A black cat is nothing compared to losing $492 Million

As soon as I could read some news reports, it turns out the main reason for the loss is that Microsoft was taking a $6.2 billion write-down against their 2007 purchase of aQuantive, an Internet advertising company. The investment in aQuantive wasn’t generating the revenue it expected. So this appears to be mostly a one-time event, not necessarily an overall trend. Most analysts are downplaying the event as insignificant. Nothing for Microsoft or their investors to worry about, most financial and technology pundits claim.

But as I further analyzed the news, I realized that this event is in fact a little more significant than what the analysts and Old World journalists are attempting to downplay. If nothing else, taking a nearly half-billion dollar loss so near to their do-or-die launch of Windows 8 just seems like a bad omen.

Here’s what this loss really highligts about Microsoft: history has shown they’re not really good at competing outside of the PC market. This is just the latest, most glaring example. They bought aQuantive with the intent of competing with Google’s advertising network. Obviously that didn’t work out so well to the tune of $6 billion. But let’s look at some other examples:

• Internet: Remember MSN? “The Microsoft Network” was supposed to compete with AOL as well as the Internet itself.
• Search Engine: The MSN name was given to a search engine in 1998, before it was renamed Windows Live Search in 2006, shortened to Live Search in 2007, and then Bing in 2009. The purchase of aQuantive was designed to work with Bing. Again, none of these ventures have been particularly successful for Microsoft.
• Music Player: Microsoft’s attempt to create an iPod-killer resulted in the Zune device, which was unceremoniously cancelled last year.
• Smartphone: While having some success in the Old World of Smartphones, Microsoft has yet to truly get out of the gates with something to compete with the iPhone. Their “Kin” phones were infamously cancelled after 6 weeks. After screwing over their Windows 7 Phone customers recently, one must wonder if they have a chance with Windows 8 Phones in the near future.

To be fair, Microsoft’s Xbox line of video game consoles has been an overall success, although never approaching the dominance Microsoft had with Windows and Office. But Nintendo’s Wii shook up the video game market starting in 2006 and now Apple’s iOS devices and mobile gaming are shaking up the market again. So the future of the Xbox and all game consoles is unclear, perhaps another victim of the New World of Technology.

The bottom line is that in markets where Microsoft can’t leverage the dominance of Windows and Office over their vendors and consumers, they don’t compete very well. So while analysts may be shrugging off this half-billion dollar loss, they are missing the fact that for Microsoft to be successful in the future, they must be a viable player in the New World of Technology. The PC era is ending and Microsoft has no proven track record of being able to compete in anything other than the PC market. The future isn’t exactly bright for Microsoft. If Microsoft doesn’t execute their mobile strategy to near perfection – and do it soon – this loss may be a foreshadowing of what is looming down the road.

You've Just Been Beta-Tested, Suckers!

I’ve written a couple of articles taking Microsoft and Nokia to task for their terrible marketing and implementation of their Lumia 900 smartphone. By claiming “The Smartphone Beta Test is Over“, the companies set the bar pretty high and unfortunately their phone just isn’t really all that good. But now Microsoft has announced something that totally shocked and surprised me. And I’m sure for the people that have recently purchased the Lumia or any other Windows 7 phone, shocked and surprised is probably more like straight-up pissed off.

As Microsoft is gearing up their marketing machine for the make-or-break, all-or-nothing release of Windows 8, they made a teeny-tiny little mention that oh, by the way, any current Windows 7 phones will not be able to upgrade to Windows 8. Yeah, that’s right. Anybody who has recently purchased a brand-new Windows phone, even the recently heavily promoted aforementioned Lumia 900, now owns an obsolete device. Sure, they’ll get a cosmetic update to Windows “7.8”, but make no mistake, Windows 7.8 is not going to be Windows 8. If Windows 8 is the future of Microsoft, current Windows phone owners are being left behind.

