Turning Microsoft’s Archipelago Into A Continent

The Verge and other publications reported this week on a talk given by Microsoft’s CMO, Chris Capossela, at the Convergence conference. One of the most interesting parts of the talk he gave was this chart he shared:

Some definitions to start

It’s important to understand what the chart represents, so I’m going to quote the official transcript for the explanation:

The size of a circle is how many consumers use the product in the U.S. in a short period of time that we measured it.

The arrows that connect the circle tell you that if you use product A, you’re statistically more likely to also use product B than the rest of the population that does not use product A.

Gold is Apple’s ecosystem, purple is Google’s ecosystem, blue is Microsoft’s ecosystem.

The concept is simple, but it’s important to get that grounding before we continue. The key point is the lines don’t represent theoretical or technical linkages, but linkages in people’s actual behavior between these services.

Size of properties matters

So what patterns does the chart show? First, as regards to usage of the various properties:

  • Microsoft has some real scale around a handful of key properties, including Office, Internet Explorer and Windows PCs, and some moderate scale around things like Bing, MSN, Outlook.com and Skype.
  • Google also has enormous scale around a handful of properties, including Google search, Gmail, YouTube, Chrome and Android (which, by the way, looks much too small here for some reason)
  • Apple doesn’t have that kind of massive scale on anything but iTunes.

But this chart is really about linkages

Now, as regards to the linkages between them, which is the real point of the chart (and this article):

  • Microsoft has relatively few strong linkages and has many more islands of interaction rather than a broad fabric of interconnectedness. I’ve often said what Microsoft has built is an archipelago of un-connected products and services rather than a true ecosystem and this chart illustrates that point wonderfully.
  • Google has good linkages between many of its products, either directly or indirectly, with some key focal points (more on this in a minute)
  • Apple’s is perhaps the most interconnected ecosystem, with lots of linkages between the various individual products and services.

As Capossela summarized it:

It shows you that we’ve got a lot of big businesses at Microsoft.  Windows is big, IE is big, Office is big, et cetera.  But it also shows you that we don’t have nearly the connectivity between our products that Google has engineered and that Apple has engineered.

Google’s linkages are in single ID, the homepage and Android

All this raises the question of what those linkages between products are at Google and Apple and why Microsoft doesn’t have the same level of connectivity. I’d argue the strongest links at Google are the Google homepage, with its list of links and the nine–square grid in the top right corner (see below); the single user identity it consolidated around in 2012 across all its properties; and thirdly, Android. Here’s that homepage corner I’m talking about (there are two separate screenshots here, with the second what you see when you click “More” in the first):

Screenshot 2015-03-25 14.32.12Screenshot 2015-03-25 14.32.23

Right here, explicitly connected on the homepage of Google search (the biggest purple bubble in the chart) is Google’s linkage between its various properties. But on top of that, your single identity allows you to hop between these properties while remaining signed in and therefore quickly accessing the data, content, or settings within each of those properties.

Lastly, Android brings all these services together as apps on the mobile operating system with by far the largest market share worldwide. Google, therefore, has these three strong existing ties between its various properties and I’d argue they’re building yet another layer on top of that with Google Now, which pulls in data from various other properties and brings them together in a single interface which proactively surfaces things that are relevant at any given moment.

Apple’s linkages are also in single ID and OS, but also iCloud

The linkage on Apple is a combination of the Apple ID and its two major operating systems, iOS and OS X. Apple’s key services are both tightly integrated into its operating systems and, increasingly, take advantage of the Apple ID for integration across devices and platforms. It’s no coincidence that, even though iCloud is a relatively small bubble, it’s at the center of Apple’s ecosystem here, as it’s increasingly the connective tissue that pulls many of these services together. Apple has always focused on tight integration between hardware and software, but it’s the integration between these two and various iCloud-backed services that’s become increasingly important in recent years.

Where are Microsoft’s linkages?

So what, if any, are the linkages in Microsoft’s archipelago of products and services? Unlike both Apple and Google, Microsoft hasn’t until recently had a single ID system that operated across all its properties. Skype had its own, Office really didn’t have any kind of connected identity associated with it until Office 365 came along, Hotmail and other online properties had disparate identity systems and properties such as Bing also didn’t require any sort of login to be valuable.

Over the last couple of years, Microsoft has begun to consolidate around a single ID system with its Live IDs, and Skype now participates in that same system too. But the benefits to using such a single ID across various Microsoft products have been fairly limited. The one really big potential integration point has arguably been Windows, which appears as a bubble on Microsoft’s chart but isn’t connected to anything else. I’m guessing because it doesn’t count as a service in the same way as the others. But the PC itself has also not really fulfilled this potential in the past, with various individual applications and services running on the PC not really sharing any connectivity between a shared file system. As such, despite both Google’s and Apple’s success in utilizing both identity and operating systems as unifying elements, Microsoft has largely failed on both counts. The new Live ID system and both Windows 8 and Windows 10 promise to do better on these elements, but I still doubt that, by themselves, they’ll drive real connectedness, especially since Microsoft is largely missing the mobile piece.

The potential role of Cortana

One thing I think could become really interesting for Microsoft here is Cortana and the speech makes reference to Cortana briefly, though only as one of several possibilities for driving greater interconnectivity. Now, I’ve made the mistake along with others of thinking of Cortana much as I think of Siri – as a speech assistant on a mobile platform. It is that, to be sure, but what Microsoft really means by Cortana is not just the software on the phone but all the cloud services that sit behind it, including both the global data gathering that happens through Bing and the user-level data crunching that builds a profile of a specific individual. This is what allows Cortana to exist, not only as a feature of Windows Phone, but as a deeply-integrated feature in Windows 10 and as part of Bing online as well. In this sense, it’s much more like Google Now than Siri, in that it’s a cloud platform that can both suck in data from various sources and feed it back on various endpoints in an integrated fashion.

