Why Microsoft's CEO Thinks Windows 10 Will Put the OS on a Growth Path

By Markets Fool.com

ForMicrosoft, Windows 10 represents the ultimate mulligan.

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The launch of the new operating system gives the company a chance to right all the wrongs it committed with Windows 8. That means a return of the Start Menu as well as a familiar look and feel. Windows 10 brings back what users liked (or at least were familiar with) about the OS, which should hopefully appease those who stuck with older versions rather than upgrade to WIndows 8.

CEO Satya Nadella believes Windows 10 will correct the problems of its predecessor and put the OS part of the business back on a growth path.

What is Nadella saying?
Nadella was very upbeat about the new OS in remarks made during the conference call after it released its fourth-quarter 2015 results. He sees Windows 10's growth as about more than PCs. He reiterated his earlier remarks about having the OS on one billion devices and he spoke exuberantly about the launch.

CEO Satya Nadella Source: Microsoft.

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"It's the first step toward our goal of one billion Windows 10 active devices in fiscal year '18. Our aspiration with Windows 10 is to move people from needing, to choosing, to loving Windows," he said. "Based on feedback from the more than 5 million people who have been using Windows 10, we believe people will love the familiarity of Windows 10 and the innovation. It's safe, secure, and always up to date."

Basically, above all else, Nadella made it clear that Windows 10 fixes what Windows 8 broke. The company aggressively courted user opinion before this launch in a way it did not with the previous OS.

There won't be a surprise negative backlash this time mostly because Win10 is not a radical change from previous, non-Win8 versions of the OS.

It's also about moving forward
While Nadella was very careful to tout how familiar the Windows experience would be, he also explained how the new version would improve on previous iterations. He was specifically excited about what the OS offers enterprise customers.

Windows 10 provides advanced security capabilities with additional features for hardware-based security, mobile work, and data protection. It also provides a single mobile device management platform across all devices from phones, to laptops, to Internet-of-Things devices. And Windows 10 helps enterprises stay up to date with Windows Update for Business and Windows Store for Business.

He also took the time to talk about some of the new additions being rolled out with the OS explaining he they impact users of all types.

Windows 10 is more personal and more productive with Cortana, Office, Universal apps and Continuum. And Windows 10 will deliver innovative new experiences, like inking on Microsoft Edge and gaming across Xbox and PCs, and also opens up entirely new device categories such as HoloLens.

Windows 10, it's important to note, will ultimately power everything Microsoft -- from phones to tablets, PCs, to Xbox and ultimately to devices on the Internet of Things.

More than just PCs
As noted, Nadell believes that Windows 10 will buck the pressure facing the PC ecosystem and "broaden our economic opportunity and return Windows to growth." He added that the company's OEM partners have over "2,000 distinct devices or configurations already in testing for Windows 10 upgrades, as well as hundreds of new hardware designs."

He also predicts that the company will generate "new growth through gross margin on our own differentiated first-party premium device portfolio." In addition, he expects to "grow through monetization opportunities across the commercial and consumer spaces."

It's a bold plan, but Nadella has not shied away from making big moves and so far he has been able to deliver.

This is huge for Microsoft
WIndows 8 was a misstep, but the company has enough of a user base to get a second chance. If Windows 10 misses, then Windows may be in a death spiral, but there is no reason to believe that is the case here.

WIndows 10, which I have been a beta tester on as part of the company's Insider program, does deliver a familiar but improved experience. There's no reason to believe it won't appeal to the Microsoft faithful and maybe even bring some former users back into the fold.

The rest of the plan is the challenge. For real growth to occur, Nadella needs success beyond the PC audience, because PCs are in a declining market. It's hard to know whether that will happen, especially, since the IoT is in its early days.

Still, Windows 10 gives Microsoft something to build on. A successful launch on traditional devices opens up the doors for all sorts of new growth areas.

The article Why Microsoft's CEO Thinks Windows 10 Will Put the OS on a Growth Path originally appeared on Fool.com.

Daniel Kline owns shares of Microsoft. He liked Windows 8 (at least on touch devices). The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.