Microsoft Corporation (MSFT): Should You Mimic ValueAct?

That is to say that consumers are device-neutral when it comes to working in Google Docs: it simply doesn’t matter what type of device they’re using, they always get the same experience.

If cloud computing, then, is the future, and more applications follow in the footsteps of an app like Google Docs, consumers will no longer be willing to pay up for a high-priced PC (or smartphone or tablet). As long as the device is able to access the Internet reliability, it will fit the needs of consumers (in this hypothetical, future cloud-focused world).

In that case, it simply won’t matter how great a device is; sales will shift to whomever can provide the cheapest — albeit usable — hardware. That is not now, nor has it ever been, Apple’s value offering.

Windows as a value-trap

But, while I agree with ValueAct’s long-term vision, I’m still wary of Microsoft Corporation (NASDAQ:MSFT) as an investment. Although it seems evident that Windows 8 has failed and the Windows brand is dying, the company continues to cling to the past.

Rather than shift its resources towards a cloud-centric future, I fear Microsoft might blow its cash on a futile attempt to keep Windows relevant. While management should focus on the cloud, Xbox and Office (and bringing Office to the cloud), the company seems intent on trying to save Windows with an expanded retail operation and redesigned Windows 8.

That kind of misguided initiative could keep Microsoft range-bound for the next 10 years — just as it’s been range-bound for the last 10.

The article Should You Follow ValueAct Into Microsoft? originally appeared on Fool.com.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.