Category: Microsoft

An insiders view of Microsoft from the bottom looking up

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

Why the Cloud Matters

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It’s hard to have a discussion these days with a customer or read an article in the technology space without having a discussion about “the cloud”.  It has even hit the television, all be it in rather confusing terms.  I imagine for most people the question would be is “what is it” and “why do I care”?  In many instances most people are already using a cloud based offering, they just don’t know it, because what they are using has not been referred to as a cloud application before.  A couple of classic examples would be Microsoft Hotmail or Google gMail.  The simple reason these are cloud applications is nothing is needed bot a browser to sign up and use the applications.  All your data resides somewhere on the internet.  Where?  Who cares.  But i guess to further the discussion we need to break our cloud up into scenarios.  Probably the easiest way to do this is to look at business and then consumers.

When I started in the industry back into 1991, businesses in America were aggressively looking to the PC and the PC based network as a way of differentiating themselves from their competition.  This led to new concepts (or rehashed concepts as nothing is ever truly new in technology).  Along came networking, email, client-server, large databases, customer relationship management(CRM), it’s really an extensive list bit this led to a new organization in business: IT.  Granted the PC era did not create it but it certainly grew it to the point that most large enterprises have IT departments with a billion budgets.  These were necessary departments but the bottom line is the are expensive to maintain.  If you start to think what it takes to create and support these systems there is a lot to it.   You need hardware (desktop and server hardware), network equipment such as routers and load balancers, administrators for nearly everything, whether it is managing your messaging systems of a database.  There is the physical space to actually manage all these systems, this is where the big term we hear so often today comes into play: data centers.   in addition these data centers with all those machines get hot so the need cooling systems.  When everything is in place you still need something to manage the fact that you could have a fire or earthquake.  Therefore you need backup for all this stuff at remote locations.  So everything I mentioned which is a subset of reality can be multiplied by two.  In short as systems grow and technologies improve or newer better stuff becomes available one thing is consistent, your costs continue to increase.

The cloud provides the promise to reduce some of the complexity and costs in the CIO’s budget.  The term CIO stands for Chief Information Office or Career is Over.  The former is a business title the latter is true.  The cloud promises to take some of the complexity away from IT organizations today.  A great example is CRM and what SalesForce.Com is doing.  AT my current place of work we use the too to manage our sales forecasts, contacts, product pipeline etc..the great thing is we simply pay for  the service we do not have to set up new hardware in a data center and pay for power and cooling of the system.  It allows our company to focus our operations on our core business serving customers rather than having to have internal discussions about developing new features and functionality into an application that may or may not work depending on what is delivered.  We can extend beyond CRM into a whole set of new services that will be offered.  I believe in time email will be a cloud based service and will not require as much on primes equipment.

One of the most annoying commercials on television is Microsoft’s MSN, Live Messenger ad that ends with some goofy looking people saying, “to the Cloud”.  With that quick slam of Microsoft I should point out there is some truth to the ad. Cloud based services will play an ever-increasing role in how consumers interact with technology.  As I pointed out in the beginning people already are with cloud based email services like Hotmail and gMail. With the explosion of digital photography into everyday life it is becoming increasingly important to have some type of cloud based storage.  Why risk family memories to a house fire or theft?  When you post pictures to Facebook aren’t you essentially making a back up copy of photo’s?

The promise of the cloud for the consumer is the same as the enterprise, taking some of the complexity out of how we manage our personal lives online.  We can take a simple example of a Word document.  Today you create a word doc and save it to your local hard drive.  Whether you know it or not that file has a path it is located on such as C:\\jill\mydocuments – now that file is at risk. Your computer could have a hard drive crash.  A virus.  You spill a coke on the computer.  There are a number of things that could happen.  I am sure many of you our there have had them happen. With the cloud you can make this a seem less experience where you store all your files in the cloud – you can just change the file path to G:\\ or H:\\ with the corresponding path being on the internet.  There are services out there today that do online back up with services such as Dropbox or Windows Live Skydrive, which offers 25 GB for free. These are simple examples.  But with applications like Google Docs the world of apps will also live in the cloud.  Your documents and spreadsheets will run in the browser and all files you create will live in the cloud.  Te benefit of all this is when you do spill Coke on your Netbook, you may destroy it but your valuable files, like photo’s, music, tax documents, financial statements will be somewhere else.  You will not need to reload Microsoft Office (what did I do with the CD?)  This will be taking a level of complexity that has been growing over years out of our day-to-day lives

In the end the Cloud will fundamentally alter our lives and alter how business is done today.  In the tech industry it has always been the goal to make all great innovations accessible to the general public.  Though the PC took us much closer to making that vision reality, it also introduced a lot of complexity, unknowingly into people and enterprises lives.  The cloud is the next step in simplifying technology.  Let the “whiz kids” do all the heavy lifting in the background and let people get on with their lives and get on with their jobs.  Let’s reap the benefits and not the pain.

