Tag Archives: Microsoft

Microsoft’s “One Windows” Strategy

What is Happening?          

Quietly included in Microsoft’s quarterly analyst call this week was a critically strategic positioning statement, followed by some clarification, by company CEO Satya Nadella. The topic? “One Windows.” Saugatuck believes that the “One Windows” effort is actually a core strategic positioning by MSFT – one which has been widely misinterpreted, and therefore discounted in the marketplace.

The most widely held misunderstanding right now is that “One Windows” means the same OS, the same UI, the same everything, everywhere, on any device.

In our view, what “One Windows” really means is a unified development strategy leading to a centrally-governed, federated union of developers, partners, and customers across Windows and all related software and devices, as follows:

  • One internal Microsoft team coordinating and developing all Windows alternatives – including the Xbox One OS. This began a year ago, with the establishment of the “Unified Operating System Group.”
  • One common NT core. Each Windows version is built on top of this core, and is adapted/optimized for the range of devices and environments in which it will be run.
  • One app/software store with one common business model across all Windows versions and developer/user environments.
  • One unified developer platform that enables developers to “write once and run on any Windows variant,” suggesting a long-term goal of “universal Windows apps.” This still requires lots of work on APIs and tools.

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Memo to Satya Nadella as Microsoft Shifts Its Core  

To:       Satya Nadella, CEO, MSFT
From:   Bruce Guptill, 30-year IT industry analyst
Re:       Your email of 11 July

Sir:

I have read through and discussed your “internal” email regarding Microsoft’s direction and emphasis with several colleagues and competitors, and I must say, “Bravo.” You are the first Microsoft CEO to effectively, publicly, shift the company’s core positioning and direction. That took vision, guts, planning, lots of internal politicking, and nerves of steel.

For me, the key bits were as follows:

  • “We will reinvent productivity for people who are swimming in a growing sea of devices, apps, data and social networks.”
  • “Across Microsoft, we will obsess over reinventing productivity and platforms.”
  • “We will relentlessly focus on and build great digital work and life experiences with specific focus on dual use. Our cloud OS infrastructure, device OS and first-party hardware will all build around this core focus and enable broad ecosystems. Microsoft will light up digital work and life experiences in the most personal, intelligent, open and empowering ways.”
  • “Developers and partners will thrive by creatively extending Microsoft experiences for every individual and business on the planet.”

In my view, you hit every important point in the right way, effectively blocked every obvious avenue to thwart change, and provided enough direction and emphasis to inspire and guide. Kudos to you and your Continue reading

Microsoft Strategizes on the Boundary-free Digital Business Shift

What is Happening?

Microsoft has generated significant news presence in recent weeks. In Saugatuck’s view, the most significant was CEO Satya Nadella’s sit-down interview at this week’s Code Conference, where he promoted a vision of Microsoft’s future as “building platforms and software for productivity.” We see his remarks, and Microsoft’s actions, as indicating a powerful shift toward enabling boundary-free enterprises and Digital Business, and indicating a massive, envelopment business strategy extension.

In the context of how the company expects to compete, Nadella stated that we’re entering an era in which Microsoft’s software and services need to be available on “all devices,” adding that “Microsoft has to build apps and platforms that are not really about a specific device, but for people.”

Bottom line: Microsoft is trying to enable itself, its users, and its channels to extend and expand what everyone’s business is and does. Saugatuck sees this as a continuing re-direction toward the Boundary-free Enterprise™ reality, which could not only result in Microsoft retaining its current influence but build its revenue sources and streams beyond the already massive presence. IT markets, be aware: The Windows footprint is expanding – everywhere. Continue reading

Microsoft Build, Free Windows, and Strategy

What is Happening?

So far, focus at Microsoft’s Build developer event on the audio-driven Cortana PDA has garnered tremendous publicity. Saugatuck believes that Cortana right now provides a sexy sideshow distracting from what Saugatuck considers to be a public acknowledgement by Microsoft concerning its core strategic positioning.

cortana

Source: Microsoft

In Saugatuck’s opinion, the Microsoft news this week with the greatest impact on Microsoft and IT markets was announcement of free Windows licensing on smaller mobile devices.This announcement puts clear and massive Microsoft internal and ecosystem emphasis on Cloud; it positions Cloud as keystone in Microsoft’s strategic business. That’s an excellent move, and at in business terms, it is much more sexy than the Cortana PDA. The move helps to push developers and users away from traditional computing devices, and reduces (and over time removes) the company’s opportunity for massive, volume-driven revenue growth in smaller, more numerous devices.

We think that this is an interesting step, an important step, but one that indicates that Microsoft is really still pursuing its traditional business model – just under a “Cloud-first” halo. Continue reading

Old Jeans & OSes: Microsoft Out-innovated the Market & Why We’re Not Buying Win8

I’d like to offer 900 words on why Windows 8 should not be considered a failure, and why it has shipped “only” 200 million copies to date.

