What’s Microsoft Planning to Do with Cortana?

Microsoft (MSFT) stated on November 15 that it was planning to discontinue its standalone Cortana app on iOS and Android in selected countries outside the US. These countries are India, Australia, China, Spain, Canada, Mexico, and Germany, according to Techspot.

Microsoft stated that it would remove the app on January 31, 2020, but it would integrate it as part of the Microsoft 365 productivity apps. Even users’ existing notes, calendar items, and to-do lists will automatically transfer to Microsoft’s other apps.

Microsoft failed to keep up with Amazon and Google

Microsoft introduced Cortana in 2014 but made it an independent application on iOS and Android in 2015. Even though Microsoft’s digital assistant has evolved with time, it hasn’t been able to match Amazon’s Alexa (AMZN) or Google Assistant (GOOG). In April, Microsoft released a study that said 19% of its users preferred Cortana, while 36% each preferred Google Assistant and Siri. A total of 25% of users preferred Alexa. The ability to integrate Google Assistant and Siri with mobile phones has favored them, stated the report.

Similarly, Alexa’s popularity rests on its alignment with the Echo Dot smart speakers. Meanwhile, Cortana is only available on Windows 10. It’s also present in the Kardon Invoke speaker or Surface headphones. However, even that doesn’t count for much of a presence compared to Alexa or Google Assistant.

Cortana wasn’t even all that popular with Windows 10 users. In 2018, out of 700 million active Windows 10 users, 150 million opted for Cortana, according to OnMSFT. This represents a meager 21% opt-in rate. According to Monica Chin from Tom’s Guide, Cortana’s confinement to the Windows 10 personal computer is its primary problem.

Microsoft changes its strategy for Cortana

Over the years, Microsoft has realized that it’s difficult for Cortana to survive this cutthroat competition among Digital Assistants. In January, even CEO Satya Nadella accepted that Microsoft no longer sees itself as a competitor to Alexa or Google Assistant, revealed The Verge. Therefore, it has slowly started showing less support for the assistant. Thus Cortana is now only an app that’s available on Alexa or Google Assistant. Earlier this year, Microsoft also removed Cortana from its Windows 10 search bar.

Bundling and repositioning is the solution for Cortana

Subscription is the way to go for tech companies nowadays. Microsoft also wants to take Cortana on the same path. The company focuses mainly on enterprise customers, so it will now offer the digital assistant as part of Microsoft 365. In December 2018, ZDnet indicated that Microsoft could come out with a consumer subscription model comprising Windows 10, Office 365, Cortana, Outlook Mobile, and Skype.

Nadella also hinted about it in January, stated the Inquirer. He said, “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.” He added, “Cortana needs to be that skill for anybody who’s a Microsoft 365 subscriber.”

Cortana can’t compete with Alexa or Google Assistant, but it’s making its presence felt on Microsoft 365. The company isn’t laying it to complete rest anytime soon. It’s now reinvented Cortana as a smart voice assistant to businesses. At Microsoft Build in May, the company showed a concept video of Cortana with improved functionality. It’s now positioning Cortana as a “personal productivity assistant” that can plan emails, summarize meetings, block calendars, and the like, stated The Verge. The company has also introduced a masculine voice for the digital assistant.

The Verge also cited Andrew Shuman, Microsoft’s head of Cortana, on its enhanced features. He said, “Both our voices have also been upgraded to use Neural Text to Speech capabilities, making them sound even more natural thanks to deep neural networks that match the patterns of stress and intonation in spoken language.”

Will Cortana be successful this time?

Microsoft isn’t planning on scrapping Cortana completely, but it’s redesigning it for more utility to enterprises. The company is also trying out a variety of initiatives related to Cortana. To learn more, read Why Microsoft Is the Stock to Watch. The company has also done some organizational restructuring on this front. It has shifted its Cortana team from AI research to experience and devices.

Microsoft surely has some strategies in play for its digital assistant. It’ll be interesting to see whether its bundling of Cortana will act as the product’s saving grace.