Satya Nadella’s came close to calling for a return to Microsoft's founding principals during his keynote speech at the the company's Build 2014 conference in San Francisco yesterday. The speech by the newly appointed Microsoft CEO contained a lot for Windows lovers and mobile phone fans.  But it also contained repeated pleas for developers to keep the faith -- faith in Windows specifically and Microsoft generally. 

Nadella arrived at the conference facing a number of problems that have arisen from Microsoft’s previous lethargy in meeting new challenges, particularly the rise of mobile. 

A More Restrained Microsoft

This is particularly true for Windows 8 and the lackluster response to it by customers, as well as the fact that Windows phones have had little impact on the mobile landscape.

Nadella is not former CEO Steve Ballmer in either approach or mindset. In contrast to Ballmer’s gregarious and often overstated challenges to Microsoft employees and the wider tech industry, Nadella is restrained and measured in his delivery. 

Rather than reiterate Ballmer's insistence to hold onto the PC. Nadella said Microsoft needs to adopt a ‘challenger’ approach. “You should build for Windows because we're coming at this with a challenger mindset,” Nadella said.

“Microsoft was a tools company before it was an Office company, before it was a Windows company,” a clear reference to the fact that it was a software company serving the wider technology community rather than just a company that "does Windows" or "does Office."

It is pertinent to note here that only this week, Gartner’s figures for software sales over 2013 show Microsoft has retained its position as the top software maker by a very, very large margin.

For those looking for Windows innovation, there was a lot to digest. Nadella urged developers to work with Windows because … well that really was the billion dollar question developers were waiting to have answered.

Why build for Windows? That's the question of the conference and the question this morning. You want to build for Windows because we're going to innovate...We are going to come at this by innovating in every dimension."

He told developers that they were special, that Microsoft wanted them and more importantly, pointed out that Microsoft has more “input devices” than any other company in the business.

Windows Phone

Windows Phone 8.1.jpg

In practical terms, Microsoft is facing a number of challenges. Consumers that are slowly recovering from five years of recession appear to be dumping the PC in favor of tables and smartphones.

In the mobile world, Microsoft has been very slow off the blocks and is now completely overshadowed by both Apple and Google’s Android. That said, Microsoft at Build has shown it is fighting back — and eager to push Windows onto a lot more devices.

To achieve this, Microsoft announced that it will be offering the Windows operating system to smartphone and small tablet makers who are producing devices with screens of 9-inches or less, as well as for devices that carry machine-to-machine communication — a nod to companies that are currently developing devices for the Internet of Things.

Until now, Microsoft has charged table makers between $5 and $15 per device to use its Windows system, something it has done since the beginning with PCs.

While Microsoft is clearly targeting the mobile market, it also appears to be counting on more Windows phone users buying other mobile Microsoft products like Office, which is now on the Pad, or even Skype.

Microsoft also introduced Cortana for Windows Phone, a voice-powered personal digital assistant powered by Bing, which is still in beta and launching only in the US United States.

Windows Phone Cortona.jpg

Cortana is part of the new Windows Phone 8.1 and, according to Microsoft, will fully replace the search function on Windows Phone. It is named after the artificial-intelligence character in Microsoft's best-selling "Halo" Xbox video game series.

Cortana also gets better over time by asking questions based on your behavior and checking in with you before she assumes you’re interested in something.

Other new features that make Windows Phone 8.1 smartphones more personal include Action Center, which complements Live Tiles by showing new activities and notifications at a glance; and Senses, a suite of features that takes the work out of managing data use, storage space and battery life.

Windows Phone 8.1 will start rolling out to current Windows Phone 8 users over the coming months. It will also come pre-installed on new phones starting this month.

Windows 8.1 Update

Of course, if Microsoft is working on pushing Windows 8.1 onto more devices and making Windows more user friendly, it is also upgrading Windows 8.1 generally.

According to Microsoft, the new Windows 8.1 will include improvements that provide quicker access to their data, as well as a more familiar and consistent experience across touch and non-touch devices.

These changes will come in the shape of significant interface improvements for mouse and keyboard users as well as the ability to access the task bar from any screen and access Windows Store apps from the toolbar too.

Specific to the enterprise, the Windows 8.1 update offers improved Internet Explorer 8 compatibility on Internet Explorer 11, as well as improving mobile device management functionality

No Mention Of XP

So far, though, there has been no mention of XP and the upcoming cut-off date for customer support, and the problems that upgrading is going to cause a lot of business users.

Windows XP Problems.jpg
While Microsoft has issued numerous warnings about this over the months, the April cut-off point is next week and many users face considerable problems.

In fact, according to new research by IObit, a specialists in PC performance and security 57 percent more than 5,000 XP users surveyed said they concerned that they will loose data if they are forced to upgrade now.

Nearly 58 percent of those 57 percent of participants consider loss of system accounts, files and setting as the first problem, followed by loss on personal files like pictures and videos (28 percent).

If Nadella was trying to make friends and win approval at this early stage in his tenure, he could make some kind of concession to those who are still using XP, but don’t want to upgrade to Windows 8 after the mediocre reviews it has received to date. Its only Day 2 of the Build conference today with plenty more to come before closing tomorrow afternoon.