We really shouldn’t be too surprised, however. When Microsoft introduced Windows Phone 7 only a year-and-a-half ago, they abandoned their users at that point as well. People who owned Windows phones at that time (then known as Windows Mobile) were not able to upgrade, nor were any applications developed for Windows Mobile able to run on Windows 7 phones. The difference in this instance, however, is the brazen nature of the recent Lumia 900 marketing campaign. It is almost as if Microsoft is now spitting in the face of their users. “Ha! You’ve just been beta-tested, suckers!”

Mercifully, there aren’t that many Windows 7 phone owners out there. And this little turn of events will probably ensure there won’t be many more. But the problem for Microsoft is that this might also ensure there won’t be many Windows 8 phone users either. Fool me once …

I have always had a keen interest in the convergence of cars and technology. For the amount of time that we spend in cars, I think most of it is very unproductive and I’ve spent a lot of time (especially when I’m spending otherwise unproductive time driving myself!) thinking how technology could be used to make the time we’re trapped in our car better spent. As well, I’ve also wondered how technology could be used to make driving safer. Most of my ideas have not been feasible, but with the rapid advances taking place in The New World of Technology, it seems entirely possible that we could see a lot of advances over the next few years in car/technology integration. Perhaps most exciting for me is the research Google is doing with driverless cars. In fact, the state of Nevada just became the first to issue a license for a self-driven car in May.

I recently came across an article on Mashable that shows an infographic for the “connected car of the future”. Created by a company called  Symphony Services, it has a lot of interesting ideas, so I’ve copied the infographic here. Do note, however, that this particular infographic may also win the award for the “longest-ass infographic of the year”. So be prepared to scroll awhile – enjoy!

Seriously, Nokia? Do you honestly think that the average consumer knows or cares who/what Carl Zeiss is? Or that talking about a “wider aperture” is going to stir the least bit of interest in anyone? That is the tact Nokia is using in advertising their Lumia 900 Windows Phone (yet another ad in the lackluster “Smartphone Beta Test” campaign). If you must state that a wider aperture helps in low light, then you’ve already lost. Why even mention the wider aperture? Wider than what? Maybe photo geeks would care about Carl Zeiss optics or a wider aperture – but not in a smart phone.

The reality is that most people think their smartphone cameras are just fine. Maybe not “great”, but definitely good enough. Other than photo geeks, people seldom complain about the quality of their smartphone cameras. After all, they are smartphone cameras. And even if some people think that smartphone cameras could be better, does better-than-average picture quality really sell many smartphones?

I was going to stop writing here, but I did a little digging and found out that early reviews for the Nokia Lumia 900 show that the phone actually takes terrible pictures in low light! And it’s not an isolated problem. Across the board people are complaining about the quality of the low light pictures. Just look at the comments in the YouTube video link above! And other reviews show that the Lumia 900 doesn’t take pictures any better than an iPhone 4S. You can read more comments about the lackluster low-light pictures in an article which mentions, “Nokia is set to release more firmware updates to introduce Internet sharing among other features missing from the Windows Phone experience.” I think that the ability to share pictures on the Internet from a smartphone is a pretty key feature that most people expect nowadays. Certainly much more important than Carl Zeiss optics or wider apertures. So once again, this is just another example showing that when it comes to Windows Phones and the Nokia Lumia 900, the beta test is far from over.

Technology Executives or Used Car Salesmen? Either way, they should have "beta-tested" their ad campaign a little longer.

I’ve written that Apple’s competitors still don’t get why Apple’s iPhone and iPad are so popular. The New World of Technology is driven by the huge mainstream of non-techie consumers. You can tell that most other companies are marketing devices “built by geeks for geeks”. That just doesn’t resonate with the average consumer and it is the average consumer that has made Apple’s devices king of the hill.

In another stunning example of this ignorance, Microsoft and Nokia’s entire ad campaign for their new Windows Phone-based Lumia 900 is centered around the phrase “The Smartphone Beta Test is Over.” The are insinuating that all smartphones up to this point (including the iPhone) are inferior to Microsoft’s and Nokia’s latest product.

