Google Nexus Q: A Confused Product

Wednesday, Google kicked off their annual developers conference in San Francisco.  Dubbed Google I/O, the conference is targeted at developers in the Google ecosystem.  It is meant to woo them so that they keep developing for the ecosystem and if Google had their way, leave the Apple and Microsoft ecosystems.  Many positive things came out of I/O including the Nexus 7 tablet and a spectacular demonstration of emerging technology with Google Glass.  Technology aside, I have never seen such an awesome demonstration like this that went from blimp to rooftop to rappelling to BMX bikes, and all in about five minutes.  That will be talked about in the valley for a while and I pity the next major company who does an announcement as it will be compared to Glass.

All was not good, though at Google I/O.  Amidst all the successful rollouts of products, technologies, and advanced prototype demonstrations was one of the most confusingly-positioned products I have seen in a while.  The Google Nexus Q is a real head-scratcher as it isn’t positioned well against anything that will be looked at as a competitor.  Bad positioning never ends well, as it typically results in deep price cuts or discontinuation, and that is exactly where I see the Nexus Q headed.

The current state of living room electronics has segmented Smart TVs, set top boxes, OTT adapters, and game consoles.  Sure there are gray areas and overlaps, but that’s how consumers segment them today in their heads.  The Nexus Q and Apple TV are examples of OTT (Over the Top) Adapters that take digital content from the cloud or from local devices.  So if the Nexus Q is an OTT Adapter, how well is it positioned?

Compared to the Apple TV, the Nexus Q does less and priced at $299 is three times more expensive.  That’s not very good positioning.  Both products can take content from the cloud, but the Apple TV can play almost anything from an iOS device, including games.  The Q does have an amp so you can directly plug speakers into the device.  Is that worth the extra $200?  No it is not.

Compared to the $199 XBOX 360 S, the situation gets even worse.  Today’s 360 does nearly everything the S can plus plays thousands of the top games.  According to market data of media sales, the XBOX 360 is a formidable media hub with users buying huge amounts of movies.  Users can also play content from their mobile devices if they are “PlayTo” certified or support the latest DLNA standards.

Compared to Sonos, the price gets within range, but here is where Google lacks experience, a fully segmented line-up, cross-compatibility, a brand, and mass distribution.  Sonos is the gold standard today for distributed digital audio in the home.  Sonos supports the Android, iOS, and Amazon ecosystems, not just Android like the Q.  Sonos also offers a full line of bridges, speakers, amplifiers, and OTT adapters.  The Q offers one adapter and one set of speakers.  But the Nexus Q does have lights that glow around the ball like disco lights…..

I am not down on Google or Google I/O, I am frustrated that Google blew an incredible opportunity to have a flawless Google I/O.  The industry needs a new champion and Google had a shot a proving they were the one.  Instead, Google reinforced that nagging description of not getting the end user or buyer.  So for now, Apple keeps that title and over time as the Nexus Q reduces in price and gets discontinued, Google will get another shot next year.

Why is Microsoft’s Surface obsessed with Keyboards?

IS THE KEYBOARD THE KEY TO THE SURFACE?

On June 18, 2012, Microsoft announced it’s new Surface Tablet. There are many questions swirling around the Surface, but one the more subtle, yet more important, questions is why Microsoft is so obsessed with the Surface’s add-on Keyboard.

Microsoft devoted a large portion of their Surface keynote to the keyboard. The word “keyboard” was used dozens of times during the 45 minute presentation. Further, the Surface is never depicted without the keyboard and, in fact, the keyboard is always prominently highlighted whenever the Surface is displayed.

The emphasis on the add-on keyboard did not escape the attention of the press either. Some sample headlines tell the tale:

– Microsoft’s Surface: when the keyboard is key
– Microsoft Surface Keyboard Is Here
– Microsoft Surface Takes On iPad With Secret Weapon: The Keyboard
– Microsoft’s Surface Tablet Brings The Keyboard Back
– Microsoft takes on tablets with keyboard-equipped Surface
– Microsoft’s Surface tablet: The keyboard is the key

MY KINGDOM FOR A KEYBOARD

As if all that wasn’t enough, Microsoft founder, Bill Gates, recently had this to say about computers in the classroom:

Just giving people devices has a really horrible track record. You really have to change the curriculum and the teacher. And it’s never going to work on a device where you don’t have a keyboard-type input. Students aren’t there just to read things. They’re actually supposed to be able to write and communicate. And so it’s going to be more in the PC realm—it’s going to be a low-cost PC that lets them be highly interactive. – Bill Gates

(Emphasis Added)

Dear Microsoft, Steve Balmer and Bill Gates: What is up with your obsession with keyboards?

A NICETY, NOT A NECESSITY

First of all, let me say that I’m a touch typist and I simply love my notebook’s physical keyboard. Adore it. I even named my first child, Qwerty, after a keyboard. (She still hasn’t forgiven me.) But do I think that keyboards are essential for computing? Heck no. Let’s not get carried away.

Do you remember (seems like only yesterday – because it WAS only yesterday) when the only way to text on a phone was to use the numeric keypad? The number “1” meant “a”, and pushing the “1” twice meant “b”, and so on and so forth? Painfully tedious.

Yet I saw kids typing faster on their phone’s numeric keypads than I could type on my computer’s keyboard. And if you don’t think that kids can type faster on a virtual tablet keyboard than most adults can type on a physical keyboard, it’s only because you aren’t paying attention.

Keyboards are a nicety, not a necessity. If you own a tablet and you find that you need to type faster, you switch to an attachable keyboard – you don’t switch to an entirely new operating system.

THIS ALL HAS A FAMILIAR RING TO IT – A PHONE RING

All of this “keyboards are essential” talk has a familiar ring to it. Let’s see, now where have I heard it before?

Oh yeah, it was in 2007 when the iPhone was introduced. The iPhone didn’t have a physical keyboard either. Let’s step into the Wayback machine and see what tech luminaries have had to say over the years about the iPhone’s lack of a keyboard.

RESEARCH IN MOTION

First up, Research in Motion (RIM) co-founders Jim Balsillie and Mike Lazaridis

“As nice as the Apple iPhone is, it poses a real challenge to its users. Try typing a web key on a touchscreen on an Apple iPhone, that’s a real challenge. You cannot see what you type”
Jim Balsillie, Co-CEO, Research in Motion, 7 November 2007

“Not everyone can type on a piece of glass. Every laptop and virtually every other phone has a tactile keyboard. I think our design gives us an advantage.” – Mike Lazaridis, Co-CEO, Research In Motion, 4 June 2008

Say, how’s that whole keyboard advantage thing working out for you fellas, anyways? What’s that you say? The keyboard’s gone. And you’re gone. And what’s happening to RIM is a dog gone shame?

DROID

Well, surely Android got it right with the Droid. Let’s take a look at one of their earliest commercials:

iDon’t have a real keyboard.
iDon’t run simultaneous apps.
iDon’t take 5-megapixel pictures.
iDon’t allow open development.
iDon’t customize.
iDon’t run widgets.
iDon’t have interchangeable batteries.
Everything iDon’t…Droid does.

Verizon, 18 October 2009

And how many prominently promoted Droid devices are still sold with keyboards? (crickets) Hmm, maybe iDon’t need a “real” keyboard on my phone after all.

DEJA VU ALL OVER AGAIN

But, of course, I’ve saved the very best for last:

“$500 fully subsidized with a plan! I said that is the most expensive phone in the world and it doesn’t appeal to business customers because it doesn’t have a keyboard, which makes it not a very good email machine …. I like our strategy. I like it a lot….” – Steve Ballmer, Microsoft CEO, 17 January 2007

Now, is that the very same Steve Ballmer who just introduced us to the Surface…with an attachable keyboard? Not to rub it in, Mr. Ballmer, but your strategy of relying upon the importance of a physical keyboard was wrong…and not just a little.

This week marks the fifth anniversary of the iPhone. The iPhone now generates nearly $25 billion in revenue per quarter or over $100 billion per year. And – are you ready for this – the iPhone, all by itself, is bigger than ALL of Microsoft. That’s right, one single product, that didn’t exist five years ago, is now bigger than Microsoft…

…and it doesn’t even have a keyboard.

JUST SCRATCHING THE SURFACE (Pun Intended)

To be fair, Microsoft’s obsession with keyboards may merely be a single symptom in an even larger problem. The Surface is, perhaps, a bit too aptly named. With a keyboard and a kickstand and an upturned rear-facing camera, it’s very clear that Microsoft intends the Surface to work best of all on…well…on a suface. A flat surface, to be precise

But tablets want to be held, not held down. Tablets want to be touched, tablets want to be moved, tablets want to be “free”.

A WORD OF ADVICE

Microsoft, in 2007 you thought that keyboards were essential. Here it is, 2012, and you appear to be making the very same mistake all over again. A word of advice. A keyboard is a peripheral device, not the principal device. Focus on what matters or soon nothing else will matter at all.

Android’s 7-Inch Tablet Future

It wasn’t a secret that Google was going to announce a 7-inch Nexus tablet made by Asus and running Nvidia’s Tegra 3 chipset. And announce it Google did yesterday to much applause and fan fare. As we and a great many anticipated the tablet is designed as pure media tablet rather than a general purpose tablet like the iPad. As we watched the demo it became clear the Nexus 7 is targeted right at the Kindle Fire and nothing else.

I have been thinking a lot about what Android’s future in tablets may hold and I believe we now have the answer. Android’s sweet spot for tablets may be 7-inch pure media and entertainment slates. These devices will be built and optimized specifically with entertainment not productivity in mind. They will also be very low cost and derive a significant amount of value from cloud services. This also fits right in line with Google branding their store “Play.”

This makes sense if you think about the fact that the most successful Android tablet to date, the Kindle Fire, is a 7-inch pure media tablet. With the iPad, and now on the eve of Windows 8 tablets all targeting the 9.7 to 10.1 tablet screen sizes with more general purpose tablet strategies, I anticipate the larger screen Android tablets to struggle.

Android has struggled as a tablet solution in the general purpose segment due to the immature nature of Google’s tablet ecosystem. Apple remains dominant in this area and it seems like many firms strategies are to avoid competing with Apple entirely. This is clearly the direction Google is taking with the Nexus 7.

With that context I want to point out two areas important for this segment. One that favors Amazon and one that favors the Nexus 7.

