The Personal Computing Land Grab

It is hard to describe what is happening right now in the personal computing industry than anything other than a massive land grab. The land grab I speak of does not apply as much to traditional “old school” computing devices like desktops and portables, but it does apply to smartphones and tablets.

The point that continues to be forgotten, is that there are still billions of people who do not have a smart phone, tablet, or other form of primary computing device. This point is understandably forgotten because so many in the mainstream media only focus on the here-and-now and that is ok. But in the here-and-now many tend to focus on the market share point as if the market is as big as its going to get. The reality is that specifically with smartphones and tablets we are in the midst of the largest global total addressable market (TAM) expansion we have ever seen.

Just a quick look at some numbers highlights this. Right now we sell around 80-90 million traditional PCs every quarter. That market is not currently expanding. If we believe, as I do, that the tablet market is larger that the traditional PC market, then the upside is still significant. Approximating up to the current quarter, there are less than 20 million tablets sold worldwide on average every quarter. Which means the opportunity is to add tens of millions of new tablet buyers each quarter with the current growth rate of 50-60 percent a year. Smartphones sell just over 100 million world wide every quarter, similarly growing at about 40-50% year over year. Which means tens of millions of new customers will be buying smart phones globally every quarter. This market expansion is being driven by new customers, first time buyers, and that is the key to the land grab.

This global expansion is being driven primarily by Post-PC devices of a highly mobile nature. The limiter with old school PC devices was and still is the form factor. Desktops and portables, due to their design, simply had limited use cases. Namely, you had to be stationary. With a desktop, you sat at a desk and couldn’t move. With a portable, you could move from one location to another but still needed to be stationary to use it. Tablets and smartphones break the computing paradigm of being stationary and bring mobile computing into new places. This is why the market opportunity for tablets and smartphones is much larger than desktops and portables—mobility.

The key to this land grab is entry points, and they key to defending your land is ecosystems.

Getting Consumers To Move Onto Your Land

Step one is get consumers on to your land. If we trace Apple’s strategy back just over 10 years, this was the iPod. The iPod, with its simple yet powerful value proposition, is the product that set the stage for Apple. The iPod could arguably be explained as the catalyst for the post-pc era.

This battle to get consumers onto your land is the single biggest reason the pace of innovation is picking up. Many were shocked that Apple refreshed as many products in their product line just before the holiday quarter. The truth is that most if not all of the refreshes, new product launches, etc, are targeting new customers or ones who have not upgraded in quite some time. Take the iPad Mini for example.

As hard as it is to believe not everyone has an iPad. Yet there is still extreme interest around the tablet form factor. Apple is convinced that once people start using iPads, they have profound and some times life changing experiences. Our own internal consumer research confirms this as well. So for Apple, primary strategy number one, is to break down the barriers to owning an iPad. Apple’s focus is to bring premium features to the market at mainstream prices. We could debate that point all day but an objective look at the pricing and features of all products in the market would validate the point. With every upgrade the brought to their holiday lineup, they stayed true to that formula. And as Tim Cook said, “we are not taking our foot off the gas.” Most Apple competitors aren’t in total control of the gas pedal, yet alone have enough money to keep their foot on the gas. Strategically, this is a key point in the land grab.

Microsoft, and their partner ecosystem, also understand the land grab. Microsoft had, and still has, most of the land of traditional desktops and portables. Key point number one for them is to maintain that land but expand into new ones. Hence their aggressiveness with new form factors across the board. Windows 8’s success hinges on its ability to move into new land during this land grab, namely post-PC devices. This is also where uncertainty still remains about the platforms ability to do so.

The Sticky Ecosystem

Hardware and software get consumers in the door, or onto the land in my analogy. The services are the part of the ecosystem that keep people loyal. iCloud, iTunes, iMessage, etc., are examples of this for Apple. XBOX Live, XBOX Music, Office related services, SkyDrive, etc., are examples of this for Microsoft. All of these services act as glue tying their hardware and software services together in relevant and useful ways for consumers.

The strategy is to get consumers onto your land and keep them there with a strong and useful ecosystem. To some degree these ecosystems are mature and to some degree they are not. The services element of this is one of the most exciting upsides and is still full of unexplored territory.

There is much land still to be grabbed. The pace of innovation is going to continue to accelerate because of it. But this competition will make each competitor better and in the end bring to us, the consumers, some of the most exciting, useful, and enjoyable technology products never before imagined.

Why Surface Will Be Good for the iPad–and the Rest of Us

Microsoft SurfaceFor the past 2 1/2 years, iPad as has ruled the world of tablets. Except for Amazon’s Kindle Fire and the Barnes & Noble NOOK Tablet, both special-purpose devices dedicated to consumption, there has been no competition worth mentioning. But with the entry of Microsoft into the fray, both with the Surface and an assortment of third-party Windows 8 and Windows RT tablets, the business is about to get a lot more interesting.

I start from the premise that only competition keeps the tech business driving forward and that in the absence of effective competition products stultify. This definitely happened in PCs. After Apple failed to respond to the introduction of Windows 95, the Mac market share fell to the low single digits and without effective competition, Microsoft innovation faded. It has only been Apple’s across-the-board success in recent years that lit a fire under Microsoft.

The iPhone never had iPad’s grace period. It entered a crowded market, where it had to displace the entrenched market leaders: BlackBerry, Windows Mobile, Palm, and Symbian. That proved to be surprisingly easy, helped by lunkheaded competition, but  Android soon came along as a serious challenger. I don’t think there is any doubt that the iPhone and Android have made each other better and I expect this process to continue, especially if Google can build and app and services ecosystem that rivals Apple’s. And I think the entry of Windows Phone 8 can  only improve things, pushing both Apple and Android, though its commercial success is an open question.

The fact that iPad has improved quite a bit since its 2010 introduction seems largely the spillover of iPhone features into the tablet space: better apps, better services, faster processors, and the retina display.  The first notable effect that tablet competition has had on the iPad is the introduction of the iPad mini, which is clearly a response to smaller tablets finding at least some success in the market.

Android tablets, especially the larger ones, have suffered from many problems. but the overwhelming issue is the lack of decent software. The success of iOS devices and even, to some extent, of Android phones has proven that consumers want native apps. But Google has had a very hard time seeing beyond the browser. The Android app situation remains calamitous, with most of the available choices being blown-up phone apps that are terrible on a 7″ tablet and unspeakable on a 10″.

Microsoft is not making this mistake.  The selection of Windows RT apps is still quite limited, but Microsoft understands the care and feeding of developers. The RT apps that are available are designed for the Surface’s display (and those of Windows 8 laptops and tablets) and consistently speak the Metro (for lack of a better name) design language common to Windows 8/RT and Windows Phone. Many of the apps are quite good (a notable exception being the built-in Windows 8/RT Mail app, whose awfulness is both inexplicable and inexcusable.)

Equally important, Surface is being launched into a mature Microsoft ecosystem. Microsoft has spent years seemingly pouring money down the holes of Xbox and what used to be called the Windows Live collection of online services. But now, those investments may be about to pay off, as the company pulls together the entertainment content of Xbox and cloud services such as SkyDrive, Outlook.com, and Office 360–not to mention the deep understanding of cloud services it has gained from its enterprise back office offerings. iOS devices sold a lot of Macs because of the way they work so well together in the Apple ecosystem. The same dynamic could work for Microsoft in reverse: the vast installed base of Windows PCs could sell Surfaces and Windows Phones to gain the advantages of the Microsoft environment.Surface is being launched into a mature Microsoft ecosystem..

Surface is not designed as a head-on competitor for the iPad. In many ways, from its ability to work with USB peripherals to its all-but-mandatory keyboard, it is far more PC-like. Like the iPad itself, it represents a new device class in what is turning out to be a surprisingly big space between smartphones and traditional PCs.

It’s going to take a while before we can judge the success of the Surface strategy. Microsoft, however, is a patient company that is smart enough not to expect an instant payoff from its very big bet. But by offering tablet-hungry consumers a worthy alternative to the iPad, Microsoft has put pressure on Apple to keep its game up. That can only be good for all of us.

 

 

Microsoft Pulls it Together (Almost) for Windows 8 Launch

I attended Microsoft’s launch last week for Windows 8, Windows RT, and Surface. While launch day is only one milestonephoto 1 (3) in a string of milestones, launch day is the one day that everything must come together, the day where some make their final judgment. So how did Microsoft do?

Importance of Launch Day

Launch days is one day in many important days that a product or service goes through in its lifecycle. I believe it is one of the most important days, though, as it pulls together all the hard work of the previous years into just a few hours. The value of launches differ between consumer and commercial products, too. In the commercial world, buyers like IT managers don’t expect and quite frankly don’t believe that everything would be together on day one. They’re a skeptical bunch, due in part to just how many times they have seen products and services not live up to their promises in the past. Maybe they even lost their job or got reprimanded for making what ended up being a tech mistake that cost their company time or money.

Consumer product launches are different, in that those product and services get measured by press and reviewers based upon what it can do on launch day, not at some point in the future. There are some exceptions that consumers make, where if they trust a brand and they make a future promises the company is believed, but for the most part, what is launched on that one day sticks for a very long time.

One final important piece about launch day is “permanence”. What gets written by press and analysts on launch day is rarely updated if something changes. With most consumers checking out the internet before they buy, this is vitally important. So how did Microsoft do?

Windows 8 Launch Day Plusses

Looking holistically at the day, I have to give credit where it is due. Microsoft did a very good job pulling everything togetherimage on game day. Microsoft made a good case that Windows 8 was the best Windows yet, good for older and the newest systems. On almost every metric, Microsoft showed that Windows 8 is better than Windows 7. They didn’t address the lack of a Start button or the potential confusion, but I don’t think this was the right place to do that. That is best demonstrated in the marketplace.

The demos were some of the best I’ve ever seen from Microsoft as Mike Angiulo and Julie Larson-Green did their magic. They made a pretty good case for why consumers would want Windows 8, particularly on touch-based devices. I particularly thought they did a good job showing and talking about how Windows 8 works with other Microsoft-based properties. Angiulo and Larsen-Green also did a very good job in showing the absolute breadth of designs supporting Windows 8 and Windows RT. The device onslaught was impressive, from notebooks, to hybrids, tablets, convertible flippers, convertible swivelers, to all in ones. They showed devices from all the big brands at prices ranging from $499 to $2,499.

Steve Ballmer was in rare form too, with a good balance of his famous passion and facts. He was there to put the final stamp on the event by showing just how committed Microsoft is to the Windows 8 ecosystem and experience by outlining just how many Microsoft apps and services have been developed to support a seamless Windows experience.

The launch wasn’t perfect, though.

What I Wanted to Hear More About

Microsoft demonstrated their best launch I have ever seen, but it could have been better, had they made a stronger case on a few items.

I have been a bit critical previously on how Microsoft has handled the rollout of Metro-based apps in the store. Without having enough high-quality apps, Windows 8 could have been compared to the webOS Touchpad or 10” Android tablet ecosystem, which would have been disastrous. Microsoft definitely came through on video streaming services by adding Netflix and Hulu within weeks of launch. They also showed up with many key new site apps, even though CNN is still MIA. What Microsoft missed at launch were key social media apps. While I understand that the People app has some good connections to services, it does not replace a native social media app for Facebook, Twitter, LinkedIn, Pinterest, or Google+. One example is Twitter. I, like many, have Twitter lists they want on their primary start screen. Not a single Metro Twitter app supports this. I would have at least liked for Microsoft to address this head-on and give a date when some of these apps are committed. In Surface reviews, the number of high quality apps was on key criticism in every single one of them. It didn’t have to be like that and was avoidable.

I would have also liked for Microsoft to address any hardware incompatibilities with Windows RT as opposed for users to find out on their own. Microsoft stated that Windows RT “works with 420,000,000 devices” but how do I know if that one Neat scanner or HP scanner that is so important to me works well? Microsoft has done a ton of work testing, but I would have at least liked to see accessible resources for consumers to check if their special peripheral works well. By not disclosing this, it made them appear to be hiding something.

