by Tom Kaneshige

iPhones Spotted on Microsoft Campus

Mar 16, 2010
MobileSmall and Medium Business

It's a sign of troubling times ahead for Microsoft.

Would you bring your iPhone to work, even for only personal use? Most bosses wouldn’t mind as long as you’re not spending all day on it. But it would be unwise to flaunt your iPhone if you’re a Microsoft employee.

Last fall, a Microsoft worker used an iPhone to snap a picture of CEO Steve Ballmer, who, in turn, snatched the iPhone and mockingly stomped on it. Shortly after joining Microsoft, Stephen Elop, president of Microsoft’s business division, obliterated his iPhone in a blender.

A Microsoft employee with an iPhone told the Wall Street Journal: “Maybe once a year I’m in a meeting with Steve Ballmer. It doesn’t matter who’s calling, I’m not answering my phone.”

Early last year, Microsoft changed its cell phone service reimbursement policy to cover only phones that run on Windows Phone software, the Wall Street Journal reported. Microsoft, of course, wants everyone to get behind its struggling mobile technology.

Yet Microsoft can’t stop the Apple iPhone phenomenon from breaching its proverbial four walls. Some 10,000 iPhones tap into Microsoft’s employee email system, about 10 percent of Microsoft’s global workforce, sources told the Wall Street Journal. Top Microsoft executive J Allard also carries around an iPhone.

Market researcher Gartner reported that iPhone OS grew market share by 6.2 percent to 14.4 percent last year, helping it move past Microsoft Windows Mobile. Microsoft’s market share fell by more than 3 percent to 8.7 percent. Hoping to reverse the tide, Microsoft is reportedly overhauling its Windows Phone 7 Series to be delivered on smartphones during the holiday season.

Microsoft’s chances, however, aren’t good. iPhones on Microsoft’s campus is a sign of troubling times ahead for the software giant. When folks who receive a paycheck from a company start buying a rival product, it usually means game over. Or, at the very least, there’s something fundamentally wrong with your product.

I’m inclined to believe the latter. The iPhone represents more than just technology: Its ease of usability is a direct affront to Microsoft’s unwieldy software. Microsoft doesn’t face a threat of new technology so much as an assault on its image. A big company like Microsoft can’t change its image overnight, making the iPhone a formidable (if not unbeatable) foe.

Fact is, the iPhone’s success has shed light on a disturbing truth: People, including some Microsoft employees, are fed up with Microsoft software. That’s why the sight of Microsoft employees toting iPhones is so vexing to Microsoft brass.

Tom Kaneshige is a senior writer for in Silicon Valley. Send him an email at Or follow him on Twitter @kaneshige. Follow everything from on Twitter @CIOonline.