Cloud Services and Consumer Trust
The Kindle Fire commerce ecosystem both in terms of digital media and consumers trust in Amazon as a commerce vendor are key areas where Amazon has an advantage of the Google right now. Amazon has over 100 million credit cards of consumers on file who all trust Amazon as a vendor. I don’t believe Google has released how many accounts they hold but I guarantee you it isn’t nearly as many as Amazon, or Apple for that matter.

Amazon has a more mature ecosystem when it comes to digital media and consumer trust for commerce. This is an area Google is attempting to strengthen with the Nexus 7. During the announcement of the Nexus 7 the statement kept being made that the device was built for the Google Play store. Google is clearly hoping that this device will generate more trust for their commerce platform and strengthen their commerce ecosystem.

Retail
This is an area where Google 7″ tablets may have an advantage over the Kindle Fire. Google has not yet stated when or if the Nexus 7 will ever appear in retail but you know other OEM will come out with 7″ media tablets who will get them in retail.

Retailers have been understandably conscience of Amazon’s commerce strategy with the Fire being potentially disruptive to their own brick and mortar store strategy. If that trend continues you can imagine more retailers not carrying the Kindle Fire and filling that hole with other OEMs Android 7″ media tablets.

To the extent that retail will be important for this segment the advantage goes to Google in this area.

I am not sure the extent the tablet market is ready to segment into specialty tablets but if they keep their prices low and overall time investment low then I think they have a chance to become companion media devices.

Of course if Apple jumps into this segment with a 7″ tablet I will have to re-consider some positions I am taking currently. However, if Apple does this it will only validate the 7″ media tablet segment at which point I would expect OEM investments in the category to ramp extremely quickly.

Surface vs. UltraBooks

Last week I pointed out the competitive dilemma for OEMs when it comes to Surface. A key point in my mind is how tablets are becoming the next generation computers for the mass market. What I pointed out in my column about notebooks becoming history is that the notebook will remain relevant but it will do so for only a segment of the market rather than the market as a whole, which has historically been the case.

When we started doing consumer research with the late adopters (anyone not an early adopter) we started realizing that for a large majority of consumers a notebook was overkill with respect to what they did with the product on a daily basis. We discovered that many consumers purchased notebooks due to their convenience around portability more than anything else. It is this fundamental point which leads me to be convinced of the tablet form factor. This is also why the tablet + desktop solution becomes even more interesting.

Further Reading: Notebooks are the Past, Tablets are the Future

With that context in mind, I am beginning to wonder if Microsoft launching their own line of tablets hurts the OEMs in a much more important area than just competing with them –namely with their notebook products. If this industry is headed in the direction I think then more interest may be given to Surface like products, by the masses, than notebooks in 2013 particularly. I am wondering if by launching Surface Microsoft has not just potentially hurt interest in their partners notebooks over the short term.

If what we write here on our site as well as feedback I have received from many media outlets is an indication of market interest, then what I am proposing would be on track. Our content on tablets and recently Surface far exceeds the amount of reads than we write about notebooks and UltraBooks in particular. I have heard similar things from other media that tablet content does better than notebook content in terms of interest.

Intel is trying to inject life into the notebook category with their UltraBook campaign and Microsoft has just injected life into tablets built for Windows 8. Surface’s form factor is different enough from what most consumers are used to with a notebook that I believe there will be serious consideration for it by anyone who is in the market for Windows notebook. Time will tell how many will buy surface but I believe it matches up with enough trends we are seeing to at least generate interest.

However, if there is enough interest, Surface may very well impact notebook sales for Microsoft partners which will hurt OEMs more in the short term than Microsoft competing with them in a segment. In this case Surface is more disruptive to OEMs notebook strategy than their tablet strategy.

Of course another scenario could be that Surface plays the spoiler for both Win 8 tablets and Windows notebook. It may be that the wide array of differences in the Windows 8 ecosystem may be confusing for customers who then turn and consider the Apple ecosystem. In fact 2013 will be a very interesting year because the feedback we are getting from both tablet and notebook intenders will heavily evaluate both ecosystems before making a decision. Consumers will choose with their wallet and perhaps more importantly with their loyalty and it will make 2013 and fascinating year.

Why I Love Twitter

I don’t expect everyone to love twitter. In fact I anticipate that many have mixed feelings about the service. Twitter is one of those things that I believe works great for some people but not everyone. And in a world of consumer choice that is perfectly fine. I would not expect a piece of technology, service, product, etc., to become universal.

I, however, particularly love the service. It works for me within the context of my career as well as how I prefer to consume information. I don’t think my appreciation of the service hit me until it went down for nearly two hours this past week. Twitter has become my source for real time information about a range of different things. I follow sports writers of my favorite teams for real time updates about games. I follow certain news outlets for updates on the news in real time. I follow a range of technology industry colleagues and journalists for real time updates on the technology landscape.

This point of real time information became clear when Twitter went down. Since Twitter is where I get all my real time information, my first instinct when I couldn’t access Twitter was to try and go to my Twitter feed to see if it was down. I eventually had to actually go visit a technology blog in order to confirm if Twitter was down. Twitter is my source for information to as close to real time as I can imagine.

Before I was a heavy Twitter user, which only happened in the last year, I used to frequent the home pages of all the big tech blogs several times a day at a minimum. This process for me was how I tried to stay up to date with the most recent pulse of the tech industry and other related news. But most technology blogs and news websites contain way more information than I am interested in and I found that I wasted quite a bit of time trying to find information that was useful to me. This is where Twitter comes in.

Twitter has become for me my curated information filter between me and the world wide web. I have carefully selected who I follow and built specific lists in order to make sure I am only presented with information from sources I trust or find the most beneficial. Twitter is acting as my aggregator for the information I have chosen is the most important for me. When I end up going to a website it is always the individual article promoted by a source I trust from Twitter. I rarely go to news sites home pages any more and I am quite pleased by this. In fact I have learned most of the major breaking news from the past six month’s via Twitter.

Of course I still use the web for a range of different things but when it comes to news, especially related to tech, Twitter is the door between me and their websites. I am sure this is true for a wide variety of folks and perhaps even readers of this article. Maybe you were referred to from a tweet or a retweet of a trusted source. Perhaps you came from another source of curated content. Either way it is more likely you got to our site and this article from another means than the homepage.

When Twitter is used this way it can be quite a useful tool for saving time. I don’t find myself needing to frequent blogs or news sites home pages in order to get caught up with what is happening in my industry. As long as I have checked Twitter in the past few hours I am completely caught up. Checking Twitter takes a matter of minutes to catch up where going to four or more blogs or news sites could take upwards of ten minutes to accomplish the same thing.

I am not sure what this means long term for the news media websites if Twitter is one of many useful aggregators to come. On this point we came across an internal research report that had caught wind of groups of Twitter users only using the service to consume useful media not to actually tweet anything. I don’t have enough data to proclaim that a trend yet but in light of my point it is an interesting development.

All of this brings up an interesting question to Twitter’s long term business model. After the outage I become convinced that I would pay a fee to use Twitter due to the value it brings to me in my daily work flow. Maybe I would pay just to keep it ad free but if it was a matter of not having it or paying to have it, I would choose to pay for it every time.

Maybe Twitter will add more value to their service for people like me and charge for premium features. Maybe they won’t and will keep the whole service free but allow ads, however, I hope this is not the route they choose.

Whatever the case of a business model, Twitter has become embedded into my work flow. I find Twitter as a valuable resource for curated information. Twitter may not be for everyone but it definitely is for me.

Usefulness Is the Greatest Feature of All

“The simplest way to achieve simplicity is through thoughtful reduction.”

“Simplicity is about subtracting the obvious and adding the meaningful.”

– John Maeda from his book The Laws of Simplicity: Design, Technology, Business, Life

Years back Palm had a slogan I liked quite a bit. It was a slogan but also a vision statement for the kinds of products they wanted to make. The slogan was simple, elegant, and truly useful. A few months back I wrote a column on how Apple turns technology into art. I dove into some of the psychology behind creating objects of desire and how things that are beautiful are more often than not useful.

On Wednesday our latest team member John Kirk, wrote a terrific column contrasting the philosophically different approaches that both Apple and Microsoft are taking with tablets. The key message from John’s column was that simplicity is king. I tend to agree but I would add that what we perceive as simple is actually being perceived as useful.

I remember the first time I got my wife to switch to the iPhone. She is the first to tell you that she is not tech savvy, in fact she hates most technology especially printers. She has never been much interested in computers mostly because she wasn’t comfortable on them–yes even Macs. But the first time she used the iPhone, and started really using it, I remember vividly that she never said it was simple, rather she kept proclaiming how useful it was.

Technology at its best is packaged up and designed to be useful to its owner. What is useful may very well differ between segments. For example those who like to tinker and control more of the technology the own may define usefulness differently than someone who is not a power user and finds technology generally scary or unapproachable. For some more is more and for others less is more. This is fine and to each his own, however, I would contend that there are more humans out there who prefer simplicity over complexity.

Creating something complex is easier than creating something simple. Simple solutions require sophisticated technologies. However, to create something simple I don’t believe you start with the goal of simplicity. To create something simple you need to focus on creating something useful. Simplicity leads to usefulness, and as I stated in the beginning, usefulness is the greatest feature of all.

Consumers aren’t turned on to technology products because they are simple. They are more interested in them being useful.

The Surface and the iPad

I have ridiculed companies like Samsung for simply copying Apple’s tablet strategy and for not showing any vision, so I’ll give Microsoft credit for at least coming out with some new ideas with the Microsoft Surface. However, I’m not sure it will work for them.

Microsoft has been in the tablet business for a long time with its partners and it has failed miserably. The company has tried to convince consumers that a tablet needed to be like a PC, but consumers didn’t buy it.

Apple on the other hand drew a line between the traditional laptop and tablet. The iPad is a touch device and apps are made so you can interact with it using your fingers and gestures. Apple contends that there is no need for a mouse with a tablet because your finger is the pointing instrument.

Just because Apple says this is the way it should, doesn’t mean it’s the law. However, consumers have clearly spoken by purchasing millions of iPads. The iPad is the type of device that people see fitting into their lifestyle.

From what I’ve seen, it seems to me that Microsoft is trying to do a similar type of dance with the Surface that it did with previous tablets. The company is trying to convince consumers that this device can be a computer and a tablet at the same time. Based on the sales of the iPad, I’m not sure that’s what consumers really want.

I’ve seen people argue that Windows now has the largest app library by default because you can use all of your Windows apps on the Surface. I don’t see that as a good thing.

