What Led to this Mess (Premium)

When Windows 10 first launched, I celebrated the return of PC-centric user experiences and the de-emphasis of the previous regime’s “touch-first” nonsense. But Windows 10 also marked an escalation of Microsoft’s desperate bid to find a new way to monetize the billions-strong Windows user base in an era when Windows license sales were collapsing.

Windows licensing was a business model for the ages: It led to Microsoft’s domination of the personal computing market and fed its expansion into new businesses too. But the dark side of Windows licensing is that it created a separation between Microsoft and the ultimate end-user. Microsoft sold few Windows licenses directly to people. The vast majority were—and still are—sold to PC makers. Which we should logically see as the middle-men that they are.

One might argue that the success of the PC meant that PC makers were sitting pretty for decades. But that’s not the case: The PC market was always a low-margin business, even when volumes were high and growing. And the most egregious expense, always, was that Windows license.

To overcome this cost, and the fact that they were unable to customize Windows to their liking, PC makers looked for other ways to further monetize each PC purchase. There were obvious component upgrades, peripheral sales, and software bundles at purchase time, for example.

But the winning strategy, short-sighted though it was, was crapware.

Crapware has long been the bane of the PC buyer. But it’s interesting to note that the worst crapware, today, comes from Microsoft, and not from PC makers. And that’s because it’s now bundled with Windows 10. It’s something that even PC makers selling prosumer- or business-class PCs cannot remove.

Yes, PC makers still bundle some crapware with their PCs. And, yes, PC makers still try to justify this intrusion by claiming that these bundles are made to address some perceived shortcoming in Windows, to address some user need. That’s nonsense. It’s always been nonsense.

So what changed? Why is Microsoft, the platform maker, overloading Windows 10 today with crap?

Simple. That Windows licensing model is collapsing. And while nostalgia for the good old days is understandable, Microsoft is a business. And the Windows business needs to justify its existence. As I noted in Terry (Premium), Terry Myerson was tasked with the impossible by Satya Nadella: He had to create a software updating infrastructure for Windows 10 that would allow this mess of legacy code to be updated as if it were a modern online service. It was the only way that Windows could fit within the new Microsoft, that sudden darling of Wall Street.

But I undersold what was required of Terry. (And you may recall that I had felt rushed to get that article out in a timely fashion, and that I knew I’d be leaving out key parts of the story.) In addition to the Windows as a Service piece, he was also required to be more aggressive about monetizing the Windows user base. All while making Microsoft’s customers somehow “love” Windows 10 too.

Those two requirements are contradictory. And are thus impossible. And I can only conclude that Mr. Nadella always intended for Terry to fail. It was only a matter of timing.

And here we are.

As a reminder, I called out Satya Nadella for his “love Windows 10” crazy-talk three years ago in my first major editorial for Thurrott.com. At the time, PC makers were still the main issue.

“Crapware destroys the Windows experience,” I wrote at the time. “It makes PCs more bloated, slower, and less efficient. The available disk space—which is at a premium in this age of low-storage devices—is compromised, as is battery life, boot and shutdown times, ongoing RAM and other resources usage, and more. Crapware is unnecessary, annoying—some even display pop-up ads—and hard (or in some cases, impossible) to actually remove.”

Ironic, isn’t it, that it is Microsoft that is now doing all this to Windows? (Further ironic: They are pushing a “streamlined” Windows version for the future that will allegedly solve these issues. It’s an insane asylum, folks.)

Of course, Microsoft has been chipping away at the Windows experience for decades. It’s just getting worse over time, escalating.

Back in the late 1990’s and early 2000’s, the software giant found itself in antitrust hot water for bundling apps like Internet Explorer, Windows Media Player, and Windows Messenger in Windows. And it is interesting to recall that one of its half-hearted attempts to prevent earlier antitrust action was to let competing online services like AOL and CompuServe have space on the Windows 95 desktop alongside MSN. They were ads in the form of icons on the system’s most precious real estate.

In more recent years, however, the monetization efforts have expanded. There is the pointless and failed mobile app store and ecosystem, which has no place in a desktop platform. (Perhaps a desktop app store might make more sense, not that it matters anymore. But the “best” apps in the Store today are Desktop Bridge apps, period. That’s not a coincidence.)

And there are ads. Everywhere.

Oh, the ads. I called ads in Windows a “slippery slope” in a rare prescient moment back in 2012, and despite some idiotic commentary from the usual cheerleaders, it turns out I was right: It just kept getting worse. And I just kept pointing it out as it escalated. In 2013. In 2016. And in 2017. I am the pied piper of advertising in Windows.

But I’ve had no effect at all. None.

Today, there are ads in apps, in the Start menu, animating off of the taskbar, in Action Center, in Windows Ink Workspace, in OneDrive, and more. There are even ads in Windows Setup now: You will be asked about Office 365 when you clean install a new Windows 10 version 1803 PC in the coming year.

But the absolutely shittiest example of this monetization effort is, of course, the bundled games that now ship with Windows 10. I’m talking about useless nonsense like Candy Crush Soda Saga, March of Empires: War of Lords, and their ilk. It doesn’t matter how much you spend on a PC. That crap will be there. Waiting to be dealt with. All you can do is manually uninstall each in turn and hope they don’t come back.

How could anyone love Windows 10 under these conditions? It’s an embarrassment.

And it’s just going to get worse. Again.

As we exclusively revealed earlier this year, Microsoft is now changing the way it will license Windows to PC makers this year. It will offer a variety of premium SKU up-sells that will cost PC makers, and thus end-users, more.

The idea here is that you get more if you pay more. It’s the classic SKU strategy, which Microsoft once rode to great success with Office. That it is doing so today with Office 365—where there are something like 137 different SKUs on the commercial side—is not coincidental. Having fewer SKUs would be simpler for customers. Having more SKUs is more profitable for Microsoft. Which, again, is not a charity.

And that is what it all about: Squeezing every last cent they can out of customers and do so on an ongoing basis by morphing what used to be single-purchase software into subscriptions. It works for Office, and it’s the reason why Office 365 is such a major component of Microsoft’s future. And it works for Windows, to some extent, because businesses have been on a subscription plan for some time.

But the issue with Windows, of course, is that it’s hard to squeeze more money from an audience that does not upgrade very often. That audience may, in fact, have already purchased their final upgrades. My belief is that a huge chunk of the PC installed base is just riding this out until their PCs die and that they will move on to something else—an iPad, a Chromebook, or maybe even a Mac—when that happens. This audience isn’t engaged in any way, as I’ve often pointed out. And I don’t think they’re very loyal either.

But then why would they be? Given Microsoft’s actions, one could make the argument that the software giant is actively working to push them away. Surely there is a way to calculate the cost of all the actions that Microsoft has taken to ruin the Windows experience.

Windows 10 makes me sad. The core of this system is so solid, so right, and so much better than any of its competition. But it’s been rope-a-doped by a failed strategy that destroys the faith and trust of its user base and demeans the product itself. And it’s not clear if Microsoft will ever wake up and show this once-great product the respect that it—and we, as its users—deserve. This is what decline looks like. It’s ugly, and it’s hard to watch. And it’s happening right now.