Microsoft Learns to Love Apple's iOS and Google's Android

For years, some top Windows executives at Microsoft wouldn’t even say the word “Apple” in interviews, although one used the phrase “the fruit company.” Times have changed: In a June interview, Julie Larson-Green, then chief of Windows engineering, said the company should respond to the growing dominance of Apple’s iOS and Google’s Android on mobile devices by developing apps for those platforms. “We can provide unique, differentiated experiences on our devices and on other people’s devices,” said Larson-Green, who on July 11 was named to run Microsoft’s new hardware and studios group in the company’s latest reorganization.

Larson-Green’s way of thinking is prevailing at Microsoft as the company faces plummeting demand for Windows PCs. Its operating systems now control 20 percent of the total consumer-computing market, which includes smartphones and tablets, compared with 42 percent for Android and 24 percent for Apple’s systems, Goldman Sachs data show. Microsoft has struggled to move into mobile devices; its Surface tablets accounted for just 3.7 percent of tablet sales, and phones running its Windows Phone operating system made up 3.2 percent of smartphone sales in the first quarter, according to market researcher IDC. On July 18, Microsoft announced its biggest quarterly profit shortfall in more than a decade, taking a $900 million writedown on unsold Surface tablets.