Finally, there is the commercial PC and tablet market. Enterprises are currently shifting from Windows XP to Windows 7 on standard form factors like notebooks and desktops and therefore Windows 8 for the most part is irrelevant to them. Tablets are another matter altogether. Tim Cook routinely announces the extremely high per cent of enterprises rolling out or evaluating iPads, the latest figure pegged at 92%. Given Microsoft makes 75% of their profit from the commercial market, this seemed like an oversight. Given the competitiveness of the Windows 8 and Windows 8 Pro tablets, many enterprise IT people would be hard pressed to justify an iPad purchase, Microsoft should have at least given a tip of the hat to Windows 8’s applicability to the commercial market.

Where We Go From Here

Many consumer reviews have been written and there will be many, many more in the future for Windows 8 and Windows RT. For the most part, the die has been cast and the Microsoft marketing and ad machine are in full swing, all which will make a difference on perception. The Windows 8 launch was the best Microsoft launch I have ever seen or attended, and I have personally attended many. While Microsoft didn’t address everything they needed to in order to seal the deal, they absolutely got Windows 8 and RT off to a solid start. Now it’s time to see if that translates to sales.

Buyers Remorse is a Way of Life in Tech

[dc]H[/dc]ave you ever bought a tech gadget and two weeks later, a better version of it comes out? Or purchased one of the new HDTVs with high resolution and then seen a new version with even higher resolution come out just weeks later for the same price? It may be relatively obsolete after CES in January as all TV makers will introduce their 4K or Ultra HD sets with 4 times the resolution of today’s HDTV’s.

Whether consumers like it or not, buyers remorse is just a way of life in the world of technology and that will never change. How come you ask? Well, there are a lot of reasons but the basic answer lies in the fact that no matter what product a tech company puts out, it is in its DNA to make it better, faster, thinner, lighter or develop a whole host of other tech related advancements that enhance the product further. I have been covering the tech market for 35 years, and this cycle never changes. However, the pace of tech advancements today is faster then I have ever seen in my years of covering technology professionally.

When Apple introduced both the iPhone and the iPad, they pretty much committed to a year long cycle before new models came out. This was because as early as 2003, Apple was updating the iPod every 6 months and consumers were squawking about this pace of upgrades and their buyer’s remorse. So Jobs said at one MacWorld that they were going to start this yearlong cycle to help alleviate those concerns. And this has been the case from then until last week.

So, why did Apple introduce a 4th gen iPad just seven months after the 3rd generation iPad hit the streets? My educated guess is that once Apple perfected the A6 chip, which they introduced in the iPhone 5 and doubled the speed of iPhone, they really wanted to upgrade the iPad as soon as possible so that both products performed at these new processing levels. Having both equal in performance makes a lot of sense because once you use the iPhone 5, you clearly want that same speedy performance in your iPad too.

Keep in mind, Apple does not do R&D then put things into manufacturing over night. The fact that they were going to put an A6 chip in an iPad was probably put in place at least 18 months ago and while they could have held it off until next March, the performance gains they had with the A6 chip was just too good to hold off releasing it until next year.

But this same logic drives much of the tech vendors thinking about product releases. Many Android backers and PC vendors update smartphones, tablets and laptops in 6-month increments. And if a consumer service has new features, it usually gets upgraded even faster, even if it means offering a new device with more advanced features to handle the new services.

When I was a kid, I remember getting a hand held transistor radio so I could listen to baseball games. And I saved up my money to get this particular model that was small and very portable. I literally scraped pennies and dimes together over a period of time so I could buy this particular radio I had seen advertised in the back of Popular Science.

Well, guess what happened. As soon as I got the radio, the newest model was released and as a kid, I had my first bout of buyer’s remorse. And even today, that happens all too often for me even today. But at some point I just have to say that this product will meet my immediate needs and pull the trigger and buy it.

While Apple releasing a new iPad may have come quickly, the same will happen with the Nexus 7. Google is likely to introduce not only a new 10” model soon but also an updated 7” version too, even though the current one hit the market just 4 months ago. And given the pace of technology advancements, I will not be surprised if Amazon upgrades their current Kindle Fire HD six or seven months after the current model came out.

So, the fact that Apple introduced a new iPad not long after the last one came out should not be that upsetting to people. The opposite would be to tell Apple to slow down the pace of innovation and as a technology buyer that is the last thing I want Apple to do. The same goes for Google, Amazon and any other company who delivers innovative products. The key is to understand that what you buy today will meet your needs today since you may not even know what your needs will be tomorrow. That is the job of the tech companies; to anticipate users future needs and drive their R &D in that direction.

A Surface Retail Reality Check

Photo of popup Microsoft store

Whatever the buzz that got some people to line upo for the midnight launch of Surface sales at Microsoft Stores last night seems to have dissipated quickly. This afternoon, I stopped by the popup store in Westfield Montgomery Mall  in Bethesda, Md. It was a slow time of day, about 3 pm on a Friday, but the heavily staffed store wasn’t having a lot of luck even getting passing shoppers to stop and take a look at its assortment of Surface tablets and Windows 8 laptops. At one point, I counted five customers (at least in the sense they were looking) and 10 store employees, probably mostly contractors.

Here’s a very of the same store, located at the crossing of two main aisles, from the level above:

Photo of popup Microsoft store.

And here, for contrast, is a shot of the Apple Store located directly above the Microsoft popup. It’s actually pretty empty by Apple standards, but Microsoft would die for this sort of quiet time.

Photo of Montgomery Mall Apple Store.

The Windows 8 Ecosystem, For Experimental Purposes

[dc]I[/dc]n the coming weeks I will do something for experimental purposes that I have not done for over 10 years. I will be immersing myself in the Windows 8 ecosystem entirely. I converted from the Windows ecosystem to the Apple ecosystem in 2002 and I have never been happier. Apple products work the best for my computing needs and workflow, and as the saying goes, the best product is the product that works best for you.

However, I used to be fully in the Microsoft ecosystem. I started my career in this industry in IT for a semiconductor company and I could troubleshoot, diagnose, and keep Windows working with the best of them. In fact, back in those days, even after converting to Apple’s ecosystem, I was extremely loyal to Pocket PC, then Windows Mobile as my PDA and my smartphone choosing Microsoft’s mobile products over the popular Palm products. I have fond memories of those devices.

What I personally use for my computing ecosystem is irrelevant to the way I do industry analysis. To effectively understand the trends and long term market opportunities we need to understand the strengths and weaknesses of every platform and ecosystem holistically. This is why I did the 4 month test with Android by embedding myself in Google’s ecosystem as much as possible. I will be doing the same thing with Microsoft’s latest offering, Windows 8, in order to fully perform a platform analysis. And I am actually kind of excited about it.

Although, I have committed to Apple’s ecosystem, I am a fan of technology and innovation and I appreciate it no matter where it comes from. Just because I know what products work best for me does not mean I can’t appreciate innovative things about other products of ecosystems. And as mentioned before, this is key for us to assess the short and long term opportunities for those in the technology industry.

So for experimental purposes, for periods of time over the coming months, I will be using the latest HTC Windows 8 smartphone as my primary smartphone, The Acer S7 UltraBook with Touch as my notebook, Surface and the Asus Vivo Tab RT as my tablets, and a few X86 Windows 8 hybrids.

Besides my goal of an exhaustive platform analysis of pros and cons and short and long term opportunities within the Microsoft ecosystem for our clients, I hope to find specific things that I like or appreciate about Microsoft’s latest effort.

I’ve always believed that the most enjoyable computing experience will come when you commit to a platform or ecosystem and stick with it. Each platform and ecosystem looks for unique ways to make their products work better together. I believe that philosophy will yield the most valuable experiences in personal computing.

In my view Apple and Microsoft have the strongest platform and ecosystem stories to day. I say this because they have platforms that span every screen in personal computing. Apple’s is more mature in my opinion but Microsoft is not going anywhere.

Regardless of whose ecosystem you commit to, the future for personal computing is extremely bright.

Windows 8: Back To The Future

[dc]D[/dc]ue to scheduling conflicts I could not be in NYC yesterday for the Windows 8 launch but watched it intently as it was streamed around the world from Microsoft’s Web site. But what I saw was both impressive as well as confounding for many reasons.

Let me start with the confounding issue first. Once Microsoft CEO Steve Ballmer took the stage with his bubbly personality, he expressed “excitement” about Windows 8 and he was right to do that. Windows 8 will always be known as the version of Windows that ushered in the age of the touch UI to the Windows world. And just as Windows 95 solidified the GUI in PC users mind, Windows 8 will burn into people’s conscience the fact that touch should be a key addition to the Windows User Interface. And before he spoke, other Microsoft executives showed off a plethora of laptops, all-in-one touch PCs as well as tablets that are already touch enabled so they can take full advantage of Windows 8 touch features.

But as I listened to Steve Ballmer speak, I could not help but think that his message was one of “welcome to the past” instead of “welcome to the future.” We all pretty much know that we are well into the post PC era and demand for traditional PCs are stable, stalled, or even in decline in many areas of the world. In fact, while we still expect to see between 300-350 million P’s sold WW annually for a few more years, the hard fact is that traditional PC vendors are having a tough time making any money on PCs anymore and some of them may get out of the consumer PC business completely in the next 12-24 months.

Smartphones and tablets are quickly supplanting a need for a full-fledged PC. User surveys show that tablets especially can handle as much as 80% of the tasks they used to do on a PC and that consumers are spending less time on their PC than before. This is not good news for the PC vendors as well as Microsoft and Intel. As more customers are ushered into the world of tablets by cheaper models from Amazon and Google, as well as Apple’s new entry into smaller tablets with the iPad mini, tablet unit shipments will outnumber the amount of PCs sold annually WW by 2015.

We also sell 1.4 billion cell phones a year and by 2013, 65% of the cell phones sold in the US will be smartphones. And by 2015, 60% of all cell phones sold WW will be smartphones. In fact, instead of the post PC era being used to describe where we are today, a more accurate terminology could be that we are finally entering the age of truly personal mobile computing, with smartphones and tablets leading the way.

But I also viewed the Windows 8 event as impressive and important due to the demand for new traditional PCs will stay stable or decline, there are well over 700 million PCs still in use today and Windows 8 represents an important step or bridge to the future of PC UIs and the role touch will play in these devices. Also, millions of PC customers are already familiar with touch through their purchases of tablets and smartphones, Windows 8 has to be considered an important evolution of the graphical user interface for existing and new PCs and laptops.

While I view Windows 8 as important, the one area that I think it will have its greatest impact in will be with devices that are truly touch enabled. This includes new hybrids or combo laptops and tablets that can take full advantage of Windows 8’s new touch interface. However, I am less confident it will be a huge success with existing PCs where the only input is a mouse or a touchpad. Current input devices were not designed with touch in mind and therefore do a rather poor job with navigating through a rich touch based user experience. The exception to this may be when Synaptics’ new ForcePad is installed in new laptops. This is a trackpad that maps the touch UI interface and mirrors some of the touch UI features through this innovative new trackpad optimized for Windows 8. Apple does this already with their Magic Trackpad. Interestingly, Apple does not believe their laptops or desktops should be touch enabled as they view the use of the hand or finger having to move from keyboard to screen as an unnatural way to navigate these types of devices.

There is also another key issue that may keep Windows 8 from being adopted faster and that is the added cost of laptops that sport touchscreens. At the moment, putting a touch screen on a laptop adds about $150-$200 to the cost of the laptop. That is why we still see most of the laptops sold at least through 2014 having non-touch based screens as consumers are inclined to buy on price instead of features in most cases.

While I see Windows 8 working well with touch based devices and see it having a harder time being adopted by users whose laptop or desktop is not touch enabled, Still, Windows 8 will be important to the collective PC market today. And it represents the next major evolution of the user interface for PCs, even if the market for PCs will not be a major growth market in the future.