There are two big problems with this campaign. First, they are insulting smartphone owners who don’t own their product (in other words – EVERYONE) by portraying current smartphone owners as clueless and hiring a condescending pitch man to point that out. Second, they assume that people actually know what a beta test is! In techie circles, the term “beta test” is very common. But outside of techie circles? Who knows for sure? I’m betting Microsoft and Nokia themselves don’t know the answer to that question. Because if they did, I don’t think this campaign sees the light of day. It’s just not that common of a term in the real world and I think for most people, it just goes over their head if not outright confuses them.

I have two words for Microsoft and Nokia (along with the rest of the industry)- “Target Market”. Figure out who that is and try again please. Because up to this point, you’re just embarrassing yourselves.

Hey ladies! Is this hot or what?

Behold the Samsung Galaxy Note: It’s  a smartphone that’s way too big and a tablet that’s way too small!. Any way you choose, it does neither well! One device that sucks across two categories – way to go for the gold medal in mediocrity, Samsung!

Manufacturers competing against Apple seem so desperate to find a hit, they are attempting everything and anything in new product designs. It’s as if they are saying, “let’s keep throwing things against the wall until something sticks.” They are frantically attempting to discover that mystical form factor or combination of technical features that will draw users away from the iPhone or iPad. The problem is, superficial technical features are not the reason why Apple’s products are so popular. Their runaway success is due to the combination of reliability, ease-of-use, and empowerment that iOS devices embody. Until someone else can nail the complete package, they have little chance of seriously threatening Apple’s dominance. Apple has ushered in the New World of Technology and everyone else is trying to compete using Old World rules.

The situation reminds me of the old adage about bringing a knife to a gun fight. The competitors may have bigger screens, or claimed faster processors, or run Adobe Flash, or come with styluses, or you can buy one get one free, or their commercials claim how much they “kick ass” – but they’re all still knives in Apple’s gun fight.

As The New World of Technology, led on the device side by Apple products, continues to replace the Old World of Technology, it has become harder for established technology experts to downplay the iPhone and iPad. In fact, while it was nearly “standard operating procedure” for technology experts to try to dismiss Apple’s products over the last few years, it now is starting to make them look like they have their heads buried in the sand. How else would you describe someone who continues to deny what seems so obvious to the rest of the world? Therefore it is not surprising to see more articles being written by Old World experts starting to begrudgingly accept Apple’s iOS platform (iPhone and iPad) as a major player in the marketplace. Still, it seems old habits are hard to break, as this article from Paul Thurrott shows.

The article starts off showing that the author actually seems to get what the iPad has done to the technology industry. He understands that the new iPad is going to present a tricky problem for the upcoming Windows 8 and associated hardware manufacturers. And then he does something almost unheard of – he actually acknowledges that he was wrong about downplaying the iPad 2 years ago. He makes a point about how the iPad is all the computer most people need and better than any PC for them. However, even when doing this, he claims that NO ONE saw this coming. “No one credible anyway,” in his own words. Seriously? So instead of simply acknowledging that he was wrong, he has to pretend that it was impossible to foresee the success of the iPad and so dismisses anyone who did predict this.

At this point, let me stray off-topic for just moment – hey Paul, from me to you personally, you can suck it and your definition of credibility – OK, I’m better now.

The majority of the rest of the article goes in depth about technical details of high resolution display technology, how Microsoft and PC hardware vendors have bungled this technology, and how the new iPad’s Retina Display is a huge win for Apple at this time. I won’t bore you with those details, other than to say that the content of this article is for the most part dealing with how superior the iPad is at this time. Which then makes his finish to the article all the more surprising.

