It appears faded mobile phone brand Motorola has proved disappointing for Chinese computer giant Lenovo reports TechCrunch.
For Lenovo, this is concern as the company explores ways to diversify away from the shrinking PC and tablet marketplaces although the smartphone market which itself suffers from poor margins doesn’t seem to be the opportunity the company is looking for.
It does however show that Google is often right in casting off companies it doesn’t see a future in.
Earlier today chip maker Intel beat analysts’ estimates with an earnings report showing the company’s income hadn’t fallen as much as expected in the previous quarter.
As Business Insider explained before the earnings call, Intel’s numbers aren’t look good ahead of the rollout of Windows 10.
In the past, a new version of Windows has been the time many customers upgraded their PCs with Intel and other computer component makers being the beneficiaries.
With this version of Windows Microsoft are giving it away free to users of Windows 7 and 8 which means the rush of upgrading customers is going to be subdued compared to previous occasions.
For Intel, the Internet of Things should be the big opportunity in the post PC world but smart devices require low powered chips rather than the more power hungry chips the company excelled in supplying for desktop computers.
At the moment Intel seems to be focusing on the data centre market that may well be a suitable market for power hungry CPUs but is still very much leaving the company isolated from the bulk of the industry which will increasingly demand ultra low powered chips.
For Intel, like Microsoft, the struggle for now is to keep relevant in a dramatically shifted marketplace.
One of the key factors in bringing the Personal Computer era of business to a close was the end of the upgrade cycle where users tended to buy new systems every three to five years.
For companies like Dell, Acer, IBM and Microsoft this cycle was an important and reliable income stream.
In the early 2000s though it stopped as customers decided that with most new innovations coming onto their computers through web browsers they didn’t need to buy new systems.
For the PC industry, particularly Microsoft, this presented a huge threat to their business models and all of them have been trying to find ways to refocus their businesses.
Late last year I was asked by Microsoft Australia to participate in their ModernBiz Technology Make-Over where a small business running Windows XP and Server 2003 was given a free tech upgrade to the latest equipment.
This was interesting as it was an opportunity to see how Microsoft and the market are adapting to a very changed industry.
As well I still carry the many scars – most psychological but some physical – from my years of running PC Rescue where upgrading companies’ old technology was a core part of the business.
The fallacy many managers and inexperienced companies fall for is that migration customers from old equipment to new systems is a simple matter of copying a few files. It is never that simple.
Upgrading company computers a tough field as every business is unique and in workplace where the technology has been in use for over a decade the learning curve onto new software is insanely steep for staff and management alike.
So watching the process from a relatively safe distance where I wasn’t worrying about losing customers’ data or trying to complete a complex task within a short deadline was quite attractive. Basically I wanted to see the other guys sweat.
Another attraction in participating was to see how Microsoft are managing the transition from supplying business servers to provisioning cloud services and how customers are managing that change in product offerings.
For both Microsoft and their customers the shift from one off hardware and license purchases to cloud based monthly subscriptions is a major change in mindset, so seeing how small business users adapt to online services will be interesting.
Overall the technology makeover promises to be an interesting exercise on how the small business computer industry is changing.
For his participation in the Modern Biz Technology Makeover program, Microsoft gave Paul a Lenovo laptop which he hasn’t yet used.
Personal Computers cost one thousandth of what they did in 1980 reports Aki Ito in Bloomberg Business.
For the computer industry that’s been both a blessing and curse; cheap systems have allowed computers to become pervasive but at the same time the collapsing prices have destroyed the business models of those who built their companies upon the industry economics on 1980 or 2000.
Software has fallen a similar amount with computer programs now costing 7/1000ths of what they did 35 years ago. Again this has dramatically changed the structure of the industry with Google and Amazon taking over from Microsoft and Adobe.
While the computer industry is the starkest example of the collapse in prices due to technological change, it’s not the only sector being affected – almost every industry is under similar pressures as margins get stripped away.
Anywhere where middlemen are exploiting market inefficiencies are opportunities for new technologies to destroy the existing business models, Uber are a good example of this with the taxi industry.
With technological change accelerating in all industries, no business or its managers can assume they are safe from shifting marketplaces or new, unexpected competitors.
After several years of stalling, MS Office makes it onto the iPad with an announcement this morning by Microsoft’s CEO Satya Nadella.
The idea of tying the product into the company’s Office 365 and Microsoft’s cloud services make sense although it might be a matter of too little, too late.
Perversely, if Office for the iPad is successful, it could remove one of the last barriers for business and power home users moving off PCs.
Microsoft’s move also shows cloud services are now the main focus of the company; Satya and his team have given up any attempt to shore up the traditional – and immensely profitable – box software business.
That is going to mean Microsoft’s financial statements are going to look very different in the near future.
Regardless of the success of Office for the iPad, what were Microsoft’s core businesses are deeply affected as the company evolves to the post-PC computer marketplace. The challenge is for Satya and his management team to manage that change.