Recently, Microsoft (MSFT) announced that it has finalized a cross government licensing framework with the New Zealand Government's Department of Internal Affairs. The agreement will span for a period of three years.
The biggest advantage that this will have for the government is that it will save it a substantial amount of money. The total amount of money that the New Zealand government hopes to save through this collaboration is $119 million. In addition, it also provides a higher degree of flexibility as well as simplicity. It will also serve as a way for the New Zealand government to modernize its information technology and improve the efficiency of its systems. These advantages are all in line with the New Zealand government's broader strategy. The new framework that Microsoft is introducing will cover new cloud based software as well as older and more traditional software. This is an important step forward for the New Zealand government as it has realized that improved technology is the way forward.
The new deal also serves to illustrate that Microsoft remains a force to be reckoned with when it comes to technological domain. It creates a big media splash which will likely impact Microsoft stock in a very positive way. The successful outcome of the New Zealand deal will show other countries that Microsoft can integrate its products smoothly into different business systems. The deal also improves Microsoft's global image, making it more attractive as an investment. Microsoft's ability to maintain its strong global presence by signing important deals with governmental systems is what will keep the company on top of its competitors.
At a local level, Microsoft has won the battle against Google (GOOG) for the US government cloud market. More and more governmental departments are transitioning to the use of Office 360. Most recently, the Federal Aviation Administration (FAA) chose Microsoft over Google, a great symbolic win for the company. However, Google is still a very serious competitor in this regard. The two companies are still locked in battle for the custom of the various governmental organizations, and recently Google signed a big government contract with the Department of The Interior. The battle is ongoing and we will have to wait and see who comes out on top in the long run.
Microsoft and Facebook (FB) are both searching for bigger premises in Manhattan. This is because New York is an essential location for tech companies to have a presence in if they are to be successful in the market. The current trend is for tech companies to make their presence felt on both the west and the east coast, and in this regard New York is an important location. Both companies already have buildings in Manhattan, but in order to solidify their presence there they have come to realize that they will have to expand their premises even further.
Microsoft's current lease expires in two years time, so the question is whether the company will choose to take the opportunity to expand its presence in Manhattan. This area is a "growing incubator for technology". It makes sense for Microsoft to position itself here. It is certainly a wise move to make if Facebook is also looking at this option. To keep ahead of the competition, Microsoft should focus at least some of its attention on the Manhattan area.
Facebook has been struggling to keep its head above water ever since its failed debut on the NASDAQ. Not only has the company proven to be a big disappointment to those who have invested in it, it has also managed to drag down the entire social networking market in the process. The combined market capitalization of Facebook, LinkedIn (LNKD), Groupon (GRPN), Zynga (ZNGA), and Yelp (YELP) has dropped by about $29 billion in total since the introduction of Facebook to the market. What should have served as a significant milestone for the industry has instead proven to be a failure.
Competitor Google is suffering a little under the pressure of an EC investigation into claims that it is breaching competition rules and using its power to unfairly dominate the competition. The EC has given Google about a month to come up with a plan to change the situation as it stands at present. Google seems unprepared to accept the charges. Among other things it has been accused of giving its own sites preference over those of competitors on its search engine. It is also accused of copying information like reviews without permission.
AT&T (T) has recently partnered with Acclaim Energy Advisors in order to work on new power grid technology. As a result of the partnership the company's business clients in Texas will have access to technology that will "improve [its] power grid reliability, protect equipment from power surges and reduce their utility costs". This is something that will be particularly helpful during electrical power outages and similar emergencies. This is an innovation form AT&T that will make the company a significant leader in the tech market and generate further interest in it as a stock option.
Nokia (NOK) is putting a lot of faith in its new Lumia smartphone which has hit the Indian market and plans to forge ahead with new models. This could turn out to be a good or a bad move for the company. Clearly it is struggling to keep up its old reputation as companies like Samsung have overtaken it. However, its new smartphone range may not be the best way to get back into the swing of things. Investors will have to wait and see if a new range of phones is enough to get Nokia back on track.
Microsoft does face competition in certain domains, but at this point it still seems to be well ahead of the game. Investors need not fear the future of Microsoft at this point. Big deals and strategic moves are what keep this company near the top of the tech world.