Yes, people and firms are buying PCs at a slower rate than in previous decades, partly because there is more competition – but at the lowest end of devices, meaning tablets and smartphones. Sorry, but those can’t be compared to PCs. We use them for some things that used to require PCs, but they are not PCs, either in terms of complexity or capability. We’re buying fewer PCs because we have other things that do what once could only be done by expensive, complex PCs.

And I agree that Windows 8 was engineered and delivered as a compromise, and that was a big mistake. Microsoft had the right long-term idea – One Windows To Rule Them All – but delivered it years too soon, before either devices or users were ready for it. Continue reading

Microsoft’s Same Old New Direction?

What is Happening?

The advent of a new Microsoft CEO has much of the IT industry wondering aloud about how this will, or should, affect the company’s direction, strategy, and plans.

Most of the speculation and opinion centers on how to “turn around” Microsoft, and how to make Microsoft “relevant” to the overall IT market again, especially to the traditional enterprise IT/software marketplace. Even new CEO Nadella has come out of the gate emphasizing a need to innovate, and to become more of a front-line IT leader.

The underlying theme to most of this conversation is that the company has somehow failed or is failing, is on the precipice of business and/or technological disaster, and must change direction, increase speed, and charge to the front of the pack in order to be considered a leader.

Saugatuck believes that, while Microsoft certainly makes its share of mistakes, and does have some significant challenges to address and overcome, the company is in no danger of losing relevancy or influence, is as innovative as any similarly market-dominating IT provider, and does not need to be “turned around” in order to achieve or maintain its position in a changing IT marketplace. Continue reading

Research Alert: Cloud, Mobile, Social, Analytics – Greater Than the Sum of Its Parts

What is Happening? 

There is little doubt that the technologies and capabilities of Cloud, Mobility, Social IT and Advanced Analytics (CMSA) promise great value to user enterprises. Few enterprises of any type or size are not actively pursuing each.

And according to the latest research from Saugatuck, enterprise executives expect significant competitive value from each as well. In our Q1 global Cloud IT survey this year, we asked participants to “please indicate how important each of the following technologies are to your company’s competitiveness over the next 24 months.” Figure 1 aggregates the percentages of survey responses ranking each as “Very Important” or “Extremely Important” – rankings that have, over the years, been reliable indicators of imminent investment.

Figure 1: Ranking CMSA Competitive Value

Cloud Mobile Social and Analytics for Business Value

Source: Saugatuck Technology Inc., 1Q2013 global web survey; n = 218

CMSA is truly a simultaneously evolving set of services and capabilities, helping to change enterprise IT from a monolithic entity into sets of loosely-coupled, complementary services.

But as much value as each of these provides (or is expected to provide), even greater value is seen from combining them with each other, and with business management applications software and processes in key enterprise systems. Figure 2 summarizes our survey data regarding how business and IT leaders see combinations of Mobile, Social and Advanced Analytics with enterprise business systems as adding the greatest business value to the enterprise. The higher the percentage, the more survey participants see business value.

Figure 2: The Integrated Value of CMSA with Enterprise Business Systems

The Value of Mobile, Social, and Analytics on Business Apps

Source: Saugatuck Technology Inc., 1Q2013 global web survey; n = 218

Clearly, Cloud-based Mobile, Social, and Advanced Analytics are seen as relatively less beneficial to business when used individually (in most cases) than when used in combination with each other, and as part of enterprise business systems. In short, while Mobility, Social IT and Advanced Analytics each have intrinsic value, that value is typically multiplied with coordinated use.

Why is it Happening? 

With past IT architectures, single or serial evolutionary trends tended to define the evolution, and IT became more and more focused on (obsessed with?) tightly-integrated technologies and systems. This grew through the almost manic progression of 1990s-era distributed and client-server architectures, which brought increased scrutiny on IT costs, resulting in edicts to standardize and integrate, which in turn led to a renewed emphasis on tightly-coupled architectures and technologies.

What makes the combination of CMSA different is that buyers, users, and increasingly some IT leaders are starting to see the potential value and utility of systems, technologies, and business operations that are only loosely-coupled and not tightly integrated. Integration is readily available and reasonably affordable in the form of Cloud-delivered services that alleviate many requirements for tightly-coupled technologies and systems. Cloud Integration services also expand the choice for building out certain capabilities beyond the traditional vendors of complicated, pre-built solutions and heavy customization, toward building a functional alternative from a variety of better suited products from different vendors without the tight coupling at their core.

