Category: Apple

Where is the Microsoft Tablet?

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It has been nearly 2 years since the release of the iPad and during that time we have seen a titanic shift in technology and the market’s expectation of what technology can provide.  It seem every week companies are coming out with a new iPad application.  If you watch local news or national programs they all seem to have a iPad application. The good news for the market is it is not just the Apple iPad.  Not far behind and rapidly growing its user base are the Google Android tablets.  The Android provides a greater range of choices while still providing access to thousands of cool and useful applications.  Soon there will be other entrants like the HP tablet based on the Palm OS.  The interesting thing is not what is coming out, but where is the 800lb gorilla?  It seems very hard to hide a beast of that size, but yet the gorilla has remained hidden.  You cannot even hear it whisper.

At the recent Consumer and Electronics Show, Microsoft CEO Steve Ballmer was on stage delivering the keynote address.  What I guess was interesting about the whole presentation was not what he said but what he did not say.  At a trade show where everything was focused on tablets, Ballmer talked about everything but a tablet.  His big thing was Microsoft’s foray into engineering and developing for ARM (for you non-techies who read my blog it’s a microprocessor like Intel).  This should not be trivialized, this could have benefits.  However it is short on sex appeal.  Unlike some tech shows where new things are touted at CES, tablets were new, but there were sales to back it up.  So it was not just another gizmo.

Since CES we have seen launches of new Tablets like the Samsung Galaxy and iPad 2.  We see them developing channels for resale through the service providers.  Companies like AT&T and Verizon are eager to have these devices on their network as they can drive data plans.  Microsoft for years has been trying to build a resale channel with the Telco’s. An old boss of mine is in charge of creating the worldwide reseller channel with the telecommunications carriers.  What does he tell them when they ask, “what’s your tablet strategy?”  He also used to tell me in sales, “You are what your numbers say you are”. In its first weekend of sales the Apple iPad 2 sold over 500,000 tablets.     Now we can have positive adjectives to describe our numbers, which is fun or we can have negative adjectives to describe our numbers, which is pro fain.  Apple and Google would both have very colorful adjectives.  Microsoft, well lets just say they may need to spend time in the confessional booth .

One thing that seems to be holding Microsoft back and seems to fuel a lot of speculation and gossip is what  operating system will they use, when they do come out with a tablet (I gotta admit I am guessing on this one as I have seen nothing in the press or heard from old friends about this one)?  The debate is between Windows 7 and Windows Phone 7.  Do you mimic what Apple did with the iPhone and simply enlarge to the iPad or do you go with your bread and butter, your flagship product, Windows.  I can say from a historical point of view when push comes to shove, the big boys at Microsoft always win, with that in mind it would seem Windows 7 will come out on top.  All I know is while the debate rages on the market does not stop.

When thinking about what is going on can history really repeat itself again?  Microsoft was in the Smartphone business for quite some time before Apple joined the party with the iPhone, and before they could respond out the gates and off to the races came Google’s Android platform.  By the time Windows Phone 7 came out the market was in a mature phase, so the Windows Phone was just another player trying to be heard. The Tablet business is similar in many ways. Microsoft has been in the Tablet business even longer than the phone business, as the vision of a more interactive device had long been a pet project of Bill Gate’s.  Yet as I sit in my office it seems as if history has already repeated itself.  Apple came out withe iPad but not far behind, once again, was Google with their Android based Tablets.   To be honest this is all eerily similar to the early days of the PC industry where Apple made the expensive high-end computers and Microsoft did the cheaper low-end computers, except now we can replace Windows with Android.  One area of my theory can be brought into doubt by one single question, “Where is the Microsoft Tablet”?

Good Night and Good Luck

Hans Henrik Hoffmann March 24th 2011

The death of Zune

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I can say I have owned a Zune for several years and can actually say that I have loved it. I will also say I was way behind the younger generation in getting a MP3 player or iPod.  I was and still am buying my cd’s through the retail channel.  However when I finally got my Zune it was a really enjoyable experience to have my entire collection of music on a 80gb Zune.  Not to mention the process of creating a playlist was so simple, gone were the painstaking days of making a tape (I am dating myself) to impress my then girlfriend, now wife.  These were all things that the Apple crowd had been experiencing for several years with the enormous success of the iPod.  As much as I have enjoyed the Zune, it has struggled mightily in the market.  Unlike “i” everything the term “Zune” has not made it into regular occurence in the English language. Beyond Microsoft employees how many people actually own a Zune?  The answer is pretty simple..not many.  Thus the recent rumors circulating that Microsoft is killing the Zune device (not the software) is somewhere between disappointing and understandable.

