November 15, 2013 11:21 AM
Posted by: Ron Miller
This is how we used to ask IT for hardware and software.
In the old days, if you wanted a server, you groveled to your IT department and asked for one. “Oh sure,” they would say. “We’ll get on that and after we put an image on there and rack it and stack it and do our IT magic, we’ll give you access to it –in 60-90 days.”
Fast forward to today when infrastructure as a service providers such as Amazon Web Services offer infrastructure that’s cheap and instantaneous. Instead of 60-90 days, you can have a server cluster up and running in 90 seconds.
Well, bust my buttons that’s a horse of a different color.
And that was the message Stephen O’Grady from Red Monk was delivering in a session called Shadow IT: Protagonist, Antagonist, or Neither at the Alfresco Summit in Boston this week. This ability to self procure hardware, software and services has forever shifted the balance of power between IT and end users.
They no longer have to ask. They don’t have to wait and they don’t even have to pay a lot because many cloud services are free or very low cost.
In fact to illustrate his point, O’Grady put up a slide with the following quote from Flip Kromer:
“[Amazon] EC2 means anyone with a $10 bill can rent a 10-machine cluster with 1TB of distributed storage for 8 hours.”
That very notion has changed everything, but it’s not just the infrastructure. The tools are free or low cost. There’s open source and cloud services galore with everything one could need to do a job and IT is just sort of sitting there a little shell shocked wondering what their role is now in this newly disrupted environment.
And it’s worth noting that Amazon made an announcement this week that could kick up the stakes just a little bit higher. It announced a new virtual desktop in the cloud that could change the way companies provision desktop computing in the same way it changed the way they provision servers.
The new tools include a standard type of computing environment and are available at a variety of price points. According to a blog post from Amazon, the tools will include “Adobe Reader, Adobe Flash, Firefox, Internet Explorer 9, 7-Zip, the Java Runtime Environment (JRE), and other utilities. The Standard and Performance Plus bundles also include Microsoft Office Professional and Trend Micro Worry-Free Business Security Services,” according to the blog post.
The price range is $35 to $75 per month, depending on the CPU, memory and storage options you select. Regardless of the price point, Amazon gives you access to these services from any device with an internet connection.
That means that anyone can provision a fully functional business desktop for a very low price and have access to their materials on any device, anytime anywhere.
As O’Grady pointed out these types of changes have had a profound impact on the balance of power in organizations because individual users can get the services they need without the help of IT. The desktop is just another step towards that total business provisioning in the cloud, one that can completely bypass IT if users were so inclined.
And of course, it would be a mistake to think it’s just Amazon that is leading here. They are just one example.
O’Grady said this ability, like bacteria, is neither positive nor negative. It just is and as IT pros you have to understand this changing environment and their role in it because as O’Grady pointed out, “The way we do procurement has to shift due to the availability, accessibility and lack of cost [of all these cloud services].”
And there’s no denying that or the role the cloud has played in that change.
Photo Credit: (c) Can Stock Photo
November 7, 2013 12:13 PM
Posted by: Ron Miller
We are starting to see the massive impact of mobile disruption on traditional PC hardware and software companies and older phone manufacturers.
In Clayton Christensen’s seminal book on disruption, Innovator’s Dilemma he points to the mid-1980s when most of the mini computer companies –DEC, Prime, Nixdorf, Wang, et. al –went from vibrant companies to the scrap heap in a matter of years after the introduction of the desktop PC.
We are seeing a similar dynamic play out in 2013 as mobile disruption from smartphones, particularly iOS and Android, is driving many traditional PC players and older phone manufacturers from the stage.
In a single year, we have seen the CEOs of Microsoft, Blackberry, Acer and Nokia lose their jobs. As Horace Dediu of Asymco pointed out on Twitter the CEO of HTC is teetering on the edge of the abyss. So what the heck is happening?
It’s disruption plain and simple. And get ready for plenty more of it as familiar brands bite the dust or the CEOs walk the plank in some kind of desperate hope that changing leaders will change the outcome. It won’t.
