Paul Wallbank – Brilliant Communications

Category: computers

  • Steve Ballmer’s big platform change

    Steve Ballmer’s big platform change

    All Things D today reports that Microsoft is considering a major restructure to reflect changed computing markets.

    One of the big messages from The State Of The Internet report is we are seeing three simultaneous changes to the computer industry – the shift from personal computers to smartphones, tablet computers and wearable systems – and Microsoft is at the centre of these transformations.

    One graph, first released by Aysmco and expanded in the Meeker presentation, illustrates how fundamental these shifts are to Microsoft’s business.

    mary meeker computingmarketshare-640x480

    Microsoft’s domination of the computer industry was almost total at the beginning of the century and remained so until the iPhone was released in 2007. Then suddenly things changed.

    With the success of Android and the iPad, the market shifted dramatically against Microsoft and the WinTel market share is now back to 1985 levels when the Commodore 64 was a credible competitor.

    The change that Microsoft faces shouldn’t be understated, although the company’s strengths with products like Office, Azure and Hotmail (or whatever this year’s name for their online mail product is) give the once untouchable incumbent some opportunities, particularly in the cloud.

    At the end of Mary Meeker’s presentation at the D11 conference, Walt Mossberg asked her about Microsoft’s view that tablets and smartphones are just new computing platforms. Meeker dismisses that with the observation that the data is clear, the market has shifted to Apple and Google.

    “Google and Apple are driving innovation,” says Meeker. “Microsoft is not.”

    The numbers aren’t lying for Microsoft. That’s why Steve Ballmer has to move fast and think creatively about the company’s future.

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  • ABC 702 mornings – Storage and your computer

    ABC 702 mornings – Storage and your computer

    This morning on 702 Sydney I’m talking to Linda Mottram on the decidedly unsexy topic of storage – hard drives, cloud computing and the struggle to keep up with ever expanding file sizes of documents, photos and downloads.

    It’s an opportunity to revisit the How Much Data Does The Internet Need topic which I covered for Radio National last year, although almost certainly that needs updating.

    Earlier this year networking vendor Cisco released its 2013 Virtual Networking Index which forecast global data traffic growing fourteen fold over the next five years.

    Those bytes slopping around the internet have to come to rest on someone’s hard drive and this is what’s driving the storage crisis.

    Yesterday US business site Venture Beat had an op-ed by an executive from Seagate, the world’s biggest hard drive manufacturer where he discussed the storage challenges with a claim from industry consultants IDC that worldwide computer storage is 2.7 zettabytes.

    A zettabyte is a trillion gigabytes, or ten followed by twenty zeros – it’s the equivalent of a billion one terabyte hard drives that are standard on most cheap desktop computers.

    Where those hard drives are located is the big challenge, is it on your laptop, smartphone or on a somewhere on a cloud service?

    The other big challenge is what do you do with all this information – which is where the Big Data discussion comes in.

    While data storage is a mundane topic, it’s a big one that matters. I hope you can tune in.

    We’d love to hear your views so join the conversation with your on-air questions, ideas or comments; phone in on 1300 222 702 or post a question on ABC702 Sydney’s Facebook page.

    If you’re a social media users, you can also follow the show through twitter to @paulwallbank and @702Sydney.

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  • Disrupting the incumbents

    Disrupting the incumbents

    One of the truisms of modern business is that no incumbent is safe, Microsoft, Nokia and Hauwei are good examples of just how businesses that five years ago dominated their industries are now struggling with changed marketplaces.

    In the last two days there’s been a number of stories on how the smartphone and computer markets are changing.

    According to the Wall Street Journal’s tech blog, PC manufacturers are hoping Microsoft’s changes to Windows 8 reinvigorates the computer market.

    Those hopes are desperate and somewhat touching in the face of a structural shift in the marketplace. These big vendors can wait for the Big White Hope to arrive but really they have only themselves to blame for their constant mis-steps in the tablet and smartphone markets.

    Now they are left behind as more nimble competitors like Apple, Samsung and the rising wave of Chinese manufacturers deliver the products consumers want.

    All is not lost for Microsoft though as Chinese telecoms giant Hauwei launches a Windows Phone for the US markets which will be available through Walmart.

    Hauwei’s launch in the United States is not good news though for another failing incumbent – Nokia.

    Nokia’s relationship with Microsoft seems increasingly troubled and the Finnish company is struggling to retain leadership even in the emerging markets which until recently had been the only bright spot in the organisation’s global decline.

    Yesterday in India, Nokia launched a $99 smartphone to shore up its failing market position on the subcontinent.

    For the three months to March, Nokia had a 23 percent share of mobile phone sales in India, the world’s second-biggest cellular market by customers, Strategy Analytics estimates. Three years ago it controlled more than half the Indian market.

    India isn’t the only market where Nokia is threatened – in February Hauwei launched their 4Afrika Windows Phone aimed at phone users in Egypt, Nigeria, Kenya, Ivory Coast, Angola, Morocco and South Africa.

