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Microsoft is working on a new bundle of software for consumers, following the launch of its Microsoft 365 package for workers. CEO Satya Nadella hinted at it in a meeting with journalists at company headquarters on Monday.
The remark appears in the context of Nadella's response to a question about what Microsoft will do in the near future to serve consumers. Nadella's Microsoft has reduced focus on things like Windows for smartphones and doubled down on, among other things, selling Office subscriptions and renting out the Azure public cloud to meet businesses' computing needs.
But at the Monday event, Nadella made it clear that it still very much cares about consumers. And a new software package is part of that.
"It's very fair to say, as I said in the very beginning, that we started after all on the consumer side and then over-indexed to the IT side, and we definitely are very focused on bringing that back," Nadella said, according a transcript of the event circulated by Ben Thompson's Stratechery newsletter.
Nadella pointed to Microsoft's collection of Surface devices as an example.
"Surface is doing well because ultimately people do have a special connection with the device they use," Nadella said. In the most recent fiscal year, Microsoft's Surface revenue totaled $4.7 billion, representing about 4 percent of total revenue.
Microsoft also has an advertising business, which addresses consumers, partly in the Bing search engine.
"We have all kinds of strategic flexibility to do things that would perhaps be more amenable to both the end users as well as the advertisers and publishers, so we expect to do things even in that space," Nadella said.
The CEO also hinted at the potential of a Microsoft 365 collection of products for consumers, although he stopped short of saying what it might include, when it will become available and how much people will have to pay for it. (Microsoft didn't respond to a request for comment about that.) The comments came a month after ZDNet reported on plans along these lines.
"So I would say Surface is a brand, what we are doing with Office 365 or what we will soon be talking about as Microsoft 365 consumer subscriptions, those would be again completely consumer businesses," Nadella said.
Microsoft introduced Microsoft 365 in mid-2017. It's a way to give employees Windows 10, the Office 365 portfolio of subscription-based productivity applications, and Enterprise Mobility + Security, a grouping that comes with identity and device management tools. Earlier this week Microsoft announced a deal with Walgreens Boots Alliance that will bring this software collection to some 380,000 employees.
Microsoft carefully tracks the number of devices running Windows 10, as well as the number of people who subscribe to Office 365. It's conceivable that one or both of those could be part of Microsoft 365 aimed at non-business use.
Another part of the package could potentially be gaming, given that Nadella also spent some time on Monday talking about that subject. The company has a subscription business called Game Pass and is readying a service for streaming games from the cloud.
"We have a structural position in that we have both a console business as well as a PC business which happens to be in fact bigger than the console business when it comes to gaming, and the idea is to aggregate those sockets with a subscription service," Nadella said. "We won't be the only ones, there will be competition just like with other content, there may be a few subscriptions that will be successful, so we are going to go after it."