After the turmoil and chaos of the Ballmer years, the Nadella Era of Microsoft is almost boring. The company is executing well with a few misfires—nobody's perfect or flawless—controversy is minimal and employees seem content for the first time in ages. CEO Satya Nadella enjoys a 95 percent approval rating, according to Glassdoor.
That doesn't mean 2016 was an uneventful year, just quieter than in the past with no major blowups. But let's look back at the year that was in Microsoft highs and lows.
High:
Microsoft introduced its real-time translation technology for Skype, creating the sort-of equivalent to the Star Trek universal translator where voice conversations would be translated in real time. We learned why the Skype translator came out. Nadella saw it still running as a lab project and lit a fire under the researchers to productize it. He wanted to see more of an effort to make commercial projects out of research experiments, and the translator was one of them.
Low:
As part of its Windows 10 push, Microsoft declared it would end of support for Windows 7 and 8.1 on Skylake processors on July 17, 2017, three years before the official end of support for Windows 7. So, any Skylake machines that ship would have to have Windows 10. This has been extended to cover AMD's forthcoming Zen processor, which has generated very high hopes. Microsoft eventually blinked, sort of, by extending Windows 7/8 support .
High:
Early in the year, market research firm Strategy Analytics showed the overall tablet market dropped by 11 percent in the last quarter when compared to the same period in 2014, with iPad sales down 25 percent and Android-powered tablets down by 7 percent. But Windows tablets grew by an impressive 59 percent. Surface would show good momentum all year long.
Low:
March saw the end of Kinect as a non-gaming device. Microsoft had high hopes for the motion detection device in areas such as medicine, but it went nowhere. It didn't help that Microsoft gave it poor support, releasing an SDK and never updating it.
High:
Microsoft took the lead with the IF This Then That (IFTTT) programming language when it introduced Flow, a service that allowed you to create conditional connections between its business services. It supports Microsoft products, such as Office, as well as non-Microsoft services, such as Twitter, Slack, Google Drive and Dropbox, letting you build conditional actions. For example, you could have a text alert generated when you received an email, automatically pull tweets into an Office app or get Slack notifications when a file is uploaded to a Dropbox folder.
Low:
All the pushiness to upgrade to Windows 10 began to cost the company. Teri Goldstein, an independent travel agent in Sausalito, California, sued Microsoft after an unwanted Windows 10 upgrade left her system unusable for days and prone to crashing. Other times, her computer slowed to a crawl. After Microsoft failed to help her, Goldstein sued Microsoft and won, collecting a $10,000 judgment from the company.
High:
Microsoft is the undisputed number two cloud provider behind Amazon, proof you can teach an old dog new tricks. Cloud revenue now accounts for about $13 billion annually and has seen triple-digit year-over-year growth for the past five quarters. Much of that is thanks to Office 365, which had 24 million subscribers at the end of Microsoft's first fiscal quarter in September.
Low:
The Electronic Frontier Foundation (EFF) called out Microsoft over its Windows 10 behavior in a big way this past August:
“The tactics Microsoft employed to get users of earlier versions of Windows to upgrade to Windows 10 went from annoying to downright malicious. Some highlights: Microsoft installed an app in users’ system trays advertising the free upgrade to Windows 10. The app couldn’t be easily hidden or removed, but some enterprising users figured out a way. Then, the company kept changing the app and bundling it into various security patches, creating a cat-and-mouse game to uninstall it.”
High and Low:
The LinkedIn purchase was an interesting strategic move. It was a massive purchase of a website, not a software or services company, and Microsoft promised all kinds of integration magic. But was it worth $26.2 billion, a marathon of a purchase? No doubt Nadella got a good company, but he really overpaid.