Windows 8, Windows RT, and Surface: A Strategy Emerges

Microsoft SurfaceMicrosoft has begun the tough job of answering three questions vital to its future: Why Windows? Why Windows RT? And why Surface? The arguments given at the Windows 8 launch event in New York on Oct. 25 won’t close the deal, but they mark the emergence of a strategy out of what has sometimes seemed a muddle

Why Windows
Microsoft has clearly been watching Apple and learning. It understands that when customers buy iPhones, iPads, or Macs, they aren’t just purchasing hardware; they’re buying into an ecosystem of products, services, apps, and content where everything works together.
Microsoft has long had the pieces, but lacked the integration. Now it is putting them together. Content moves seamlessly from your Xbox to your PC to your tablet to your Windows Phone. The new Xbox Music brings a Spotify-like music service to all devices. SkyDrive lets you share your files easily and all the devices have access to some form of Office. Clever Windows 8 apps connect to Bing services. Windows users will be able to “plug into the largest ecosystem anywhere,” says Windows chief Steven Sinofsky.
How well this all works in practice remains to be seen. Microsoft, with its deep experience in enterprise back-end operations, has a considerable advantage over Apple, which has stumbled often with network-based services. For once, it is Apple that is stuck with the legacy of iTunes, which Microsoft is starting clean. And the Microsoft offering leaves Google, which has tons of stuff but none of it very well integrated, in the dust. Neither Apple nor Google was mentioned by name in the lengthy presentations, but I got the sense that Google, which has left an opening by failing to exploit its early advantage in cloud services,  may be the primary target.
Microsoft isn’t forgetting the enterprise, but for the moment, at least, it seems to be taking it for granted; the messaging at the Windows launch was nearly 100% consumer. Except for tablets (Microsoft seems to have given up on the idea of calling them “slates”), the company has no illusions of large-scale enterprise adoption of Win 8 any time soon. But corporations remain wedded to Microsoft and these days, the company makes more enterprise revenue from  servers and tools than from desktops and laptops, or even Office.
Why Windows RT
Windows RT, the version designed for tablets based on ARM processors, is a tougher proposition. At the launch, Microsoft started the hard job of differentiating between the two new versions of Windows. The selling point for Windows 8 is fairly simple: Although the new user interface will require a fair amount of learning by users, the operating system remains compatible with the vast array of existing Windows software. If you want to run Autocad or Photoshop or even Microsoft Outlook, you need the legacy support of Windows 8.
But that legacy also brings a lot of cruft with it, and if you don’t need to run these desktop programs, you may be better off with the lean, clean Windows RT. Windows has made great leaps in security since XP, but a traditional operating system that gives programs full access to system resources is always going to be vulnerable
Windows RT is much more locked down and only allows installation of apps through the Windows Store. This should provide an environment that is resistant to both malware and the complex problems caused by software interactions that plague tradition Windows and, yes, Mac OS X
The troubling question is whether users pf RT-based tablets will be able to get the apps they need. As of today, the answer is no. I had hoped that launch day would see a sudden profusion of apps on the barren shelves of the Windows Store, but it hasn’t happened. There have been some very welcome additions, such as a client for the SugarSync cloud synchronization service and a Kindle reader, and a Twitter client is sad to be coming soon. But the Windows Store remains deeply impoverished compared to the iTunes App Store or even Google Play
The preloaded Microsoft apps are a mixed bag. The biggest issue is the awful mail client, which lacks such basic features as a consolidated inbox and support for POP mail services. Microsoft has promised improvements, and I hope that either they come soon or that someone steps up with a third-party offering. Having major components of Office–Word, Excel, PowerPoint, and One Note–certainly distinguishes RT  from other tablet OSes, but the allegedly touch-optimized applications still aren’t very touch-friendly. Their use pretty much demands a keyboard and a touchpad or mouse.
Why Surface
It’s clear that Microsoft regards Surface, its first plug into computer hardware, as an entirely new type of device, neither a tablet nor a PC or, more accurately both.  Microsoft offers it without either of its two keyboards–either the flat $100 Touch Cover, which looks unusable but actually works quite nicely, or the $129 Type Cover, with keys that actually move a little–both to hit a $499 price point and to avoid a profusion of SKUs. But if you are buying a Surface, don’t even think about getting it without one of these keyboard-plus-touchpad covers.
Apple considers the iPad a post-PC device. Microsoft considers the Surface a kind of PC. Thee difference was summed up, in hyperbolic language, by the respective chieftains. Sinofsky describes the Surface as “not just a tablet but the best tablet I’ve ever used. Not just a laptop, but the best laptop I’ve ever used.” But Apple CEO Tim Cook, who hasn’t actually seen it yet, dismissed it as “aa fairly compromised, confusing product…. I suppose you could design a car that flies and floats, but I don;t think it would do any of those things well.”
Surface is in many ways a more ambitious device than the iPad because it can do everything most consumers want from a PC. Sinofsky even makes a big deal of its ability to work with printers and other peripheral devices through a USB cable (personally, I don’t want to think of connecting a tablet to anything except over a wireless link.
It will be interesting to see how the market shakes out between the ARM-powered Surface and the Surface Pro, which uses an Intel Clover Trail processor and standard Windows 8. The Pro version will be heavier and considerably more expensive. It will truly be a PC in a new design: lighter than an Ultrabook and less capable, though probably capable enough for most uses
To the extent to which enterprises go for the Surface, they are going to choose the Pro (expected to ship some time in Novmber), both for software compatibility and because it, unlike the regular Surface, can be centrally managed like a PC. IT managers may see the Surface Pro as an way to stop the creeping invasion of iPads, giving executives the tablets they want while retaining the manageability IT desires.
Microsoft still has a lot of work to do to sell Windows 8. It’s biggest immediate challenge ia to set customer expectations for Windows RT correctly to avoid a wave of returns of Surfaces (and RT tablets from Lenovo, Dell, and Asus) by consumers who did not understand the software limitations. But Microsoft is off to a good start. It’s good to see the tablet battle finally fully joined.

Selling The Amazon Kindle Fire and Google Nexus 7 Is As Silly As Selling Razor Blades To Men Who Love Beards

Gillette, Amazon, Google and Apple

— The Gillette business model is to give away the razor in anticipation of making profits from the sale of the blades.

— The Amazon business model is to give away the Kindle Fire for cost in anticipation of making profits from the sale of content and ads.

— The Google business model is to give away the Nexus 7 for cost in anticipation of making profits from the sale of ads and content.

— The Apple business model is to sell the iPad Mini for a profit…AND in anticipation of making additional profits from the sale of content and ads.

The razor blades business model

“(T)he razor and blades business model, is a business model wherein one item is sold at a low price (or given away for free) in order to increase sales of a complementary good, such as supplies (inkjet printers and ink cartridges, “Swiffers” and cleaning fluid, mobile phones and service contracts) or software (game consoles and games).

Though the concept and its proverbial example “Give ’em the razor; sell ’em the blades” are widely credited to King Camp Gillette, the inventor of the disposable safety razor and founder of Gillette Safety Razor Company, in fact Gillette did not originate this model.

The (razor and blades) marketing model may be threatened if the price of the high margin consumables in question falls due to competition. For the (razor and blades) market to be successful the company must have an effective monopoly on the corresponding goods.”

~ via Wikipedia

Three Flaws

There are (at least) three flaws in the Amazon Kindle Fire and the Google Nexus 7 business models:

1) No proof of sales;
2) No proof of profits;
3) No monopoly (proprietary) pricing available.

1) No proof of sales

The razor and blades business model works, in part, because when the razors are given away at cost or for free, they become ubiquitous, thus making it convenient for razor owning customers to purchase the company’s proprietary blades. There is no evidence to indicate that either the Amazon Kindle Fire or the Google Nexus 7 are selling well despite their subsidized sales prices.

It’s been estimated that the original Amazon Kindle Fire sold 4.7 million Kindle Fires over a 9 month span and that the Google Nexus 7 sold 3 million units last quarter. These numbers are estimates because neither Amazon nor Google are willing to release the actual sales numbers.

When you consider the fact that these are both subsidized products being sold at cost, those numbers are remarkably low.

2) No proof of profits

The razor and blades business model works, in part, because when the razors are given away at cost or for free, the profit is made from the blades. There is no evidence to indicate that either the Amazon Kindle Fire or the Google Nexus 7 are making substantial profits from the sale of content or ads. In fact, when you look at the company’s recent quarterly earnings reports, there is evidence suggesting that they are NOT making significant revenues or profits from tablet related content and ad sales.

3) No monopoly (proprietary) pricing available

The razor and blades business model works, in part, because the blades are proprietary and command the premium price neccessary to offset the lack of profit from the giveaway of the razors.

For the (razor and blades) market to be successful the company must have an effective monopoly on the corresponding goods.” ~ via Wikipedia

The Printer Example

Computer printer manufacturers have gone through extensive efforts to make sure that their printers are incompatible with lower cost after-market ink cartridges and refilled cartridges. This is because the printers are often sold at or below cost to generate sales of proprietary cartridges which will generate profits for the company over the life of the equipment.

The Game Console Example

(V)ideo game consoles have often been sold at a loss while software and accessory sales are highly profitable to the console manufacturer. For this reason, console manufacturers aggressively protect their profit margin against piracy by pursuing legal action against carriers of modchips and jailbreaks.

Atari had a…problem in the 1980s with Atari 2600 games. Atari was initially the only developer and publisher of games for the 2600; it sold the 2600 itself at cost and relied on the games for profit. When several programmers left to found Activision and began publishing cheaper games of comparable quality, Atari was left without a source of profit.

~ via Wikipedia

Neither the Amazon Kindle Fire nor the Google Nexus 7 have a monopoly on the content or the ads that they sell. They cannot command a premium price. In fact, if anyone can command a premium price on the sale of content, it is Apple because of their extensive distribution channels. While Apple is able to sell content in over 90 countries, the content sales channels for both Amazon and Google are extremely limited.

Cheaper is not necessarily better

There are rumors that Google may announce a $99 Nexus tablet next week. But in a subsidized model, cheaper is not necessarily better. In fact, it could be counter-productive.

The razor and blades business model works, in part, because when the blades are given away at cost or for free, they become ubiquitous, but there is no point in giving away the razors to men who love having beards. Similarly, there is no point in selling low-cost Amazon or Google tablets to customers who don’t buy their content or consume their advertising. Subsidized products attract bargain hunting customers and bargain hunters are as useless to Amazon and Google as bearded men are to Gillette.

The non-existent “Price Umbrella”

Apple is being criticized for selling the iPad Mini at $329 and leaving a “price umbrella” under which the likes of Amazon and Google tablets can grow and prosper.

There is no price umbrella. The Amazon Kindle Fire and the Google Nexus 7 are zero-margin products.

Let me say that again. Amazon and Google make zero profit from tablet sales.

No matter how much Apple lowers its sales price (and its margins) it won’t be taking any profits away from the Amazon Kindle Fire and the Google Nexus 7 because they already make no profits.

Now there is an argument to be made that lower Apple iPad Mini prices might reduce Amazon’s and Google’s tablet sales and therefore lower Amazon’s and Google’s tablet related content and ad sales. This presumes that lower iPad Mini prices would spur higher iPad Mini sales. If the iPad is supply constrained, (i.e,, Apple can’t make enough of them) this argument fails.

Further, both the Amazon and Google tablets are already selling poorly. And there is absolutely no evidence that Amazon or Google are making more than, or even as much as, Apple is in content and ad sales. Lower iPad Mini prices would have a negligible effect on Amazon’s and Google’s ethereal profits but it would have a significantly negative affect on the iPad Mini’s margins.

Giving razors to men with beards

“Never interrupt your enemy when he is making a mistake.” ~ Napoleon Bonaparte

Apple doesn’t need to lower its pricing to deliver “the tablet death blow” to its competitors. Apple’s competitors are doing a fine job of starving themselves of profits as it is.

