Microsoft's three major moves in the automotive industry exposed "car ambitions"

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In the American auto industry, there's a well-known joke: A Microsoft software engineer once met a Detroit automotive engineer. The software engineer teased, "Your car industry is moving too slowly. If your technology developed at the same speed as Microsoft’s, today’s car would have 32 cylinders, go 10,000 mph, and cost less than $50!" The Microsoft engineer expected the car engineer to be embarrassed, but he just smirked and replied, "Who would buy a car that crashes three times a day?" As one of the world’s leading tech companies, when Microsoft first entered the automotive sector in 1995, it was met with skepticism from traditional automakers. However, in recent years, Microsoft has made three major moves that have sparked significant interest within the automotive world, revealing its growing ambitions in this field. First, on June 6, Microsoft appointed Jeff Bayer, a former vice president from the Dai-Ke Group, as the head of its interactive entertainment business. Bayer gained fame at Chrysler for using online games to promote cars. Microsoft believes his deep understanding of both the automotive and electronics industries makes him an ideal fit for this role. Then, on July 6, Microsoft won a fierce bidding war to become the official engine control system sponsor for the 2008 F1 season. This move signals Microsoft's intent to enter the most critical areas of automotive technology. On July 16, Microsoft launched its car dealership management software in the U.S. with great fanfare. Bill Gates announced that dealers could now manage their global sales networks using this platform. At the event, John Reed, Sales Director of Microsoft Automotive Division, said, “The size of the automotive market is very attractive. Although we are latecomers, we are confident in our future.” He also hinted that Microsoft will leverage its competitive pricing strategy when entering the industry. Competition in the automotive sector is fiercer than in the office. Some experts predict that the future car will be “a computer with four wheels,” a vision Microsoft is working toward. The head of Microsoft’s Automotive Division stated, “With the increasing use of electronic devices and communication systems in cars, automakers are seeking a standard software platform. Who better fits that role than Microsoft?” Despite its ambitions, Microsoft’s path into the automotive world hasn’t been easy. In 1995, the company established its Automotive Division with the goal of making its products as dominant in cars as they are in offices. However, it soon realized that competition in this space is much tougher than in the office software market. Automakers have many options, such as Japanese companies like Toyota, Honda, and Nissan, who formed a non-profit organization to develop international standards for automotive software. General Motors also has its OnStar system, which can automatically contact emergency services during accidents. Microsoft also faces competition from other embedded operating systems like VxWorks, Linux, and QNX. These systems have advantages in integration with vehicles that Microsoft lacks. But Microsoft isn't without its own strengths. Its car window system can directly interface with familiar computer software, giving users a more intuitive experience. At the Geneva Motor Show, Microsoft demonstrated a production car running the full version of Windows Mobile. At the Hannover Communications Technology Show, it unveiled a concept car with full internet access. In terms of management software, Microsoft has a unique edge. In May, it introduced a solution for automotive parts suppliers, helping them optimize resource allocation through computer systems. As David Cole, chairman of the Ann Arbor Automotive Research Center, noted, “Microsoft’s goal is to increase awareness in the automotive industry.” While continuing to develop automotive software, Microsoft is also addressing the challenges of entering this new field. A Microsoft executive said, “Whether Microsoft becomes the preferred brand depends not only on technology but also on adapting to the culture of the automotive industry. In this sector, the manufacturer’s brand is more important than the supplier’s.” To this end, the software giant is adopting a more humble approach. A Microsoft technical leader said, “No one in the auto industry has a dominant position. We’re here to collaborate, not to take over.”

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