That’s because we are seeing the Innovator’s Dilemma play out in front of us across the technology industry.
Just as the Mini disrupted the mainframe and the PC disrupted the Mini; we are seeing mobile devices disrupt the PC and smartphones disrupt feature phones –and these companies are struggling to find ways to stay relevant to their base while attempting to build devices that appeal to the newer touch-enabled markets.
It’s interesting to see Nokia and Blackberry on this list because they are two companies that were on top of the world before iPhone and Android came along, but neither company has been able to adjust to the changing markets.
Blackberry eventually came out with a touch-enabled smartphone, but it was too little, too late, didn’t work very well and alienated its long time user base that actually liked a physical keyboard. They were torn between two worlds and reacted very slowly.
Nokia also had an extremely lucrative feature phone market. It seemed counter-productive to alienate that market and they only dabbled in the smartphone market. Their early entrees were actually quite good, but they didn’t go all in and ceded the market to cheaper touch-enabled Androids. By the time they realized what was happening and switched to Windows 8, it was far too late. iOS and Android already had complete control of the market and Nokia could only pick up the scraps left by the fading Blackberry.
Then we have Microsoft and Acer. I’ve written before about the struggles Microsoft faces as it tries to transition from a PC-based Windows/Office software model to one based on the cloud and designed for a smartphone/tablet model. It’s torn between the two and as I’ve written it’s almost impossible to serve two masters: the cloud and the desktop –another innovator’s dilemma playing out before us.
And finally we have Acer, the PC/laptop maker. As we’ve watched PC sales level off worldwide and we’ve seen tablets and smartphones pass the PC in a big way, it only makes sense that a PC maker would be a victims of this shift and sure enough we see the Acer CEO falling on his sword this week.
As Microsoft struggles, it would follow that the OEMs who sell PCs and laptops would face a similar issue. We have seen it with HP and Dell as well and we will watch these companies continue to fade, just as surely as we watched the mini computer ones fall in the 80s.
Christensen built the model, and today what we’re seeing it play out at an even faster rate than we ever thought possible. And this is only the start of a massive shift that will impact not only technology, but every industry.
Photo Credit: (c) Can Stock Photo
October 25, 2013 10:49 AM
Posted by: Ron Miller
The other day at the Apple press event announcing a slew of new products, services and pricing schemes, Apple officials took a few not-so-subtle swipes at Microsoft without naming names. They couched it in terms like “our competition.”
Tim Cook used the product announcement this week as a forum to attack competitors.
Here’s a good example of one of Tim Cook’s barbs:
“Our competition is different: They’re confused. They chased after netbooks. Now they’re trying to make PCs into tablets and tablets into PCs. Who knows what they’ll do next? I can’t answer that question, but I can tell you that we’re focused.”
Instead of ignoring such obvious trolling, Microsoft took the bait and shouted back. Of course they did. Because they don’t when to shut up and let their products and services speak for themselves. The trouble with Microsoft is every time they open their mouths, they show how little they know about mobile.
Microsoft’s response according to VentureBeat was that iPad’s not a real work machine and iWork is “watered” down, the implication being that Office is the only true office productivity app and you can’t do real work on a tablet without strapping on a keyboard. There might have been some statements about Tim Cook’s mother, something about army boots, a statement or two about the Apple executives dressing funny, and perhaps even a poopy head thrown in, but that couldn’t be confirmed at press time.
Microsoft CEO Steve Ballmer has had it up to here with Apple’s comments.
In fact, Jeff Rutherford, a PR Consultant who works with digital and tech companies believes Microsoft made a big mistake in how they handled the response. “I just think it’s tacky. I guess they felt obligated to respond since Tim Cook mentioned competitors on stage. Frankly, I think that was a mistake. Let yourself shine – don’t worry or even mention competitors,” he told me.
He’s right when you answer that kind of statement, you just look petty. And if you do answer certainly don’t do it by putting the other guy down too, especially when they didn’t even name you outright. Just be cool about your own products and services and be done with it.