If you look back in time at what Zune was competing against, it was in short, up against a product that you could argue saved Apple and shot it into the stratosphere.  The iPod was a cool little device and it was not long before you saw the white headphones nearly everywhere you went, on the bus, at school,camping, even on the Microsoft Redmond campus, never before had I seen competitive products on campus in mass.  Beyond basic technology Apple was able to market it in away that reflected people s lifestyles.  They were colorful.  Microsoft early on was pursuing the traditional MS philosophy that they provide the software and then 3rd party providers would innovate.  The problem is they were not very innovative.  I looked at these devices early on visa vi the iPod.  One spin of the wheel and the argument for the iPod was very simple

When the Zune finally did come out Microsoft’s old Achilles heel came with it, color.  The original came in Black, and Brown.  Not overly exciting.  The executives would often highlight in talks the popularity of brown.  Not to be too cynical here, but really? brown?    The people working at Zune worked hard to play catch up.  I heard through people that the Zune Program Manager’s were logging 80hrs a week for their less than five percent market share.  I admire that they were so committed and worked so hard against a seemingly invincible juggernaut.  But to what end and was that dedication well served?  It’s hard to build a great product, but even harder is to change public perception.  Especially when this category is defined by high school and college students.

There were some good innovations that the Zune should be remembered for and we should be clear the device looks set to die, but the software shall live on.  One of the services constantly highlighted is the Zune Pass.  People who have used it adore it.  It is pretty straight forward.  You pay a monthly subscription fee and then you get access to all the music you want.  The price is minimal at $14.99 per month.  You can use on your Zune, PC or Windows Phone.  You no longer need to worry about purchasing music, you just have access to it.  Despite the imminent demise of the Zune player, it sounds like the Zune Pass will live on.  Which is great as it’s a valuable service.

Moving forward what will Zune look like now that it is becoming a software service.  It raises a lot of questions.  First what will the mobile strategy be for Zune?  Will it be tied to the Microsoft OS or will it be ported to their platforms such as iOS and Android?  What about the Tablet?  Attacking the different form factors will be paramount, but even more important in my opinion will be developing a cohesive mobile strategy.   Having a stronger ad campaign would help.  I have seen colorful iPod Billboards everywhere.  I cannot remember a single Zune ad.  I know U2 supports the iPod.  So do the Beatles.  The Zune…let’s not go there.  It talks to one of the big failing not just of eth Zune, but of Microsoft, which seems to be a lack of advertising that actually connects to people.  It may be shocking to some but people like things that make them feel good.  Having a smart ad campaign can go a long way to making that connection.

The demise of the device seems logical as more and more people move to Smartphones as their all-purpose device.  However even though the growth of the iPod segment is slowing, it is not insignificant.  In the fourth quarter of 2010 19 million iPods were sold, despite a flattening of sales that is a pretty large number.  To walk away, despite Zune’s struggles, in my estimation is a bit premature.  It also seems like Microsoft is falling back to its old mode of. “we are not a hardware provider”.  As I have said before it is really about the whole experience.  Experience combines both software and hardware.  The lines are no longer so simple.

My final say on this is what is music?  Since I first got into music it was always a way of self-expression.  At first it was on a little turn table.  Then it started to be reflected in the clothes I wore.  Then there were concerts.  Friends I got together with as we found common ground in the music we listened to and shared with one another.  This exposed me to new music and new thought.  The idea of a device that would allow me to bring that experience with me and the ability to easily share with new friends is the holy grail.  Technology enables the experience, but it is not the experience.  That rests with you and I.

RIP Zune.

Good Night and Good Luck.

Hans Henrik Hoffmann March 20, 2011

The Return of Steve Jobs and the Rise of Apple (updated)

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This is an update to one of my more popular posts that I wrote a year ago, but worth revisiting.  A lot has happened in that time.  With Steve Jobs in ailing health and the iPad now a huge success Apple continues to roll, but with a bit of uncertainty in its leadership ranks – namely how do you replace a Steve Jobs?  Still one thing has not changed Apple continues to succeed.