When your competition is giving razors to men with beards and hoping to make their profits on the sale of blades, you don’t attack them – you ignore them.

The iPad Mini Could Spur an Education Revolution

Picture of iPad miniI have long been a skeptic about the role of personal computing in education, especially for K-12 schools. Yes, the internet has made a wealth of information accessible to students. But the instructional revolution promised by technology optimists seems to hover forever on the horizon. The tablet—and for now, at least, that really means the iPad for reasons I will get to—could be the tool that finally makes the difference. And the new iPad mini could greatly accelerate the trend.

There are many reasons why technology has been an educational disappointment for three decades. Probably the most significant is that the computer has never become students’ constant companion but remains instead an occasional tool.

There have been experiments that equip large groups of students with laptops, but they have been far from a roaring success. Laptops are expensive to buy and even more expensive to maintain—both hardware and software. They are heavy for kids to carry and often lack the battery power to get through a school day of steady use. While many textbooks and other instructional materials are available for Windows and Macs, reading on a laptop screen is a mediocre to terrible experience. In theory, laptops opened the door to new educational experiences, from rich media to a wide-range of custom generated instructional content. In practice, the device itself got in the way.

Tablets are fundamentally different. They are intensely personal and no more obtrusive than a textbook. Reading on them is a delight. While they can break if abused, they are far more rugged than laptops. Perhaps more important, their software is secure by design, making them all but immune to the malware and corruption that plague conventional PCs.

Apple is best equipped to take advantage of the K-12 tablet market. It has quietly worked with schools to develop tools for successful classroom use and to improve the manageability and delivery of custom content and applications. (A case study of a large-scale iPad school pilot in the Australian state of Victoria gives a lot of information on how this can be done.) Apple offers extensive training and support for educators. And the iPad Mobile Learning Lab is a charging cart designed for classroom sets of tablets.Apple is best equipped to take advantage of the K-12 tablet market..

There’s nothing like this in the fragmented Android world and Google does not appear to be taking on a leadership role in education. (It is promoting Chromebooks for educational use, but not Android.) Microsoft might have a shot with its new tablets, but an obscure technical decision will limit their appeal. One of the big attractions of Windows, at least to school system IT departments, is the ability to manage devices centrally, including deploying software and locking down systems. But Windows RT devices, including the Surface and other tablets based on ARM processors, are not able to join Windows Active Directory domains.

What seems like a really geeky move by Apple could greatly enhance the ability of educators to create custom instructional content for the iPad, especially in math and the sciences. Mathematical typesetting for ebooks of all types has been a source of enormous pain for as long as ebooks have been around. Apple has just made it easy. The just-released update to  the iBooks authoring app allows text to be created in three forms widely used for mathematical typesetting, LaTeX, MathML, and MathType. This is a simple example of text including LaTeX that I entered into iBooks Author in about a minute:

LaTeX text

This attention to the needs of education is likely to pay big dividends for Apple. And the iPad mini should prove particularly attractive to educators. Educational volume discounts could take the unit price well under $300. And the lighter weight and smaller size makes it better suited for younger students, who are likely to find the larger iPad heavy and bulky.

A lot has to happen in education before tablets can reach their potential. Most important, the people who run schools have to overcome their deep-seated fear of students in possession of connected devices. Yes, they can facilitate cheating and distractions, but teachers have always had to deal with cheating and distraction in classrooms and this is a terrible reason to deny students the advantages to students of everything from a library at their fingertips to instructional materials enabled by the tablet. The upfront cost of the tablets will be an issue, though savings on textbooks and other educational materials that will no longer be needed in physical form could allow a rapid recovery of the investment.

Schools, particularly K-12 education, is a sector that has lagged badly in the adoption and use of computer technology. The explosion of tablets may finally be about to change that.

Microsoft’s Surface: Less Than A Tablet, Less Than A Notebook PC, Less Than Ideal

Introduction

I hadn’t planned on writing a review of the Surface today. But after reading over a dozen reviews, a pattern has clearly emerged:

— Excellent hardware
— Not as good a tablet as the iPad
— Not as good a PC as a notebook PC

The Promise

But perhaps none of that matters. The Surface, after all, wasn’t designed to be only a tablet or only a notebook PC. It was designed to be a hybrid – the best of both worlds. Perhaps it succeeds in that role?

As Josh Topolsky of The Verge put it:

The promise of the Surface was that it could deliver a best-in-class tablet experience, but then transform into the PC you needed when heavier lifting was required. Instead of putting down my tablet and picking up my laptop, I would just snap on my keyboard and get my work done.

The Surface won’t satisfy the tablet user

The Good

It’s clear that Microsoft has really thought through the Windows RT tablet software.

It’s a new paradigm, and people are uncomforable with new, but new isn’t necessarily bad. And the Windows RT “new” appears to be very, very good indeed.

It’s not as discoverable as iOS and Android, and it will receive criticism for that but discoverability isn’t everything. Some of the gestures in Windows 8 are brilliantly implemented. Many of the reviewers found it to be more engaging, more immersive, more delightful than either iOS or Android.

In that way, I believe that Windows RT for the tablet will be like Android on the phone – it will appeal to the more advanced users who will love it for the power that it unlocks.

The Bad

There is absolutely no reason to have a desktop OS on the Surface RT tablet. The Surface RT doesn’t even run desktop applications, so why bother?

Almost all of the reviewer’s complaints stemmed from the schizoid nature of the dual operating systems. Sometimes you were in tablet mode. Then suddenly you were in desktop mode. There were two control panels and two Internet Explorers. In short, there were two too many operating systems in one device, especally when that one device didn’t even run Windows desktop software.

The Ugly

The Windows RT store is barren. Could this change? Possibly. But until it does, you’ve bought a tablet that doesn’t have any available tablet apps. And that’s going to make you very un-app-y.

The Surface won’t satisfy the notebook PC user

The only Windows desktop software that the Surface RT runs is Windows Office. That’s it.

There are over 4,000,000 applications that run on Windows. The Surface RT falls 3,999,999 applications short of being an adequate notebook PC. And that’s really short of ideal.

The Surface won’t satisfy its ideal user

Ed Bott, of ZDnet, describes the ideal Surface RT user:

On a busy Sunday evening a few weeks ago, I was sitting in Terminal 4 of the Phoenix Sky Harbor airport waiting for a connecting flight. The guy sitting next to me was clearly an experienced business traveler.

I watched out of the corner of my eye as he pulled an iPad from his briefcase, checked some football scores, and played Words with Friends for a few minutes.

Then he put the iPad away and pulled out a well-worn Dell notebook (I swear it had duct tape on one corner). He waited (more patiently than I would have) for Windows XP to load, and then he worked on an Excel spreadsheet for 30 minutes until our flight was called.

That guy. The one who has to carry around two devices because neither one by itself can do everything that needs to be done. That’s who Microsoft’s new Surface with Windows RT was designed for.

First let me say this: There aren’t as many of those guys out there as we think. There are a whole lot of people who only need a notebook. And, as I tried to explain in my article entitled: “The PC is the Titanic and the Tablet is the Iceberg. Any Questions?“, there are even more people who only need a tablet.

But even if they are only a niche, there are still a sizable minority of people who fall into the above description of the Surface’s ideal user. And the most damning thing that I can say about the Surface is that it won’t satisfy it’s own ideal user.

— He’ll go to check on some football scores and then be frustrated that he doesn’t have access to one of a dozen available alternatives to the official ESPN app.

— He’ll go to play a game and then be frustrated that he can’t play any one of the 300,000 games available on Android or the game that everyone’s been talking about and that’s been available on iOS for over a year.

— He’ll go to run a Windows application and then remember that the Office suite are the only Windows applications that run on his device.

That guy. The one who has to carry around two devices because neither one by itself can do everything that needs to be done. The ideal customer for the Windows RT. That’s the guy who will be totally unsatisfied with the Windows RT.

Less than a tablet, less than a PC, less than ideal

Microsoft calls the Windows 8 operating system and the Surface RT a “no compromise” computing solution. But this tablet is such a compromise that it will satisfy no one – not even it’s intended target audience.

Ironically, it is the software, not the hardware, that is letting Microsoft – the software company – down. And that’s too bad because it would have been much better for Microsoft if it had been the other way around. It’s possible that another hardware partner would have fixed any deficienies in the Surface’s hardware. But no matter how good the hardware, it will still be running the Windows RT operating system. And that’s far from ideal.

Why Apple Is Keeping the iPad 2 [UPDATED]

iPad 2Some commentators have expressed surprise that Apple is keeping the iPad 2 in its lineup after announcing what it calls the fourth-generation iPad on Oct. 25. The company’s normal practice would be to keep the n-1 product while dropping anything older. Instead, Apple dropped the third-generation iPad announced just last spring.

But when you look at the products, this call is not at all surprising. The key is that it’s a big stretch to call the new iPad (the 9.7” version) a fourth-generation product. All that is new for the iPad announced this spring is a processor bump from the A6 to the A6X and the replacement of the 30-pin dock connector with the new Lightning connector used on the iPhone 5 and the iPad mini. If Apple hadn’t already had an event scheduled, this announcement probably would have been made by press release.

Then there’s the question of pricing. There’s probably very little difference in the bill of materials between the new-new and the old-new iPad. So dropping the price of the third-generation iPad to $399 to maintain a $100 differential between the products would have forced Apple to take a significant margin hit. So the iPad 2 stays and the third-gen version is retired.

The real fourth-generation product is the mini. Although it uses a non-retina display and an older processor, it is amazingly thin and light. Its stunning new case, made with a new manufacturing process, echoes the design language of the iPhone 5.

I expect that come next March or April, Apple will hold its by-now traditional iPad announcement. Then we will really see a new-generation product. Look for a thinner, lighter tablet with the perfect chamfered bezel edge that is Apple’s latest design hallmark.

UPDATE

The announcement of the new iPad has set off a remarkable and totally unjustified chorus of whining, such as this piece by Cnet’s Roger Cheng, “thanking” Apple for rendering his months-old third-generation iPad obsolete. It’s no more obsolete today than it was on Monday. It’s true that the new iPad features a faster processor, but I haven;t heard anyone complaining about the current model being slow.

iPad Mini: The iPad in the Palm of Your Hand

Today’s Apple event was perhaps one of the more interesting to me for a variety of reasons. Apple made a number of announcements that in my opinion give them a strong lineup for this holiday season. Apple has made advances in almost every one of their products in just the last few months. But all eyes today were on the newest member of the iPad family–The iPad Mini.

It took me a long time to come to grips with the reality that Apple was making a smaller iPad. If you have read much of what I have written over the past few months, I explain my belief that the iPad has not yet reached its full potential, and I was concerned that releasing a smaller iPad may deter or delay the iPad reaching its full potential. I was also very keen on some specific and unique positioning for the iPad mini as I stated in a column last Friday. I still believe specific features for families and communities are important going forward but after soaking in the breadth and depth of the Apple announcements from today’s event, my thinking has altered slightly.

It Fits in the Palm of Your Hand

For me the moment of clarity, was when they showed a slide of the new iPad, the iPad Mini, being held comfortably in the palm of a hand. This slide was articulated with the key point that this iPad, the iPad Mini, can do something the iPad can not–fit in the palm of your hand.

This has clearly been a benefit of the 7″ tablet experience if you have ever used one. There was something to being able to hold it easily in one hand. In fact in many of my columns on the 7-8″ tablet form factor, many of our smart commenters remarked on their excitement, or anticipation, of the 7″ tablet form factor because of it being lighter but also easy to hold with one hand.

