If you have never seen how a large company does damage control from the inside, the somewhat surreal proceedings are a bit hard to understand. Microsoft’s current strategy to re-brand the failure of Windows 8 is equal parts masterful and disingenuous.
In case you haven’t been following Windows 8 sales recently, or should we say lack thereof, it is a debacle. The release of a new OS usually spurs computer sales, even the lamentable Windows Vista spurred sales quite a bit, as did Windows 7. While I can’t find a list of historical PC sales by quarter for the relevant time periods, the yearly trendshows pretty clearly that the trend has been steadily and significantly upwards almost without deviation.
Microsoft has a history of putting out sales figures when things are good, and almost invariably skewing even those to look better than they really are. The widely reported 67% increase in sales due to Vista was a very skewed number, but even that dog of an OS bumped sales notably. The real point is that the initial sales numbers released are never as good as Microsoft spinners first say, but historically speaking they have never been negative. So why does Microsoft feel the need to inflate an already good number?
The answer to that question is essentially because they can, if you see a situation to get good PR for your company, you usually take it. How far one goes to get that is a good reflection on the ethics or lack thereof within a company. We won’t comment on the ethics of Microsoft, if you are unsure about them I would recommend starting with a quick Google search about how the company has been found to violate its court or EU ordered behavior changes for a start. If you still want more, go read their all about theUS monopoly abuse trial which they lost. For the record, the author doesn’t hold their corporate ethics in very high regard.
So when Microsoft has good news, they shout it from the rooftops loudly. It is usually picked up by anyone that will listen and printed in just about every news outlet out there. Given the echo chamber effect of the internet where no one seems to think about the numbers they are reporting much less actually fact check them, it is really easy to manipulate the press and create “truth”. Microsoft is quite adept at this technique.
The idea behind it is easy enough to understand and even easier to carry out. If you know that people are expecting a result of X, it gives you a backdrop of plausibility. Official statements from a company also add to this veneer of truth, and with both one can play off of people’s preconceived notions in a very scary way. If Microsoft knows everyone thinks that a new OS will bump up sales, that is where they can start.
To make up an example, if a new OS is released and sales go up 25% for that quarter, a company would be well served with that as a headline. “People love it” etc etc etc. If sales go up 50% for the top 5 PC makers that hypothetically sold 50% of the units, that definitely looks better than a 25% increase. This however means that the rest of the ecosystem was flat that quarter which is not a good thing. An average company would run with the 25% number, an ethical one might lead with 25% and note the disparity between the top 5 and the rest. An unethical company would say, “Sales are up 50% this quarter”, then only hand out cards for the PR folk at the top 5 PC makers.
Is the last one lying? Nope, it is 100% true. Is it honest? By the literal interpretation of the words, barely and technically yes. Is it ethical? Hell no. Is it a deliberate attempt to be deceitful and mislead? Hell yes. But this kind of thing never happens with upstanding Fortune 500 companies, right? Nope never, and not a chance that it will either,especially in front of financial analysts.
OK, sarcasm aside it happens all the time, and the modern press has almost totally eschewed their responsibilities in both fact checking the original and more importantly calling the company out on any unethical behavior. This is an abject failure in their most important responsibility and it is becoming the norm rather than the exception. More troubling is that many companies have noticed this and actively use it to make sure their skewed or flat-out untrue message gets out and repeated before the real story bubbles up.
The idea is once again simple, if you see a headline on 10 of the 11 sites you normally read, you might believe it. If, “Sales up 50%!!!!” is everywhere and you were expecting it to be up, you “buy” the story as true. A week later a rather dry and technical story on page 3 saying, “Well you know, a close examination of the numbers shows that the 50% number wasn’t really the whole truth.” will get maybe 1% of the reads the 50% headline story got two weeks before. Worse yet, many outlets won’t even publish the not-quite-a-retraction like the Seattle PI did above, that might endanger ad revenue.
Most of the modern media is completely bought and sold, advertisers and money men have absolute control over content. To compound the misery, editors either have no real say or are complicit in the ethical lapses. Don’t believe me? Know who CNet is? How about CBS, they own CNet. Remember CES 2013 where CNet awarded Dish the Best of CES award for their Hopper DVR? Remember how a letter from CBS legal made CNet silently remove that award before the winner was announced and give it to the runner-up Razer Edge Tablet?