Good Night and Good Luck

Hans Henrik Hoffmann March 15th, 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

Nokia

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One of my favorite things to write about is the competitive landscape in the industry. I have seen many companies come and go. Some remain. Some are stronger and some are weaker. There are those that burst on the seen looking to change the world. They end up like Kim Kardasian on stage with Prince, bright lights and large audience but in the end they just can’t dance. Netscape and MySpace come to mind. They are then politely asked to leave the stage. Then there are those that burn so bright they are the future and the end is something they can only define, Facebook and Apple seem to be those stars of late.  We call them Lady GaGa.  How long will they last?  Who  knows.  They may end up becoming the next Madonna (Apple probably already is this category), constantly changing and exciting us or they could end up like…Lady GaGa.   Then there are those that were stars of huge magnitude and now they are like an aging Frank Sinatra or Mickey Mantle. The people who were there when they started revere them and those that came after are told to revere them, they just don’t know why. Microsoft and Nokia fall into those camps.  With the recent announcement of a partnership between Microsoft and Nokia,  I thought it would be good to go back and have a deeper look at Nokia.

Nokia has an interesting history.  Unlike your current high flyers who have a history that can be measured in some instance less than a decade.  Nokia is over 140 years old.  Being located in Finland they started in an industry that Finland has by default…timber.  The founders Fredrick Idestam started a pulp mill and Nokia stated manufacturing paper.  I am sure at the time it was sexy but in todays world  it just seems so un-environmental now.  That was back in 1865.  It would be much later during the era of diversification and mega conglomerates that they would diversify into another vertical,  telecommunications. This would lay the foundation for the Nokia that we all know.

When mobile phones came onto the scene Nokia was well positioned to provide the phones and start the drive towards where we are today.  Nokia had some keen insights that would propel them to the leadership position in the industry. As a a friend told me who has a deep history in wireless what Nokia really figured out was that you could do more with those phones then just make phone calls.  There was software on them.  You could show what day it is, the current time, all sorts of cool things.  You could even do this text thing pretty easily.  It was also one of the first companies to have accessories for their phones.  Those original dove bar phones that sold 80 million world wide pretty soon had all sorts of colorful cases, the kids loved them.

Things were going good for Nokia and then they made a series of unfortunate decisions.  Though people liked the dove bar phone there was a whole group that did not like them, but preferred the flip phone.  Nokia tried but did not persist in trying to create the next cool phone.  All companies should try to influence the market however they should not dictate to it.  It is a fine line, but I am afraid on this one Nokia decided to cross over it.  There was also the debacle with the US market.  For a long time the US market was perceived to be behind the rest of the world when it came to wireless. In all fairness this was true.  Part of the reason is in the rest of the wireless world used mobility to get around a lot of network constraints and government regulations related to traditional LAN line services.  Nokia being headquartered in this part of world understood it.  However the US is a very competitive culture, to dismiss the US and think we would not catch up at some point and be an exciting and aggressive market, well it is inexcusable.

Finally we have to look at the mobile OS that Nokia chose to build around, Symbian.  Symbian started as a open source project backed by NTT DoCoMo, Ericsson, and Nokia.  It operated independently for many years until Nokia bought the Symbian LTD in 2008 and became the main contributor to the source code.   Through the years it seemed that Symbian and then Nokia struggled to maintain a vibrant developer community.  With the move by more and more consumers to smart phones Symbian seemed to lose direction.  Though the largest mobile OS on earth by market share, recent years have seen a steady decline as more viable platforms like iOS and Android emerged on the seen. Those two platforms have obtained the perfect marriage; developer loyalty with consumer love.  Another interesting tidbit is Finland is the home of Linus Torvalds, the father of the open source movement.  Just think the birthplace of open source is standardizing in Windows Phone 7.  Turns out David didn’t beat Goliath.

Which brings us to today and the big recent announcement that Nokia is going to move to Windows Phone 7.  This deal even on the face of it has so many connotations and implications that it is hard to get ones head around it.  But in short Nokia is ditching the Symbian OS and letting Microsoft do the innovative things in software and reducing Nokia to a manufacturer of handsets.  It is, I am sure a hard pill to swallow for Nokia as for a long time they were perceived as the leader in mobility, a company that would try and set the future course of mobility.  They are walking into the wilderness deciding that their primary competition is HTC, Samsung, LG, and China is now also getting heavily into this space.  Nokia has decided they are going to compete on design.  Good luck with that.  The Asian handset manufacturers have made a living  off of creating cool inexpensive handset models.   At a time when the world is realizing the value of mobility in ways far larger than originally imagined, Nokia has decided not to lead and to walk away.  It’s a stunning fall from grace.

Will this partnership work? Possibly.  It’s two companies that really needed to do something different.  Nokia and Microsoft were losing market share.  What they were doing was  not working.  Focusing on the Nokia side the challenge will be selling the new strategy internally.  Early on there has been a lot of backlash, but lets be pragmatic and look 6-12 months out.  The big challenge for current CEO (and former Microsoft President) Stephen Elop will be managing a big cultural shift in the organizations mentality and the companies outlook toward the future.  I am sure of late they have paid a lot of attention to Google and Apple, moving forward that will be more a Microsoft issue.  How much input will Nokia have in these discussions?  What kind of input will Nokia have into the Microsoft software? Will they have more than HTC or Samsung?  Or will they just be another OEM partner?  I think in the end there are a lot more questions than answers, but one thing is clear the era of Nokia leading in the mobile industry is over.  It did not follow the traditional trajectory and now it looks like Kim Kardasian is back on stage trying to dance, Nokia it’s your turn to leave the stage, you just can’t dance.

Good Night and Good Luck

Hans Henrik Hoffmann February 18, 2011