software | Paul Wallbank - Communications Professional

Locking down the firmware of the internet of things

As the smart devices become common in our homes, cars and workplaces suppliers will have to do more to secure their software.

There’s a fundamental problem with smart devices warns Kim Zetter and Andy Greenberg in Wired magazine.

In Why Firmware Is So Vulnerable to Hacking, and What Can Be Done About It, Zetter and Green look at the problem with the embedded software that is shipped with every computerised device from Personal Computers to smart sensors.

The problem with firmware is that it’s difficult to check it’s not been changed, awkward to upgrade and complex to find, the Wired piece mentions how even the batteries in Apple laptops have vulnerable software embedded into their chips.

As the smart devices become common in our homes, cars and workplaces suppliers will have to do more to secure their software.

Business in a time of falling technology costs

The fall in computer prices shows no business or manager can assume their markets are safe

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.

Uber and the management dilemma

Is Uber profoundly changing the economy or are even bigger forces at work that will challenge managers?

“Uber-mania reflects a profound turn in the way the global economy is organized,” writes Fortune Magazine’s editor Alan Murray.

That’s a bit of stretch as Uber’s simply an application of the technologies that are changing business and the economy; those technologies are having a more profound effect on the role of managers in the modern workplace.

Along with services like AirBnB and Task Rabbit, are the result of the new breed of cloud, mobile and big data tools that make it easier to deploy new business models which in themselves threaten traditional industries and their executives.

Uber’s success is in finding an industry that in much of the world has been ripe for disruption for decades; in most Western cities cab services have been regulated to protect plate holders’ incomes and often to protect corrupt local cartels.

What Uber’s disruption shows is how those tools can be deployed against cosy incumbents.

Probably the cosiest group of incumbents of all have been corporate managers; over the last thirty years businesses have been downsized, workers have become more productive and many functions have been outsourced or offshored.

Management however has largely remained untouched as the need to supervise business functions has remained.

Now those tools – particularly the smart algorithms that run companies like Google, Facebook and Uber – are coming for managers in many industries. Added to the manager’s dilemma are improved collaboration tools that allow workers and machines to communicate and make decision autonomously without the need for supervision.

Possibly the greatest change in business over the next decade will be the disappearance of the manager as software takes over.

Microsoft’s search for a strategy

Microsoft CEO Satya Nadella says the company’s future lies in the cloud and productivity. What’s new?

The decision of Microsoft to offer its Office tablet apps for free last week has had the desired effect with them rocketing to the top of the charts as people enthusiastically grab them.

Microsoft’s decision pretty well locks its resellers into the loss leading strategy the company flagged last week in China, with the tablet apps available for free its hard for retailers and integrators to be charging for the desktop version.

That loss leader strategy has been further laid out by CEO Satya Nadella at a function in London yesterday where he described their cloud and mobile first strategy, something he also discussed at a briefing to ‘a small gathering of journalists’ last week.

Nadella’s vision isn’t really anything new; it differs from Ballmer’s ‘devices and services’ strategy but the thrust of the business was always going to be on cloud services and the company’s Azure services regardless of any conceits around tablets or professional offerings.

Of the three key areas Nadella identifies — Windows, Office 365, and Azure — two of them are problematic; the Office 365 for reasons already mentioned and the Windows product line.

The ‘Windows everywhere’ strategy, which also happens one of Ballmer’s earlier initiatives, is doomed as the operating system is not suitable for smartphones or lightweight internet of things devices.

Even if Windows was successful on smartphones or could be successfully ported to low powered smart devices, the margins are tiny compared to the traditional desktop market that was so profitable for Microsoft in the past.

All of which brings Microsoft back to Azure; it’s clear the cloud service is the future of the company but the margins are dire except for some relatively niche areas like collaboration software.

Mantras about ‘productivity’ count for nothing as every software and cloud computing company cater for the B2B market is delivering a service that claims to improve customers’ productivity. That Office is declining as a profit centre only makes things harder for the company.

If anything, Nadella’s discussions illustrate the company is still casting around for the next big profit centre. As the Windows and Office franchises decline, time may start to run out for the current management just as it eventually did for Ballmer.

Giving away Office apps may lock some users into the 365 service and could prove moderately profitable, but last week’s moves indicates a much smaller future For Microsoft.