You may have heard about Razer’s win during CES and possibly the flap about CNet/CBS’ behavior that broke just about every rule of journalistic ethics out there. Do you remember the CEA’s belated press release almost a month later giving Dish the co-winner award? Probably not. Care to venture how many page views across all sites the original “Best of CES goes to Razer” story got? How about the, “Co-winners of Best of CES are…” one a month later? Think the latter hit 5% of the former’s reads? How many print newspapers do you think ran with the first vs the second?
The worst part of manipulating the press for financial gain is that it works very well. The fallout for CNet? They can’t run the Best of CES award next year, boo-hoo. CBS changed their tune not a bit, and has since been forced to admit they won’t even allow coverage of companies that they have disagreements with. Aereo won’t get reviewed on CNet or CBS at all, nor will any others that CBS doesn’t like for some non-public list of reasons. How many others? Who knows. What are these offenses? Who knows? How does one find out what CNet/CBS is silently submarining? The scary part is that there is no way, they won’t tell you unless someone leaks it and, not or, it starts getting lots of coverage. How many other companies do this and to whom? Good question with no answer. You might want to go back and read 1984 again if it hasn’t been silently pulled from your e-reader without consent or compensation.
What this is all about is simple, you get more eyeballs with big early splashy headline than without. Dry analysis and/or retractions weeks later get almost none and the end result is that truth is effectively manufactured. Income for most sites is directly related to hits so more eyeballs equals more income. The original story also becomes “true” because everyone just “knows it”. If you do a search on the net, the original version will almost always get higher rankings because of the reads, re-links, and the general echo chamber effect related to the number of views, a designed by Google, profit by Google-Ads system that cares very little about actual news. The irony here is that the actual truth is almost permanently buried unless you know about it and actively search for it. In reality this Catch-22 means the truth dies.
Most companies know this and not just use it, they actively exploit it in the most cynical ways they can. Microsoft has a long history of doing just this, see the Vista 67% example for one, and go look at how Windows 7 pre-sales orders were accounted for as well.
Does this sound reasonable? Everyone expected it to be up, but 234%? Then again, the original numbers are from an “independent’ research firm so even if it is later proven to be completely false, poor old Microsoft had no way of knowing that. If proven false publicly, this type of scenario is usually followed by a public scolding on the brutal level of, “Bad research firm, bad”, then a contract renewal including a hefty increase in fees for a job well done. That said, I am not implying NPD did anything wrong here, they are one of the good firms. Many of the others however never seem to disclose who funded a study anywhere for some reason. Odd isn’t it?
And so we come back to Windows 8. Sales blew and everyone knew it. Surface sales were even worse, abysmal is hardly a strong enough term. Remember how the Microsoft toadies spun the really amazing sounding but equally vague numbers their executives put out? Remember how few outlets questioned the figures until the degree of the farce they were participating in was undeniable? This wasn’t an accident, all the large sites know where the money comes from and as CBS/CNet proved, it is the only thing that counts anymore.
So how well did Surface sales do? The entire world was pretty sure the answer was awfully, but for some reason Microsoft just wouldn’t officially comment. Third party report after third party report came out, each worse than the last the farther we got from the Surface launch. Microsoft’s response? Paraphrased it was that sales were great, they weren’t expecting the thing to actually sell much anyway, it was all about setting a high quality bar or something. No really, that wasn’t a joke. And still the numbers didn’t come out officially until someone leaked the real numbers that were so low they shocked even Microsoft’s most cynical critics.
Unfortunately the manufacturing of the truth did it’s job and for weeks if not months, all the mainstream sites were effectively cynical Microsoft apologists. The truth only started to come out in the mainstream news organizations when it was once again undeniable. Suddenly they were filled with editorials that effectively said, “We knew it all along, we are so good” without a hint of mentioning that this new line was a 180 degree shift. Cynical isn’t a strong enough word to describe this behavior, but sadly I don’t know a better one.
If you think back to that time eons ago when this article started, it was ostensibly about a new PR campaign from Microsoft. It is, and all the above is relevant background too, it wasn’t just a needles rant. This new campaign is on the topic du jour, the failure of Windows 8. You might recall the original mating cry of the Northwestern Yellow-Bellied Microsoft Apologist was to wait until the numbers came out. We did. They were horrific.
