Do you think we should phase out IE6 support?
Our reasoning for why we should is here.SaaS - reinventing the channel
The channel conflict noted in this article reveals one of the big challenges/opportunities for new SaaS vendors
Under an online model, there are often issues with your existing ‘real world’ channel.
- Does the old world channel add value in an online world? Does it get you sales?
- How do you pay a sales channel if there is no up front license fee? Often SaaS pricing is sharp because they have eliminated some of the channel and distribution costs.
- Ongoing commissions for sales is a very expensive sales cost for SaaS vendors. The real cost of SaaS is driving more innovation and outstanding customer care, so a recurring fee model just for a sale is to much cost.
Flipping it around, existing real world channel needs to think about how they share in this new online world as the inventories of products they earn margin on will erode.
In the business software space this creates a huge opportunity for buyer aggregation points. The retail browsing shop of the 21st century.
In the New Zealand small business SaaS market this is where MED and NZTE can really help out. Providing a location where NZ small business owners can discover great products that can make their businesses better.
This what small businesses have asked for. (Don’t worry, I’m onto it.)Big software economics
Rare glimpse on the economics of software companies with scale.
It’s believed the Mac BU currently employs around 180 people whose products — including Office, Messenger, and Remote Desktop Client — combine to generate over $350 million in revenues each year.
Say the average person’s annual cost is, say, $US150k. That’s 27m. Even with a lot of marketing spend that’s a good return.
When pressed for details, a spokesperson for the Redmond, Wash.-based software giant would say only that the company expects to release new versions of Office for Mac every 2 to 3 years.
I was hoping the days of 3+ year releases were gone. Seeing the progress that web office companies like Zoho are making in months - imagine how far they’ll go in 3 years.
OSX is being updated every few months. 10.5.4 is almost here. 10.5.3 had quite a few new features. So complexity is no excuse.
I’ve been playing a around a bit with web office tools. The collaboration features are awesome, but they are still clumsy to use. As Silverlight, Flash, AIR, Java and other web hosted runtimes roll out over the next year I’m sure we’ll see office parts that you can embed. You would have to think that’s all going to accelerate well within the 3 year horizon.
It staggers me that the biggest horizontal categories are so ripe for innovation and the door is open so wide. And the rewards for getting it right are so large.
The use-case of office documents are they are ‘hot’ for probably a day - maybe even just an hour of intense collaboration. Once a document is done, 99.99% of them never change again.
Probably 5 times a day I’m hunkered over someone else’s PC collaborating on a document. Or I’m emailing changes around that have to be in series or we have a version control nightmare. That slows collaboration and minimizes review cycles. Worse it’s embarrassing to have to go around again at the last minute. An emotional, painful response. Something you seek when looking for high value problems to solve.
It would be so good if we could use all that processing power on the desktop to deal with the rendering of multiple users attacking a document at once. Easy rollback of changes. Full tracking ability and difference detection. The bandwidth requirements are minimal as it only needs to keep a track of a few people typing and where their mouse is.
Use the power of the computer to empower across the world what people are doing next to each other everyday. It’s such an obvious scenario.
I hope that’s what the Office and MacBU teams are working on.
We are seeing innovation in this space. Zoho seems to be in front technically, speeding past Google. The experience the web guys are gaining in collaborative editing will be invaluable. But I wish they would work on fat client versions as well. They seem reluctant to charge. Hard to find any pricing info on Zoho. I think they should charge so they can accelerate investment.
These numbers show it is a high value space. New entrants getting close to the sacred cow will hopefully drive faster innovation in Office.If I was in charge at Microsoft
We’re a Microsoft Gold partner and really appreciate our relationship with MS. Lots of friends there.
Only a few years ago the Microsoft powerhouse was unstoppable. You couldn’t even imagine Microsoft could have a competitor and there were calls to break MS up.
Then two fronts happened. The Internet, which challenged the lock in of the desktop model, and Apple came back.
It’s a fascinating tech story that thousands of people commentate on. But this article was a bit of a wake up call as to where MS is at.
Over the past couple of years, Microsoft’s already problematic reputation in some circles — as the soulless, power-hungry purveyor of lackluster products — has suffered a series of self-inflicted wounds. It spent two years and $500 million on the media blitz around the long-delayed Windows Vista launch, only to see the January 2007 “Wow” campaign, which likened Microsoft’s new operating system to Woodstock and the fall of the Berlin Wall, derided as arrogant and creatively void. Vista itself sold poorly, leading to price cuts of up to 40%. Worst of all, the flop bred a new generation of Microsoft haters. “Microsoft has really lost control of its image,” says Rob Enderle, an influential advisory analyst for tech companies including Dell, HP, and Microsoft. And with its two most formidable competitors — Apple and Google — boasting their own consumer cults, that’s the last thing Microsoft can afford to do.
I’m sure Microsoft strives to do better but the fact is as companies grow it is just hard to be nimble and the technology market allows new entrants to come in unencumbered and change the rules. In that climate long term brand demise is entirely predictable. But at the same time a cheeky challenger, smaller with a lot more focus, but big enough to make an impact has been accelerating that brand erosion.