Apps made for a desktop or laptop are not designed to work on a touch-enabled device. That just makes sense. Interacting with those apps on a tablet will be cumbersome and frustrating for users. I think that’s a given.

Of course, you always have the Surface’s stylus, but then you seem to be getting away from a touch-enabled device and going back to devices that were around years ago. That’s not a step forward in the industry, although it still may be for Microsoft.

It’s well known that Steve Jobs hated the stylus. He told Walter Isaacson about a Microsoft engineer who kept talking about a tablet years ago.

“But he was doing the device all wrong. It had a stylus. As soon as you have a stylus, you’re dead,” said Jobs.

I’m certainly not saying that Microsoft’s tablet offering is dead in the water — it’s much too early for that. But unlike some in the mainstream media, I’m definitely not ready to proclaim the Surface will overtake the iPad either.

There is still a lot we don’t know about the Surface because Microsoft wasn’t exactly forthcoming with details, so for now we play the waiting game.

Microsoft Surface and the OEM Dilemma

On Tuesday Patrick pointed out that the dynamic between OEMs and Microsoft may be forever changed. The primary reason for this being that Microsoft has signaled intent to compete directly with their partners in the tablet PC arena. What I want to examine in this article are the major points of concern from an OEM (Microsoft partner and original equipment manufacturer) perspective.

Trust
The Microsoft partner dynamic is one that has historically been based on trust. The company providing the main software layer, in this case Microsoft with Windows, needs to be closely working with the company making the hardware which will run said software, in order to assure some level of quality assurance and user experience. Of course this has not always been done well but it is none the less the goal. Because of this reality both Microsoft and hardware partners need to be in communication very early in the hardware process.

In many cases OEMs share specific details of their hardware roadmap with Microsoft. If Microsoft intends to be a competitor then any hardware OEM will have to think twice about how much roadmap and hardware detail around tablets they share with Microsoft. In this scenario there is a significant risk that the software and hardware are not tightly integrated (and it should now be obvious how important that is) thus resulting in poor user experience and a poor reflection in the market for all companies involved.

Tablets are the Future
Many of the authors in our forum here at Tech.pinions are proponents of the critical role that tablets play in the future of computing. This is an incredibly important category and arguably more important to the future of computing than the notebook category. With that in mind, and depending on your opinion on the matter, Microsoft is getting into the game in one of the most important segments going forward.

I can entirely see Microsoft’s reasoning for this move and honestly, based on my convictions on where this industry is going, if I worked at Microsoft I would heavily advocate this direction . They simply can not afford to sit back and watch the iPad completely destroy any competing tablet. Microsoft is a platform company and is responsible for an ecosystem. Every customer that enters Apple’s ecosystem, whether that entry point is an iPad, iPhone, Mac, etc., is potentially a customer who will not be leaving Apple’s ecosystem any time soon–if ever.

In reality, Microsoft partners are likely to be more focused on notebooks in the short term than tablets. Which means there is a possibility that Windows 8 would have lost more time in the tablet space. So it makes sense that Microsoft felt the need to make sure a compelling product was available at launch. However, the tablet segment is one that OEM’s need to focus more on, perhaps more than notebooks, and can not afford to not have a compelling play themselves. My concern if I am an OEM is that Microsoft intends to compete with me in one of the most important categories going forward.

The challenge will whether or not Microsoft can walk a line that few have tried. In this case be vertical in a segment but also be open in the same segment and others.

Brand
Lastly, and this point could prove the most costly for the Windows ecosystem. Microsoft will have Surface, other brands will have what? Slates? Tablets? or perhaps some other new name they come up. So if I am a customer shopping for a Windows 8 based tablet, I need to learn, study, then decide between Surface, Slates, Tablets, or any other number of names and tablet brands. All with different looks, feels, ports, CPUs, versions of an OS, keyboard accessories, general accessories, capabilities, etc.

Contrast that with Apple. If I want a tablet in Apple’s ecosystem, right now my options are the iPad (2 or current). Yes with minor different configurations but my point is the brand. The iPad is Apple’s tablet, now choose which iPad you want. The environment around Windows 8 tablets is going to be much more confusing.

The tablet sector is one that is maturing. Consumers, who have not yet owned a tablet, are interested in what a tablet means to them and how it fits in their life. I would argue that right now consumers don’t know what they want in a tablet. Therefore if they are presented with too many choices which confuse and frustrate them how can they feel comfortable making an informed opinion. Take USB for example. A consumer looks at this option and says I have USB in my notebook. Why do I need it in my tablet. Maybe they do and maybe they don’t but having not owned a tablet yet how do they know? This is one small observation of the overall consumer adoption cycle and how it works. This is also generally why a market like this favors the market leader and in this case the iPad. Once a market segments the door opens for specific feature differentiation. The market for tablets has not yet segmented.

I firmly believe that any platform or ecosystem that offers confusing choice to consumers around tablets is going to have an uphill battle.

Of course one possible way Microsoft can maneuver in light of everything I have pointed out is to let Surface be a general brand and product strategy that others OEMs can participate in. I suggested this on Tuesday when I stated that Microsoft should let other OEMs participate in the Surface program. Time will tell what path they take.

Regardless one last point on hardware needs to made with respect to open platforms like Windows, Android, etc. Hardware only exists as a gateway to a software and service ecosystem. Thus a platform like Windows creates platform loyalty but it does not create hardware loyalty. Therefore, those who compete only in hardware will have to do so with every upgrade cycle. This means for Microsoft its a win-win for their platform either with their hardware or others. If this plays out how I think it might, I can’t say it’s a win-win for OEMs.

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

Last night, Microsoft introduced us to the their Microsoft branded Surface Tablet. Never have we seen such a clear line of demarcation between Apple’s and Microsoft’s visions of what a tablet should be. And at the end of the day, it is those differences in outlook that will determine the fate of each company’s respective tablet offerings.

Historical Background

For ten long years Microsoft tried to get us to use their desktop operating system on a tablet device. What we really wanted, they told us, was the brain of a desktop in the body of a tablet. Didn’t work.

In 2007, Apple introduced us to the first modern tablet to use touch – and only touch – as the user input. They called it the iPhone. Three years later, Apple introduced us to the iPad, and while the tech world sat on its collective hands, Apple proved that size really does matter – at least when it come to tablets.

Microsoft’s Tablet Vision

Now here we are just over two years later and what is Microsoft telling us with the introduction of the Surface Tablet? They’re telling us that what we really want is a keyboard so that our tablet can be used more like a notebook computer. What we really want is a pen so that our tablet can be used like a PDA. What we really want is a kickstand so that our tablet can stand more like a notebook computer. What we really want is a trackpad so our tablet can BE a notebook computer. (A trackpad on a tablet computer? Really? Just think about how redundant that is.)

The Microsoft Surface is not a touch tablet, it’s the ANTI-touch tablet. While Apple is doing everything in its power to embrace touch on the tablet, Microsoft is doing everything in its power to negate the influence of touch on the tablet. Microsoft is saying: “Sure, touch is nice, in a pinch, but what you really wanted all along is a tablet that runs like a notebook.” With the Surface, Microsoft has come full circle, back to where their tablet efforts began. But they’ve added a twist. Not only did they put the brain of a notebook in the body of a tablet but they made the tablet look and act like a notebook too.

The Lure of Everything and the Best of Both Worlds

“But wait,” you say. “Microsoft is not giving us the anti-tablet. They’re giving us a tablet AND a notebook. They’re giving us both. They’re giving us the best of both worlds.”

It’s a compelling argument. Why not do both? Why not have both a desktop and a touch OS on a tablet? Why not add a pen? Why not add a keyboard? Choice is good. Why not let the customer choose to use the device the way they see fit? Why not have it all?

Before we answer that question, ask yourself this one: Do you think for even one second that Apple – who had a two year head start on Microsoft – could not have added a kickstand, added an integrated pen or added an integrated keyboard to the iPad? Apple did not neglect to do those things…they CHOSE not to do those things. Why?

Focus and Simplicity.

“That’s been one of my mantras — focus and simplicity. Simple can be harder than complex: You have to work hard to get your thinking clean to make it simple. But it’s worth it in the end because once you get there, you can move mountains.”-Steve Jobs

One of Steve Jobs’ greatest talents was as an editor, selecting what not to include in a product. Think of all the products that have way too many features. Now think about the iPod. The iPhone. The iPad.

“…the result of that focus is going to be some really great products where the total is much greater than the sum of the parts.”-Steve Jobs

Every iPod killer, iPhone killer and iPad killer had one thing in common – they all had more features than did their Apple counterparts. Yet they all had less success. How could this be? Simply put, simplicity may be the greatest feature of all.

“Simplicity is the ultimate sophistication.”-Steve Jobs quoting Leonardo da Vinci

Apple realized – long before anyone else did – that touch was the key to tablet computing. Styluses and keyboards are useful, but they pull the tablet away from its essence. They’re to be used, if required, to supplement, not sustain, the tablet.

“People think focus means saying yes to the thing you’ve got to focus on. But that’s not what it means at all. It means saying no to the hundred other good ideas…”-Steve Jobs

Diverging Philosophies

Now, more than ever, we can see how differently Apple and Microsoft view tablets. Apple thinks less is more. Microsoft thinks more is more. Apple thinks “both” is the enemy of focus. Microsoft thinks “both” is the best of all worlds. Apple thinks that simplicity is the key to everything. Microsoft thinks that having everything is the key to success.

Apple’s philosophy is clear. The iPad is a touch device. It excels at doing the things that tablets are excellent at doing. If you want the benefits of a computer, buy a computer. Preferably one of ours.

“…we have a vision for the tablet. It’s a tablet that works and plays the way you want to. A tablet that’s a great PC. A PC that’s a great tablet. Surface.”-Steven Sinofsky, introducing the Windows Surface Tablet

Microsoft’s philosophy is also clear. The tablet is a PC. The PC is a tablet. If you want a PC that functions as a tablet, buy the Surface. If you want a tablet that functions as a PC, buy a Surface. Heck, we’ll make this easy for you to understand: Buy a Surface.

There Can Be Only One

To paraphrase that great philosopher, Sesame Street:

One of these things is not like the other,
One of these things just doesn’t belong,
Can you tell which of these won’t work like the others
Which is right and which is wrong?

Was Steve Jobs and Apple right about the what’s important in a tablet or will Steve Balmer and Microsoft’s vision prove to be the more perceptive of the two?

I’ll tell you this much – we’re about to find out.

