When Satya Nadella was named the new chief executive officer of Microsoft (NASDAQ:MSFT) earlier this year, he didn't exactly give the $7.2 billion acquisition of Nokia's devices and services unit a ringing endorsement. Nadella has steadfastly stuck to his guns when discussing the future: the cloud and a comprehensive mobile experience, via apps not necessarily devices, is where Microsoft is headed.
But like it or not, Microsoft has found itself with a leading mobile device manufacturing group, and it's not content to let it sit idly by as the likes of Apple (NASDAQ:AAPL) continue to dominate the mobile device sector. Microsoft's new Surface Pro 3 will never convert iFans, nothing coming out of Redmond, Washington can do that. But, it's a great example of Microsoft's mobile capabilities. And now, if the rumors are true, Microsoft is taking another step in the mobile device direction, this time in the ready-to-explode wearables market.
Rumor has it
When it comes to rumors, the tech sector is the recipient of more than its fair share. And Apple almost certainly leads the rumor pack. Not a day goes by there isn't news of a leaked iPhone 6 picture, or a new release date for its much-anticipated iWatch. Another iPhone? Ho-hum. But an Apple iWatch, should the rumors prove correct, could be the shot-in-arm Apple investors have been waiting for. Apple's perceived lack of innovation, once its claim to fame, could be kicked to the curb with a cutting-edge technology like a wearable device.
The new iWatch is supposedly due for release this fall. Its primary function appears to be much like Nike's beleaguered FuelBand wearable device in that the majority of the iWatch's 10 plus sensors are health-related. Monitoring heart rate, breathing, and related health and fitness specs will be, based on the rumors, the primary functions of the iWatch.
The iWatch is a good start, but with the technological advances we've enjoyed this past decade, a watch that monitors health-related issues, and does little else, seems a bit ... pedestrian. And that's where rumors involving Microsoft's foray into wearable technology take a turn for the better. Nadella may not be a lover of device manufacturing, but it appears if he's going to do it, he'd just as soon do it right.
News of Microsoft delving into the world of wearables was fueled by recently uncovered patent filings. Technology companies often file patents long before ever producing a product, and sometimes never follow through at all but want to cover their proverbial bases, "just in case."
But Microsoft's recent patent filings are wearable-related, and outside of perhaps cloud and big data, it's one of the most talked about technologies, and growth opportunities, on the planet. And as Nokia's devices and services unit becomes fully integrated with Microsoft, a wearable device would seem like a natural step, and one in the right direction.
The rumored Microsoft watch appears to go above and beyond other, more basic alternatives. A couple of patents are particularly intriguing. One involves displaying "contextually relevant information." In other words, the device would feed information to a user based on what is likely to be of interest at the time, beyond the simple notifications of most wearable devices.
The other patent filing is also focused on adaptive content, providing data based on where a user is, and what the user is doing. For example, different data would be presented depending on whether a user is driving, running, or simply lounging on the couch. Now that sounds more like a wearable device of the 21st century.
Final Foolish thoughts
Like it or not Nadella, Microsoft is, at least in part, a device manufacturer, as the Surface Pro 3 indicates. As such, a wearable Microsoft gadget makes perfect sense, particularly if plans are for it go beyond what are quickly becoming mainstream, fitness-related devices. And it appears that will be the case, assuming Microsoft follows through with its patent filings. Wouldn't it be something if Microsoft were able to beat the long-awaited iWatch to market? Even if investors didn't opt for a Microsoft watch, they'll wear smiles, all the way to the bank.
Tim Brugger has no position in any stocks mentioned. The Motley Fool recommends Apple and Nike. The Motley Fool owns shares of Apple, Microsoft, and Nike. 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.