Asymco

Asymmetric Intelligence

Microsoft

  1. Dick Brass Vents

    Research

    I knew of Dick Brass at the time when he was promoting ClearType inside Microsoft. We met his team to consider licensing our table recognition algorithms for the production of ebooks for Microsoft Reader, an early ebook reading solution for the PocketPC. It was then I learned about plans for “reading solutions” from Microsoft, almost 10 years ago.

    Now he writes about the tragedy of Microsoft’s complete absence from the future of mobile computing.

    "...why Microsoft, America’s most famous and prosperous technology company, no longer brings us the future, whether it’s tablet computers like the iPad, e-books like Amazon’s Kindle, smartphones like the BlackBerry and iPhone, search engines like Google, digital music systems like iPod and iTunes or popular Web services like Facebook and Twitter."

    Part of the answer, Brass writes, is that Microsoft put too much faith in aggressive managers (like himself) who nurtured a culture of conflict. But mostly, he says, it's because of inter-departmental bullying by Microsoft's established divisions and a "dysfunctional" corporate culture that thwarts innovation.

    To support his contention, he offers a couple of telling anecdotes in which he does everything but name names:

    Microsoft's ClearType display technology languished in the lab for years, he says, because engineers in the Windows group "falsely claimed" it made the display go haywire, the head of Office products said it was fuzzy and gave him headaches, and the vice president for pocket devices was said he’d support ClearType only if Brass transferred the programmers to his control.

    In 2001, the vice president in charge of Microsoft Office refused to modify Word, Excel and Outlook to work properly with Brass' tablet. Result: "if you wanted to enter a number into a spreadsheet or correct a word in an e-mail message, you had to write it in a special pop-up box, which then transferred the information to Office. Annoying, clumsy and slow... To this day, you still can’t use Office directly on a Tablet PC. And despite the certainty that an Apple tablet was coming this year, the tablet group at Microsoft was eliminated."

    Brass believes that the intense, sometimes cut-throat, internal competition that Bill Gates fostered among his managers has devolved into something uncontrolled and destructive: "The big established groups are allowed to prey upon emerging teams, belittle their efforts, compete unfairly against them for resources, and over time hector them out of existence."

    He also gives a nod to the modular/integrated dichotomy to which we are always pointing accusing fingers:

    “Part of the problem is a historic preference to develop (highly profitable) software without undertaking (highly risky) hardware. This made economic sense when the company was founded in 1975, but now makes it far more difficult to create tightly integrated, beautifully designed products like an iPhone or TiVo. “

    "It’s not an accident," he writes, "that almost all the executives in charge of Microsoft’s music, e-books, phone, online, search and tablet efforts over the past decade have left."

    Read More (New York Times)...

  2. That River in Egypt

    Research

    Mini-MSFT:

    Windows Mobile 7: we so dropped the ball in our early phone OS presence that now it seems like it's a losing battle to have a dog in this fight. But WinMo7 is out there. To me, I can imagine this becoming like the Zune HD: well praised and all, but not making a dent in the market because everyone has already moved on to the iPhone platform. David Worthington interviews Brandon Watson, “director of product management in the developer platform at Microsoft”: Watson claimed that many developers of applications for the iPhone OS–which the iPad uses–are not making money. Developing applications for the iPhone and iPad is expensive, he said, because iPhone OS uses the Objective-C language rather than Microsoft’s more pervasive .NET platform. And Apple’s control over the platform has alienated some people that make software for its products, he said.

    Now if we can get the Grand Poobah of Ovi to chime in, we'll be all set.

  3. Bad(a)

    Research

    http://www.electronista.com/articles/09/11/09/samsung.may.deal.microsoft.severe.blow

    This prediction says that WinMo and Symbian are out at Samsung. Not a big surprise there.

    The real news is some new "proprietary" OS is to take a majority share of the portfolio moving Android out of the picture gradually after 2011.

    You will infer from my previous comments that the reason any deep pocketed vendor would shun Android is the same as why they would shun WinMo: no "control" over the whole product and hence no differentiation vis-a-vis an integrated competitor.

    The Android devotees would then have to depend on their platform reaching critical mass without Nokia, Samsung, Apple, Palm and RIM, all of which will be shipping integrated products. LG got bought off by Microsoft and they will wallow in the mire.

    Where does that leave Android? Moto and SE? They barely make up 10% of all devices and negligible smartphone share today and both are borderline going concerns.

    That just leaves HTC, which shipped 80% of all WinMo. My bet is that they will ship 80% of Android, but that still tops them out at 10% share WW.

    Looking at the platform game top-down and bottom-up you get the same story.

  4. Serving the Needs of IT

    Research

    An interesting note in the latest Canalys Smartphone quarterly summary (http://www.canalys.com/pr/2009/r2009112.htm):

    "...in our October study of 600 European decision makers in medium and large enterprises, more than 20% said they expect the iPhone to be the dominant smart phone platform for running business applications in their organisation within the next 3 to 5 years. In France, the iPhone was ahead of Windows Mobile and RIM in this regard – a remarkable result.”

    This short quote brought back to mind the recently formed partnership between Nokia and Microsoft to deal with RIM. One fruit of this relationship is a recent job posting atcareers.microsoft.com which seeks Symbian developers to work for Microsoft:

    Job Category: Software Engineering: Development Location: India, Hyderabad Job ID: 702365 Division: Microsoft Business Division

    The Office team is looking for a self-motivated and highly passionate Developers to contribute in building a new team and drive discipline excellence in the delivery of Office Mobile and Communication experiences for Nokia’s Symbian smartphones.

    Microsoft and Nokia have formed a global alliance to design, develop and market mobile productivity, communications and collaboration solutions.