Microsoft Surface Reveals the Cost of HP’s webOS Folly

HP's TouchPadWith Microsoft’s planned launch of the Surface tablet, the full cost of Hewlett-Packard’s grotestque mishandling of the purchase and abandonment of Palm’s webOS has become clear.  HP’s Personal Systems Group now finds itself in the worst of all possible worlds, facing competition from its most important supplier in what should be its hottest market.

HP’s purchase of Palm in early 2010 was a strategic move by PSG chief Todd Bradley and then CEO Mark Hurd both to move HP into the increasingly important smartphone market and to win a measure of independence from Microsoft. The key was webOS, a rough-edged but highly promising operating system.

HP’s plans for webOS were ambitious. A tablet, the TouchPad, was added to Palm’s planned lineup of new phones and a version of webOS was being developed to run on top of Windows to create an HP webOS ecosystem across a wide variety of devices.

Alas, the whole project was caught up in HP’s boardroom melodrama. Mark Hurd was replaced by Léo Apoteker, who had little love for PSG in general or webOS in particular. The TouchPad was rushed to market before it was ready and sold poorly. Barely two months after the TouchPad’s launch, Apoteker killed the entire webOS effort, leaving HP with nothing but a huge writedown for development costs and inventory.

Although the replacement of Apoteker by Meg Whitman spared PSG from possible spin-out or sale, it hasn’t solved its fundamental problem. It’s the dominant player in a PC business that is barely profitable and seems doomed to continue its slow shrinkage. It’s not a player in smartphones and by the time it enters the tablet market, if indeed it still plans to, it will be competing directly with Microsoft-branded products.

It is becoming painfully clear that the future of personal computing belongs to those who control integrated platforms: Apple, Microsoft, and maybe Google. It’s impossible to say where the webOS vision would have taken HP had it been given the investment and time it needed for success. But it is all too clear where its failure has left the company.

HP is a stool with three rickety legs. Personal computers produce neither growth nor a lot of profit. The cash cow of imaging and printing also faces a long, slow decline. And the enterprise business—servers, software, and services—is heavily dependent on partners such as Intel, Microsoft, and, on a good day, Oracle.

The cost of the webOS misadventure was far less than the $10.3 billion HP for analytics software maker Autonomy, an Apoteker acquisition on which the jury is still out. But the price of the failure may end up being far higher: The loss of HP’s ability to shape its own destiny.

 

Surface Changes the Microsoft, OEM Dynamic Forever

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Yesterday, Microsoft announced Surface, a Microsoft-branded line of Windows tablets and convertibles. While details on battery life, pricing and availability were not available, Surface looks very impressive at first glance. The most unique feature is the thin keyboard case that converts the device into an extremely portable notebook. By competing with their own PC customers, Microsoft has changed the customer dynamic forever and will cause ripples all the way down the value chain.

Microsoft has a mixed history of making their own hardware products. On the plus side, we have the XBOX, mice and keyboards. XBOX is the dominant gaming and entertainment living room platform with one of the most innovative input devices, the gamer with Kinect. Microsoft has also had some big failures, too. The Kin phone was on the market a few months and the Zune was just recently discontinued. Both the Kin and Zune were nicely designed hardware, but both had certain fatal flaws, too. Kin consumer pricing blew it out of any reasonable price range for its target market. Zune forced users into a content acquisition model consumers just weren’t ready for and also faced intense competition from Apple’s iPod. While Surface details like pricing and availability were not available, assuming enough high-quality Windows Metro apps are available, the tablet looks very compelling… and that’s a problem for OEMs.

Since the days of DOS, Microsoft has never crossed the line and competed with its own PC customers in PCs, the HPs, Dells, Toshibas, and Lenovos of the world. When Microsoft got into Xbox, their customers did not want to get into that market. The only major friction point was discussion around Microsoft under-investing and deprioritizing PC gaming in lieu of Xbox game investments. When Microsoft launched Zune, PC OEMS did participate in the PMP market, but the Zune took the premium spot and left some differentiation room for its OEMs.

Before Surface, many OEMs I research were planning to launch Windows 8 and RT tablets. Some would be out for the October Windows launch, others would be out in Q1. Some tablets would be focused on the consumer market, others commercial and designs were in final prototype stages. Those designs could be in serious jeopardy now, but key details do not exist on Surface that would give better indication of an OEMs response. These are details like pricing, bundled software and services, target markets and distribution. Given Microsoft did not share details, one must now play out scenarios and do what-if games.

Microsoft could price Surface $100 above their OEMs. This would be a halo product strategy where Surface was the best of the best and aspirational, but wouldn’t sell that many. That is, unless it came pre-bundled with key services up front. This could be dangerous given consumer reaction to Zune’s all you can eat music plan. It would though “prime the pumps” like Ballmer indicated, paving the way for other OEMs to slot in. Microsoft could also narrow the target market, like going consumer only and not adding tools and features that would make it desirable to IT. This is an unlikely scenario given the Windows 8 and RT enterprise feature set and the popularization of BYOD. Surface will be in the enterprise on its own or get dragged in there by CIOs given the Microsoft brand and backing.

All the above scenarios are muddy and net-net only enable OEMs to participate in a low price leader position. This is similar to what the Android tablet manufacturers are experiencing today, which is ugly at best. A few companies are rising to the surface like Asus and Samsung, but still no one I talk to likes this market as no one is making any money in it and return rates and low levels of satisfaction run rampant. This is why OEMs were so excited by Windows 8. They saw how Android and in HPs case webOS turned out for them and came back to Microsoft.

With Surface, the dynamic between Microsoft and its customers changes…. forever. The announcement yesterday may be known as the day Microsoft delivered the iPad’s first real competition, but may also be known as the day Microsoft crossed the line with OEMs. Microsoft now is competing directly with its customers. Some OEMs will contemplate exiting the PC business entirely or exit the consumer market. Others will re-engage with Android. Some will run after Tizen, webOS or even plan to double down on their own OS like Samsung’s bada. Regardless, the PC market as we know it will be different from here on out. In some ways, that is a good thing, but long term could be a very dangerous game for Microsoft if the conclusion is that they have less customers for Windows.

Microsoft Should License Surface Technology and Brand to Partners

Microsoft’s Surface PCs are yet to hit the market so it may sound odd for me to propose what I am about to propose. However, the potential impact of a Microsoft branded tablet for their partners is significant if Microsoft is actually choosing to compete with them. I tend to believe Microsoft may be challenging them and in the process creating some useful and innovative solutions designed to help their partners not compete with them.

Surface PC is being positioned as a new family of computers. There is some truth to that and there isn’t at the same time. This is a class of computer some call convertibles but we refer to them as Hybrids. We have written many articles about this form factor and why we think it is interesting. The key takeaway is that to truly engage in productivity tasks a keyboard is a necessary accessory and we already see demand in professionals and many consumers to use a keyboard with their iPad.

The demand is there and Microsoft believes Windows 8 is uniquely positioned to meet the needs of the customer who wants true tablet and true notebook functionality in the same device–and they may be right. I say that because if there is a sweet spot in the market for a product like Surface, Microsoft is the only one merging touch and mouse / keyboard computing to a single OS. Microsoft may not have been the first to create a product like this but they may be the first ones who make it work.

With all of this context I believe the smartest thing Microsoft can do is license the Surface Brand and many of their hardware innovations like the Touch Cover, Type Cover, Vapor MG, Digital Ink, etc., to any hardware partners who wants to make a Windows 8 Tablet. 


In this scenario Surface could be to Microsoft what UltraBooks are to Intel. Microsoft can influence the specifics of the hardware and provide them with the tools to create Surface PCs. Microsoft could still sell keyboard accessories or perhaps others they come up as well, which is a model they are already successful with.

This path would also allow Microsoft to build the Surface brand and keep all Windows 8 tablets under the same brand. This is a good positioning strategy so consumers are not confused when they see an OEM tablet which is not a surface computer but is similar. Given the youthfulness of the tablet category, and the challenge of a horizontal platform while a market is maturing, the less confusion in the market the better. Given what I have seen so far the best path forward is for every Windows 8 tablet to be a Surface PC whether it has the Microsoft brand on it or not. 

Lastly, this move would not put Microsoft in a position to compete with their partners but rather spur interest in a category that is beneficial to the Windows ecosystem. They can then let their hardware partners take it from there and come up with differentiators that fit the surface computing paradigm.

This direction would require Microsoft to work much closer with their hardware partners going forward. Something I believe Microsoft should have been doing all along and yet they have not. This has led to quite a bit of frustration with some partners to which I have first hand knowledge of.

From what I have seen so far there are enough interesting features to generate interest in Surface PCs. The bottom line is many professionals and some consumers are looking to unite a keyboard with a tablet. For those a Surface PC may be a viable option. However, we believe that even though the hardware is compelling, it will not change the fact that for Microsoft to be successful customers have to want more than the hardware, they have to want Windows 8.

The challenge staring Microsoft in the face is convincing customers Windows 8 is a software platform worth their time, energy, and overall commitment.

The bottom line is I am excited by what I saw. More importantly I am impressed that Microsoft did something bold and took a risk. Whether it works or not, this is the kind of thing they needed to do to stay relevant in the new era of personal computing.

The Terrible Tablet Tsunami and the Future of Computing

IDC just issued a press release updating their expectations for tablet shipments. Here are their numbers, year by year:

2010: 19.5 million tablet shipments.
2011: 69.6 million tablet shipments.
2012: 107.4 million estimated tablet shipments.
2016: 222.1 million estimated tablet shipments.

When looking at the above numbers, you need to keep two things in mind:

1) These numbers DO NOT include the anticipated shipments of Windows RT and Windows 8 tablets. If Microsoft has its way, that’s a lot of missing tablets. Further, IDC expects the coming Windows tablet shipments to be ADDITIVE to their existing tablet estimates.

2) IDC has consistently UNDERESTIMATED the number of tablet shipments in each of its previous forecasts. By a lot.

For example, in March 2012 – just three months ago – IDC increased their estimates of tablet shipments in 2012 by 21% from 87.7 million units to the 106.1 million units. That still wasn’t enough of an upward adjustment and three months later IDC had to tweak their totals from 106.1 million to 107.4 million.

Further, if you look at the current growth in tablet shipments and compare it with IDC’s predicted 222.1 tablet shipments in 2016, you can see that their estimated growth rates are far below current levels and conservative in the extreme.