This is certainly the draw back of the iPad in some but not all use cases. For example, reading on the iPad while laying in bed, reclined, or any position where you are holding the tablet with one hand can be uncomfortable if done for long periods of time. I was thinking about this the other day as I was reflecting on how much I like reading with the Kindle Paperwhite. The primary reason being because it is very light and holding it up for long periods of time during reading requires almost no effort. Paper books are light, and easy to hold. Smaller tablets and e-readers mimic a very natural book like feeling because they are light. This is one of several clear advantages of the smaller tablet form factor.

The first thing that struck me with some of the time I spent handling the iPad Mini was how light it was. By contrast the Kindle Paperwhite with 6″ screen size is .47 pounds and .36 inches thick. The iPad mini is .68 lbs and .28 inches think. I brought my Kindle Paperwhite to the event and held them simultaneously. It was tough to tell the difference in weight.

By taking on the task of delivering a smaller iPad to the market, Apple has in turn designed one of their best iPads yet. But the smaller form factor and cutting edge design is not the only part of the story.

How is it Different than Competing Smaller Tablets?

The answer–as is the case with many platforms–is apps. I was wrong (at least for now) in my initial assumption that the smaller screen size would require custom made apps for the small screen. Apple, by making the screen 7.9 inches, was able to keep the identical resolution as the iPad, so all apps run and look exactly the same. Although slightly scaled down, the apps function and look exactly the same on both the iPad and the Mini. The iPad Mini is literally a full iPad experience in the palm of your hand.

As I reflected on this, I realized I have never personally experienced scaled down tablet apps on a smaller tablet. This is because 7″ Android tablets run scaled up apps built for the smartphone. This means you are running a small screen app and user interface on a larger screen. Apps built for the small screen, were built for just that, a smaller screen.

Yelp on Nexus 7 vs. iPad Mini
Apple showed side by side comparisons of the same smartphone app running on the Nexus 7 and the same iPad app running on the iPad mini. This image is the only one you would need to see to grasp the full value of Apple’s approach with the iPad Mini. The difference in the software experience between a smaller tablet running smartphone apps and a smaller tablet running tablet apps is night and day. The bottom line is that there are only a few hundred tablet apps for Android and several hundred thousand for iPad. This alone gives the iPad Mini a clear and distinct advantage in my opinion. Whether that experience is worth the extra money for consumers will be up to them, but I know it would be worth it to me.

This experience is so new, that it will take time to form a more lengthy analysis of its potential impact. However, what Apple has done with the industrial design is more than impressive. At .68 lbs, 7.2 mm thin, with a 7.9″ screen, running all the over 250,000 iPad apps, Apple has brought the full iPad experience to the palm of a hand. And with an entry price of $329 my guess is it will get into more palm’s than ever before.

Windows, iOS, and Android All Have Something to Prove This Week

Prior to Apple developing iOS and over the last 25 years, there had never been much of a threat to the Windowsecolove ecosystem. With iOS, Apple proved many things, including the value of a holistic experience delivered through purpose-built combinations of hardware, software and content. Now in mobile, it’s Microsoft looking into the window wanting to get inside. After iOS came Google’s Android, which was focused on the same areas as iOS. This week, with multiple announcements, Windows, iOS and Android all have some things to prove and I wanted to dive a bit deeper into some areas.

Windows 8 Launch

For decades Microsoft has been the uncontested PC market share leader. Macs made a little bit of a dent, but for the most part, Microsoft ruled and for years it looked like Microsoft would have uncontested dominance. That was until the iPad. While the iPad isn’t trying to be a PC, it did provide an optimal experience for specific usage models the PC once delivered. Sure, you can surf the web on your PC, but when kicking back on the couch is it the best way to do this? Not for me and not for 100s of millions of other people. I still must have my PC, but I prefer my iPad for certain tasks my PC previously performed.

With Windows 8, Microsoft hopes to bridge the gap between PC and tablet. They will attempt to do this by releasing Windows 8 on about every conceivable form factor possible and seeing what sticks. This is a huge risk in that they are also sub-optimizing the experience for desktop-only experience by adding the Metro layer and removing the start button. The Windows 8 experience is optimized for devices with touch and an accessible keyboard, turning the devices into a Swiss Army device. I have used my iPads for years with an extended keyboard, so I absolutely see the value here. This week, Microsoft must prove that flexibility of Windows 8 trumps the purpose-built focus of an iPad.

Windows RT adds another proving ground. For decades, Windows equated to compatibility with the past, which is inextricable linked to Microsoft’s IT roots and the fact that many consumers are peeved about wasting a prior, large investment. I am not saying that consumers care less about backward compatibility, but they care more about what the device does today and in the future then the past. Unlike Windows 8, Windows RT will not run all the older Windows 7 desktop applications. Microsoft bridges the gap with some key Office apps, but forget about loading up iTunes or Quicken that you have. Hardware compatibility with USB devices is an unknown as well. This has never been an issue with the iPad, but then again, neither iPad or Apple stands for backwards compatibility.

Finally, we have Microsoft Surface, the first Microsoft-branded PC that directly competes with its ecosystem. This test will take a long time to play out but rarely do these examples of suppliers competing with customers work out well. While we don’t know exactly how pricing and features will work out over time, few premium-branded Windows tablet makers are excited about this. If Ballmer’s email to its stakeholders wasn’t clear enough, future Microsoft does two things: devices and services, and those devices that its customers currently provide.

While we will need to wait months and some cases years to fully understand how all these play out, the official launch for Windows 8, Windows RT and Surface this week will give better indications on where Windows is headed.

Windows Phone 8 Launch

Windows Phone was very respectable in the early days of smartphones and was one of the few phones until RIM’s Blackberry to be accepted by businesses. Then came the iPhone and iOS, which undoubtedly changed Microsoft’s mobile fortunes for the foreseeable future. Instead of a commanding 90-95%% OS market share like it does in PCs, in mobile, Microsoft is looking right now, at best, 3% share of the mobile market. Given how Windows Phone 7.X has done, there must be some huge change for Microsoft to start gaining share.

Microsoft’s biggest challenge in smartphones is consumer apathy. Metro is differentiated, the maps are good and Nokia has some really good imaging but consumers are not yet all that excited about Windows Phone. Microsoft needs more black and white, differentiated, and demonstrable features to break consumers out of their addiction to iOS and Android phones if they are to make big progress.

With the launch of Windows Phone 8, Microsoft could start to reverse its fortunes. If Microsoft can show that a Windows Phone 8 is a must-have device to pair with a Windows 8/RT PC or tablet and an Xbox, I do believe they can start to make faster traction with those audiences.

iPad Mini Launch

Apple, plain and simple, invented a new category with the iPad. Sure, there were previous Windows Tablets, but the biggest issues were a lack of apps, pen requirement and very high prices. Tablets , particularly iPads have started to eat into the PC market. It’s not that an iPad can replace a PC, but some consumers are choosing to buy the new category (and shiny thing) instead of buying a replacement PC.

The iPad Mini will be interesting for Apple. Apple has always been able to command a price premium in, quite frankly, all devices. Whether it’s an MP3-playing iPod, iPhone, iPad, or Mac, consumers are willing to pay more. The iPad Mini will test this pricing elasticity more than ever. I believe to hit its profit goals, Apple will need to be priced at least at $299, which puts it into that 30-40% gross profit range. They could margin blend on the rest of the iPad line to get the price even lower, but that’s pushing it.

With Amazon Kindle Fire at $149, a $299-349 price will be pushing the pricing power farther than I have seen in a long time. I do expect an iPad Mini to have a much better experience than a $149 Kindle Fire, but with many consumers just glad to be able to have an affordable tablet, many will opt for the Fire. Apple will sell truckloads of the iPad Mini this holiday season, but not nearly as many as they could have if the Nexus 7 or Kindle Fire didn’t exist.

Google Nexus 10” Android Tablet Launch

While Android has done well on smartphones and 7” tablets, anything above 7” has been a business and marketing disaster. Google had clearly deprioritized the 10” category as the smartphone market eclipses the size of the tablet market. At some point though, Google needs to bring their “A” game to large tablets and incent developers to create high quality tablet apps. Right now, Google does not allow anyone to easily count the tablet-specific apps as they number in the 100’s. Not 100’s of thousands, I am saying hundreds.

Google is rumored to announce this week a Google Nexus 10” tablet with Samsung. Price is almost inconsequential in that without more native Android tablet apps, a new Nexus tablet could be worse than bad. I expect 10″ Android tablets this holiday to be relegated to the bottom of the pricing barrel below Windows 8 and iOS. Unless Google can pull off something completely amazing and unexpected, this Nexus 10” will sell as well as all the other Android 10” tablets, not well.

An Amazing Week

Yes, this week will be one that all the ecosystems will have something to prove. When I step back a bit, I marvel at the amount of innovation and competition that is happening and just know this will be great for consumers this year and five years into the future. Competition and innovation are important as evidenced more than ever by this week’s announcements.

Windows 8: It’s Later For Microsoft Than You Think

Microsoft Needs To Hurry

Microsoft has two problems. The first is that they have no presence in mobile and mobile is where it’s at. The second, is that they’ve run out of time.

Run out of time? How is that possible? The iPhone is only 5 years old. Android is only 4 years old. The iPad only appeared on the market 2 and a half years ago. How can it possibly be that Microsoft is out of time? Three things:

1) PC sales are declining fast;
2) Smartphones, and especially tablets, are being adopted at historically unprecedented rates; and
3) Microsoft’s absence from the market has been ceding the mobile computing business to Apple.

1) PC Sales Are Declining Fast

Both Gartner and IDC concur that worldwide PC sales fell by over 8%. Ultrabook sales forcasts were slashed in half for 2012 from 22 million to 10.3 million.

But as bad as that looks, it’s actually a lot worse than that if you’re Microsoft. If you take out the Apple Mac sales, PC sales in the U.S. actually shrank by 13.8%. And, naturally, as PC sales shrink, so do Microsofts profits.

It’s not so much that PCs are in decline – it’s PCs running Microsoft windows that are in decline. And the decline is not temporary, it’s permanent. As Mike Gualtieri, principal analyst at Forrester Research, put it:

“I don’t think [Windows 8] is going to turn [the PC industry] around because nothing’s going to turn it around…”

2) Smartphones, and especially tablets, are being adopted at historically unprecedented rates

It’s not computing sales that are down, it’s only PC sales that are down. If you add tablets with PCs, overall sales of computing devices (excluding smartphones) will actually RISE by 12% this year.

Smartphone sales grew so quickly that they surpassed PC sales in late 2010. And the rise of tablets has been even faster and has been even more spectacular. No other technology has penetrated society so quickly. By the end of this year, tablet sales will jump 90 percent to 124 million units or just over 35 percent of the total PC sales for this year. Tablet sales are expected to outsell PCs by 2016, if not sooner.

Market Penetration

Within 18 months after the introduction of the iPad, tablet penetration among U.S. housholds hit 11%. 12 months later it was at 25%.

A Lost Generation

Microsoft has lost an entire generation of users. Don’t believe me?

40% of U.S. teens own an Apple iPhone. 62% want one.

— More than half (51 percent) of tablet users think that their tablet will be their primary computing device within the next two years.

Microsoft’s absence from the market has been ceding the mobile computing business to Apple

Business has long been a Microsoft bastion. It’s been estimated that as many as 92% of all business personal computers once ran on Windows powered machines.

Consumerization and BYOD

But Apple is riding the crest of the “consumerization of IT” trend. Truth be told, Apple isn’t riding the wave, it CREATED the wave. For most companies, BYOD doesn’t mean “bring your own device” to work, it means “bring your own iOS device” to work.

Business Adoption

94 percent of the Fortune 500 companies are either testing or deploying iPads. Some 70 percent of the Global 500 companies are testing or deploying iPads, too. 3 in 4 American enterprises have adopted the tablet in some way.

And when 500 of the UK Chief Information Officers (CIO) were polled, 37% choose the iPhone to be the dominant business smartphone in the the next few years.

“The role of the iPad cannot be overemphasized. Some observers estimate the iPad sales in the business market might represent up to half of all iPad sales,” ~ Charlie Wolf, Needham & Co.

