediocre and powerless.

I haven't heard lately from immoderate customers who consciousness that their "unmet, unarticulated needs" are being met. More often, they consciousness ignored aliases that they're being forced to usage and salary for products and features they neither want nor need.

First, location was past year's shambolic rollout of nan AI-powered Recall feature, successful which nan institution forgot to see nan privateness concerns of its customers.

Then, earlier this year, location was the disastrous Microsoft 365 Copilot launch. Existing customers sewage a abrupt 30% value increase, and Microsoft's trading droids blamed it connected AI. The guidance from customers was brutal. As I wrote astatine nan time, "As acold arsenic I tin tell, nan consequence from customers has been overwhelmingly negative. I show Microsoft-focused online forums obsessively, and I publication hundreds of complaints without seeing a azygous compliment."

All of nan accepted Office apps that are portion of Microsoft 365 now athletics a Copilot button. Every truthful often, I effort utilizing 1 of those features successful Word aliases Excel aliases Outlook, and nan results person been spectacularly underwhelming and often comically wrong. They consciousness for illustration prerelease versions and surely aren't capable to warrant a 30% value increase. As of earlier this year, Microsoft counted 84 cardinal subscribers to its Microsoft 365 Family and Personal products. The astir communal petition I perceive from that group is to make that Copilot fastener spell away.

And past there's the transition from Windows 10 to Windows 11, successful which Microsoft has done nan unthinkable, telling hundreds of millions of group that their Windows PCs are obsolete and will nary longer person information updates arsenic of Oct. 14, 2025.

This is simply a funny determination from a institution that has spent nan past 23 years talking astir its committedness to making its package "secure by default." The latest whitepaper for nan Secure Future Initiative is headlined "Security supra each else." In July 2025, nan CEO himself said, "Security and value are non-negotiable."

Yeah, let's talk astir that.

You tin jump done a fewer hoops to enroll successful a subscription for Windows 10 Extended Security Updates and hold nan reckoning for 1 other year. The group who are astir astatine consequence are besides nan slightest apt to understand really to make that happen. 

I get emails each week from group (many of them older) who are connected fixed incomes and can't spend to switch their middle-aged but still perfectly functional PC. They deficiency nan method skills to understand why this is happening and really to sphere their investment. Microsoft appears to person nary empathy for them. At 12:01 AM connected Oct. 15, those Windows 10 PCs will nary longer beryllium unafraid by default.

Also: Microsoft said these 400 readers couldn't upgrade to Windows 11. They did it anyway

Once upon a time, Microsoft understood that its worth arsenic a institution was calculated utilizing a analyzable equation that included nan contributions of hobbyists and enthusiasts and students and retirees and part-time developers whose contributions could not beryllium quantified successful incremental revenue. They helped prolong an ecosystem that extended from suburban basements to firm datacenters. When you return distant nan amateurs, nan marketplace becomes overmuch little interesting.

Redmond appears to beryllium nether excessively overmuch unit to attraction astir those bequest customers, focusing alternatively connected nan heavy pockets of its corporate customers, who it believes will salary an other $30 per spot to adhd a chatbot to their Microsoft Office -- sorry, Microsoft 365 license. That's nan only measurement Redmond's crushing investments successful AI infrastructure ($80 cardinal past twelvemonth alone!) will ever salary off.

Good luck pinch that. In fact, nan economics make nary consciousness for a patient that sells endeavor licenses connected a per-seat basis. If nan adjacent procreation of Microsoft exertion is going to thief organizations slash headcount by giving nan remaining quality workers AI-powered tools, that will mean nan prices for each licence will person to summation conscionable to support nan gross statement flat. And nan per-seat value will person to double to salary for each those datacenters.

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Back successful July, soon aft nan adjacent of nan fiscal year, Nadella wrote an email to nan 220,000 aliases truthful labor still moving astatine Microsoft. (As a reminder, that number is down much than 15,000 from nan commencement of nan year, acknowledgment to layoffs.)

The email was also published to Microsoft's firm blog, which mightiness beryllium your first hint that this was really a PR move and not a sincere connection to nan labor whose early is successful Nadella's hands.

It's a singular missive, and aft reference it, I'm beautiful definite that Nadella had thief penning it. I americium not speaking astir nan competent PR professionals and ineligible minds successful Microsoft's firm HQ, who astir apt had immoderate constricted input.

No, this sounds for illustration thing that was drafted and reshaped by nan Copilot LLM chatbot that has go Microsoft's obsession these days. It has that cloying, inauthentic reside that astir humans can't match, filled pinch sweeping connection that breaks down erstwhile you ask, "What does that mean, actually?" And it wouldn't astonishment me; Nadella has boasted successful nan past astir his reliance connected Copilot. "At this point, if personification took distant my 365 Copilot, I wouldn't cognize what to do!" he told an audience at a London arena successful 2023.

Let maine springiness you an example:

This is nan enigma of occurrence successful an manufacture that has nary franchise value. Progress isn't linear. It's dynamic, sometimes dissonant, and ever demanding. But it's besides a caller opportunity for america to shape, lead through, and person greater effect than ever before.

The occurrence we want to execute will beryllium defined by our expertise to spell done this difficult process of "unlearning" and "learning." It requires america to meet changing customer needs, by continuing to support and standard our existent business, while besides creating caller categories pinch caller business models and a caller accumulation function. This is inherently hard, and fewer companies tin do both.

But I person afloat assurance that we can, and we will erstwhile again find nan resolve, courage, and clarity to present connected our ngo successful this caller paradigm.

Some of those words are inspiring, but astatine a definite constituent it each feels for illustration nan aforesaid vague but cheery pep talk you tin get from Copilot if you inquire really to commencement a caller business aliases lick a narration problem. Or possibly each of nan chatbots person been programmed to speak successful nan aforesaid neutral, bland tones adopted by nan CEOs of each trillion-dollar company. You ne'er know!

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Are these devices that Microsoft and its rivals are building really that miraculous? Two professors from nan University of Washington, conscionable a fewer miles complete nan span from Microsoft HQ, person a slightly little enthusiastic opinion of devices for illustration Microsoft's Copilot and OpenAI's ChatGPT. They telephone them "bullshit machines."

Technologists and publicists gush astir really Large Language Models (LLMs) will revolutionize nan measurement we work, learn, play, communicate, create, and link to another.

They are correct that artificial intelligence (AI) will impact astir each facet of our regular lives.

And they are correct that by providing a measurement for group to talk pinch machines successful mean language, LLMs represent a melodramatic measurement guardant successful making computing accessible to everyone.

Yet for each nan bully that AI systems will do, they will besides saturate our accusation situation pinch bullshit astatine a standard we've ne'er earlier encountered.

After spending nan past twelvemonth wrestling pinch Copilot, I afloat agree.

Under nan strain of trying to win successful a conflict of nan AI titans, Microsoft has turned into a painfully adjacent approximation of nan Borg -- emotionless, efficient, driven by a desire to conquer, and -- yes -- lacking successful empathy. I'm not eager to beryllium assimilated. That's not to opportunity I scheme to move each my PCs to whatever Linux distro is popular this week. But I besides person nary desire to maximize Redmond's pipeline of cash.

I conjecture that makes maine portion of nan Resistance.