What does this all mean? It means that if desktop shipments continue to stay flat or modestly decline as they have for the past several years, then tablet shipments will be on a par with desktop shipments within the next 4 years.

The implications are industry shattering.

First, he who makes the most tablets makes the most growth.

Second, only platforms that are able to sustain significant market share in tablets will remain viable in personal computing in the long run. The first implication is self-explanatory. The second may require some justification.

Three Categories of Computing. Today, there are three distinct categories of computing: smart phones, tablets and desktops (including notebooks). Some consumers own devices in only one category, some own devices in two categories and some consumers own devices in all three. The trend is definitely toward multi-category computing ownership.

If you’re going to buy devices that span multiple categories, it only makes sense to buy devices that run on the same or a compatible platform. In other words, if your platform doesn’t support phones, tablets and desktops, then your platform is going to become marginalized.

I don’t hear analysts, pundits or commentators talking about this much and I don’t know why. Platforms are “sticky” – they have high retention rates. Multiple device platforms are like glue. Once you own two or more devices on one platform you’re very unlikely to every leave that platform. The company or companies that work well across all three computing categories will dominate personal computing for the next five to ten years.

APPLE: Right now, only Apple has a multi-category solution in place. Apple’s mobile operating system (iOS) runs on both its phones and its tablets and Apple is working hard to make the transition between their mobile OS and their desktop OS (OS X) as familiar and as comfortable as is possible.

Apple not only has a lead in creating solutions for all three computing categories but they are working hard to extend that lead as well. Last Fall, Apple announced that they would synchronize their mobile and their desktop operating system updates and put them on an annual schedule. This commitment to parallel development makes it much easier for Apple to move their two operating systems in lock step.

With iCloud binding their phones, tablets and desktops together in a seamless whole, Apple is well positioned for the multi-category computing market that lies ahead.

MICROSOFT: Currently, Microsoft has a big problem and an even bigger proposed solution. Right now, Microsoft dominates the desktop, has minuscule share in phones and no share at all in tablets. That’s a big problem.

Their big solution? This Fall Microsoft intends to introduce Windows RT tablets, Windows 8 tablets and, perhaps, even an ebook reader. Microsoft is currently well behind Apple but they intend to provide a solution that spans and ties together all three computing categories. And they plan to do it in a hurry.

Can they make it happen? Unknown. We’ll have to wait and see. If they don’t, they are in deep, deep trouble, at least so far as personal computing goes. If Microsoft’s tablet solutions are only as popular as their phone solutions have been thus far, then those who seek a multi-category computing solution will soon learn to look elsewhere.

Microsoft has its work cut out for it but if they can gain acceptable market share numbers in the tablet sector (which will presumably translate over to the phone sector, as well) then they are well positioned to create the type of ecosystem that makes multi-category computing such a joy. Microsoft has flaws like any company, but ecosystem is not one of them. If Microsoft can just get back in the game, they can play the multi-category computing game as well, or better, than anyone.

ANDROID: So wither Android? Right now Android dominates overall smart phone sales. But just as Microsoft is currently stranded on the desktop, Android is currently stranded on phones. Their struggles with tablets have been well documented and they’re not even trying to provide an Android solution on Desktops (Chrome, yes. Android, no.) If you want a single platform to support your multiple category devices, Android is currently the last place you’re likely to turn.

Can Android turn things around? Of course they can. Google has committed to putting more resources into Google Play (I still don’t understand why they re-branded Google Marketplace as Google play – Google Play is an awful name) and they’ve promised us a tablet “of the highest quality” this summer. But promises are only promises, nothing more. Just as Microsoft has to prove that they can field a successful tablet product, Google has to do the same. And while Microsoft has a proven track record in building strong and vibrant ecosystems, Google seems to struggle in this oh-so-crucial facet of the multi-category computing game.

Conclusion: Right now, Windows dominates desktops, Android dominates smart phone sales and Apple dominates the cross-category solutions. But rapidly growing tablet sales may not only be the key to computing growth, it may also be the key to the future of all three categories of personal computing.

As tablet sales grow, not only will Apple’s share of the computing market grow but the current positions of the big three operating systems will necessarily shift as well. Like a monstrous game of Jenga, as the pieces move in and out of place, there will be a titanic shift in power as someone, or several someones, find themselves unable to satisfy the desires of a demanding consumer base.

Apple’s place in the new world order seems assured. But as Google and Microsoft fight to gain tablet share, the one who fails to become relevant where they are weakest, will also risk becoming irrelevant where they are currently strongest, as well.

The future is uncertain, but one thing is for certain. If you like tech, the next 18 months are going to fascinating to watch.

HSA Foundation: for Show or for Real?

I recently spent a few days at AMD’s Fusion Developer Summit in Seattle, Washington.  Among many of the announcements was one to introduce the HSA Foundation, an organization  currently including AMD, ARM,  Imagination, MediaTek, and Texas Instruments.  The HSA Foundation was announced to “make it easy to program for parallel computing.”  That sounds a bit like an oxymoron as parallel programming has been the realm of “ninja programmers” according to Adobe’s Chief Software Architect, Tom Malloy at AMD’s event.  Given today’s parallel programming challenge, lots of work needs to be done to make this happen, and in the case of the companies above, it comes in the form of a foundation.  I spent over 20 years planning, developing, and marketing products and when you first hear the word “foundation” or “consortium” it conjures up visions of very long and bureaucratic meetings where little gets done and there is a lot of infighting.  The fact is, some foundations are like that but some are extremely effective   like the Linux Foundation. So which path will the HSA Foundation go down?  Let’s drill in.

The Parallel/GPU Challenge

The first thing I must point out is that if CPUs and GPUs keep increasing compute performance at their current pace, the GPU will continue to maintain a raw compute performance advantage over the CPU, so it is very important that the theoretical performance is turned into a real advantage.  The first thing we must do is distinguish is between serial and parallel processing.  Don’t take these as absolutes, as both CPUs and GPUs can both run serially and in parallel.  Generally speaking, CPUs do a better job on serial, out of order code, and GPUs do a better job on parallel, in-order code.   I know there are 100’s of dependencies but work with me here.  This is why GPUs do so much better on games and CPUs do so well on things like pattern matching. The reality is, few tasks just use the CPU and few just use the GPU; both are required to work together and at the same level to get the parallel processing gains.  By working at the same level I mean getting the same access to memory, unlike today where the CPU really dictates who gets what and when.  A related problem today is that coding for the GPU is very difficult, given the state of the languages and tools.  The other challenge is the numbers of programmers who can write GPU versus CPU code.  According to IDC, over 10M CPU coders exist compared to 100K GPU coders.  Adobe calls GPU coders  “ninja” developers because it is just so difficult, even with tools like OpenCL and CUDA given they are such low level languages.  That’s OK for markets like HPC (high performance computing) and workstations, but not for making tablet, phone and PC applications that could use development environments such as the Android SDK or even Apple’s XCode.  Net-net there are many challenges for a typical programmer to code an GPU-accelerated app for a phone, tablet, or a PC.

End User Problem/Opportunity

Without the need to solve an end user or business problem, any foundation is dead in the water.  Today NVIDIA  is using CUDA (C, C++, C#,), OpenCL, and OpenACC and AMD supports OpenCL to solve the most complex industrial workloads in existence.  As an example, NVIDIA simulated at their GTC developer conference what the galaxy would look like 3.8B years in the future.  Intel is using MIC, or Many Integrated Cores to tackle these huge tasks.  These technologies are for high-performance computing, not for phones, tablets or PCs. The HSA Foundation is focused on solving the next generation problems and uncovering opportunities in areas like the natural user interface with a multi-modal voice, touch and gesture inputs, bio-metric recognition for multi-modal security, augmented reality and managing all of the visual content at work and at home.  ARM also talked on-stage and in the Q&A about the power-savings they believed they could attain from a shared memory, parallel compute architecture, which surprised me.  Considering ARM powers almost 100% of today’s smartphones and tablets around the world, I want to highlight what they said.  Programming for these levels of apps at low power and enabling 100’s of thousands of programmers ultimately requires very simple tools which don’t exist today to create these apps.

The HSA Foundation Solution

The HSA Foundation goal, as stated above, was to “make it easy to program for parallel computing.” What does this mean?  The HSA Foundation will agree on hardware and software standards.  That’s unique in that most initiatives are just focused on the hardware or the software.  The goal of the foundation is to literally bend the hardware to fit the software.  On the hardware side this first means agreement on the hardware architectural definition of the shared memory architecture between CPU and GPU.  This is required for the CPU and GPU to be at the same level and not be restricted by buses today like PCI Express.  The second version of that memory specification can be found here.  The software architecture spec and the programmer reference manual are still in the working group.  Ultimately, simple development environments like the Google Android SDK, Apple’s XCode and Microsoft’s Visual Studio would need to holistically support this to get the support of the more mainstream, non-ninja programmer.  This will be a multi-year effort and will need to be measured on a quarterly basis to really see the progress the foundation is making.

Foundations are Tricky

The HSA Foundation will encounter issues every other foundation encounters at one time in its life.  First is the challenge of founding members changing their minds or getting goal-misaligned.  This happens a lot where someone who joins stops buying into the premise of the group or staunchly believes it isn’t valuable anymore.  Typically that member stops contributing but could even become a drag on the initiative and needs to be voted off.  The good news is that today, AMD, ARM, TI, MediaTek and Imagination have a need as they all need to accelerate parallel processing.  The founding members need to make this work for their future businesses to be as successful as they would like. Second challenge is the foundation is missing key players in GPUs.  NVIDIA is the discrete GPU PC and GPU-compute market share leader, Intel is the PC integrated GPU market share leader, and Qualcomm is the smartphone GPU market share leader.  How far can the HSA Foundation get without them?  This will ultimately be up to guys like Microsoft, Google and Apple with their development environments.  One wild-card here is SOC companies with standard ARM licenses.  To get agreement on a shared memory architecture, the CPU portion of ARM SOC would need to be HSA-compliant too, which means that every standard ARM license derived product would be HSA-compliant.  If you had an ARM architecture license like Qualcomm has then it wouldn’t need to be HSA-compliant.  The third challenge is speed.  Committees are guaranteed to be slower than a partnership between two companies and obviously slower than one company.  I will be looking for quarterly updates on specifications, standards and tools.

For Show or for Real?