Use In The Workplace

77% of tablet users report that their destop usage decreased after getting a tablet. 1 in 4 owners say their tablet is now their primary computer.

Indispensable

Not only has the iPad stolen a march on Microsoft in business, it’s going to be hard to dislodge. People love their iPads. In a quirky poll taken earlier this year:

— Almost half of respondents (47 percent) said they’d rather have an iPad for work than a bigger or better office or a more senior title (34 percent).

— Sixty-eight percent said they’d rather have an iPad than their own parking space at work, while almost one in four (23 percent) would prefer the tablet over an extra week of vacation each year.

— When asked what they would go without before they would give up travel with their iPad, nearly half (48 percent) say they would forego meals, 41 percent would skip drinking water, and more than 1 in 3 (35 percent) would give up bathroom breaks. More than half (55 percent) said they would rather forget deodorant than forget their iPad.

Headlines

Read these headlines and tell me that Microsoft should not be terrified. Many of the headlines have to do with the demise of RIM, but notice that the busienss is moving to Apple and Android – not Microsoft:

More car companies link iPhone nav apps to dashboard displays

The iPad Kiosk: Landing at an Airport Near You

Urban Outfitters Replaces All Cash Registers With iPads

BlackBerry Dropped by Booz Allen for Apple, Android

Australia’s Woolworths drops RIM for iPhones

U.S. Immigration and Customs (ICE) dropping RIM BlackBerry and purchasing 17,000 Apple iPhones

Windows 8 Is Late

Windows 8 is arriving on Friday, October, 26th and it’s none too soon…

…in fact, as far as mobile goes, it may already be too late.

Windows 8: Microsoft Is Betting The Company

I am one of those who thinks that this week is a seminal moment in computing history. The introduction of Windows 8 is the most important time for Microsoft since the launch of Windows 95. Microsoft’s actions – and the buying public’s response to those actions – is going to change the future of Microsoft – and the future of computing – forever.

Microsoft will survive…

Let’s take a step back and put things in perspective. Microsoft makes – and will continue to make – a lot of money.

Microsoft is really an enterprise company. It makes much of its money from business customers with products like Windows Server, management software, SQL databases and development tools. Those businesses are doing well. Further, Enterprises are upgrading to Windows 7 and the Microsoft Office suite. Microsoft will have most enterprises locked up with agreements for three to five more years. Finally, Microsft is sitting on $60 billion in cash. It has deep, deep pockets.

However, personal computing is no small part of Microsoft’s business. Windows makes up 25% and Microsoft Office makes up 35% of Microsoft’s total sales and a much greater percentage of its profits.

…but their future in personal computing is not assured

There are those who argue that Microsoft has plenty of time, plenty of money, plenty of chances to fix Window 8 even if it goes astray. I couldn’t disagree more.

Did time, money and opportunity allow Microsoft to fix the Zune? Or Windows Phone 7?

Windows 8 on the desktop may or may not do well. But Windows 8 is all about Microsoft’s efforts to transfer their desktop user base to the tablet and smartphone markets. Mobile is the future of computing and Microsoft has absolutely nothing going on in mobile. If Windows 8 does not kick-start Microsoft’s mobile efforts, Microsoft will have missed the boat for good and no amount of time, effort or resources will allow them to swim fast enough to catch up.

Microsoft knows this. They remember well the PC wars of the eighties. In those wars, they were the ones sailing into the sunset, leaving Apple and the Mac floundering in their wake. In today’s world, iOS and Android are the new Windows and Windows is the new Mac. And for Microsoft, that ain’t a pretty picture.

If Windows 8 flounders, Microsoft will survive, but not as the same company we know today

The times, they are a-changing. The decades old Windows-Intel empire is already crumbling. If Windows 8 doesn’t gain traction in mobile, it will be disastrous for Microsoft. We’re witnessing history – we just don’t know yet what the result of that history will be. October 2012 marks a new beginning for Microsoft’s mobile efforts. Or it marks the beginning of the end for Microsoft’s mobile efforts. By this time next year, we’ll know for sure – one way, or the other.

Windows 8: Get Your Popcorn Ready…

Welcome to Windows 8 week.

On October 26th, Microsoft will be introducing Window 8. Actually, over the next week or so, Microsoft and its partners will be introducing:

— Windows 8 OS for the desktop
— Window 8 OS for Intel tablets
— Third party tablet hardware to run Windows 8
— Windows Office for Window 8 tablets
— Windows RT OS for Arm Tablets
— Windows Office for RT tablets
— Windows RT Platform (Third-Party apps)
— Third party tablet hardware to run Window RT
— A new business model where makes the hardware that runs their Windows 8 software
— Windows Surface – A Microsoft branded tablet that runs the Windows RT OS
— Windows 8 OS for the phone
— Third party phone hardware to run Windows 8

Wow. That’s a lot of stuff and it’s happening all at once.

Any one of the above items would have normally justified a major announcement by Microsoft. Taken all together, the above represents a fundamental shift in the way Microsoft – and the world – will view computing from this time forward.

This launch is so large and so all encompassing that no one article could do it justice. So rather than try to create one article, we’re going to break this down into a series of articles and gather them together in a new section entitled: “A Series of Tech.Pinions.”

Get your popcorn ready. It’s going to be quite a show.

Chrome OS, Not Android, is Google’s Future

Google recently updated their Chromebook offering and began running new commercials touting the new product. At $249 it is an aggressive price offering, however, the software by way of web apps will be the key. Although, we are not in a full HTML or browser based world for our key applications, I believe there is a good chance that someday we will be. In many of the scenarios I play out in my head about the future, Chrome and Chrome OS is more important to Google than Android.

There is a debate happening in the industry about whether or not we are heading toward a future where all computing takes place in the browser or where all computing takes place with native or installed software.

Today we download and install software or apps on our PCs, smart phones, tablets, and connected TVs. In the future this may not always be the case. It’s possible that in the future all of our software will run in the browser, not natively as an installed application. We call these applications “web apps.” In my opinion, in the future we won’t install apps we will access them.

A web app is an application that is used through a web browser instead of being downloaded and installed onto your PC or device. A web app has all the functionality of an installed application. The only major difference is that to use a web app you need to be connected to the Internet.

You may think that idea is crazy. We aren’t always connected to the Internet, so why would you want to use software that you can’t use when you’re not connected? That’s a good question. However, if you think about many of the things you use a computer for on a regular basis you will find that they require a connection: E-mail, Facebook, twitter, surfing the Internet, searching the Internet, web browsing, downloading, streaming, and a whole lot more all require the Internet. I’d be willing to bet that for most people, the Internet is involved in over 90% of the things they do with a PC.

But to be fair, most of us are used to what we call the hybrid experience; one in which we take advantage of Internet-based content when possible, while relying on local apps during the times we can’t connect via the various devices we might use in our daily lives.

I had an experience recently where the power went out where I live. This power outage affected a major power source for the cellular service provider data towers, so although I had cell service, I had no mobile data. Between having no mobile data and my power being off, which knocked out my DSL connection, I was literally without the Internet.

It was at that time I realized that without the Internet, my notebook was basically a paperweight. Of course that’s not completely true but everything I needed to do in that moment required the Internet. That experience got me to thinking about all the things I do regularly that require the Internet.

I came up with a list, and the only things I use my PC for that don’t require the Internet are writing, editing photos and making videos. And without the Internet, I can’t send or share my writing or photos or videos.

With that in mind, the argument which states that the Internet should not be required for us to use our computers doesn’t hold water. The reality for most of us is that the Internet is a critical part of our everyday experience with our computers.

This Is Where Chrome OS Comes In

Google recently launched Chromebooks in conjunction with Samsung and Acer. Chromebooks are essentially PCs but with the major difference being that Google’s Chrome browser is the only thing installed on the PC.

Google’s vision for Chromebooks is one similar to the one I described. This vision is where everything we do with our PCs happens inside the browser.

This future heavily depends on where the industry takes future versions of HTML and Javascript. As HTML and Javascript advance, we will be able to have more complex software run in our browsers. HTML and Javascript are the fundamental programming languages used to create web sites and web applications today. In this vision, they essentially become some of the most important programming languages in the future.

There is an interesting example currently based on HTML5 called MugTug. If you check out MugTug.com you will see a web app that lets you actually edit photos. All of this is done in the browser and takes advantage of HTML5. MugTug is a great example of a program as powerful as a native application, except that it runs in the browser.

Google has even taken this one step further, announcing recently that their Chrome browser is beta testing support for the C/C++ programming languages. C and C++ are some of the most common programming languages used to create native desktop and OS applications.

In Google’s announcement in their blog they state:

“Native Client allows C and C++ code to be seamlessly executed inside the browser with security restrictions similar to JavaScript. Native Client apps use Pepper, a set of interfaces that provide C and C++ bindings to the capabilities of HTML5. As a result, developers can now leverage their native code libraries and expertise to deliver portable, high performance web apps.”

This is another confirmation that Chrome OS may become a powerful alternate to a native operating system in the future.

Also there is something important with regard to this vision that I don’t see talked about much. Almost every developer we speak to, is simultaneously developing an iOS, Android, and HTML 5 web app at the same time. They believe it is more economical to do all that work up front then maintain over time. This means that at some point in time there will arguably be just as many web apps as native apps in every major app store. We will of course still need some way to discover these web apps, but over time someone will take a leadership stance in this area.

So Where Is Android In This Vision?

Android fits the model of native OS and native apps all needing to be downloaded and installed. Android also is more focused on mobile devices, not traditional PC form factors. However, in this vision I can imagine Chrome phones and Chrome tablets as an alternative to Android phones and Android tablets.

Part of the reason I bring up the longer-term vision for Chrome is because recently Android has come under quite a bit of legal scrutiny. Google is being sued quite heavily over patent violation claims against Android. Many people are watching this very closely because if Google loses these patent lawsuits, Android’s future comes into question. However, in the vision I am laying out, Android may be a shorter-term play for Google, which means even if they lose and Android loses partners, it doesn’t signal the nail in the coffin for Google.

One other point I’ll make on Android is that it’s not going away in the short term—if ever. There’s too much momentum in hardware, software and services that even if additional licensing costs become associated with Android, the vendors will still pay the costs to license Android. My main point is that in this browser-based computing future, Chrome OS presents the longer-term opportunity for Google and their hardware partners.

What interests me about Google’s Chrome browser and its evolution to Chrome OS as its used on things like Chromebooks is how the browser itself was built in a way to take advantage of all of the computer’s hardware. Specifically the browser can take advantage of things that normally only the operating system does, like the GPU and ports like the microphone, media card readers and USB ports.

It is because Chrome is architected this way that I can see it replacing a traditional OS in the future if all of our software moves to the web.

To use a Wayne Gretzky quote and slightly modify it: Android is where the puck is today. Chrome OS is where the puck is going.

Google is leading this effort with devices that take a clamshell notebook design, but in the near future I will not be surprised if we see Chrome devices in a tablet form factor.

Now to be honest, although I believe we are moving in this direction, I am not sure when this vision will become a reality. Many different pieces need to come together, including devices with persistent, reliable and affordable connections to the Internet.

Some times technology moves at the speed of light, and other times it moves very slowly. This is an area where I think it will move slowly, putting us at least five years away and most likely much longer.

7 Inch Tablets Employ An Odd Definition of “Success”

TROY WOLVERTON at the San Jose Mercury News, talks 7 inch tablets:

Just two years ago, Apple’s late co-founder and CEO Steve Jobs mocked small-screened tablets as “tweeners” that were too little to compete with the larger iPad but too big to compete with smartphones.

But after the success that Amazon and Google have had with small-screen tablets…

Whoa, whoa, whoa! Stop right there.

Success? What success?

Success is defined as: “the accomplishment of an aim or purpose.”

— Research in Motion, Samsung and other manufacturers introduced tablets with seven inch screens that flopped.