The high value of Analytics, both alone and when combined with other capabilities and systems, is easy to understand, as the ability to better analyze and then utilize business data has long been a goal of IT and business leaders. In short Analytics almost intrinsically adds value everywhere. Mobility enables greater reach and utility of most business systems; and Social IT enables improved collaboration, which in turn adds value by improving group and resource communication and coordination. And with Cloud, they can often be added, used, and removed as needed –an additional value from the inherent flexibility of loosely-coupled, Cloud-based services.

Finally, more CMSA offerings are being architected with multiple, often open, standards-based interfaces that enable them to work with a wider array of business systems and data. They are enabling Mobile, Social and Analytics capabilities that recently cost significant amounts of additional money when included with traditional software (and didn’t always work as well as needed or expected). Buyers have wanted some combinations of these capabilities for years; making them available cheaply via Cloud has accelerated and expanded their adoption and use.

Market Impact 

By YE 2017, the inclusion of Cloud-based Mobile, Social and Analytics capabilities will be considered de rigueur and required by the majority of IT buyers and users. SaaS and BPaaS provider understand this, and are scrambling to engineer, integrate or embed an increasing range of such capabilities with their offerings.

Most will utilize capabilities from such providers as Dell Boomi, IBM CastIron, Informatica, MuleSoft, Pentaho, etc. These and other Cloud-based integration-as-a-service platform providers (“iPaaS”) are already, rapidly, pursuing BPaaS, SaaS, and other PaaS providers to embed a wide range of integration capabilities into business process services and solutions. So we believe that the loosely-coupled advantages of CMSA will only continue to grow. There will be no shortage of established and upstart providers serving enterprises and Cloud-based business solution providers alike.

Large-scale business management solution providers (e.g., Microsoft, Oracle, SAP) will be pressured to add more data and workflow integration capabilities and APIs to their core Cloud platforms; their traditional preferences for in-house “standards” will decrease as more buyers and users come to accept, then expect, the loosely-coupled IT and business reality of the Boundary-free Enterprise™.

This loosely-coupled future also helps to bring clarity and certainty to the roles of traditional SIs and enterprise IT departments. The proliferation of services and providers will mean increased roles, and increased need for skills, as enterprise users force the growth of a variety of hybridized IT and business environments, utilizing a changing array of Cloud-based offerings that need to work with other Cloud-based and on-premises systems. There will be new, different, and more skills required, and roles will continue to adapt, but there will be no shortage of need for skilled and experienced IT professionals in a world replete with ever-changing, dynamically-utilized IT.

More detailed analysis of this and much more data from Saugatuck’s 2013 Cloud IT survey will be published for Saugatuck CRS clients beginning the last week of June, including a series of research analyses and data reports.

Home, Please – A New Front in the Mobile OS Wars?

What is Happening?

The development of mobile platforms and their attached ecosystems by Apple, Google, Microsoft, and Blackberry has created a new competition within IT, in which vendors and mobile platforms themselves fight for mindshare and user share. The network effects that each ecosystem gains from this competition drives more value to each provider’s ecosystem. Thus, reinforcing each against the others in a highly competitive market.

However, this view does not incorporate all of the possibilities, as was aptly demonstrated by Facebook’s rollout of its “Home” app, and the resulting (some might say “looming”) potential for phones to follow servers and PCs into virtualization at both an application and potentially hardware levels. While the Big Four above continue to dominate the mobile OS space, their situation among consumer and enterprise demands is far from predictable.

Why is it Happening? 

Facebook Home is an app that runs on selected Android devices, replacing the Android user experience and GUI with a Facebook one. The replacement interface favors Facebook’s sites, apps, and operations rather than Google’s, but without fundamentally changing or forking the Android operating system, as Amazon did with the Kindle Fire. For Facebook, this means that it can effectively “hijack” an Android phone and turn it into a “Facebook phone” (and soon, tablets as well). Although it is hardware dependent, and limited now to a few specific phone models, there is little beyond developer policies to prevent Facebook Home (and other, future “home” functions) from being ported to other operating systems. The strategy has interesting implications, and it is not the first time that it has been used.

Other companies seeking to provide a better lock-in to their own ecosystems or more carefully tailored UIs are likely to consider this “third way” strategy very carefully. It avoids the costs and complexities of building an OS; avoids the loss of control of building a range of simple apps. Yet it is capable of dominating the user experience. Companies with suites of Cloud-based apps are likely now considering doing the same. Such a strategy would doubtless appeal to Salesforce.com or Cisco for example. Right now, this capability is unique to Android, with Facebook being the only company to demonstrate a potentially viable option.

Though Android is making more headway into the enterprise though, iOS, due to maturity and “walled garden” approach among other reasons, still dominates the current enterprise plans for mobility. If the “home” strategy gains momentum though, it could spell a more rapid change of fortune for Android in the enterprise, as this would shift Android’s openness from a challenge to security (as many perceive it now) to being an enabler of better enterprise mobility. One can also imagine how, a mobile device could deploy multiple containerized apps like Facebook Home on the same device at the application level, thus allowing switching between multiple “homes” for personal or corporate use.