When I first started at Microsoft back in 1991 Apple was more or less a relic of what it used to be. Keep in mind it was still a cash cow for Microsoft as we owned the core application set for Apple, Microsoft Office for the Mac. However it was a company seriously lost in what it wanted to be and where it was going. the one thing Apple did have going for it was a fiercely loyal user base. Even though Microsoft was 90% of the market, Apple had 10% and it was going nowhere.

At the time the original founders of Apple, Steve Jobs and Steve Wozniak were not to be found. Jobs had been forced out by then CEO John Scully and was off trying to do the next big thing at NeXT computer. In addition he bought a small company from Lucas that became Pixar (it did pretty well). On the other hand Wozniak nearly was killed in a plane crash and not too long after would walk away from Apple (though he still is on the Apple payroll). In a lot of ways you can parallel Woz with Microsoft Co-founder, Paul Allen. John Scully grew Apple significantly after the release of the Mac, however, he was never able to generate the buzz and excitement around Apple that it deserved. Scully came from a successful career at Pepsi and was no doubt a talented marketer. However after 18 years in technology one thing I firmly believe in is if you are going to be a cutting edge technology company you need someone from the industry to guide you and set the vision for the future, to generate buzz, to generate excitement. I have always said the tech sector is more Hollywood than Wall Street. Technology leaders who cater too much to Wall Street, will ultimately doom the company.

For the next 5 years at Microsoft I watched as Apple went through various CEO’s and considered licensing the Mac OS similar to what Microsoft was doing with its OEM channel. I watched as they launched a Windows Virtual Machine so they could run Windows Applications. It always seemed like Apple was throwing darts at the board trying to find someway that something would stick. At one point Microsoft even made an investment in Apple, just to show we were good guys. Things would start to change in 1996 when Apple purchased NeXT Computer, bringing back Steve Jobs to the company he helped found. It ushered in one of the great comeback stories in the history of high-tech.

It used to be said in the industry that you can have a PC any color you want as long as it is beige. It was sadly very true. In addition to the giant CRT screens we had in the day it made for a very ugly desktop. One of the first things that was noticeable when Steve came back to Apple was the launch of Mac’s in color. The orange and lime green seemed to be favorites. Some of the best ideas in the tech industry are the simplest. In 1999 I remember Bill Gates showing off some new Dell PC’s that had some color to them and he mockingly said “We can do color to”. It is and will always be a challenge for Bill to understand the “hollywood” side of technology. Color was important because the beige was so ugly.

For those who remember around this time in the late 90′s a company called Napster became very popular. Napster did some things that Microsoft liked a whole lot. Mainly it allowed end-users to share music files over the internet. Thus promoting the power of the PC and leveraging the value of the internet. Now at this point I can only guess, but my feeling is that someone at Apple could see the real value here – which was that these PC’s had large hard drives that enabled you to store a lot of music, would it not be cool if it was mobile? You could put a hard drive in a little plastic case with ear phones and carry it with you. In October 2001 Apple launched something called the iPod and later a music service called iTunes. As we all know these have gone on to be gigantic success. Microsoft has partners doing their own MP3 players and I remember going into the Best Buy looking at some of them, then I picked up a iPod. At first I was not impressed with its DOS like interface than I started touching and trying to click the wheel, at first it did not seem that responsive. Then I took my thumb and made a semi-circular motion..cool! After that those other MP3 players were dust. The iPod was huge for Apple in the sense they were no longer the niche player the Mac, they were now the darlings of the every day end-user. As momentum continues Microsoft finally scrapped the partner model and came out with the Zune (I have had several). These devices work well, are cool and have the “wheel” like feel (apparently Apple forgot about the patent process). The challenge for any company is once a competitor has established a huge market lead, can you ever catch up? Not to mention on the advertising front I see Apple iPod ads everywhere, on TV, on Billboards. I cannot recall seeing one Zune ad. Another area that always has concerned me is what our response at Microsoft, while I was there, was to Apple. the typical, it is very proprietary. They really don’t work that well. As Steve B would say, “blah, blah, blah..” I would say, “who cares?” If end users like the experience and are happy with the $.99 price tag, they will continue to download songs from iTunes. As of this writing more than 10 billion songs have been downloaded from iTunes.

