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"There are now a number of companies \u2014 Apple, Google, Amazon, and others \u2014 that have Microsoft in their rear-view mirrors, disappearing quickly on the horizon in a cloud of dust.\nThat kick of dust in the company\u2019s face is being emitted by Apple\u2019s iPhone and iPad, Amazon\u2019s Kindle, and Google\u2019s search and cloud domination. Microsoft\u2019s own wild lunges into various technology segments are also contributing considerably to it being left behind. Take the company\u2019s recent partnership with Barnes &amp; Noble, where it took 18% of the Nook e-reader for $605 million in cash and future guarantees. This was a move to compete with Amazon, but can it really compete?\nIf you want to know why Microsoft\u2019s share price has been flat for 11 years while Apple, Amazon, and Google shares have soared, this is why. Microsoft is not innovating aggressively. It is not leading categories or blazing trails. No, it\u2019s acquiring aggressively as a shortcut to innovation.  That isn\u2019t working. Its own history suggests as much. \nMicrosoft Has Not Capitalized on its Partnerships and Acquisitions\nLast year, Microsoft announced a broad strategic partnership with Nokia, presumably to use Windows operating systems and software on Nokia\u2019s smartphones. This was 15 months ago. But last week, a report found that Apple and Samsung generated 99 percent of the profits in the mobile phone category. Nokia, which once enjoyed more than half of all mobile phone profits, made zero. \nIn 2009, Microsoft acquired a 10-year license to use Yahoo\u2019s core search technology, which later became the Bing search engine. Today, Google\u2019s search market share is a dominant 66%, with Microsoft\u2019s Bing a very distant second at 15%. After spending billions building and marketing Bing, Microsoft is barely visible in Google\u2019s rear-view mirror. \nFinally, what of Microsoft\u2019s Skype acquisition a year ago? It\u2019s too early to tell, but here\u2019s a fact worth noting: The Wall Street Journal reports that 85% of Microsoft\u2019s revenue comes from Windows and Office software. The rest of it? Barely a blip. \nAnd so, Microsoft is proving, like many have before it, that acquiring companies outside your core competencies are recipes for failure. Remember when Cisco purchased the Flip video camera, at the time one of the most popular consumer electronics products on the planet? How did that work out? In 2010, HP bought Palm for $1.2 billion, but we haven\u2019t seen any industry-altering smartphones from HP. \nConversely, consider Apple\u2019s acquisition of Siri: a technology that immediately and profoundly complimented and enhanced its iPhone. It fit obviously and very successfully. \nMicrosoft Does Not Need to Compete with Amazon\nAnother major problem with Microsoft\u2019s partnership involving the Nook is that there is simply no need for it to compete with Amazon. This is like Best Buy focusing all of its efforts on its ecommerce site while neglecting its one major competitive advantage: its brick-and-mortar stores. This is also like Research in Motion spending a year building its atrociously received tablet, the PlayBook, while neglecting its core competency of Blackberry smartphones. \nMicrosoft dominates the competition in computer operating systems and software. Computers are dying, right? And yet, in May 2012, there is no Microsoft Office for tablets and smartphones. Millions of iPads and Android tablets are being adopted in corporate environments, and most of those customers would be happy to spend $70 on Microsoft Office for each device. Except, it does not exist. \nI can only guess why: because with its many categories, acquisitions and partnerships, Microsoft is physically incapable of putting its full focus behind converting its desktop products to mobile devices. \nMicrosoft is Going Wide, Not Deep\nWhich brings me to the third and final big problem with Microsoft\u2019s Nook play. It is keeping with the strategy of going as wide as possible. Microsoft is not, and cannot be, all things to all people. In fact, no company can. \nHere\u2019s the truth: The wider you go, the more priorities you focus on, the less chance you have to be successful. But when you go deep, you can dominate. (See Apple, and Amazon.) When you go deep, you can continue perfecting. You become the world\u2019s expert on a certain specialty. \n\nSEE ALSO: Microsoft Research: Bringing Sexy Back\nApple is seen as the world\u2019s expert on smartphones and tablets. Amazon is the accepted leader in online shopping and electronic reading. It\u2019s because these two companies relentlessly focus on their strengths, saying no to nearly everything else. No. That\u2019s a word Microsoft should consider trying out before it gets left in the dust permanently.  Image courtesy of iStockphoto, JasonDoiy"^^<http://www.w3.org/2001/XMLSchema#string>
<http://mashable.com/2012/05/11/microsoft-innovation/>