Rutherford believes that Apple handled the situation well. They outflanked Microsoft by giving away their own operating system and office productivity package for free, and threw in a couple of well-placed barbs while they were at it.
“And, frankly, I thought Apple’s moves of giving away iWork [and Mavericks] for free was brilliant. Between Apple and Chromebooks and all the various Android mobile devices, Microsoft knows their PC hegemony is never returning, and they’re basically screwed unless they really do some dramatic retooling or make some acquisitions in the mobile space,” he said.
So what could Microsoft have done to salvage the situation? Rutherford says he would have recommended they take the focus away from Apple and put it on their own products. “If I were advising them on PR strategy, I would tell them to take the high road if called by reporters. “Apple is a smart and talented technology company as their latest iPad announcement shows. At Microsoft, we’re working hard to build the mobile Microsoft of tomorrow. Let me tell you about the new Surfaces we’ve announced . . .”
But of course they didn’t do that and Rutherford says that points to the flaws in their overall mobile strategy even more, a point on which I have to agree.
“Microsoft’s mobile/tablet struggles aren’t a PR issue,” he said. “They are a profound business and strategic error.”
Rutherford is right, there is a fundamental problem with their mobile strategy and this continued emphasis on the keyboard and Office as the primary tools for work is going to continue to be a major problem for the company. They need to find a way to define a better mobile strategy and forget about answering catcalls from Apple. That’s just distracting them from building their mobile marketshare.
Tim Cook Photo Credit: deerkoski on Flickr. Used under CC 2.0 license.
Steve Ballmer Photo Credit: aanjhan on Flickr. Used under CC 2.0 license.
October 15, 2013 9:12 AM
Posted by: Ron Miller
Yesterday, the always insightful Monday Note blog had an interesting post about the dilemma faced by the next Microsoft CEO. In summary, Microsoft finds itself very much between a rock and a hard place when it comes to its strategy moving forward and whoever takes over is going to face a huge challenge guiding the company through this.
The rock you see is the still-lucrative but ultimately fading PC software business. Microsoft still makes the bulk of its money from Windows and Office. So what’s the problem? There are still plenty of PCs. Walk into any business in the world and you’re likely to find oodles of them, most running some version of Windows and office.
The problem is that this isn’t a sustainable model long-term. If you doubt me (and I’m sure many of you do), then click through to this screenshot from Asymco and see what has happened to PC sales since the launch of the iPad in 2010. I’ll wait.
As you can clearly see if you clicked through, it’s not a pretty sight for a company focused on the desktop. No matter how many PCs there may be in your company today, the numbers show that the PC business has been in steady decline and that’s not likely to change any time soon.
Microsoft is caught between, well, you know.
So where is all that PC business going? It’s moving to mobile devices like tablets and smartphones. As that has happened, Microsoft has not stood stone still of course. It has recognized this fundamental shift just like the rest of us and while it took some time, it has begun to build its mobile and cloud business over the last several years.
Which brings us the hard place, the cloud.
And the goal now says Steve Ballmer, is to be a devices and services company instead of what it has always been, a desktop software company. It’s a worthy and sensible goal in today’s market reality, but it’s one thing to recognize that the market is shifting and another to ignore that cash cow that is Windows and Office.
As the Monday Note post points out, “Microsoft can’t abandon its current model entirely, it can’t stop selling software licenses to hardware makers. But the company realizes that it also has to get serious about making its own hardware if it wants to stay in the tablets and smartphone race.”
So how do you keep these two seemingly disconnected strategies going while finding a way to push the company forward. It’s going to be a monumental challenge for the next CEO, and what’s worse is as the market has shifted, the dollars have shifted away from Microsoft.
Make no mistake, Microsoft is still a substantial company, but it’s basically making money with an old playbook while trying to transition to a new one and they often conflict.