Then came the iPhone.  At a time when the smartphone had yet to “realize its potential”.  As the story goes Randall Stephenson, CEO of ATT Wireless (then Cingular Wireless) was in a meeting with Steve Jobs. Steve had just shown him a new mobile phone Apple had been developing. Randall just kept playing with the phone, fixated on its beautiful and responsive touch screen user interface. Steve Jobs is known as one of the toughest negotiators in the business. Randall was a long time telco guy who had net and negotiated withe th best. He also knew that what he was holding represented something bit, something that could turn the tables against some of ATT’s biggest competitors Verizon, Sprint and T-Mobile. Unlike most phones carried in a store which are in many cases subsidized by the manufacturer, Steve wanted it sold and all the revenue. ATT could get the voice and date plan revenue, but Steve wanted everything else. In the end the device was too good to pass up. Steve Jobs had just got an unprecedented deal in the wireless industry. This launched the march towards the delivery of one of the most “revolutionary” hand-held devices in the mobile phone industry, the Apple iPhone. I had a friend contracting at ATT at the time working on getting the online payment for mobility set up and all he would say was everything being done in Atlanta was geared towards the launch of the iPhone. This was a device with a serious amount of weight being thrown behind it.

The iPhone launched on June 29, 2007. As Bill Gates would say later on, “Microsoft did not set the bar high enough”. The iPhone was a huge success and that is an under statement. It did a number of things better than had ever done before. First was the touch screen. It was responsive. Very responsive. You could be up and doing something within seconds. Second the mobile browser experience was easy and the content you got back was readable. Every device I have ever had the mobile browse experience has been different with each device and very painful. Third it created a market for mobile applications. Prior to the iPhone making money on mobile applications was a dream more than a reality. Competitors will argue, again, Apple is a closed environment (for you non-technical folks – it’s Apple’s way or the highway). I will say again and again, that is the argument of technical people, if end users like the experience they support with their wallets and do not care about open environments versus closed. The iPhone will go down in history as a major technology milestone and another big hit for Apple and Steve Jobs.

Apple about a year ago launched yet a new device, the iPad. The orders are built up  and Apple has done it again. Now the iPad was yet another attempt at the Tablet. Does anyone remember the Apple Newton? Microsoft Pen for Windows? The Microsoft TabletPC?  I wrote a year ago “Will this time the idea of a usable tablet finally become reality? My view initially is that Apple is riding its wave of success to create yet another blockbuster in the industry”.  THey did create a blockbuster.  Then I wrote the following: In the latest issue of Wired Magazine they do raise the question of interaction with computers. If you think about how we as people interact with our technology it has not changed on over 20 years. We have a monitor, keyboard and mouse. I will say having been at Microsoft 18 years there were many efforts from the top down to drive the success of tablets. To change the interaction of user and technology. If Apple succeeds with the iPad it will be a huge psychological blow to Microsoft. Apples first attempt in over 15 years after the many attempts by Microsoft and it is a huge success? The success Apple has had with the iPad has led to a huge change in how people want to interact with technology and spurred a new wave of innovation.  Not far behind has been Android which was quick to respond with their own Tablets.  I cannot count the amount of emotional responses I hear from people with iPads “I Love”, “I adore”, “I treasure” .  Not far behind are business ideas for their iPad.  It is really quite amazing what can happen with success.  It creates a force of gravity that cannot be stopped.  A Wall Street dream.

Bill Gates has left Microsoft. Today Steve Jobs is the poster child of the technology industry. He is the rock star pumping out hit after hit. The movie star who cannot make a bad film. He is in the zone. From when I started to when I was let go at Microsoft the journey of Apple has been an interesting and amazing story to watch unfold. All tech stars rise and fall. The list is long WordPerfect, Lotus, Borland, Netscape, AOL, etc Apple certainly did this, but then to rise again bigger then what they were before has been a spectacle to behold. What they are doing now is not so much about how they are influencing technical innovation, but how they are impacting the global culture.  The future can still be bright despite the illness that has removed Steve Jobs from day-to-day operations.  In my view the next holy grail will be television and how we interact with our oldest of friends.  AppleTV is a start but it is not there yet.  GoogleTV is on their heals.  But given their track record it’s dangerous to bet against Apple right now.