    The smartphone market is instructive on how many industries are changing, almost overnight the iPhone changed the cell phone sector and three years later Apple repeated the trick with the iPad, in both cases incumbents like Motorola, Nokia and Microsoft found themselves flat footed.

    As barriers are falling with cheaper manufacturing, faster prototyping and more accessible design tools, many other industries are facing the same disruption.

    The question for every incumbent should be where the next disruption is coming from.

    In fact, we all need to ask that question as those disruptions are changing our own jobs and communities.

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  • Sunset on the laptop market

    Sunset on the laptop market

    Yesterday Toshiba released their Kira laptop computer – a premium device aimed at the ‘aspirational’ market.

    The Kira is a fine device with good specs, little weight and an ambitious $2,000 price point. It probably also marks the laptop computer’s decline.

    As tablet computers and smartphones become most people’s preferred computer devices, the laptop computer is becoming a niche device and increasingly less relevant to most technology users. The Kira is fighting for the share of a marketplace that has moved on.

    Losing the Aspirationals

    Unfortunately for Toshiba, those aspirational customers are locked into their Apple iPads and Sumsung smartphones. Laptops are seen as work devices more valued for their portability and cost.

    “We have to give our customers a reason to upgrade their computers,” said Mark Whittard, the Managing director of Toshiba Australia.

    The problem is computer users have little reason to upgrade, as nice as the Kira is the price point is just too high for customers who’ve been groomed to expect sub – thousand dollar systems and there are few compelling reasons to buy such a device.

    Caught in a pricing pincer

    Price points are probably the biggest problem for computer manufacturers – one of the reasons for the tablet computer’s success is they delivered an easy to use, portable computer for half the price of a portable computer.

    At the same time the rise of netbooks and the rush to dump unwanted Microsoft Vista and Windows 7 stock onto the market groomed customers to expect cheap computers – few computer buyers are interested in spending more than a thousand dollars on a device.

    These factors have squeezed the margins of the major manufacturers like Dell, HP and Asus.

    Those pressures are going to increase as volumes fall. For much of the 2000s, laptop computers were fast moving consumer goods – pricing and profits were based on moving large numbers of the devices.

    As manufacturing volumes fall, those devices are going to lose their economies of scale which will put further pressures on vendors’ margins.

    Laptops aren’t going away, they still have a role for power users ­– particularly for those, like this writer, who need a tactile keyboard and media editing capabilities.

    However those feature rich devices with their nice keyboards are going to cost more as parts become more expensive.

    For laptop vendors the challenge is to find the profitable market niches and exploit them. In some ways Toshiba probably has a better opportunity than most with its range of premium and gaming portable computers.

    Those in the market hoping the happy days of big volumes and good profits will return to the laptop PC market are in for a painful future. It’s something retailers, resellers and vendors need to understand.

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  • Is there a tablet to cure the reality distortion field?

    Is there a tablet to cure the reality distortion field?

    It’s hard not to be impressed by the calibre of guests CNBC’s Squawk Box when they’re able to get Warren Buffett and Bill Gates on together for an interview.

    During the interview Bill Gates made an interesting assertion about Apple’s iPad, ““A lot of those users are frustrated, they can’t type, they can’t create documents, they don’t have Office there.”

    Bill’s undoubtedly right, some iPad users are frustrated by the device’s limitations. However for every irritated iPad user there are a dozen baffled by the lack of a Start button on Windows 8.

    The reality distortion field though is strong, “Windows 8 really is revolutionary,” says Bill. “It takes the benefits of the tablet and the benefits of the PC and it’s able to support both of those.”

    The Microsoft founder is enthusiastic about the company’s Windows tablet, “you have the portability of the tablet but the richness, in terms of the keyboard and Microsoft Office, of the PC.”

    It’s notable Gates mentioned Microsoft Office, particularly given the question was about the cloud. It’s clear one of Microsoft’s priorities is to maintain their strength with productivity applications and move with their customers onto the cloud.

    The problem though for Microsoft is that Apple’s iOS and Google’s Android are dominating the cloud focused operating systems, leaving Windows behind.

    Making matters worse for Microsoft is it’s clear Windows 8 tablets are never going to catch their competitors. Consulting group Gartner last year predicted the global market for tablet computers will double over the next three years, but Microsoft will capture barely 10% of the sales.

     OS

    2011

    2012

    2013

    2016

    iOS

    39,998

    72,988

    99,553

    169,652

    Android

    17,292

    37,878

    61,684

    137,657

    Microsoft

    0

    4,863

    14,547

    43,648

    QNX

    807

    2,643

    6,036

    17,836

    Other Operating Systems

    1,919

    510

    637

    464

    Total Market

    60,017

    118,883

    182,457

    369,258

    Sitting in a reality distortion field is fine when things are going well and you dominate your world, but Microsoft – despite still being insanely profitable – no longer dominates the markets that made it into one of the world’s leading companies.

    The challenge for Bill Gates and Microsoft’s management is adapting to those changes, projecting your own frustrations onto the users of a competitor’s product, isn’t a recipe for success.

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