He starts to give some arguments about how devices that will run the upcoming Windows 8 operating system will be more versatile than the iPad, and lists off several technical features that potentially could be possible, such as docking stations and ports. In effect he lists features that are commonly associated with laptops. Additionally he states, “all of these machines can run powerful desktop applications, not just the Playskool stuff we see on iPads …” He then quickly asserts that businesses will prefer Windows 8 by a wide margin, just like they prefer Windows over Macs today for the claimed reasons of versatility, manageability, and IT administrator familiarity. To quote him, “Windows 8 will destroy the iPad in the enterprise. There won’t be any contest at all.” He then finishes his article by stating that Windows 8 will earn its spot at the table with iPads, reiterating an earlier comment that he believes the future of computing will be a split between Windows, Android, and Apple.

It’s pretty easy to see what he’s doing here. He can no longer keep his head in the sand about the New World of Technology, but he also doesn’t want to admit that the Old World is ending and alienate himself from his audience of Old World professionals. He flip-flops between the superiority of the iPad, his claim that Windows 8 will be better – at least for business, and then weakly predicts that the future will be a mix of various technologies. That’s understandable as he has made his living writing about Old World technology. But is he really doing anyone any favors? Mr. Thurrot is making the same mistake many Old World thinkers do when looking at the near future of technology. They still think that the market is going to be driven by the “techies” who care about such things as number of ports, gigahertz, and other esoteric technology features. They also still think business technology is going to be driven by a top-down mentality where the IT departments make the standards and forces them down to the end-users.

No, one of the hallmarks of the New World of Technology is that of simplification and ease-of-use. iPhones and iPads are not hugely successful because they have a multitude of ports or are marketed on things like gigahertz and how much they “kick ass”. In fact, many will argue it is the lack of such complexities as one of the driving factors behind their success. Apple’s devices are world-changing because they simply empower their users, not confound them with technology mumbo-jumbo. That is the secret to Apple’s success and everyone else is just trying to superficially copy Apple’s hardware and software look-and-feel. To quote Yoda, “that is why you fail”.

Because Apple has successfully conquered the consumer market, the other concept that most Old Worlders miss is that of bottom-up or grassroots technology in the business world. No longer are the words of the IT department being taken as gospel. On the contrary, employees are demanding their companies support their technology of choice, which is most often Apple devices such as the iPhone and iPad. It was one thing when it was a single user here or there with a Macintosh computer as was the case in the past. IT departments could largely ignore Mac users. But the mass of people who own iPhones and iPads (and increasingly Macs!) are overwhelming IT departments. Especially when many of those users are high-level executives! To highlight this fact, a term has been coined, Bring Your Own Device, to describe this growing trend.

Plus, I must wonder how well the author has explored the multitude of business applications available for the iOS platform. In making his “Playskool” comment, he clearly shows that he doesn’t understand how many businesses have leveraged Apple’s devices to massively increase their productivity. When one of the largest companies in the world, General Electric, is making extensive us of the iOS platform, I think that gives some credibility to its usefulness in a business environment. Wouldn’t you agree, Mr. Thurrot, great guru of all that is credible? Business technology is about a lot more than Microsoft Office and it might help to realize that.

Many Old World thinkers like to put the business and the consumer markets into their own little bubbles, pretending that they are completely separate and there is little relation to the two. Perhaps in the Old World this was true in practice, but the New World of Technology is changing the industry across the board. It is a simple as this: in the New World of Technology, consumers feel empowered to make their own technology decisions and they are taking this empowerment to the workplace. If IT professionals don’t train themselves in New World technologies, they will be replaced by those that do.

Maybe the future of technology won’t be dominated by Apple, but I know what it certainly will be dominated by – New World thinking. As long as Apple is the only personal computer company that is creating products grounded in the rules of the New World of Technology, it will be the only personal computer company to flourish. No, Apple’s technology won’t kill all other technologies, just like Microsoft (as much as it tried) didn’t kill all their competitors, but only Apple is setting the expectation for the way future technologies should work. Any technologies that do not conform to the ease of use, reliability, and empowerment that Apple has set the standard for will quickly be dismissed as the Old World technologies they are.

Old Worlders, let me put you on notice: the time of being wishy-washy is over. Man up and acknowledge that there is a bigger world than ports and gigahertz or fade away with the Old World technologies that you so dearly cling to.