The reports about Cortana making its way onto iOS and Android make a lot more sense in this context, since Microsoft doesn’t enjoy significant share in mobile as it does in the PC market, and tying together your mobile world on iOS or Android with your PC experience requires something like Cortana to pull all the pieces together. Although I’d expect a Windows Phone-like instantiation of Cortana in an app on those other platforms, I’d also expect Cortana to play an increasingly important role in the background of various other Microsoft apps, pulling in data from them that helps improve Cortana’s performance as a virtual assistant wherever you use it. In this way, Microsoft might finally start to build a set of connected services that actually work better together rather than working independently as they do today.

Microsoft’s success in consumer depends on building these links

Chris Capossela doesn’t actually elaborate much on how Microsoft will build these links in his talk, beyond a couple of small examples. But I believe that creating these linkages between consumer properties will be critical to the success of Microsoft as a consumer brand. I wrote about this a bit in my piece on Microsoft’s recent acquisitions in the personal information management space, but it goes further than that. Microsoft won’t be broadly successful as a consumer brand if it only has a handful of popular but disconnected products and services. It will only be broadly successful if it’s able to built an interconnected ecosystem of products and services which are better because they work together in ways that benefit users more than if they piece together their own patchwork of equivalents from various different providers. To extend the analogy I used earlier, Microsoft needs to replace its archipelago with a continent.

Published by

Jan Dawson

Jan Dawson is Founder and Chief Analyst at Jackdaw Research, a technology research and consulting firm focused on consumer technology. During his sixteen years as a technology analyst, Jan has covered everything from DSL to LTE, and from policy and regulation to smartphones and tablets. As such, he brings a unique perspective to the consumer technology space, pulling together insights on communications and content services, device hardware and software, and online services to provide big-picture market analysis and strategic advice to his clients. Jan has worked with many of the world’s largest operators, device and infrastructure vendors, online service providers and others to shape their strategies and help them understand the market. Prior to founding Jackdaw, Jan worked at Ovum for a number of years, most recently as Chief Telecoms Analyst, responsible for Ovum’s telecoms research agenda globally.

125 thoughts on “Turning Microsoft’s Archipelago Into A Continent”

  1. Microsoft’s predicament reminded me of a quote from The Leopard, where Tancredi says “If we want things to stay as they are, things will have to change.” (Giuseppe Tomasi di Lampedusa).

  2. Microsoft has never been a consumer company, and because they missed their chance in mobile, they never will be.

  3. “Microsoft might finally start to build a set of connected services that actually work better together rather than working independently as they do today.”
    There’s a whole lot of MIGHT in your article. I think it is accurate in the now part but to think that MS will be able to “herd the cats” I think at this point in time is more might than will. The biggest problem for MS in my mind (a 100% Apple user) is the hurricane like blowback from the faithful MS users for any type of movement from the XP days. If MS ever goes down, it will because of their fear of the STOPerottsi. I guess the Apple crowd is a bit more pliable than the MS crowd???

    1. The movement away from WinXP is happening excepting the migration is happening towards Win7 (for the most part) or other platforms.

  4. Just a thought, but could the weak linkages be due to the antitrust rulings against Microsoft? There might have been an unwillingness to tightly integrate separate products because of this.

    If so, then the implications would be that as Google becomes more carefully scrutinized, they too will have to intentionally weaken their linkages. Similarly, if Apple becomes dominant in certain markets, that will hurt them more than it helps.

    1. I think it’s also due to historical reasons: Windows pre-dates modern “ecosystems”. MS has long been perfectly OK with consumers using other apps and Web properties: their focus was on Corp, they often had nothing to offer to consumers be it apps, web sites/services, content… For example, Apple keep dumbing down their own-brand software so that consumers take to it, MS keep building it up so that Corp find all the features they need. I still miss MS Works ^^
      Plus when they started waking up, their attempts where haphazard and lacking: Windows Mobile/Phone went through a yearly upheaval that quickly turned everyone away, Zune, .NET lived as long as a cut rose (there was a web ecosystem called that, at launch), Windows Live (I think that one is obsoleted too, not really sure, the mail client used to be Live Mail, now it’s Windows Live Mail…)…
      I’m sure anti-trust played a part in that MS could never do what Apple are doing today (take a cut on all app sales, be free to lock out competitors, even bundle apps/services and set them up as default would probably have been contested). But mostly, MS stuff just sucked. They couldn’t even get the web browser right, and *that* was bundled (except in Europe). Hotmail went downhill as soon as MS bought them (hey ! they got IMAP support… last year… :-p)
      Compared to their Corp strategy and products, their Consumer efforts have been amateurish. I was working for Novell when we got steamrolled by NT Server, Exchange, Office (and a dollop of SQL Server not aimed at us)… the whole thing was impressive, and they went on with SharePoint, which is also a debatable product carried by an impressive push.
      Edit: the same chart for Entreprise products would be full of arrows !

      1. Yes, it is very possible that MS wasn’t focusing on consumers.

        I wonder what implications that has on the ability of MS to improve in the near future. Maybe if they focus, they could pull it off.

  5. Very interesting, thank you.
    What strikes me most is the omission of Facebook. FB are ever more redefining themselves as a platform/ecosystem on their own.

  6. Also, next to Google Now, I think Inbox is another specific lock-in tool. Both of those tools’ functionality is useful to many, and hard to duplicate w/o as pervasive/ubiquitous an ecosystem as Google’s: both need mail + calendar + social graph + search data + location + whatever else I’m forgetting…

  7. I just realized Skype isn’t even in there. That’s weird. AFAIK it has 300+ million users, I’d assume xbox music is smaller.

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