Trying to decide how to divvy the resources, while keeping internal factions from killing each other and stockholders from all-out rebellion is going to take stout leadership, creativity and political savvy, and it’s going to be a tremendous business challenge to find the right balance among all these conflicting needs, while guiding the company out the other side to whatever it is to become next.
Good luck with that.
Photo Credit: (c) Can Stock Photo
October 4, 2013 9:39 AM
Posted by: Ron Miller
Danny and the Juniors once sang Rock and Roll is here to stay. Just like rock, the cloud isn’t going anywhere.
Last week I read a piece quoting Steve Wozniak that maybe the cloud wasn’t so bad. In fact he’s a fan of the cloud now. Wonderful, but it actually doesn’t matter what Woz or anyone else thinks, because just like rock and roll, the cloud is here to stay.
Cuz I don’t care what people say, Rock and Roll is here to stay…
I know the NSA can spy on us through the cloud, or apparently just about anywhere they choose, but it doesn’t matter. Cloud computing has become entrenched in the way so many of us do business. It’s so ubiquitous now that we don’t even think about it as the cloud. It’s just computing and that’s as it should be.
So let’s just end the discussion now. Repeat after me, “The Cloud Isn’t Going Anywhere.”
Rock ‘n roll will always be our ticket to the end
It will go down in history, just you wait, my friend
It’s just not. Many thought Rock was a fad. It wasn’t. More than 50 years later it’s still here and moving forward so will the cloud.
That’s because we have grown accustomed to the idea of accessing our apps and content on any device, anywhere, anytime and we aren’t going to back to carrying 3.5 inch floppy disks, a thumb drives or even emailing content to ourselves to move our stuff from device to device.
In an age when many of us have multiple devices including like a smartphone and a PC or laptop and likely a tablet too, we are used to accessing our stuff on multiple devices. And since my phone doesn’t have a 3.5 inch floppy drive or even a USB one, the cloud is the best way to access my content anywhere on any device.
Perhaps you have an issue with the name “The Cloud.” Get over it. It’s just a name. Sure it’s been abused my marketers and misused and misunderstood by many, but it’s just a term, a common lexicon. You don’t have to like the term, but it is what it is and that’s it.
If you don’t like rock ‘n roll, think what you’ve been missin’
But if you like to bop and strawl, come on down and listen
What the cloud comes down to is convenience and ease of use. The NSA? It’s a red herring. Even if you have a private cloud, chances are you’re accessing the internet to share your data and content. If you’re using the public pipes anywhere along the line, we know they’re listening to everything that flows through it. It doesn’t matter. It’s irrelevant to the discussion.
This blog has been first and foremost always about the beauty of the cloud-mobile connection. And while there’s been tons of noise around the cloud about security and reliability and even the name itself, the fact is it works the way it’s supposed to work most of the time.
So, no, the cloud isn’t going anywhere. Let’s just move now, shall we.
Photo Credit: Ben Sutherland on Flickr. Used under CC 2.0 license.
Lyrics from Rock and Roll is Here to Stay by Dave White as recorded by Danny and the Juniors
September 23, 2013 8:02 AM
Posted by: Ron Miller
Apple proved critics wrong as their new iPhones sold in huge numbers this weekend.
The lines were still there. The product still flew out the door and by weekend’s end in an astonishing show of strength, Apple had sold 9 million iPhones.
Apple was reporting that the iPhone 5S, its flagship product was sold out. The 5C was still available. Unfortunately, Apple did not break down the numbers by type. Charles Arthur, the tech writer for The Guardian pointed out on Twitter that it certainly helped that Apple released the iPhones in multiple markets including China on the same day. Apple reported releasing the phone last week in US, Australia, Canada, China, France, Germany, Hong Kong, Japan, Puerto Rico, Singapore and the UK.
Still, that’s some serious muscle flexing and The Wall Street Journal reported that even Wall Street was impressed with the sales numbers as Apple’s stock was up 3.6 percent in premarket trading.
For all those who have been blathering that Apple’s best days were behind it and Apple couldn’t perform without its superstar founder at the helm, Apple answered that this weekend in spades as their products once again flew out the door.