— It’s been estimated that Amazon sold 4.7 million seven inch tablets over a 9 month span.

— It’s been estimated that Google sold 3 million Nexus 7, seven inch tablets over the last quarter.

That’s not a “success”. That’s anything but a “success”.

Notice that the numbers for Amazon and Google are estimates. Their respective companies have not released sales figures. There’s a reason for that.

Also note that the Amazon and Google products are subsidized, which means that they are being sold at cost. What product wouldn’t sell well if it was sold at cost? Apparently, 7 inch tablets.

By way of comparison, Apple sells more that 5 million 9.7 inch tablets every month – at full price – and Apple is conservatively expected to sell 25 million iPads this upcoming holiday quarter. Again, at full price.

I have no doubt that the 7 inch tablet category is viable and I’m guessing that – starting on October 23rd – Apple is going to prove that in a big way. However, we need to stop talking about “the success that Amazon and Google have had with small-screen tablets” or we need to get a new definition for the word “success”. I’m leaning towards the former.

Wireless Charging: It’s Coming, but Probably Not to iOS

Pre with Touchstone

Wireless charging has been around for a long time. It’s what powers electric toothbrushes and cordless shavers and well as a lot of medical devices. But it has been very slow to make it to mobile electronic devices, but the Wireless Power Consortium aims to change that as it pushes ahead with its Wireless Qi (pronounced Chee) standard.

To date, wireless charging of mobile devices has been associated mainly with companies on the brink of doom. Palm and, briefly, Hewlett-Packard offered the Touchstone wireless charger for both Pre phones and the TouchPad tablet. Nokia is now offering it on its Lumia phones.

The principle of wireless charging, called resonant inductive coupling, is simple. An alternating current in a coil induces a current in a nearby coil. If the two coils are tuned to the same resonant frequency, the power transfer between them can be very efficient. And if the two coils are the same size, the magnetic field will be contained in the space between them.

The current Qi standard provides for 5 watts of power, adequate for smartphones but not for tablets, which take too long to charge at low wattage. A 10 W standard is on the way, but like all standards bodies, the WPC moves slowly and may take a while. But this is an area where standards are crucial. One of the reasons previous efforts failed to catch on is they were proprietary and the advantage of wireless charging lies in the ability to power a variety of devices from a single charging pad.

A number of handset makers, including Samsung, LG, and Motorola, are members of the consortium and while that doesn’t guarantee they will offer products, it at least shows interest. Delphi, the former General Motors electronics and parts division has just joined, increasing the prospect of automotive charging systems. But Apple is prominently missing from the membership list.

Apple marketing chief Phil Schiller recently dismissed wireless charging as bringing no real advantage to consumers. But WPC Chairman Menno Treffers, of Philips Electronics, says he was off the mark: “That’s a real misconception about what the point is. The point is the difference in the charging experience. I can best explain it by talking about my own experience. I used to have a USB charger on my desk, but in practice, I didn’t use it; it’s a hassle and you tend not to do it.If you have a Qi phone, you just put it on the pad and you pick it up. People keep their batteries charged much better.”

The BIG Opportunity for the iPad Mini

Let me start this column off explaining why I was skeptical of a smaller iPad in Apple’s offering. I have been bullish on tablets from the beginning. From my first experience with the iPad I knew Apple was on to something. In my opinion the iPad in its current form has not reached its full potential as a personal mobile computer. Because I am convinced this is true, the scenario of a smaller iPad that would inevitably cannibalize and potentially delay the potential of the iPad in its current form seemed like a poor long term strategy. However, something I have been thinking about lately may be the key for these products to co-exist and fulfill fundamentally different needs of consumers.

I’ve convinced myself that for Apple to have two different sized iPads, they need to be positioned differently and poised to tackle different market needs. Unlike notebooks, where screen size is partially a matter of preference, but also a matter of primary tasks, tablets play a different role in the lives of consumers. I am a big believer that the iPad in its current form can suffice for many mass market consumers as a notebook replacement. I do not believe the same is true of of a smaller iPad. These two different sized iPads will also offer different software experiences. I do not believe that we will simply see scaled up iPhone apps or scaled down versions of current iPad apps on an iPad mini. This product will shine with custom applications and experiences built for the new screen size.

From Mine to Ours

The BIG opportunity I see for the iPad Mini is to cater to how families or communities use these devices as shared screens in a communal environment. I’ve articulated this before, the concept of a shared screen versus a personal screen, and I think the 7-8″ tablet may represent the perfect form factor for a shared device. Take for example what both Amazon and Barnes and Noble have done in this space.

The Amazon Kindle Fire HD tablet with its FreeTime feature is a solid step in the right direction toward family tablet computing. This solution offers parents the ability to set parental controls for their kids so as they enter FreeTime mode, children are presented with a kid-friendly user interface and access to only approved applications and abilities. Parents can also set limits on how many hours per day kids can play games or watch videos.

Barnes & Noble took Amazon’s important FreeTime concept even further by introducing profiles to the Nook HD. This allows consumers to set up a number of different profiles for each family member. This way, when a particular user logs in, they see only the books, magazines and applications that are of interest to them. Another well thought out part of profiles is that if two people are reading the same book in different profiles, the Nook HD will keep each person’s last read point for them so that they’re not constantly trying to find where they left off. User profiles deliver powerful features and are the best example to date of how a tablet can deliver on a shared family computing experience.

These are experiences that I think shine on a communal or shared screen. These experiences can exist of course on larger tablets but I have a hunch that the smaller tablet form factor will encourage the shift away from the sentiment that the device is mine to the device is ours.

This shift in sentiment from mine to ours could pave the way for entire new software experiences. Just looking at the previous examples I gave from Amazon and Barnes and Noble, show how they are thinking uniquely about this from a software standpoint. I would argue that Apple’s ecosystem is even stronger across the board when you incorporate others screens as well as iCloud to foster and embrace the shift of some devices being ours rather than mine.

What encourages me about this thinking is that it genuinely appeals to the way consumers are using these devices. Some products fit well as a personal product. My smartphone for example is mine and is tied to me in unique ways. The smartphone will also be mine and never ours. A notebook also follows very personal use cases and highly personalized to the individual. The tablet however may be owned by one person but still shared by many in family environments. It is something unique to the tablet form factor that it can comfortably be mine and ours simultaneously. But to my point above, I believe that the smaller tablets those in the 7-8 inch range fit this new paradigm nicely.

Now, I have no idea if the iPad Mini will launch catering to anything I’ve proposed in this column. My point is that whether or not Apple believes it, I believe this is the big opportunity for a smaller iPad. It would be uniquely positioned and create a strong loyalty and stickiness to Apple’s ecosystem for not just the individual but the family as a whole.

Truel: The Good, the Bad and the Ugly; The iPad, the Surface and the Nexus 7

The Plot

The Good, the Bad and the Ugly is a 1966 Italian epic Spaghetti western film directed by Sergio Leone, starring Clint Eastwood, Lee Van Cleef, and Eli Wallach in the title roles. ~ paraphrased from Wikipedia

Apple, Microsoft and Google are engaged in an epic tablet war starring the iPad, the Surface and the Nexus 7 in the title roles.

In the Good, the Bad and the Ugly, the plot revolves around three gunslingers competing to find a fortune in hidden Confederate gold.

In the tablet wars, the plot revolves around three tablet gunslingers competing to find a fortune in hidden tablet profits.

Clint Eastwood as “Blondie”: The Good. A subdued, cocksure, bounty hunter who both works with and works against Angel Eyes, and Tuco in shifting alliances to find the hidden gold.

Apple as “iPad”: The Goliath. An implacable, cocksure, bounty hunter who both works with and works against Microsoft and Google in shifting alliances to find the hidden profits.

Lee Van Cleef as “Angel Eyes”: The Bad. A ruthless, unfeeling and sociopathic mercenary who always finishes the job.

Microsoft as “Surface”: The Bad (ass). A ruthlessly efficient, relentlessly effective, money making machine who knows how to close.

Eli Wallach as “Tuco”: The Ugly. A comical, oafish fast talking bandit who proves to be a crafty and surprisingly dangerous opponent.

Google as “Nexus 7”: The Geeky. A nerdy, engineering and advertising company whose “don’t be evil” exterior masks a surprisingly powerful and unexpectedly ominous corporate bandit.

The Truel

In the movie’s climatic final scene, Blondie, Angel Eyes and Tuco face off against one another in a Truel.

In the climatic autumn of 2012, Apple, Microsoft and Google face off against one another in a truel.

A truel is: “a neologism for a duel among three opponents, in which players can fire at one another in an attempt to eliminate them while surviving themselves. ~ via Wikipedia

Each party jockeys for position, each itching to fire first, each wary of what the other two fighters will choose to do.

In tech, Apple, Microsoft and Google are involved in a great tablet truel. Each party jockeys for position, each itching to eliminate the other, each wary of what the other two competitors will choose to do.

The three stare each other down in the circular center of the cemetery, calculating alliances and dangers in a Mexican standoff.

The Apple iPad stands alone at the center of the tablet world. Then the Google Nexus 7 joins in the fray. And finally, on October 26, 2012, the Microsoft Surface steps into the ring. The three stare each other down, calculating alliances and dangers in a Mexican standoff.

The parties position themselves, the tension grows, the Ennio Morricone film score swells until suddenly, they draw and…

The Treasure

Remember the pundits who laughed off the tablet form factor and called them toys? No? Neither does anyone else. They were as wrong as wrong could be.

Tablets are the second coming of the personal computer. Apple knows it. Microsoft knew it long ago but they were unable to successfully seize the moment and capture the treasure for themselves. Google is only just now realizing the importance of tablets. The company or companies that win the tablet wars win the future of computing. The fight is only just begun but like a gunfight, the battle may soon – and very suddenly – be over.

The Gunfighters

Apple iPad

Apple is like Blondie. Confident. Cock-sure. Perhaps a bit too cock-sure. Apple insists on doing things their own way. Google is counting on Apple’s insistance on having a closed shop to be their undoing. Microsoft is counting on Apple’s unwavering insistance on seperating their touch and desktop devices to be their undoing.

However, Apple has an advantage. Like Blondie, they know where the gold (profits) is hidden. The key to unlocking the tablet treasure is tablet optimized Apps. And using our gunfight analogy, when it comes to tablet apps, if Google and Microsoft have six shooters, Apple has an Uzi. Or a bazooka. Or a tank…

Microsoft Surface

If Apple is the cocky newcomer – the up and coming gunslinger – Microsoft, like Angel Eyes, is the consummate professional – the grizzled vertern who has the experience, knows all the tricks in the book and is extremely confident in their ability to win in a shootout.

If Apple is cocky because they think they’re good, Microsoft is confident because they know they’re good. Microsoft has not only been through the wars, they’ve won the wars and they’ve won them convincingly.

However, Microsoft’s secret weapon in the PC wars was compatibility and familiarity. In gunfighter terms, it would be like shooting with the sun at your back. And getting in five shots before your opponent even drew their weapon. And shooting from behind a wall. It was that devastating an advantage.

When it comes to a gunfight – or a platform war – Microsoft is the best there ever was. But this isn’t yesterday and this is a whole new fight. In mobile, Microsoft’s monopoly advantage is no where to be found. If Microsoft is going to win this gunfight, they’re going to have to do it on merit.

And Microsoft is very, very late to the fight…

…and it’s never good for a gunfighter to be late.

Why is Microsoft’s Surface obsessed with Keyboards?

The Apple iPad Tablet vs. the Microsoft Surface Anti-Tablet

Battle Of The Tablet Business Models: Windows 8 And The Microsoft Surface

Google Nexus 7

Google, like Tuco, is in good position. Microsoft and Apple know that each is the greatest danger to the other. They will almost certainly fire all their weapons at one another leaving Google (Tuco) free to gain from the exchange.

Only Google, like Tuco, has a problem.

