Up until now most people thinking about Microsoft might have thought software. But the tech giant announced this week it would also become a leader in aiding entrepreneurship as well.

Writing on The Official Microsoft Blog, Rahul Sood, general manager of Microsoft Startups, introduced Microsoft Ventures, a global effort combining several Microsoft programs currently proving funding, mentoring, and guidance to entrepreneurs worldwide.

In the post, Sood explained:

Today, Microsoft is announcing the creation of Microsoft Ventures, a coordinated global effort that offers the tools, resources, expertise and routes to market by providing mentorship, technology guidance, seed funding, joint selling opportunities and other benefits.

BizSpark

The new Microsoft Ventures effort combines and strengthens programs Microsoft already has in place with new programs still being built.

One of these existing programs is BizSpark. The initiative provides software including Windows and Office, Visual Studio, Windows Azure and additional support to promising and visionary startups at no cost. Microsoft says the program currently serves 50,000+ members in 100 countries on 6 continents.

Accelerators

The accelerator programs offer immersive 3 to 6 month experiences for early stage startups including mentoring, technical guidance and an opportunity to build connections. To be considered, startups must have a full-time founding team, less than $1 million in capital funding raised, and must be developing a technologically driven solution to solve a real world problem.

Microsoft already operates accelerators in Bangalore, Beijing, Paris, Seattle and Tel-Aviv and will be adding new accelerators in Berlin, Moscow and Rio de Janeiro soon.

Funding and Community

Finally, Sood says Microsoft Ventures is creating new resources to help entrepreneurs grow their businesses.

For example, the company will be expanding its existing Bing Fund to provide seed money directly from Microsoft for startups already experiencing early success. Neither Sood nor the Microsoft Ventures website are specific about the amount of funding likely to be offered or the criteria for companies to receive it.

Microsoft also says it has built partnerships with 200 startup focused organizations globally including Startup BootCamp, Enterprise Ireland and Telefonica’s Wayra. The company says it will continue to expand this community to make further investments in entrepreneurship globally.

The company has provided an easy way for entrepreneurs to learn more about the opportunities available. Microsoft Ventures offers a simple sign-up form to allow interested entrepreneurs to be notified as soon as program applications become available.

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A slide released by Channel 9 indicates that Microsoft’s SmartGlass Xbox companion application has collected more than 17 million downloads since its launch in 2012 across four platforms: Windows 8, Windows Phone, Android, and iOS.

There’s a recurring Daily Show segment that asks a simple question: Is that a lot? It applies in this context: Is 17 million downloads of SmartGlass an impressive tally? No.

There are nearly 50 million Xbox Live subscribers, implying that SmartGlass has failed to reach even 50% penetration among the audience that it was built for. Is that too high a standard? No, given that SmartGlass is strongly cross-platform, providing every Xbox user access to its technology.

We cannot correlate downloads to users, of course. That’s to say that the 17 million figure cannot be used to imply 34% market share for the application among Xbox Live subscribers. However, given that there cannot be more than one active user per download – on a per-account basis, for comparison, of course – we can state that SmartGlass cannot have any more than 34% market share.

This in an application tuned for a specific audience that runs on each of the three key mobile platforms.

What we can surmise from this is that Microsoft’s efforts to extend the Xbox experience to other screens than the television are not explosive. That said, the company does have more planned. As reported by Neowin: “One change [coming to SmartGlass] is that each Xbox One console can handle up to 16 simultaneous SmartGlass app connections, versus just four connections for the Xbox 360.” That could make its use more social, and thus perhaps more popular.

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Since last October, Microsoft has been reorganizing itself around the idea that it's a "devices and services" company.
The company has plenty of services, but not so many devices. If it's really going to become a devices company, then it stands to reason that it needs a few more devices.

The most important missing device from Microsoft's line up is a smartphone. So, naturally, it would make sense for Microsoft to build its own smartphone, right?

Well, never say never, but we don't think Microsoft is going to enter the smartphone business despite the fact that it's focusing itself on devices and services.

There are three reasons for Microsoft to steer clear of the smartphone business:

1. Carrier distribution is complicated.

2. Nokia and HTC are making good Windows Phones.

3. Microsoft's Windows Phone failures don't have anything to do with bad hardware.

After Microsoft released its own tablet, the Surface, chatter of a Surface smartphone started kicking up.

There are, however, many important differences between the tablet market and the smartphone market.

In the tablet market, Microsoft just has to ship the Surface and let users fire it up with WiFi.

To enter the phone market, Microsoft would have to build a global distribution network, as well as secure contracts with carriers around the world.

Each carrier is going to have its own specifications, and its own demands. That's a headache Microsoft doesn't want, or need.

Look at Apple. Despite selling the most influential phone, it's only on 240 carriers. Samsung, by contrast, is on 800 carriers. 

This is part of the reason Apple's iPhone isn't winning on market share, while at the same time the iPad remains relatively strong in tablet market share.

There's another key difference between the Surface tablet and the current smartphone market.

Microsoft's PC partners weren't making great computers with strong brands.

Quick quiz: What's the best Android smartphone on the market?

If you're paying attention at all, you would probably guess the Samsung S4, or maybe just, Samsung. (The correct answer is actually the HTC One, but that's another story. The important thing here is that there is at least one well-known Android brand for hardware.)

Next question! What's the best Windows-based computer on the market?

You're probably stumped. This is a problem for Microsoft.

If a consumer walks into Best Buy, he or she has no problem asking for a MacBook, or an iPad. Which Windows-based PC would he or she ask for? An Acer Aspire S7? An Asus Zenbook Prime? The Sony Vaio Pro 13? They don't exactly roll off the tongue, or come to mind very easily.

The hope for Microsoft is that the Surface can become a strong brand that rivals iPad, or MacBooks. Consumers can walk into a store and say, "I want a Surface."

Microsoft wanted to have at least one premier Windows 8 device when it launched Windows 8 last year. Because Windows 8 was such a radical departure from what Microsoft had been doing, it had to have at least one device it could confidently say did exactly what it wanted.

Its PC partners were dragging their feet in the tablet market, and Microsoft wasn't sure it could rely on them to produce something that competes with the iPad.

In the smartphone market, these problems don't exist to the same degree.

HTC and Nokia both make high-quality hardware. There's almost nothing Microsoft can do that will be better on the hardware side than either of them.

As for branding, Nokia's Lumia brand isn't exactly killing it, but Nokia is a brand on its own, and Windows Phone is slowly developing into a brand.

If a consumer walks into a Best Buy looking for a Windows Phone, it won't take much to get the best Windows Phone in his or her hands.

It's important to note that Nokia and HTC are both sickly companies. If they were to face serious financial problems, then we would expect Microsoft to either step in with a big check to bail them out, or it would be forced to go on its own and make a phone.

Until then, we think it stays out of the phone manufacturing business.

Just because Microsoft is developing into a devices and services company, it doesn't mean it has to make all the devices. It just means it has to work well on devices.

The reason Windows Phone hasn't caught on has less to do with hardware, and more to do with software and apps. A Microsoft-built smartphone wouldn't change that.

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