There were reports of lines outside Apple stores on Saturday, the day after the release. The fact is that Apple still commands that kind of reaction, while other manufacturers can just sit on the sidelines and watch.
To put that kind of performance into some perspective, consider that in the second quarter report that came out in July, Nokia reported selling a record 7.4 million Lumias for the quarter. Samsung’s popular Galaxy S4 boasted selling 20 million units in 68 days. Apple sold 9 million iPhones in a weekend.
When I saw the pictures of the lines on Twitter on Friday like this one outside the Fifth Avenue store in New York City, I was surprised. I had written last week that the thrill of the Apple announcement was clearly gone, yet in spite of the less than stellar reaction to the iPhone announcement on social media, people still showed up in huge numbers on launch day and still waited in long lines for a phone.
It’s a phenomenon that I’ve never completely understood. Why would I wait in a long line to have the phone on the first day? Is being first with a smartphone still so cool that you would take time off from work to get one? Apparently so as the people in line on Friday proved.
Given my druthers I’ll wait for a few weeks and waltz into my local store without a line and get one whenever it’s available. I realize I might have to wait for one as I did with my iPhone 4, but it’s a chance I’ll gladly take. I don’t have the patience to sit in a line to get a phone.
But it seems that many people don’t share my feelings. There are still millions of people who are willing to do just that proving once again that the Apple brand still has cachet and they can move product with the best of them.
For those who have been suggesting the company has been in decline since Steve Jobs died, this must have been an eye-opening experience, and it seems rumors of the company’s downfall have been greatly overstated. Time to find something else to write about because if this weekend is any indication, Apple’s doing just fine, thank you very much.
Photo Credit: chocobos on Flickr. Used under CC 2.0 license.
September 19, 2013 7:37 AM
Posted by: Ron Miller
Microsoft’s attempt to buy Apple products in exchange for Windows mobile ones smacks of desperation.
Microsoft’s latest gambit to get people to buy their tablets and smartphones is to pay Apple customers to give theirs up. Good luck with that.
In fact, just a week after offering a $200 gift card to Apple owners, ZDNet’s Mary Jo Foley reports that they’ve upped the ante to $350. It’s worth noting that’s what a new Surface RT costs, so they would be making exactly zero dollars on this deal. Do I hear $400?
I love the smell of desperation in the morning.
I can just see the Microsoft brain trust sitting around spitballing ideas about how to jump-start their mobile business. Ballmer enters a room surrounded by Microsoft’s sharpest marketing minds. A large white board and several magic markets sit at the wait in the front of the room. Ballmer sets the stage.
So far, every attempt by Microsoft to capture mobile marketshare has been stifled. They tried making their own tablets and it’s gone so poorly, Microsoft had to resort to giving them away to schools. The phone business remains mired in the single digits in the US and is not doing terribly well outside of a few pockets of popularity in the rest of the world.
The mission, Ballmer tells his marketing minions, is to find a way to get that market fired up. He opens the floor to suggestions. One particularly sharp young woman suggests they build better devices that people actually want. Ballmer pulls a Tim Armstrong and fires her on the spot.
This stifles the conversation for a bit, but after a few minutes somebody cautiously raises their hand and suggests paying iPad and iPhone owners to sell their equipment to Microsoft in exchange for a Windows phone or tablet. The room goes silent. Ballmer stares at the employee, then raises his eyebrows and triumphantly declares the idea brilliant!
OK. That never happened, but just how did such an idea actually see the light of day and why would they think it would work? Ideally any product lives on its own merits and doesn’t require gimmicks to make people buy it. That Microsoft believes it needs to pay its competitor’s customers to give up their devices to use Microsoft’s smacks of the worst kind of desperation.
And seriously, how many devices are they going to sell with this stunt? I’m guessing not very many. The thing is if Apple owners wanted a Windows device, chances are they would have bought one. It’s not as though the market is teetering towards Microsoft’s favor, and with just a little push, Apple owners are going to go running to Microsoft. That’s not going to happen.