The HSA Foundation is definitely for real and formed to make a real difference.  The hardware is planned to be literally bent to fit the software, and that’s unique.  The founding members have a business and technical need, solving the problem means solving huge end user and business problems so there is demand, and the problem will be difficult to solve without many companies agreeing on an approach.  I believe over time, the foundation will need to get partial or full support from Intel, NVIDIA, and/or Qualcomm to make this initiative as successful as it will need to be to accelerate the benefits of parallel processing on the GPU.

 

 

An Install CD? Really?

Picture of blank CDHard drive powerhouse Western Digital is getting into the home networking business with a new line of high-speed wireless routers, some with built-in storage, that the company says are optimized for streaming media around the house. I’ll be taking a deeper look at the products and the state of home networking when I get back from a couple of weeks away.

But something struck me when I opened the box of the sample My Net N900 that WD sent me. The package contained te router, the usual butt-ugly wall wart power supply–and a yellow ethernet cable and an installation CD. I shouldn’t have been surprised, but I suddenly realized what an anachronism this was.

The CD does a nice job of leading you through the Windows setup using a direct ethernet connection. But even WD seems to realize that is is living in the past because the instructions for “Mac/Tablet/Browser” tell you to start the router, connect to it over Wi-Fi, and point your browser to 192.168.1.1, a follow the routine on-screen. (That IP address can be problematic if you are using the My Net to replace an existing wireless router that uses the 192.168.1.x address space. It should instruct you to shut off any existing Wi-Fi first.)

Disk-based setup is still common, but it is time for it to go away. Apple has made it clear that it considers the both the optical disk and the RJ-45 Ethernet port dead in laptops, and where Apple leads, everyone else eventually follows. WD properly anticipates that some people may be setting up a router in a home that has no traditional PCs with optical drives, Ethernet ports, or even the ability to install a setup program other than through an app store.

Fortunately, there are two simple alternatives available. Manufacturers can rely entirely on online setup. Or if they don’t want to rely on connectivity, a web server embedded in the device itself will do the job. Everyone should ditch the disk.

 

The One Thing I Want to See from Microsoft

I have been following the news coming out of Microsoft’s TechEd conference closely. I was scheduled to attend the event but family circumstances altered my plan. There are a host of things that are of interest to me regarding Windows 8. Not everything I am interested in will be addressed until much closer to launch but it has been interesting to see the major messages around their next major software release at their TechEd conference.

The more I study the trends in the industry the more I am convinced that Microsoft’s future depends on them becoming a hardware agnostic software company. Throughout most of Microsoft’s history, all their major innovations and value have been strictly limited to companies who license their software platform Windows. This worked in a Windows dominated world but with the role of smartphones, tablets, and even shifting tides in notebooks / desktops, it is clearly no longer a Windows dominated world. I don’t personally believe we will see a Windows dominated world again the way we did as the computing industry was maturing.

Related: Why History Won’t Repeat Itself

If this is true then the market will support a multitude of software platforms. Which means for a company like Microsoft the key strategy should be to innovate through software for all hardware platforms.

The first obvious move could mean to bring Office to platforms like iOS, Android, and perhaps RIM IF they make a comeback. Reports have come out about Office for iPad and I hope they are true. Microsoft is committed to Office and it would be wise for them to re-envision office for every software platform. When Microsoft began taking the Mac and OS X seriously they brought office to the Mac in a relevant way and did not just port the Windows version. I believe they should do the same thing for iOS, Android, and perhaps Blackberry 10 if it gains traction.

But the thing I would really like to see from Microsoft is something new. Something not Windows and something not Office for personal computing. Microsoft’s innovations have revolved around Windows and Office but I wonder what is beyond. I’d like to see new software, for the new personal computing era, created by Microsoft.

Take for example Apple’s iLife suite of software. It blows my mind that Microsoft has not felt compelled to solve the problem of ease of use for digital media creation and management. I know Microsoft has relied on partners in this area like Adobe, ArcSoft, Pinnacle, etc., but given how key this experience is to consumers I would have thought it was important enough for Microsoft to control the way Apple does.

Even if the area of creativity is not of huge interest to Microsoft I would like to see them create new software or apps that is unique and fresh for their ecosystem and beyond. Windows and Office have been pillars for Microsoft but I am not convinced they are the only legs they have to stand on going forward. I appreciate their efforts to re-think user interfaces for the next era but I still want to see more. I also wonder if just re-imaging a user interface is enough in todays world.

We are entering a new era of computing where we will face new problems which will present new opportunities to solve through software. Which brings me to the one thing I am desperately interested to see from Microsoft. Vision.

Why We Started Tech.pinions

June 13, 2012 marks the one-year anniversary of our site, Tech.pinions. In light of its anniversary, I thought I would share why we felt compelled to attempt something different within the public tech media forum, namely to start a website dedicated primarily to opinion editorial and long form columns.

One of the primary functions of my job as an industry analyst is to study the industry at large and attempt to make insightful observations about all of its happenings. Besides meeting with as many technology companies as my time allows, I find reading quite a bit of tech journalism to be helpful. The problem I found was that much online technology journalism is focused more on information than insight. Tech journalism at its best tells stories and covers informative facts and is genuinely more informative than insightful. There is nothing wrong with this model and I find it particularly helpful in my line of work.

However, what I desire to read is a wide range of informed and insightful opinions on key industry topics. What I have found in my 12 years as an analyst is that insightful perspectives in the form of opinion columns were much harder to find than informative content. I believe both have a role in shaping this industry’s future, and our goal with Tech.pinions is to provide a place where interested readers can find a wide range of opinions, that we hope share key insights and perspectives, on a wide range of subjects related to the technology industry.

Our goal is to accomplish this vision in a number of ways. The first is to be highly selective in the opinions we allow to be published. We seek out a wide range of opinions from individuals who have a history of credibility and a reputation in this industry. We seek out authors who are professional industry observers, experts in their field, company executives, and many other kinds of insightful individuals. The casual reader may not know who the author is, but oftentimes industry insiders will know the author. Because of this we found it important to include the bio of the author on every post so readers can easily see who the person is and what their background is. I personally find this very important when reading content on the Internet in order to know if the author is credible and should be trusted for their opinions, insights, and perspectives.

One other point on this first goal should be made clear. Opinions are not facts. The opinions we publish are based on expert experiences, insights, and data, but the point remains that opinions are just that–people’s opinions. Because of that we fully expect healthy and respectful disagreement from time to time. We only ask that the dialogue be respectful because in the end, everyone is entitled to their own opinion and most importantly, the beautiful thing about opinions is that they open the door to disagreement. We hold our writers to a high bar with their content and we intend to hold our commenters to a high bar as well. So when we disagree, let’s agree to disagree.

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Does Apple Love PCs More Than Microsoft?

Does Apple, the post-PC company, have more faith in the future of PCs, than Microsoft?

Photo of Mac Book Pro
Mac Book Pro 15 with Retina Display

The idea may seem a stretch, seeing how Apple’s business is now dominated by iPhones and iPads, but it may well be true. Microsoft very much depends on the PC for its future, but it doesn’t seem to be serving its PC users well

Much of the analysis of Apple’s Worldwide  Developer Conference announcements has focused on the impact on Google. Dumping Google Maps from the iPhone and enhancing Siri search definitely pose some challenges for the search giant. But the larger near term impact may well be on Microsoft, as it struggles to hang onto its PC business while gaining traction in the elusive phone and tablet markets. Microsoft was having a hard enough time catching up with where Apple has been, but Apple, of course, is not standing still.

It’s significant that the new features of iOS 6.0 and OS X Mountain Lion, while impressive, are not earth-shaking. In the past five years, Apple has built a comprehensive infrastructure that ties all of its products together. This effort, while still evolving, has achieved considerable maturity, which is why we should expect that changes will be incremental. The lack of new features that knock your socks off may disappoint ardent fans and the markets, but it’s really a sign of how far Apple has come.

Keeping things separate. Microsoft maintains its dominance of the enterprise back office, but is struggling everywhere else against an upstart it though it had vanquished nearly 20 years ago. In the consumer space, it is betting pretty much everything on on Windows 8, I’ve made no secret of my belief that Microsoft’s decision to go with a common software platform for traditional PCs and tablets is a mistake. As Ryan Block of GDGT tweeted, there are a lot of former PC tasks now routinely handled by tablets, but “for the tasks that remain, computers are as important than ever. The user base isn’t contracting so much as the use cases are clarifying.”

Apple raised the stakes at WWDC as it revealed the refined features of Mountain Lion and iOS 6.0. Where Microsoft is merging the desktop with the tablet, Apple is continuing to converge the two. The difference is critical and, I believe, all in Apple’s favor. Apple is adding iOS-like features to OS X when they make sense. So Mountain Lion gets reminders, notifications, and messages. But it retains its distinctive look and feel and an environment that is optimized for the sorts of complicated tasks for which users will continue to rely on traditional PC hardware. In particular, the multi-windowed Mac desktop is retained along with the traditional icons, menus, and pointers. And while Apple has made it possible to manipulate the user interface through touchpad gestures, it shows no inclination to move to touch screens on either iMacs or MacBooks.

Microsoft, by contrast, is forcing Windows 8 users to deal with a Metro UI that seems to be optimized for tablets and touch screens. Metro apps are designed to run full screen, with some very limited screen sharing possible on larger displays. Metro actually looks like a very nice tablet UI, superior in some ways to both iOS and Android. But it find the Consumer Preview painful on a laptop. Even if you spend most of your time working in traditional Desktop apps, which continue to work in multiple windows as always, you are forced to put up with a jarring switch to Metro for some critical tasks. Metro apps feel like they waste an awful lot of space on a 13″ laptop and  are truly ridiculous on a 27″ desktop display. (Microsoft’s developers used to be criticized, only half in jest, for thinking that everyone worked, like them, with dual 30″ monitors. Now they seem to think that everyone works on a 10″ tablet.) I suspect that most serious PC users are going to want to stick with Windows 7 for as long as they can; it will be interesting to see if Microsoft will allow a downgrade option on new consumer systems.

Microsoft has made some progress integrating Windows, Windows Phone, and Xbox and Windows 8 will push the process along. But again, Microsoft has not yet caught up to Apple even as the competition takes the next leap ahead. iCloud still has a ways to go and iTunes is a hairball, but you can  wake me when Windows matches the magic of PhotoStream.

Then there’s hardware. Spurred mainly by Intel, Microsoft’s OEM hardware partners are finally beginning to catch up with the notebook revolution set off by the Mac Book Air. But Apple, of course, is not going to sit still. The 15″ Retina Display MacBook Pro (a product that desperately needs a better name) is not likely to be a huge seller. Its starting price of $2,199 is two to three times that of a typical Windows notebook and it tops out at a staggering $3,700. But it sets a new standard an definitely shows the direction laptops will be taking.