The fight for cloud computing’s sweet spot

An old PC industry was is being re-fought in the cloud. Will the result be different this time.

One of the great market battles of the PC era was the fight between the ‘best of breed’ software designed to do specific jobs well — Lotus 123, WordPerfect, and Harvard Graphics — versus the bundled ‘suites’ led by Microsoft Office.

Bundled suites of programs offered a common platform and cheaper price over buying products individually.

In the case of Microsoft Office, it also helped that the software giant was aggressive in undercutting the market and leveraging the deals it had made with hardware vendors and system integrators.

The winner of that battle was Microsoft as it turned out customers preferred the cheaper price points of the bundled packages and the common software platform made it easier to share data across the applications.

In the cloud computing field that fight is happening again as Zach Nelson, CEO of Netsuite, describes; “I think the next battle is going to be the same battle that happened in the client-server world. Is it the best of breed cloud apps or is it the suite?”

Nelson believes the suite vision will win out, “the suite is going to win again for exactly the same reasons why the suite won in the client-server world — it’s very hard to synchronise data between applications.”

Given Netsuite’s business, as its name suggests, is in providing a suite of software it’s no surprising that Nelson believes their way of doing business will prevail. Those providing ‘best of breed’ stand alone cloud applications naturally disagree.

Chris Ridd, Australian General Manager of accounting service Xero, disagrees with Nelson’s view. “With cloud and open APIs you have the holy grail of interoperability,” Ridd says. “In the 1990s the open systems were too early and didn’t work as well as they do today.”

Ridd also points out that Xero has over 350 add on services, ” I don’t think any suite can deliver that” he says.

History is on Nelson’s side but it may be that in this case history doesn’t repeat as the technology has moved along and now stand alone apps are what the market wants.

Time will tell although its unlikely whichever prevails will have anything like the success and market domination of Microsoft Office during the PC era.

Salesforce faces the end of the database era

Cloud CRM giant Salesforce faces a challenge as searching unstructured data and analytics companies like Splunk change the business model.

Last week we looked at the way we organise information is changing in the face of exploding data volumes.

One of the consequences of the data explosion is that structured databases are beginning to struggle as information sources and business needs are becoming more diverse.

Yesterday, cloud Customer Relationship Management company Salesforce announced their Wave analytics product which the company says “with its schema-free architecture, data no longer has to be pre-sorted or organized in some narrowly defined manner before it can be analyzed.”

The end of the database era

Salesforce’s move is interesting for a company whose success has been based upon structured databases to run its CRM and other services.

What the company’s move could be interpreted that the age of the database is over; that organising data is a fool’s errand as it becomes harder to sort and categorise the information pouring into businesses.

This was the theme at the previous week’s Splunk conference in Las Vegas where the company’s CTO, Todd Papaioannou, told Decoding The New Economy how the world is moving away from structured databases.

“We’re going through a sea change in the analytics space,” Papaioannou said. “What characterised the last thirty years was what I call the ‘schema write’ era; big databases that have a schema where you have to load the data into that schema then transform before you can ask questions of it.”

Breaking the structure

The key with programs like Salesforce and other database driven products like SAP and Oracle is that both the data structures — the schema — and the questions are largely pre-configured. With the unstructured model it’s Google-like queries on the stored data that matters.

For companies like Salesforce this means a fundamental change to their underlying product and possibly their business models as well.

It may well be that Salesforce, a company that defined itself by the ‘No Software’ slogan is now being challenged by the No Database era.

Paul travelled to San Francisco and Las Vegas as a guest of Salesforce and Splunk respectively

One, two, skip a few. Microsoft hopes Windows 10 will save a declining PC market

Will Windows 10 be enough to revitalise Microsoft’s ailing business divisions?

A few days ago I asked if Windows 9 would be Microsoft’s last desktop operating system.

Yesterday the company partially answered the question by announcing the next version will be named Windows 10 which conveniently skips version nine.

Skipping around numbers isn’t unusual for Microsoft, most famously Word skipped from version two to six just to overtake competitor WordPerfect in the late 1990s.