Good Night and Good Luck

Hans Henrik Hoffmann, Whistler, BC February 25, 2011

The Next Revolution has already occurred

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It was interesting reading on CNet recently that Goldman Sachs was pessimistic about Microsoft’s 2011 (This article is not about Microsoft – so please read on). This was on top of a report the day before of 54 million Tablets sold this year, 37 million were iPads, the rest were based on Google’s Android OS.  As we entered the New Year we began with the preeminent trade show, the Consumer Electronics Show.  This show has grown in strength each year as people line up to see what type of technology gizmo will change the landscape of consumer behavior and of our day-to-day lives.  Analyst line up to see what the next big innovation will be and what new breakthroughs it will drive.    Reading about all this made me stop and think about the future, and as is usual I first started thinking about the past.  I will admit I am a product of the dotcom era, where everyone’s ideas were big and going to be revolutionary.  At the time everybody got caught up in it.  When it ended it was a let down on the future, it was not just not just a market bubble it was an emotional bubble.  It’s legacy is we are all waiting for the next internet tidal wave to hit us.

Information has always brought about change, but in today’s world it moves a lot faster than it used.  If you think back to the Cold War one of the defining moments was the publication of Alexander Solzhenitsyn’s “The Gulag Archipelago”.  The book that depicted the lives of the Soviet people in the prison camps during the Stalinist regime.  To get that book printed it had to get out of the Soviet Union.   It had to be hidden in homes and far away from the Soviet KGB.  Copies had to be made and there were no computers with floppy discs or CD’s/DVD’s. It required the support of high level politicians in the United States to facilitate the process (we all know how fast they move…).  The book finally got to the west in 1968, but would not be published until 1073.  It was a long, slow, and very winding road to get there.  Those days, luckily, are far behind us.

Fast forward to today and we see the world is changing before our very eyes and  technology is driving that change..  Nearly two years ago when a wave of violence and protest spread through Iran we saw “tweets” posted via Twitter regularly.  Videos came online as protesters took to the streets and captured video with small digital cameras and mobile phones and it came near real-time to the public online.  Many of the most gruesome videos from these protester came at us from the cable news networks, as the cable news companies scoured the web for the latest content.   Not their camera men but just ordinary people in the streets like you and I.  Now we fast forward to today and we recently saw this same act play out successfully in Tunisia.  Even now as I write protests have set the world (and the markets!) on fire in Egypt as violence has spread through mystical cities like Alexandria and Cairo.  Everyone in the media waiting for the next relevant “tweet” or video.  Despite the efforts of the Egyptian government to shut down the internet the information steadily flows outside its birders, coming from the Egyptian citizens.  The big key to this is not the PC, but the rise of mobility and the mobile  internet.  Former President George W Bush in his book, “Decision Point” took a long-term view of  history that the invasion and liberation of Iraq in 50 years would be the turning point in the middle east spreading democracy throughout the region.  My view is that road was already starting, but id did not require war to get there.  Technology is the major unifier as information flows freely across borders, no matter how autocratic the regime.  Democracy and opportunity is on its way as a world order, thanks to the mobile internet.

The idea of mobility and access to immediate information is transforming our lives, both in the big ways like Egypt and Tunisia as well as a small way, like paying our cell phone bill from a mobile phone while on vacation in Yellowstone Park.  If you think back in history these changes have all been about personal freedom.  Look at what the automobile did to the human experience.  The sheer idea that a person could go drive 300 miles by themselves  in six hours was unheard of, now it is fairly common as kids drive off to college.  But the automobile led to so many things in the course of the next 100 years, from the roadside Motel to the shopping mall.  Today we are looking for freedom from our keyboard and monitor (Bill Gate’s just vomited).  The mobile internet will lead to similar change and economic opportunity like the automobile.  There will be those companies and those individuals who recognize the opportunity and will drive changes in society beyond anything previously imagined.  Then there will be those who maybe saw it and did not understand it or missed out entirely on the change in front of them.   It is one of those times where in 10-15 years we will all look back at those that failed and say “How could they not see it?”.  A few companies come to mind today that are embracing the mobile change, and in some cases defining it.  The obvious ones are Facebook, Google, Apple and Twitter. Mobility is the single biggest transformation in society since the birth of the automobile and will continue to grow and change society throughout the 21st century.  Like the automobile it will lead to new modes of life that we have yet to discover.  Those companies that embrace mobility as an overarching strategy versus a line of business offering will be poised for greater success, while those that drag their feet will be irrelevant.