Nothing is doing more to carve away at Microsoft’s reputation — and contribute to its loss of market share — than the assault launched by Apple two years ago in the form of the “Mac vs. PC” spots featuring The Daily Show satirist John Hodgman. The ads became immediate pop-culture fixtures, spawning more than 1,000 video spoofs on YouTube and taking home last year’s Grand Effie, the ad industry’s highest honor for effectiveness. “Nobody messes with anyone in the tech industry the way Apple has messed with Microsoft,” says Enderle. “It’s the first time I’ve ever seen a major national campaign that disparages a competitor, and the competitor just sits back and takes it. If somebody tried to do that to Oracle, you wouldn’t be able to find the body.”
It is so interesting to watch this battle on such a big and public scale.
Microsoft is reinventing itself. SharePoint is growing like a wildfire in the enterprise and the cash keeps rolling in.
Far from being complacent Microsoft has lots of smart people and lots of money. They know they’ve missed the market in a number of public areas and that has removed any corporate arrogance they might have been accused of a few years ago.
They will have learned a lot of the past few years, and especially over the last few months on the so far failed Microhoo bid and the unrestrained reaction from the community.
I expect Microsoft to reinvent themselves over the next few years. Now there is real competition and that leads to innovation. That is great for the industry.
What would you do if you were Microsoft? If big Steve tapped you on the shoulder and said, your turn?
Here’s my strategy …
- A lightweight operating system. Forget backward compatibility. Just needs to run Office v.next which has to be compelling. Make it not need a hardware upgrade. Less is more. Open Source it.
- Leverage the Office platform for a powerful Software + Services model. Collaborative Office has to be the goal.
- Win the Enterprise. That means double down on SharePoint, but make it a database, not a collection of objects.
- In fact promote everyone in the SQL Server team. The Enterprise is about databases.
- March out everyone in the Exchange storage team. Exchange is your corporate anchor. There has been no innovation for years. You need to port it over SQL Server immediately. Shoot anyone that stops you. Mail is a database application. Period.
- Clean sheet redesign or your mail client. Mail is broken at all levels and is the most important application.
- Buy a big Services company. Maybe HP. Microsoft has to be the new IBM. Straight partnering won’t cut it anymore.
- SilverLight has to win, or buy Adobe. Don’t let Apple get them or you’re done.
- Resurrect Internet Explorer for OSX. You’re going to loose OS market share in the short to mid term, at least have a chance to keep them in the browser.
- Lock in Dell. As computer hardware gets cheaper the OS becomes the biggest cost. They’ll go Linux unless you fix those relationships with a great OS. You need a tighter hardware/software partnership. Surely together you can build a stunning computer. Look at OLPC2.
- Significantly up your Open Source strategy across the board. That will win back the geeks.
- Win the SMB market. No one there yet and they already have Office.
- Do lots of small acquisitions to fill in the strategy.
- Platform as a Service (PaaS) .Net and Windows Server with compelling licensing.
- Sack all the existing design guys and hire a design dictator who overseas everything. Microsoft Web properties, packaging and applications are ‘over designed’. You need someone who understands less is more. Not Chris Bangle but like a Chris Bangle at BMW who drove design.
- Do a total redesign of the Windows Mobile interface. It is not a scaled down desktop computer. It is a handheld device. Hire some RIM guys to do it properly. Or buy RIM.
- Maybe use some cash to buy or lock in a global fibre network. Vertical integrate your Enterprise Software stack with the network layer. Then you can QoS connected applications and add value to the stack with Enterprise Messaging Services, off site back ups etc.
- Xbox/Media center has to be default lounge computer. Double down but really model user scenarios so it works as people want to.
It’s a big list but MS has a big team, the brains and the resources.
I’m fascinated by corporate communications. Steve’s note to Jerry is fantastic.
Allow me to paraphase it:
Here is a letter that I’m sending to the world so I’ll start off really nice.
Your shareholders would have made lots of money from our offer.
We upped our offer which demonstrates we were willing to do a deal.
You put yourself ahead of your shareholders and therefore they will sue you.
Here is all the ammunition they need for suing you.
- Your strategy is bad for Yahoo
- Your key staff will leave
- No one else could buy you, so your shareholders really lost out
- You are handing the market to Google
- Just repeating, no one else could buy you, so your shareholders really lost out
Your stock will tank on Monday. Did I mention that your shareholders should sue you?
Look forward to watching you deal with that.
As widely reported it looks like Android phones could be out later this year.
I hadn’t paid a lot of attention until I saw this photo. It’s looks like a HTC prototype but interesting it looks like standard Windows Mobile hardware.
So this is very significant as the manufacturers don’t have hardware to redevelop or even customize. All they need to do is develop the software layer that links Android to their already developed Windows Mobile hardware.
In fact it’s all upside from the manufacturers as there is little risk. Consumers can choose what they want.