One thing is clear from this attempt, Microsoft has a serious problem with their mobile device market and it’s letting the whole world know about it. Look, Microsoft probably made a smart move buying Nokia’s handset division, but they need to come up with a better approach than paying for customers. Even if they were able to buy marketshare, which is highly unlikely, they wouldn’t make any money doing it. No, Microsoft has to go back to the drawing board and earn marketshare the old-fashioned way.
They have to earn it.
Photo Credit: (c) Can Stock Photo
September 11, 2013 12:04 PM
Posted by: Ron Miller
Like the Stones, Apple has to find a way to capture the magic every time out.
Yesterday Apple announced a couple of new phones, one a lower priced one, one a typical high end one. As I peruse social media, I get the sense the masses were not impressed.
Much like the Rolling Stones, Apple has to get up on stage again and again and figure out a way to blow the audience away –and it’s not always easy.
The question is what exactly were the people looking for. Putting aside the 5C for a bit because it’s basically the iPhone 5 with a new colorful cover, let’s look at the newer model, the 5S.
The phone itself is nothing special or new if that’s what you were hoping for. The phone is, well an iPhone. It hasn’t changed much except now we have silver, gold and “space” grey for color choices. Other than that it looks pretty much the same as an iPhone has looked for a while now.
Perhaps people were looking for something new. I’m wondering if a new shape would have placated them? A bigger screen? What? Perhaps they wanted an HP-like complex list SKUs to choose from?
If I could stick a knife in my heart
Suicide right on stage
Would it be enough for your teenage lust
Would it help to ease the pain?
~Rolling Stones, It’s Only Rock and Roll
Once you get past the cover though, there is quite a bit to like under the hood inside the iPhone case, starting with the world’s first 64-bit A7 processor. Nobody else has done that. You won’t find it in a Samsung, Nokia or HTC. You won’t find it anywhere and it’s fast, at least if you believe Apple. Stephen Shankland writing on CNet points out there was a fair bit of hyperbole in Apple’s presentation yesterday, shocking as they may be, but he says it’s the future and Apple was smart to go there first –even if we don’t see the speed benefits Apple claims immediately.
If I could dig down deep in my heart
Feelings would flood on the page
Would it satisfy ya, would it slide on by ya
Would ya think the boy’s insane?
Apple didn’t introduce a wearable device yesterday, but it might have laid the foundation for one with the the new M7 chip, which is a motion tracking device. For folks into exercise and tracking their progress (or lack thereof), the new chip does all the heavy lifting, taking pressure off the A7 and, according to Gizmodo, collecting a continuous stream of data about your movements without having a huge impact on battery life.
Then of course there was iOS 7 and the fingerprint scanner. Sure some of the bloom was off the rose from these announcements because Apple announced iOS7 in June at WWDC and information about the fingerprint scanner leaked weeks before yesterday’s announcement. What might have had a little more oomph, lost a lot of luster when it was basically…oh, we’ve heard this stuff.
The fact is we want to be excited by these announcements, but as James Kendrick pointed out on ZDNet, the thrill is definitely gone from iPhone announcements, and let’s face it from just about all mobile announcements.
In the 2007-2010 timeframe, these events meant something because we were seeing something we hadn’t seen before ever, or we were seeing improvements we had been clamoring for. Sure, a faster processor and a fingerprint sensor appeal to my inner geek, but they sure don’t get the masses all hot and bothered like they once did.
Like the Rolling Stones complained in It’s Only Rock and Roll, what exactly does Apple have to do to get your attention now, suicide right on the stage? It’s a phone, folks. It’s never going to dazzle us like it once did.
It might not have excited us as it did back in the day. I’m not sure it ever could, but it was probably close enough for rock and roll. Whether that’s enough to satisfy our technology lust, only time will tell.
Photo Credit: michael conen on Flickr. Used under CC 2.0 license.
