By all accounts Microsoft is struggling. It’s true that Bing is growing, but only slightly, while partner Yahoo continues to lose search share (to Bing) keeping the “Search Alliance” in the doldrums. Microsoft also recently took $6+ billion write-down on its 2007 aQuantive acquisition, resulting in a loss for its most recent fiscal quarter.
Its core Office and Windows franchises are still healthy but their future is cloudy as PC sales continue to slow. Microsoft’s Windows Phones and mobile efforts more broadly have not borne fruit. Its novel Surface tablets have yet to reveal pricing and won’t be out until the fourth quarter. They could re-insert Microsoft into the mobile conversation but we won’t know that until Q1 of 2013 at the very earliest.
Microsoft is also increasingly dismissed in high-profile articles such as in the August issue of Vanity Fair magazine that blames CEO Steve Ballmer for a “lost decade.”
Against that daunting backdrop Microsoft has hired political strategist, PR maven and pollster Mark Penn — he ran Hilary Clinton’s unsuccessful 2008 presidential campaign — in a new, not-yet-fully-defined corporate strategy role, according to the Wall Street Journal. He will be “corporate vice president of strategic and special projects” and report directly to CEO Ballmer.
The article says that Penn “is assembling a ‘SWAT team’ to work on thorny strategy questions around Microsoft consumer projects. His initial priority . . . [will] be Bing.” Penn has been a consultant to Microsoft off and on since the late 1990s.
To the extent that Microsoft’s problems are marketing or consumer awareness problems Penn might be able to help with clever new approaches. To the extent that the problems of Windows Phones and Bing are reflective of deeper issues in the company (e.g. culture, products) or larger societal trends (i.e., the shift to mobile devices) it’s unlikely that Penn can do much but make recommendations.
Bing is a solid and even innovative search engine but hundreds of millions of marketing dollars have not really helped. One could even argue that the marketing money has been almost entirely wasted.
Penn is the head of PR firm Burson-Marsteller. He also runs polling firm Penn Schoen Berland. He is reportedly leaving his CEO position at Burson-Marsteller. But he will continue to work mostly from Washington DC according to the WSJ.
Burson-Marsteller was embroiled in controversy last year when it was revealed that Facebook had hired the company to place anti-Google stories in major news media. It’s not clear whether Penn had any role in the botched effort. However he probably knew about it.
Here’s a lengthy video of Penn speaking at Google in 2007: