It’s important to note that Windows persisted as the linchpin of Microsoft’s strategy for over 30 years for a very good reason: it made everything the company did possible. Windows had the ecosystem and the lock-in, and provided the foundation for Office and Windows Server, both of which were built with the assumption of Windows at the center. Office 365 and Azure are comparatively weaker strategically: Office 365 has document lock-in, but the exact same forces that weakened Windows in the first place weaken the idea of documents as well. It’s not clear why new companies in particular would even care. Azure, meanwhile, is chasing AWS, with a huge amount of business coming from Linux VMs that could run anywhere. Unsurprisingly, both are still benefiting from Windows: Office 365 really does, as Nadella noted in his retreat, work better on Windows, and vice versa; it is seamless for organizations that have been using Office for years to move to Office 365. Azure’s biggest advantage, meanwhile, is that it allows for hybrid deployments, where workloads are split between legacy on-premise Windows servers and Azure’s public cloud; that legacy was built on Windows. This, then, is Nadella’s next challenge: to understand that Windows is not and will not drive future growth is one thing; identifying future drivers of growth is another. Even in its division Windows remains the best thing Microsoft has going — it had such a powerful hold on Microsoft’s culture precisely because it was so successful.

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