The “home” construct is also likely to appeal at an enterprise level to Mobile Device Management vendors, who are already starting to employ a containerized or sandboxed approach to housing company data on mobile devices. The expansion of that separation to include separate user interfaces, and UI consistency enables them to deliver a better experience to end users, and further defines a demarcation between the “personal” side of the device, and the subdivision the houses company applications and information.

The Home construct also offers several similarities with application-level mobile device virtualization efforts from companies like ATT and VMWare that have attempted to house entire tenant operating systems within existing mobile phone OSes. This degree of separation so far has proven difficult to achieve, due to resource constraints – but appears to offer an even more complete separation of data.

Market Impact 

For Facebook, Home is a relatively cheap and quick entry into a marketplace dominated by iOS and Android. It is a step up from an application suite, with its ability to command mobile phone accessories, and a step down from a new operating system or (more likely) yet another Linux fork. Other vendors with Cloud based application suites should take note; this strategy can create a branded phone, and move the conversation from “Android versus iOS” to “Us versus Them.” For corporations, such a strategy could be used in conjunction with an Enterprise App Store to provide a secure and manageable “branded” access platform for employees (potentially also, partners and customers) that can separate business from personal. At least on Android.

For Android, it weakens Google’s grip, but makes Android more attractive as a corporate platform by providing the potential to reduce fragmentation and bolster management and security at a level somewhat above the operating system but below the apps, where the danger lurks.

Until some of the problems with mobile device virtualization are worked out also, we see some hybrid of MDM container and Home construct being the predominant way that companies create secure areas on mobile devices. Regulatory and compliance requirements already dictate the ways that security must be set up, and we believe that the consumer trend that Home represents will provide groundwork for an evolved corporate user experience that can ameliorate the pushback from most MDM solutions.

Wintabs Suggest Marginalization for Android, and possibly iOS, as an Enterprise Mobile OS

We’ve just published a Strategic Perspective for our premium subscribers that raises a very fun and important question: Assuming that Windows 8, especially the RT version, does not completely fail, whose butt will Microsoft kick with Win8 and tablets?

The butt-kicking is not certain, of course, as there’s still plenty of time for Microsoft, its device partners, its developer chain, and others to mess things up. There’s also plenty of time for Google to standardize a single commercial version of Android across all its partners.

But frankly, neither is likely to happen on a scale large enough to stop Microsoft from making tablet computing its own enterprise IT domain. The Microsoft power base is too big, and there are too many Android tablet makers busily building Wintabs, for this to face-plant completely. It could happen, but if I were employed by a different analysis firm, I’d give that a probability of P = doubtful.

The Perspective lays out the reasons why we believe what we believe, but let’s boil it down for this blog post: Microsoft-sanctioned and -supported tablets make tablets as a phenomenon safe for enterprise IT to buy, use, and develop for. Microsoft and Windows fit and enable the Three Cs of enterprise IT: Continuity, Compatibility, and Comfort.

Given that there is diminishing distinguishability between tablets and the smartphone experience, it’s natural and easy to see a revised and revitalized enterprise Microsoft presence building out into other aspects of mobility as well.

So, whose butt will it be? Our money is against Android, since all the Android tablet makers are swinging production to Win8/WinRT. They will continue to make Android devices, but the odds are stacked in favor of Windows given its existing worldwide enterprise presence.

We also would place a side bet of Apple being marginalized in the enterprise, possibly to the extent it was in the 1990s. It’s not that Apple couldn’t kick Microsoft’s butt – it has in many ways already(see: “design,” Zune, GUI, etc). But the Three Cs, and a building PC refresh need, make it easier and cheaper for enterprise IT to go Wintab, and from there to Win8 smartphone standardization.

Note: Ongoing Saugatuck subscription clients can access this premium research piece (1132MKT) by clicking here, and inputting your ID and password. 

Microsoft and Office 15: It’s Not Here, and It’s Not Quite Cloud, But It is a Good Step

This week, Microsoft partially unveiled the up-and-coming Office 15 business productivity suite, showing off its Cloud chops and added social (Yammer) and VOIP (Skype) capabilities. The full functionality, feature set, availability timeframe, and pricing were not released. But what we saw was encouraging, from the touch-screen capability to the Cloud-based doc storage. What was most encouraging was the fact that this positioning of Office as a Cloud-friendly business suite seemed to show that Microsoft really is “all in” when it comes to Cloud.

But it also showed how Microsoft’s approach to Cloud for its apps is still well behind most other ISVs right now. Yes, the company has enabled significant and solid Cloud-based functionality with Office 15. But it also has pursued an approach similar to the old ASP model, layering/adding Cloud interface capability to a traditionally-architected application built on limiting technologies. Continue reading