Instead of admitting the undeniable reality around them, the mating call of the Apologist (presumably directed toward their beloved Great Tufted Moneyman) turned to one of excuses. “It’s the economy” they warbled, completely ignoring the fact that tablet sales with a similar or higher ASPs were booming during the same time period. That was usually accompanied by, “Just try it, it’s not that bad and you will like it”. Strangely enough, other than forum posts, no one SemiAccurate talks to actually likes it. This is a stand alone statement, that view is much more negative when compared against the competition like Apple, Android, or even Windows 7. Every excuse that was floated was trivially deflated.
In recent days however, there is a new excuse that his making the rounds in the usual ways, astroturfing. If you look at most of the Windows 8 is horrid threads, the majority of them have a lot of comments popping up at about the same time starting a day or two ago that have a different theme. That would be that it isn’t Windows 8 that is killing sales, Microsoft made a peachy OS but those darn PC makers haven’t made anything worth buying much less upgrading to in years. This new theme has all the hallmarks of a corporate damage control campaign with a lot of money behind it.
Those hallmarks are simple, it echos an early theme from the company, it came out of nowhere, it is everywhere in the comments at once, and most importantly, it has a high degree of plausible deniability. You might remember that when Microsoft announced Surface initially, OEMs were not in the loop and rebelled. Microsoft’s damage control was bumbling and widely mocked too.
They basically said that Surface wasn’t an attempt to compete with OEMs, instead it was an attempt to raise the bar. Those silly OEMs were putting out crap product after crap product not fit to carry the Microsoft logo, so jolly uncle Steve was going to show them how to do things right. That may not seem like it logically parses, but, um, it actually doesn’t. Either way OEMs dropped Microsoft and are running to Google in unprecedented numbers, they got the real message loud and clear. That said, Surface is an abject failure because, umm, well, Microsoft did it right. I guess that part does logically parse. In any case, the seeds that Microsoft was doing it right were planted among the general public.
Now six months later or so, they are being heavily watered by all the unseen hands that a corporate damage control team and hire. The theme that the PC is solely to blame was nowhere for the last two quarters and suddenly it is everywhere even though nothing changed. OK one big thing changed, irrefutable numbers from IDC and Gartner came out and were getting lots of play. The purported stink of death on Windows 8 had now reached the point of being undeniable so damage control had to be done lest the truth be allowed to survive.
There is one problem with this little theory that somehow absolves Microsoft while blaming their entire partner ecosystem and supply chain though, reality. The first of the most glaring problems is that PCs are in an era of unprecedented differentiation. You have the miserable Ultrabooks on one hand, and convertible, bending, docking, folding and downright contortionist products on the other. Both are too expensive, bring the user nothing they want, and still fail at the basic things consumers actually need. In other words they suck more than PCs of old, but you pay a huge premium for it.
The other problem is that when Windows 7 came out, like Vista before it and XP before that, PCs changed even less. The average PC at the launch of Windows 8 is hardly recognizable compared to that of the Windows 7 launch. Conversely the PCs of the Windows 7 launch era were hardly different from those at the Vista launch. Even the most basic look at the facts not only disproves that the “fact” that PCs are at fault, they almost definitively point to Windows 8 being the only reason for the failure.
If change in PCs was needed to spur sales, that didn’t happen during the launches of Vista and 7. Sales rose. It did happen during the launch of Windows 8 and sales plummeted. Before you point out that change may be the actual cause of this plunge, think about one other little thing. You can still get Vista/7 form factor PCs now, you just can’t get them with those OSes. See the logical problem?
Sadly though the damage control team, agency more likely, did their market research right. The whole fairy tale about PC makers being at fault seem to be getting some legs if not showing early signs of going viral. This is a really well thought out campaign given what they have to work with, cynical, unethical and anti-consumer though it is. Make no mistake though, it isn’t organic and is very manufactured. Things like this don’t go from nowhere to everywhere overnight without lots of backing and low wage forum drones to astroturf on your behalf. That said, it seems to be money well spent on Microsoft’s behalf.