    Under the terms of the agreement, the two companies will begin collaborating immediately on the design, development and marketing of productivity solutions for the mobile professional, bringing Microsoft Office Mobile and Microsoft business communications, collaboration and device management software to Nokia’s Symbian devices. These solutions will be available for a broad range of Nokia smartphones starting with the company’s business optimized range, Nokia Eseries. The two companies will also market these solutions to businesses, carriers and individuals.

    This project builds on the existing relationship with Nokia who is optimizing access to email and other personal information with Exchange Activesync. Next year, Nokia intends to start shipping Microsoft Office Communicator Mobile on their smartphones, followed by other Office applications and related software and services in the future.

    (related job description)

    While the iPhone wins hearts and minds in IT through sheer brilliance Nokia tries to become a supplier to IT departments through a strategy deeply rooted in the 1980s: the manipulation and exertion of control over file formats. As IT has diminished in importance (to the point of ceasing to matter to some) it's hard to understand this misplaced alliance with Microsoft over something so inconsequential.

  5. Market Caps

    Research

    For reference, some selected current market caps:

    • Microsoft (MSFT) - $236.76B
    • Apple (AAPL) - $183.40B
    • Google (GOOG) - $173.97B
    • IBM (IBM) - $159.93B
    • Cisco (CSCO) - $138.60B
    • Hewlett-Packard (HPQ) - $114.26B
    • Intel (INTC) - $109.85B
    • Disney (DIS) - $54.31B
    • Nokia (NOK) - $48.24B
    • Research In Motion (RIMM) - $37.43B
    • Amazon (AMZN) - $40.34B
    • Dell (DELL) - $29.63B
    • Sony (SNE) - $29.10B
    • Yahoo! (YHOO) - $24.78B
    • Motorola (MOT) - $18.82B
    • Adobe (ADBE) - $18.23B
    • Palm (PALM) - $2.51B
    • RealNetworks (RNWK) - $564.74M

    The top 10 world-wide:

    1. Exxon Mobil Corporation 352.31B
    2. PetroChina Company Limited (ADR) 240.47B
    3. Microsoft Corporation 237.58B
    4. Petroleo Brasileiro SA (ADR) 220.19B
    5. BHP Billiton Limited (ADR) 204.30B
    6. HSBC Holdings plc (ADR) 199.98B
    7. China Mobile Ltd. (ADR) 199.09B
    8. Royal Dutch Shell plc (ADR) 195.76B
    9. Wal-Mart Stores, Inc. 195.27B
    10. Apple Inc. 183.57B

    Steve Ballmer is not worried, Apple is just a rounding error.

  6. Pink Cheeks

    Research

    The decision process regarding mobility at Microsoft from 2005 has been a classic example of paralysis by analysis. Trapped by their processes and resources into doing horizontal solutions for a world that buys vertical integration, Microsoft was bound to fall into a trap. Like a wounded beast, it is not dying predictably but with spasms. Rather than concluding that Pink and Zune are part of a fucked up process or evolution, they should be seen as terminal convulsions of WinMo.

    Credit to Dilger for going further than anyone in tying Pink, WinMo and Zune.

    If I may summarize, the problems Microsoft faces are:

    • A reliance on a horizontal business model at a time when modular product "turns" are not fast enough vs. integrated/vertical models. Just look at Dilger's mobile OS history graph and measure the "cycle time" of each product rev for the competitors.
    • An economic model that implies there is value in a mobile OS (something PalmSource and Symbian figured out to be dead ends long ago, not to mention OpenWave, SavaJe and a few others long forgotten.) Microsoft, a company that grew by disruption at the low end (vis. Lotus, Novell, IBM, etc.,) is unable or uncaring enough to sense when it's being disrupted the same way.
    • Competitors that combine into a pincer movement from above (Apple) and below (Google) with a fortified alternative incumbent (Nokia, Microsoft's original target) still standing. Unlike previous single competitors in each category Microsoft conquered, the mobile world presented a more diverse (and perhaps wiser) front.

    I won't get into Microsoft's dysfunctional culture as that's been covered brilliantly by others.

  7. Windows Immobile

    Research

    John Herrman reviews the new Windows Mobile 6.5 for Gizmodo:

    To put it another way, handset manufacturers have done more in the last two years to improve Windows Mobile than Microsoft has, which borders on pathetic. In the time since Windows Mobile 6.0 came out in February of 2007, Apple has released the iPhone — three times. Palm has created the Pre, with its totally new webOS. Android has come into being, and grown into something wonderful. RIM has created a touch phone and a revamped BlackBerry OS. For these companies, the world has changed.

    And Microsoft? They eked out some performance enhancements and a new homescreen in 6.1, and executed a gaudy facelift for 6.5. This is what they’ve done to Windows Mobile.

    The review from Gizmodo concludes:

    I'd like to think that 6.5's stunning failure to innovate is a symptom of a neglected project—maybe Microsoft just needed something, anything to hold people over until the mythical Windows Mobile 7 comes out, whatever it is. But as Steve Ballmer himself has plainly admitted, it's worse: Microsoft has simply lumbered in the wrong direction for two years, letting everyone, save maybe Nokia, fly right past them.

    John Gruber adds:

    Microsoft’s irrelevance in today’s mobile space is nothing short of a spectacular failure. Worse than the mere fact that Windows Mobile 6.5 is a total turd is that no one is surprised, and no one cares.

    I've said it before and I'll say it again: Microsoft will take 4 to 6 years to respond to the iPhone. Nearly 3 years have already passed and indications are that Windows 7 will ship in devices by end of 2010. I expect another 2 years hence will be needed to polish it.

    Nokia will take at least as long, though probably longer.

    Neither response will be sufficient or effective. Curiously perhaps, throughout this time both Nokia and Microsoft will use each other as benchmarks of competitiveness.