Microsoft has a problem: lack of demand for its AI products

Anyone remember Cortana? It seems like MS doesnt learn

Nothing an ad carousel full of AI-slop, embedded in the OS won’t fix

Microsoft has this problem with most of its products.

It's not just AI, it's a market fit and quality problem.

They don't need to solve it, however.

Their strategy has been quite clear: make it barely usable so that is passes muster to auditors, integrate it with systems that corporations need, and sell them on the integrations.

Teams and Azure suck?

So what?

Big companies will pay for that, because it's integrated with their ldap, has an audit trail, gives them the ISO-whatever stamp, and lets them worry about something else.

That the users are miserable is almost never the question for the ones signing the checks.

In a world where box-checking is paramount, this approach is a winning strategy.

Microsoft has a problem that they hire the middle block of talent in the market. They do not chase the top 20% most expensive nor the bottom 20% least expensive.

But this also means they end up with average products. They don't have the talent to do something exceptional.

This has worked well for them when they can just come in and copy something (say AWS in Azure) and not pay the innovation cost, but AI seems different for some reason, perhaps in the same way search was. You need the top 20% in order to really be successful.

https://www.visualcapitalist.com/microsofts-revenue-by-produ...

Helpful chart to draw conclusions

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