In a typical Apple move, it dispenses with an optical drive, long thought to be an essential in a 15″ professional notebook. It is a third of an inch thinner an 1.3 pounds lighter than Hewlett-Packard’s Envy 15. Its most important feature is a 2,880×1,800 pixel display; Windows competitors top out at 1,920×1,080, less than half the pixel density. And make no mistake about it: Apple will be pushing Retina displays throughout the MacBook line. They are expensive, but they justify charging prices that generate fat margins and let Apple capture a vastly disproportionate share of PC profits. And, have been proven with the new iPad, they produce a far superior user experience simply by making everything more legible. In the year or so since Intel introduced the Ultrabook concept, Windows machines are arguably losing ground to the company that supposedly wants to kill the PC.

Microsoft was caught seriously off-guard by the iPad and was right to shift massive resources into tablets when it became clear that the post-PC phenomenon was real. But PCs remain a very important part of the ecosystem, and right now, it’s not clear that Microsoft cares as much about them as Apple does.

Afterthought:  If this report from VR-zone is correct and Microsoft plans to charge manufacturers $85 or so for each copy of the tablet version of Windows, it is going to be almost impossible for these devices to come to market at a competitive price. I hope it is wrong, because if true–and Microsoft has not responded to the report–it will leave Microsoft with an OS optimized for tablets no one will want

 

The Apple Promise To Their Customers

I don’t normally put out an article about another article I have written but for this particular one I wanted to share it. In my weekly column for the tech section of TIME.com I wrote about what I am calling The Apple Promise to Their Customers. The line of thinking which I think is interesting is how Apple is now on an annual cadence for software releases on all their hardware. Each year Apple customers will get new features and new functionality. This is a powerful value proposition.

Here is the article give it a read and I would love to hear any thoughts.

Why Only Apple Can Promise A Better Experience To Customers Every Year

What I want to acknowledge is that some new features Apple brings out exist on other devices. Many can look at one single feature, like Maps for example, and point out that it is not new. I have heard this for years from heavy supporters of other platforms when Apple fans sing the praises of new features that have existed elsewhere for years.

This thinking misses the point because the fact that one single feature exists on another device is irrelevant to the customer who does not have that device. For an iPhone customer the fact that Android has had turn-by-turn navigation for years is an interesting but useless fact. The customer who bought an iPhone most likely knew those features existed on other devices but still choose the iPhone for a host of other reasons. The features and functions that led a consumer to choose an iPhone over other devices were probably less about one or two features but about the whole experience and package. This is why it is significant that Apple every year brings new features and even existing features to their customer base. A feature like turn-by-turn navigation may not have been important enough for a feature for a consumer to not buy an iPhone but now that it is there it sure is nice to have.

It is important to get beyond a feature by feature mindset. It is the combination of many features that make up the total experience with a device. Just because one device may have a feature the iPhone doesn’t, does not mean that device can stack up to the total experience of the iPhone. And some may argue the reverse and that is fine because my point is that it is less about a singular feature and more about many little features working together for the whole experience. If we want to debate devices lets do it on the grounds of the experience not the features.

Second, and I didn’t point this out in my TIME column, let’s not get stuck on mobile with this annual cadence. Apple is now on a yearly cadence with OSX to add new features and functionality to Mac hardware. This is not something we can say of other companies (and I am including service packs in this statement.) Consumers of Mac hardware (and there are a lot and growing fast) can be assured their hardware will get new features and functionality every single year. That is tough to find outside of the Apple ecosystem.

Sorry for writing an article about another article but I wanted to add some additional context.

Here is the link again to my TIME column.

Why Only Apple Can Promise A Better Experience To Customers Every Year

The Most Amazing Notebook Yet

It is possible that for many tech industry enthusiasts and followers that by my title alone you know what product I am talking about. In case you don’t know I am talking about Apple’s newest hardware innovation released today at their annual WWDC. This product is the MacBook Pro with Retina Display.

Apple pushed the envelope in engineering design for size and weight for a 15′ notebook. The new design alone would have been enough to impress but Apple didn’t stop there and added what is the best display on a notebook I have ever seen.

When I first saw the MacBook Pro with Retina Display, I had a similar experience to when I saw the Retina Display on the new iPad. I simply couldn’t stop looking at it. With the Retina Display on iPad, Apple set a new bar with the visual experience on a tablet. They have now done it again and set a new bar for a display on a notebook.

It is significant that this display innovation on a notebook comes to the MacBook pro line. Creative professionals are among the group that Apple has always had loyalty with. And it is with this group who tends to value performance more than mobility. The customer for the MacBook Pro wants performance in a portable package but doesn’t desire the tradeoffs in performance that need to be made for the ultra-portability offered in the MacBook Air.

Apple has delivered to this audience not only an extremely thin and light machine with all the performance for a creative professional but they added to it a display they will truly appreciate. Creative professionals look at things like graphics, animation, video, pictures, etc., all day and desire extremely high resolution monitors in order to do their work more efficiently. Many in this segment use a notebook or a desktop paired with an external monitor that is capable of higher resolution than can be offered on a notebook. With the MacBook Pro with Retina Display, creative professionals can now take that high resolution display that they need for their work with them.

I am confident that this new MacBook Pro with Retina Display will draw attention and turn heads. The whole notebook is an impressive piece of work. I am also confident that those in the market for a performance machine will seriously consider this new MacBook Pro. There is however, something perhaps even more interesting that may arise.

With the arrival of the Retina Display on iPhone and iPad, we saw a dearth of new software get created that took example of this new higher resolution display. I assume the same will happen now with the emergence of the MacBook Pro with Retina Display.

It is no coincidence that Apple released this new product at their annual developer conference. It is the third party developer community who contribute such value to the Apple ecosystem. I can only imagine the next generation of software experiences that will be created with what is clearly becoming Apple’s high resolution revolution.

My guess is this is also just the beginning. I think anyone who believes that Apple is not innovating in Mac hardware would be incorrect. Like the first generation MacBook Air, I believe Apple will bring these innovations downstream again to more notebooks over time. Again keep pressure on the competition and continuing to make some of the best engineered notebooks on the market.

The Apple Ecosystem Just Got Stronger

Apple today at their World Wide Developers Conference released a number of things that have made their ecosystem even stronger. I am of the opinion that one of the best ways to analyze computing platforms is to look at them as ecosystems. When consumers purchase a personal computer like a desktop, notebook, tablet or smartphone, whether they know it or not they are investing into an ecosystem.

Related Column: It’s All About Ecosystems

Not too long ago computing platforms were islands unto themselves. Each product stood on its own and wasn’t connected to other devices in a meaningful way. But now that consumers are purchasing more and more computing products they began to demand that their devices begin to work seamlessly together for a more fulfilling experience. This demand has led to the birth of more holistic computing ecosystems. And interestingly software companies who offer platform software for desktops / notebooks, tablets, and smartphones are the companies building the most robust ecosystems on the market and right now only Apple and Microsoft fit that bill. Today Apple with the release of new and updated Mac hardware and software and the release of their newest mobile operating system iOS 6 just strengthened their ecosystem all together.

It all revolves around iCloud

Tim Cook said something that made perfect sense to an Apple observer like me. He said that iCloud isn’t just a product, it’s a strategy for the next decade. With that fundamental point in mind it becomes easy to see why Apple is integrating so iCloud into the core of their OSX and iOS software. iCloud is the glue that holds all of Apple’s hardware and software together. Take for example some simple features they have added with the newest Safari.

It may seem small but this little thing is just the tip of the iceberg when it comes to the value of Apple’s ecosystem. Imagine you use a notebook, tablet, and smartphone regularly. In the usage of all three of those products it would seem logical that you would browse the web frequently on each of them. Now what if you where on the couch looking for a recipe and you wanted to view that very same recipe on your tablet or smartphone. Most people would either have to re-search for that recipe on the other device or you could email yourself the link. With the latest version of Safari for OSX Mountain Lion every single web page you have open as a tab is available to you on any of your OSX or iOS devices. So if I want to look at a web page I have open on my Mac from my iPad, I simply click the new iCloud tabs button on the top of Safari and all the same tabs open on my Mac are available for me on my iPad or iPhone.

This seems like something small but it is extremely useful and demonstrates the value of iCloud integration across hardware and software to create a consistent and useful experience. This is just one of many new features and advancements Apple is making through software to better delight their customers by solving current and future problems.

The Vertical Advantage

The tight integration of software innovations with specific hardware innovations all around a service like iCloud is easier when you control all the moving parts. I have emphasized this time and time again but it is this fundamental point that gives Apple such an advantage. The Apple ecosystem has no external variables. Apple doesn’t need the support of hardware or software partners in order to advance their ecosystem. This point can not be stressed enough.

It is because of this vertical advantage that Apple can annually release a unified launch of new hardware and new software all designed to work better together. And it is this better together that creates the fundamentals of the Apple ecosystem, which just got stronger.

Making The Devices We Know and Love Better

The last key point about the strength of the Apple ecosystem is that with this latest software for Mac, iPhone, and iPad, Apple has made the experience even better. I would contend that many of the devices we know and love have become even more useful. Now many may argue that some of the new features released are available on other devices or platforms. That is all fine and good for customers of other platforms but the bottom line is I and hundreds of millions of other people have invested in Apple’s ecosystem when it comes to my personal computing needs. So for me the fact that Apple has developed new features to make my experience with their hardware even better is most welcomed.

At the end of the day it is those features that add to our experience, make these products easier to use, and more importantly make using these products in our daily lives that much better. It is the small things like being able to ignore an incoming call with a text message or reminder to call the person back is extremely useful. The improved maps and elegant navigation is also a welcomed additional improvement. Perhaps the biggest improvement of all is the major upgrade to Siri.

All of these things and more are focused on one singular thing, making the devices we know and love better and more useful. Apple is continuing to make their hardware more functional every year. I am not sure it is possible to say that any other company is delivering their customer base new and improved features and functionality to all their hardware on an annual basis.

This is just one more thing adding to the already strong Apple ecosystem and it will be very interesting to see how the competition responds.

The Next Big Thing: Apple WWDC

It’s no surprise to see Apple race on, barely missing a beat since Steve’s passing – leading global innovation as it has this new millennium.