Good Night and Good Luck

Hans Henrik Hoffmann February 8, 2011

The iPad Juggernaut …..

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I guess it was bound to happen.  It is something I have seen many times before.  It is annoying, frustrating, and in some corners just plain pathetic.  Addressing the competitive threat by any means necessary.  even when it is obviously desperate.  It’s these type of corporate responses that drive me nuts. Recently Microsoft (my old company) has come under a lot of pressure to come up with a Tablet strategy.  I should add Microsoft has had for years a Tablet.  It was one of Bill Gates’ pet projects,  They just need a strategy that works.   The Microsoft response is a iPad battle card to help Microsoft partners and its field sales force sell Windows 7 slates in the enterprise, while combating the threat from the iPad.

Let me go back a bit in time and just say I have seen these battle cards before.  It was pretty standard practice at Microsoft across all battle lines and often they were very helpful.  However after the successful debut of the Apple iPhone I received in my mail box a little envelope that contained my Windows Phone 6 versus the Apple iPhone battle card (I am serious…I am not making this up).  What were some of the advantages of Windows Phone 6?  It had mobile Office, Sharepoint Support, better Exchange Synch etc..If you read the link earlier you will by now realize that whomever the marketing manager is who put the Apple iPad battle card together has mastered the art of copy and paste.

Do not get me wrong for a minute, I do not envy the marketing Manager who had the responsibility of taking this on.  It is one of those things that when nothing is happening on the product side you still have to generate some sort of response, the worst thing is to be quiet. And to their credit they created some really nice slide ware. I will be however surprised to see if any of my former mates in the Microsoft field sales force ever have the guts to present this to a customer or even regurgitate it over drinks or dinner with a client.

The slide, though intended for partners, demonstrates the focus on the enterprise and the disengagement in general from the consumer market place.  I should also add this did not come out of Microsoft’s Entertainment and Devices division.  If it had it would have a far greater emphasis on the general market.  The Windows Division is outside all of that its own $20 billion juggernaut.  We call that power.    The slides do highlight the success the iPad is having in the enterprise space as more and more users want access to their corporate networks from their iPad.  It’s the reverse of what happened with Windows , which first took off in the business world before penetrating the home.  But times have changed and with new devices hitting the market at an ever-increasing pace and a much more affordable price big sea changes in the enterprise often come from the outside in versus the inside out.  People want to be cool even when they are in he office.  Even if they are an accountant.

Finally the biggest issue I hear these days is people at the Big M are tired of following and not leading (the exception being the xBox team with Kinect).  They want to be out in front of the industry.  But if you read my last blog on Facebook I highlighted how similar they were to Microsoft, when it was a younger company.  Now it’s not like people at Microsoft are really old, no far worse, they are middle-aged.  They have kids, they live through their kids, they have divorces, they are joining AA, they buy expensive sports cars, they try really hard physical activities that they used to be able to do, they buy iPads…I think you are getting the picture.

In the mean time the Tablet market keeps chugging along as highlighted in Apples recent earnings announcement.  There are other entrants that are also gaining momentum, like Android (we should seem new slide ware shortly).  I admit I was skeptical when the iPad came out.  I felt like it was just a giant OS, but there is a beauty in having the same core code between your phone and your tablet.  The applications are easy to write for both.  The iPad seems to be gaining momentum as it creates a scenario where a more powerful device can be useful and mobile.  There are a lot of scenario where having a monitor is useful and even desired, but with so much time spent on the web there are a lot of scenarios where it does not, just look at all the useful features of the latest Facebook mobile apps.  How many people out there are just checking into their favorite Starbuck’s? I need no mouse or keyboard for that I just need my finger.  The only way to compete with iPad is to get ahead of it, but once a boulder starts to slide down a mountain it i s hard to stop.

Good Night and Good Luck!

Hans Henrik Hoffmann January 25th, 2011