Ed.: For further perspective, check out Ron on Slashdot TV. More of a sports fan than a music fan? Maybe you’d prefer to read how Apple is like the New England Patriots.
September 3, 2013 9:58 AM
Posted by: Ron Miller
The Microsoft-Nokia deal is not a slam dunk by any means.
I was all set to write an entirely different post this morning when Microsoft pulled a fast one and bought Nokia’s handset division overnight. There’s a lot of talk about the beauty of the hardware-software combination with this deal, but I for one think it won’t work for either company.
I agree it’s a deal that makes sense on paper, just like the Red Sox signing Carl Crawford and trading for Adrian Gonzalez once sounded so good on paper, Josh Beckett was quoted in Spring Training, 2011 as saying, he was looking forward to playing for a 100-win team. On paper that team looked great. In reality, the team crashed and burned in a September swoon for the ages because it couldn’t play together.
And there could be a lesson for Microsoft and Nokia in that collapse.
The conventional wisdom goes that Apple is the primary business model to emulate because Apple has always controlled the hardware and the software, and as we know has had a pretty good run doing that. The thinking goes if you want to make money, you have to control the entire equation.
It worked for Apple because that’s what Apple has always done. They do it really well, but just because it works for Apple doesn’t mean it’s going to work for Google or Microsoft. In Google’s case, they went out and bought Motorola for $12.5 billion to make Google-branded, Android smartphones.
I’ve always argued that Google makes money when Google services run on the maximum number of devices possible. That’s what makes the Android strategy so brilliant in the first place. They give away a phone OS. It explodes and becomes the most popular OS on the planet by far and Google wins. If OEMs believe Google is giving its own Android phone division an unfair advantage in this game, it’s going to upset the balance of the ecosystem it worked so hard to create.
I see a similar dilemma for Microsoft with Nokia, and for Microsoft the problem is a bit more pronounced. Android has been so successful, Google can afford to piss off some of the players in their partnership and still get away with it. Microsoft with single-digit marketshare does not have that luxury.
So while of course, Microsoft will continue to allow other phone makers to manufacture Windows phones, you have to wonder how much motivation these companies are going to have to continue doing that when they aren’t selling well, and now Microsoft owns the market leader.
One of the reasons Microsoft was successful with Windows and Office was because they worked on any PC. The more machines that ran Windows and Office, the better off Microsoft was. That’s probably the primary reason we never saw a Microsoft-branded PC. Now, they want to move away from that model and they want to control the hardware and software and be Apple. But just because you own the pieces of a system, doesn’t mean you’re going to be successful.
If you want an example of Microsoft buying a good service and doing very little with it look at Skype, for which it paid $8.5 billion a couple of years ago. As Om Malik points out, Microsoft has failed to take advantage of owning what was one of the more disruptive products of the last decade. As he put it:
“Skype as we know is slowly losing its identity. It is merely a pale imitation of its former rebellious self, a Microsoft product that is there just to further Microsoft’s vague and unclear ambitions about unified communications.”
Those who think that Nokia is the missing link for Microsoft would be wise to remember that. As Bob Egan, who is founder and CEO of Sepharim Group tweeted this morning, “Msft buys Nokia – cheap. Msft good at the A, not so good at the M in M&A. Microsoft’s purchase of Nokia is a fate determining moment.”
That it is and Microsoft had better be ready to take advantage this moment and merge Nokia smoothly into the family because in spite of its vast cash hoard, it needs to succeed in mobile or be left behind for good, a once vibrant company that simply didn’t have the ability to evolve with a changing market.
And one other thing, there’s this chart on the Guardian this morning that shows that maybe Nokia’s not doing so great selling Windows phones after all.
What I see is not a perfect match, but two struggling companies searching desperately for an answer that will somehow prevent them from becoming the next Blackberry. And even though the deal looks solid on paper, and is very likely one both companies had to make, it doesn’t mean it was a good one or that it will work.
If you doubt that, see the 2011 Red Sox. They couldn’t miss either.
(c) Can Stock Photo