Windows itself has gone 3.0, 3.1, 3.11, 95, 98, ME, XP, Vista, 7 and 8 in the past — that’s without mentioning the Windows NT family — so jumping to Windows 10 doesn’t detract from any logic in the Microsoft’s naming system.

The key point from Microsoft’s announcement is the business focus along with the continuation of Windows 8’s unified experience across PCs, smartphones and games consoles that has proved less than successful.

One area where Microsoft has conceded defeat is in the battle for a Start button with Windows 10, one of the biggest irritants upgrading users found with the new operating system and one of the reasons why many users chose the older Windows 7 software when buying a PC.

How the Start button will work on Windows Phone remains to be seen although Microsoft seem committed to the ‘One Windows’ vision despite its technological and marketplace difficulties.

Another interesting development with the new product is the Windows Insider Program, billed as an ‘open collaborative development effort to change the way Windows is built and delivered’.

Back in the old days this was called a beta program where testers were invited to try out new software to test the product and fine tune user experiences. At least it shows Microsoft are embracing the language, if not the spirit, of the collaborative economy.

Microsoft have released a YouTube video Introducing Windows 10 with Windows Vice President Joe Belfiore outlining the features of the new system.

Whether Windows 10 is enough to shore up the declining fortunes of the company’s Windows division and Joe’s job will be a key question for analysts and industry watchers over the next three years.

Driving the hybrids — VMWare and the case for hybrid cloud computing

VM Ware is pivoting its business to a mix of cloud and onsite technologies for its long term survival

A decade ago VM Ware disrupted the corporate IT world with its virtualisation software that changed the way big organisations used their servers. Today the company is facing up to the challenge of dealing with its own business being disrupted.

In the late 1990s when a big business wanted a new server it had to get someone to physically install one, VM Ware’s founders came up with the idea of ‘virtualisation’ with their software creating a virtual server that looked to the network like it was a discrete, real computer.

Naturally this was quicker and cheaper than buying and setting up a whole new server and VM Ware was an immediate success that upended the ‘big iron’ end of the computer industry.

Today VM Ware is valued at $42 billion on the stock market and is one of the IT industry’s giants.

However the virtualisation market itself is being disrupted by cloud computing. For many businesses, it’s even cheaper to pay Amazon, Microsoft or another cloud service to provide the servers for you.

So VM Ware is reinventing itself with a range of services to meet the challenge from the cloud providers. One of it’s key strategies is to provide a ‘hybrid’ cloud where customers run some IT services on their own servers and others on the cloud, the idea is this offers the best of both worlds.

This is almost the same challenge that Microsoft faces as both companies see their core business models being threatened by internet based technologies, something that VM Ware CEO Pat Gelsinger concedes.

“We think of Microsoft having a strategy much like ours, given they have on premise and in the cloud,” says Gelsinger. “We sort of agree on the shape of the market. We would say that Amazon and Google see a different shape in the market.”

Amazon and Google’s view is a ‘pure cloud’ model where companies and consumers run all their IT on web based services. In that world, purists like Xero’s Rod Drury are openly disdainful of the hybrid model believing it to be cumbersome and adding complexity to a simple business solution.

For companies like VM Ware and Microsoft their future lies upon the hybrid model being adopted by business. This is a high stakes industry battle which will define the careers of many IT workers and the shape of the businesses they work for.

Paul travelled to the VM World conference in San Francisco as a guest of VM Ware.

The strength of keeping things simple

Keeping things simple is a strength in today’s complex times.

This week I’m in New York to attend the BlackBerry Security Summit, more of which I’ll write about later although this story for Technology Spectator covers much of the news from the day.

BlackBerry is struggling to find relevance after losing its way when Apple and Android smashed their business model of providing secure, reliable and email friendly phones.

Now in post Snowden world, BlackBerry under new CEO John Chen is looking to rebuild the company’s fortunes on its strengths in security.

One of the aspects Chen’s team is emphasising is the simplicity of their software. Dan Dodge, who heads BlackBerry’s QNX embedded devices division says their operating system has a 100,000 lines of code as opposed to hundreds of millions in Windows and Android.

That weakness in the established software packages is something illustrated in today’s story about a verification problem in Android due to reuse of old code from another older product.

Simplicity is strength is Dodge’s message and that idea could probably be applied to more than software.

In the complex times we live in, simplicity could be the key to success.