In just a few hours the next Apple WWDC (WorldWide Developers Conference) will take place. A stage that has announced true global game changers, like the iPhone and the iPad.

In the end, right now it’s still about the App store.  With 600,000 downloadable games, magazines and productivity tools, Apple is the application leader.  But the others are not far behind. As quoted in Bloomberg earlier today, “The success of Apple’s App Store has helped create an economy for downloading mobile applications that will reach $58 billion in sales in 2014.”

Surely, Apple will continue App dominance – and its track record of suspense and big announcements at WWDC. Will we see the next iPhone? News on OS X Mountain Lion? A new social platform? The next “Big Thing” that none of us have even contemplated yet?  It’s hard not to wonder where Apple goes from here, without Steve Jobs at the helm… but we’ll find out in just a few short hours.

This is a question I ask over and over in my upcoming eBook on Apple, The Magic and Moxie of Apple – An Insider’s View.

“… So where does Apple – a company that started out as two guys making and selling circuit boards out of their garage, which transformed into one of the biggest international technology companies in the world – go from here? Following the loss of Steve Jobs, that question seems challenging to answer. As we know all too well, Apple has seen itself rise and fall from grace before and reinvent itself more than once, and the company is counting on the fact that it’s cemented its place at the top so profoundly that nothing will stop it from continuing to grow. Continually releasing new products (and upgrading the old) may do this, but fundamentally, what direction does it take next? The iPhone, iPad, and iPod have already seen several generations of upgrades. What groundbreaking innovations will propel Apple in the same way that the iPod, iPhone, MacBook Air and iPad did? The answer to that question isn’t what new product will they come out with, but rather who will be dream it up without Steve? … ”

 

Like many of you, I’m eagerly awaiting iOS 6 and Mountain Lion – which brings some of the most popular features found on other Apple products to the Mac, such as GameCenter, notes, etc. A personal favorite is that Mountain Lion will send messages to anyone on an Apple product – so you’ll be able to begin a message on your Mac and pick it back up on your iPhone or iPad later on. We’ll see today what else Apple has in store for us – the world of believers, creators and brand advocates.

And although the race continues without Steve Jobs to lead the pack – only his company to carry on the dream – it will not be easy to watch WWDC without him taking the stage.

Kelli Richards, President and CEO
The All Access Group, LLC
PS: If you’d like to pre-order a copy of my book, The Magic and Moxie of Apple – An Insider’s View,” please go to http://www.allaccessgroup.com/?p=2287.

 

Following Up: Equal Access To Television

At a panel on wireless spectrum that I moderated yesterday at the Tech Policy Summit in Napa, I raised the idea of repurposing the 294 MHz* of spectrum devoted to over-the-air television for wireless data. Larry Irving, former Assistant Secretary of Commerce for the National Telecommunications & Information Administration raised a very valid point: While only 10% to 20% of Americans rely primarily on OTA television, their number is disproportionately concentrated among minorities,  the elderly, and the poor and ending free broadcasts would adversely affect these groups.

I agree. But I also believe that the benefits of freeing this huge chunk of prime spectrum  would be so great that we can find a way to solve, and pay for, the problem. It’s not a great model for a bunch of reasons, but we do have precedent in telephone service. For years, a tax on telephone service has gone into the Universal Service Fund, used to subsidize rural phone service (this is now being repurposed for internet access.)  And regulators required landline operators to maintain low-cost, minimal “lifeline” phone service for the poor. Both of these approaches had serious flaws; for example, USF ended up subsidizing service to rich folks’ vacation homes. But they can be made to work.

Rural service remains a big issue. Cable TV actually began life as a rural solution for people who lived too far from broadcast towers to get a reliable signal, but today rural residents are often left behind. Satellite can be a good solution, but only for those with an unobstructed view of the southern sky. Again, the resources created by the reuse of TV spectrum can be used partly to solve the rural TV problem and the much more serious (in my opinion) problem of rural internet access.

*–In the original post, I said 200 MHz. I am indebted to Rebecca Hanson of the Federal Communications Commission, a participant in my TPS panel,  for the correction.

Why We Need More Specialty Tech Retail

Big box tech retail had its time but for certain types of technology I am convinced there is a better way to sell. I am convinced this is the case because big box retail simply offers too much choice. The real opportunity ahead is to provide better curation of that choice.

I am an avid and highly competitive tennis player. When I buy tennis equipment I buy the good stuff. More often than not the equipment I need is not found in a big box sports retailer. Rather it is found in specialty stores where the store owner is highly curating what products are carried in the store and more importantly highly knowledgable of all the goods. This is just one of example of many advantages of more specialty retail outlets and in every case it is generally the same–better products and better service.

From a technology standpoint I want to look at a couple examples.

Home Audio and Visual

Magnolia Hi-Fi was a purely specialty show room and retail outlet for high quality home AV products. You could go to Magnolia and experience the best in home CE for both the mid and high end. Magnolia never carried the cheapest home CE products but they carried the best in the categories they chose.

During the time of the CE industries transition from analog broadcast to digital broadcast and HDTV, these stores saw quite a bit of foot traffic and drove sales. There were several reasons for this.

The first was that people were hungry to learn about HDTV and all the different nuances of HDTV’s at the time. Magnolia carried a relatively limited line of HDTV’s in their outlets so it made the learning process a bit easier to take in but they also staffed very intelligent staff who clearly explained the products, their benefits, and the technology.

During the same time if you went into a Wal-Mart or Best Buy, you were confronted with too many options and SKU variables, too many screens plastered right next to each other, and staff that had a general knowledge of the products at best but couldn’t explain specifics. All of that together left consumers with too much information to process and often leaving the store less confident about buying a new TV than before.

What Magnolia did for the market while it was still being born was key. They curated choice and helped consumers feel confident and knowledgeable about their purchase. This is simply something big box retail can not do.

What About Computers

Apple, I believe, is setting the example of how computers may be sold in the future. This is why I believe Microsoft is getting serious about putting retail stores in many of the same areas as Apple stores. My observation of this move is that retail stores for computing may be more about ecosystems than anything else going forward. Let me explain that.

Apple is vertically integrated and will sell hardware and software all for their proprietary ecosystem. Microsoft’s ecosystem is not proprietary since they don’t make computers. Because of that they need partners like Acer, Dell, HP, Lenovo, etc., who may not open their own stores all over the world. However, Microsoft may and sell all those partners hardware through their stores, which all cater to the Microsoft ecosystem. In a Microsoft store the singular point is the Microsoft ecosystem rather than any one vendor. The difference in Microsoft’s licensable platform vs Apple’s vertical integration is the fundamental point that makes these different channel strategies a reality.

The benefit of this model is that you know where to go depending on whose ecosystem you have invested in. If I am an Apple customer, I can go to an Apple store and find many products, curated on my behalf, to meet my needs when it comes to the Apple ecosystem. Microsoft’s channel strategy will be the same, although it will carry competing brands, the point remains that they are all related to the Microsoft ecosystem.

You can argue that a big box retailer can accomplish this with a store within a store mentality. But, I would disagree, on the premise of sheer floor space. A retailer like Best Buy views inventory in terms of how much they can put on shelves since they have space to fill. A smaller retailer has very little space and must be highly selective due to their lack of space. The result is more curation rather than less.

I have long used Barry Schwartz’s book The Paradox of Choice as a reference for this thinking. The primary point remains in consumer psychology that too much choice is overwhelming. Many of the points of this book validate the fundamental reasons why Magnolia Hi-Fi and Apple stores are successful. Consumers want choice but rather than throw every possible choice under the sun at them, it is better to give them choice of a select list of products which are curated by the retailer. This is again a strategy which can only be employed by smaller retailers.

To go forward in this model retailers will need to accept the “if I don’t have it someone else does” mentality. Because a specialty retailer will have to be selective, they simply can’t carry anything. This strategy has its benefits which I pointed out above and will work for many things but it also has its negatives. The primary negative being what if no store has what I want? This may be where online comes into play.

If your specialty retailers don’t have the precise product mix then perhaps online will fill the void. To use my tennis example, I prefer a very specific type of replaceable over grip. My preference in this matter is different than the mainstream so not many specialty stores carry it. So I order in online in bulk, wait a few days, but have my needs satisfied.

I am not sure if big box retailers have much of a future. I think they have their place for certain types of goods, but I have my doubts when it comes to computing goods. I, for one, think the current big box retailing experience is pretty poor and for many of the goods I would buy in a Best Buy, I have moved to purchase online.

Simply put my experience is far more superior in specialty retail over big box retail when it comes to the things I care most about. It is this fundamental point that leads me to believe that computers (i.e desktops, notebooks, smartphones, tablets) are better sold in specialty locations rather than a try-to-please-everyone-and-end-up-pleasing-no-one-big-box-retailer.

Apple’s Television

People have been talking about an Apple television for the last couple of years, but nobody knows for sure if the company will actually make one or not. I wouldn’t count Apple out of that market.

I’ve long held that Apple will enter markets that it feels it can make a significant impact. Those don’t have to be brand new markets, but areas that Apple feels it can improve on the current products and make a profit. The last decade of Apple product releases illustrates this point.

The iPod music player certainly wasn’t a new product category, but Apple took a poorly designed product that had limited storage space and changed the market forever. The iPod is iconic and it helped turn Apple around, as well as paving the way for the future.

Everyone had to have an iPod. For years it was one of the most sought after products in the consumer space. Apple changed it, innovated it with a variety of technologies and rode the wave.

They did the exact same thing with the iPhone years later. An industry that hadn’t changed in years was ripe for the taking. While pundits and entrenched manufacturers scoffed at Apple’s attempt to change the industry, they did it and haven’t looked back.

Walk into any wireless carrier or look at any manufacturer’s Web site and Apple’s influence can be seen in almost every smartphone on the market today. Copying Apple’s success has almost become a sport for some companies.

Of course, the latest product to achieve market-changing levels is the iPad. The tablet market has been around for a decade or more with little success, but Apple changed all of that. With a new design, new software and a focus on the customer, Apple redefined what can be done with a tablet.

The iPad fits into our lifestyle. It changes with us, but it doesn’t require that we make changes in order to use it.

That’s the type of challenge Apple faces in the television market or any other market it enters. Apple will try to solve the current problems, while advancing what consumers can do. The home entertainment market needs to be shaken up and it will take a company that isn’t afraid to change the status quo to do it.

Some people think Apple will release a television with new menus or Siri integration. I don’t believe they are thinking big enough. If Apple enters that market they will disrupt it and change it forever.