It was just last week that Google initiated a program to encourage the creation of tablet optimized apps for Android.

Last week.

Tuco doesn’t know it, but he doesn’t have any bullets. Google didn’t know it was important, so they don’t have many tablet optimized apps. And in a truel, being unarmed is a big, big problem to have.

Google Android Tablet Optimized Apps — Two Years Too Late

Battle Of The Tablet Business Models: Google Nexus 7

The Denouement

The gunfighters move into place. The eyes narrow, the hands twitch, the music swells, the tension mounts, the guns are drawn and then…

…a single shot is fired…

…Blondie shoots Angel Eyes. Tuco also tries to shoot, but discovers that his gun is unloaded.

The mobile wars are a fascinating watch. Apple dominates tablets. Microsoft dominates desktops. Google dominates smartphones. Each knows that the future – the elusive treasure – is in mobile. They can’t all win this truel. One, perhaps two, will be left for dead. Which will it be? Which will it be?

“You see, in this world there’s two kinds of people, my friend: Those with loaded guns and those who dig. You dig.” ~ Blondie (Clint Eastwood)

Unlike The Good, the Bad and the Ugly, no one has seen how this movie ends. Microsoft hopes that this will be a sequel: How Microsoft Won The PC Wars, Part II. Google thinks that this is an entirely new genre of film, the kind where open always outguns closed. Apple thinks that there are two kinds of personal computing companies: Those with platforms loaded with apps.. and those who don’t much matter.

Me? I think it’s advantage Apple. You don’t grow from nothing in tablets to a world shaker in two and a half years unless you got it right. The essence of tablets is touch. Not keyboards. Touch.

Microsoft is desperately hoping that Apple got it wrong. Microsoft NEEDS tablets to simultaneously run both touch and desktop operating systems and Microsoft needs both to run well together.

Google? When it comes to tablets, they’re still digging.

It’s clear to me that Apple’s iPad is going to remain on top. The rumored iPad mini only makes this more likely.

Normally, I’d say that – as in phones – Microsoft would have little chance of having their tablets jump past Google and into second place. But circumstances are far from normal. Despite Google’s overwhelming success in phones, they’ve done next to nothing in tablets. And I have little respect for their newly minted subsidized tablet business model and their ever shifting business strategies. And Microsoft has powerful advantages in their ability to leverage a large desktop customer base and utilize their extensive business connections. Microsoft could quite quickly vault Google in tablets and land in second place…

…and wouldn’t that be interesting. In phones it would be Google-Apple-Microsoft. In desktops it would be Microsoft-Apple-Google. In tablets it would be Apple-Microsoft-Google.

That can’t possibly last. This is about to get very real, very fast.

The world of personal computing is in flux. It’s a “truel” world and for some tablet maker – and possibly for several tablet makers – it’s about to go bad and get ugly.

A Tale of Two Internet Explorers

I have been playing with Windows 8 on a number of different devices, specifically some touch enabled, and others non-touch enabled. One of the many questions I have been wanting to analyze was how software built for Windows 8 would handle the touch experience and the physical mouse and keyboard experience at the same time. Given that Windows 8, and many Windows 8 hardware configurations, will provide consumers with three potential input mechanisms simultaneously (touch, mouse / trackpad, keyboard).

In concept this sounds like a compelling idea. However, in execution it may be more tricky.

Although I keep in my mind that Windows 8 is still early, and updates will inevitably come, I found how Microsoft handled this dual-state touch + mouse and keyboard scenario with Windows Explorer. Microsoft decided that it would be best to include two different versions of Windows Explorer on Windows 8. There is a Modern UI (Metro) version of IE and there is also the all familiar desktop version of IE. One can be accessed while using Modern UI mode, and the other can be accessed from desktop mode. One is built specifically for touch and one is not. Here are a few simple examples of how that works.

When in Modern UI version of Internet Explorer (version 10), I get a much simpler and full screen user interface. In this Explorer touch works well with links, pinch and zoom, scoll, etc., all work as expected. When I get to a web page with a text input box, the soft keyboard automatically appears so I may enter text.

In desktop version of IE, touch, although supported, does not work nearly as well. Touching links sometimes requires multiple touches, put more importantly when you click a text entry box like the URL bar or a search field, no soft keyboard comes up. This version of IE is built more with the assumption that a mouse / trackpad and physical keyboard is present.

What strikes me about this approach is that it may not be a big deal for some hardware configurations, but it will be a big deal for others. I am caused to wonder about the number of Windows 8 tablets which will be sold without a keyboard included. Will consumers be wise enough to realize that they should avoid using desktop IE on their Windows 8 tablet? Will they even understand there are two different versions designed to work specifically in different modes? Perhaps an equally provocative question is why isn’t the software smart enough to know whether a physical keyboard or trackpad is adjust the experience accordingly. For example, if I happen to be in the desktop version of IE but am using the tablet without a mouse and keyboard present or docked, the soft keyboard should come up automatically.

It is very odd when you are using the desktop version of IE in tablet only mode and you click to enter text and no keyboard comes up. Confusion may abound. However, there is an icon in the lower left hand corner that you can click to bring up the soft keyboard. Perhaps I am nit picking but if no keyboard is present this should happen automatically no matter what the application or mode. I’d even question the presence of the desktop mode in Windows 8 when a physical keyboard is not docked or synced for that matter.

It is this kind of intelligent context switching that is still lacking with many of my experiences with Windows 8. Although I am speculating, I believe that the vast amount of input mechanisms being supported are the point of the challenge.

How software developers and Microsoft handle the multiple context switching opportunities as well as input mechanisms will be fascinating to see. Microsoft has done it by including two different versions of the same application. Let’s hope other software developers can figure out how to harness touch, mouse / trackpad, and soft / physical keyboard all in one program intelligently.

For more reading here is a Quora question someone asked as to why Windows 8 has two different versions of IE. Also here is an article on TechRepublic focusing on how to make desktop IE the default IE to open when clicking a link.

Rebuttal: Windows 8 “May Or May Not” Be The Disaster This Video Makes It Out To Be

Steve Kovach at Business Insider has a few words of wisdom regarding Windows 8:

Microsoft’s new operating system for PCs and tablets, Windows 8, will have a drastic new look.
The Start menu you’re used to is gone, replaced by a touch-friendly menu of tiles that houses all your apps and settings.

It’s going to be incredibly jarring for people to use at first.

Tech pundit Chris Pirillo demonstrates that in a man-on-the-street video where he asks people to try Windows 8 for the first time. The results don’t look good for Microsoft. Almost every person in the video is extremely confused by the new Windows 8 interface.

Does that mean Windows 8 is a flop?

Nope.

So far, I’m with Steve. Discoverability is not the same as usability. Microsoft’s radical new Windows 8 interface changes – particularly on the desktop – may be new but new isn’t necessarily bad. Features may be hard to discover at first – but learn a feature one time and you’ve probably learned it forever.

I think we can all agree that the lack of discoverability on Windows 8 is going to cause some problems at first. But it’s the overall usability that matters most and I’m not going to judge that until I’ve seen how regular people – you know, people who are not first adopters like you and me – react.

It’s at this point, however, that Steve and I part ways.

This is how you push innovation forward. It’s going to be jarring and scary for novices. It’s going to take time for people to learn the new menus. But they’ll catch on.

Hmm. Not so very sure about that. Sure, innovation CAN be jarring a scary. And jarring and scary is often the price we pay in order to move technology forward. But that doesn’t mean that we should pay that price if we don’t have to. So the question becomes, did Microsoft have to extract a price – or did they sacrifice discoverability on the desktop in order to forward their phone and tablet agendas?

Imagine giving someone who has never seen and iPhone or Android device before and asking them to use it. That person would be just as confused as the people are in the video below.

Say what now?

Kids and total novices can use smartphones and tablets. Ninty-nine year old senor citizens use them. Baby’s use them. Heck, even cats and apes use them.

As a friend on Twitter put it, “If every interface were designed by man-on-the-street committee we’d all still have Windows 3.1.”

Yeah, about that. Maybe that’s not so very accurate. Or even a little bit accurate . Perhaps the way Steve’s friend on Twitter should have put it was: “If every interface were designed with the “man-on-the-street” in mind, we’d all be using iOS or Android.”

Take a look at Pirillo’s video at the bottom of the the original article, here.

It’s Time To Fix DMCA Takedowns

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A few days ago, a teacher posted a copyright Pearson Education personality inventory on a blog at Edublogs.org. Pearson served a Digital Millennium Copyright Act notice, which set off a series of events that led to nearly 1.5 million student and teacher blogs going temporarily dark after Edublogs’ hosting service took its servers offline. (You can read the details of the affair in this Techdirt account. By Oct. 16, Edublogs was back up, apparently with a new hosting service.)

My purpose isn’t to defend or attack Pearson–plenty of others have done that–or even to rail against DMCA, which is full of both useful and ridiculous provisions. But its clear that a section of the law that was created to protect web sites hosting third-party content has gone off the rails.

DMCA requires site operators to take down copyright-infringing material at the request of the copyright holder. The key language, known as Section 512 or the safe harbor provision, is part of a compromise that bars infringement claims against sites such as YouTube as long as they make good-faith efforts to keep infringing content out and comply with takedown notices. It was this provision that allowed YouTube to fend off a suit by Viacom (still wending its way through appeals) charging massive copyright infringement. Without it, the whole idea of user-generated web content would long ago have collapsed under an assault of copyright suits.

But there are problems with the whole DMCA takedown process and they are getting worse. To ensure safe harbor protection, many sites have turned to algorithms that hunt for infringing content and these programs make mistakes, lots of them. For example, YouTube blocked posts of Michele Obama’s speech to the Democratic National convention because the address had been carried in copyrighted network broadcasts.

Content owners also use algorithms to hunt for infringement, and these too have caused trouble. Earlier this month, a Microsoft infringement-hunter went a bit crazy and sent Google 440,000 takedown requests, including pages posted by Wikipedia, the BBC, and the U.S. Environmental Protection Agency.

Aggressive copyright enforcement backed by takedown requests has targeted political advertising.  Some of this is legitimate, if perhaps unwise;  copyright holders have the right to disapprove the use of their material in ads.  But much, including network objections to the use of news clips and BMG’s attempt to block airing of ads featuring President Obama singing an Al Green song, stomp on the fair use exemption built into copyright law. (The Center for Democracy & Technology has a good analysis of the problem. It was written during the 2010 election season, but applies as well to this year.)

On the whole, the Section 512 and the DMCA takedown process has worked reasonably well at balancing interests, but there is evidence that the playing field is starting to tilt toward rights holders. I think some relatively  modest reforms are needed to restore balance (even though I am always reluctant to propose any copyright law changes on the principle  that the law almost always emerges from Congress in worse shape than it went in.)

First, we need a way to minimize collateral damage. Takedowns should be limited to to pages containing infringing material and the practice of taking down whole sites because of a small amount of potential infringement must stop. In the case of Edublogs, the takedown came after the site operator, wpmu.org, had blocked the offending post but had accidentally left a copy in a server cache. The  hosting service just did the quickest and simplest thing and pulled down the whole site.

Second, the practice of making sweeping takedown requests at the least hint of infringement needs to be reined in by penalizing false or overbroad claims. Section 512(f) of DMCA makes it possible to recover damages for a takedown that “knowingly materially misrepresents” a claim. But the law sets a very high bar for such recovery and it simply is not a viable alternative for a blogger, or anyone much smaller than YouTube, to bring a damages case against, say, Warner Bros. We need a more effective way to discourage over broad takedown requests and to compensate victims of false claims.

Copyright law, and intellectual property law in general, is all about striking a balance, weighing the rights of content producers against those of users and consumers. In recent years, the debate has been dominated by copyright maximalists, who want to restrict fair use into oblivion, and minimalists, who believe copyright is evil in principle or who think that fair use is whatever use they wish to make. Both are wrong, and they stand in the way of reasonable solutions.