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Microsoft's technology strategy needs a refresh

The company has made billions making great products at a great price, but its complacency threatens to undermine its relevance in the future of computing.

As news broke this week that Microsoft and Nokia would be partnering to (brace yourself!) port Office to Nokia phones, followed by the equally momentous (or not) news that (sit down for this one!) Microsoft will replace Entourage with Outlook for Mac OS X, I couldn't help but agree with Larry Dignan's assessment of the Nokia deal:

Simply put, Nokia and Microsoft are the equivalent of two St. Bernards that are forced to run in 90 degree heat and high humidity. They're big. They're winded. And they could knock you over--if they could only catch you.

I happen to compete with Microsoft in one area that it is growing from strength to strength (SharePoint), but for everyone else, Microsoft is becoming a footnote in the history of computing.

Sure, it's still big. Yes, it still competes vigorously. But with the odd exception (Bing, perhaps), Microsoft just doesn't seem to have the energy to compete anymore. One indication of this is that most of the dirt that Roy Schestowitz digs up on Microsoft is from old court records. It's as if Microsoft struggles even to be nasty anymore.

So Microsoft dresses up tired press releases like the Outlook on Mac announcement "like they've been working in the lab for some time now and have had some technological breakthrough that allows them to bring Outlook to Max OS X," as ZDNet's Sam Diaz puts it. The breakthrough would be putting Outlook in the cloud, Google Apps-style. It would be creating products that wow in the same way that Apple's do.

But Microsoft doesn't wow in its traditional businesses. Surface, yes. Project Natal, yes. But there doesn't seem to be much creative gas left in the enterprise computing tank.

And perhaps that's the point. How much innovation can there be, really, in Office? Or the Windows operating system? These are old paradigms that don't need window dressing: they need the window shattered and shifted to completely new methodologies of computing, similar to what Google (Web) and Apple (entertainment) are doing.

The desktop is a tired metaphor. This is why Google's Chrome OS, while not necessarily manna from heaven, is a welcome change, and just the sort of thing that Microsoft should be investing in, but is structurally, financially incapable of promoting in the same way and to the same degree that Google does. Because Microsoft dies if it innovates its way out of its Office and Windows businesses too quickly.

Google may be resorting to some of Microsoft's most frustrating practices, using its strong products to prop up weak siblings, but at least those siblings promise a different mode of computing.

Apple offers a premium "desktop" experience that makes old feel new. Google replaces the "desktop" with the Web. Open source commoditizes and then innovates enterprise IT, as Accenture's Alex Wied recently wrote. What does this leave Microsoft?

It leaves Microsoft desperately needing to refresh its approach to the market. Immediately. It can live off its billions for a long, long time, but it risks becoming like CA: ever-present but not very relevant.

Follow me on Twitter @mjasay.