So this open sourcing of the Phone OS is a very aggressive move to marginalize Microsoft on the phone. By having advertising baked into their Open Source Phone OS Google can give it away.
Fascinating.Daylights savings time screwed again, sigh
Between Entourage 2008 and my BlackBerry *some* of my meetings are out by an hour this week.
Already had 2 double bookings this week.
Voda says the BB8310 is already compliant with the new rules. Entourage 2008 should also be compliant.
Amazing this stuff just doesn’t work.The significance of the iPhone SDK
It’s fascinating watching Apples strategy role out. They are doing some very clever things.
- Providing full access to the iPhone stack makes developers feel good and like they are in control.
- But Apple is tightly in control of the distribution and gets to clip 30% of each application sale as well as control what is on the device. This is an incredible market control mechanism and I’m sure will lead to anti-trust activity. But for now they appear to have pulled it off.
- iTunes with songs was clearly a Trojan Horse and now iTunes is an IP based distribution mechanism for movies and now applications. Any content. Apple have a global billing system.
- As bandwidth issues get solved iTunes becomes a superset of BluRay. They let the irrelevant HiDef format battle play it self out.
- The iPhone SDK of course only runs on a Mac. Windows runs on a Mac. So developers who are doing .Net development and want an iPhone client will develop on MacBook Pro’s. We are already seeing some of our dev people buying their own MacBookPro’s and connecting them to their company supplied Windows dev machines.
- Going with Microsoft Active Sync launches the iPhone immediately into enterprise land. Middle managers are consumers as well.
- Arch competitor Microsoft have delivered a very solid Office product for the Mac that allows Macs to work reasonably well in the Enterprise environment.
- They are positioning RIM (Blackberry) as a closed proprietary system. (Now isn’t that the pot calling the kettle black). Note also the reference to all messages going through Canada - ‘out of our country’. That’s hardball.
- Apple have also marginalized the carriers and introduced a global device that works both on carrier and pure IP networks.
- While doing all this they have still maintained a ‘cool’ brand and significant consumer good will.
Apple seems to be very coordinated right now and executing. It is impressive to watch.
So an interesting thing to think about is if you were in charge of Microsoft strategy what would you do? I’m not sure here are a lot of easy things you can do. To fight hard you would need to make some tough calls. I’m not sure I would have licensed Active Sync (but I’m pleased they did). Do they kill Mac Office? (I hope they don’t).
If you were RIM what would you do?
(sorry about the triple captcha on comments, will try to get that fixed today)Constitutions
I’ve spent a lot of time on Shareholders agreements and constitutions and it always feels like ‘this is a lot of time and a lot of money for something we probably will never again read once it’s done‘.
But watching Yahoo’s defensive maneuvering against a potential hostile takeover is a fascinating example of using company and shareholder structures strategically.
I’d never heard of a poison pill before. Also interesting the timing of the Microsoft announcement and how they may seek to captureÂ board seats.
And now the Yahoo severance plans.
Fascinating business lessons being played out.Evaluating SharePoint?
Michael Sampson has just released a whitepaper that will be very useful for organisations evaluating SharePoint.
This paper is for CIOs, IT Business Analysts and IT Organizations charged with evaluating the efficacy of SharePoint for team collaboration.
Michael is an international expert in Collaboration, and is based in Christchurch.
There is a lot of useful analysis here and I’m glad to see that Michael is charging a small amount for it. It’s an interesting model for people with particular skills to sell knowledge directly so I’m excited to see how it goes.
SharePoint is one of the massively growing business units at Microsoft and seems like fertile ground for extending and developing add-on products.Office:mac 2008
I’ve been running the beta’s of Mac Office for the past few months and was delighted when a box with the fully released Microsoft Office:mac 2008 with Microsoft Expression Media arrived on my desk on Monday night.
It’s amazing how long the release cycles are now is for Office. This version replaces Office 2004 for Mac, so it’s been a long time coming. This version is developed to exploit the new Intel chips in Mac’s so we’ve really been waiting for a year.
For me the incremental updates to desktop productivity tools isn’t as exciting as it used to be. Word and Excel are great products but they haven’t fundamentally changed in many years.
In the words of the Spice Girls, what I really, really, want is collaborative editing tools.
For me documents have 5 mins to maybe 24 hours of intensive activity - then they seldom change. In that intensive period of activity you are working over someones shoulder, emailing versions, revise, tweak, revise, tracking changes, waiting for another edit, revise etc, etc.
In these days of Software + Services and with the power of the modern computer Word should be a collaborative writing and editing surface where 1-10 people can be actively working on the same document, at the same time anywhere in the world.
Even 10 people continuously typing can only generate a tiny amount of data. A 1200 baud modem could keep up with that small amount of changes. Normally it’s type, pause, think, type. Maybe 30 words a minute.
How useful would it be to have a few people working on budgets in Excel in real-time?
Yes you can start to do sharing with Google Apps, but with the power of the installed productivity tools we should by now have rich, real-time collaboration.
So I think there still huge potential in desktop productivity software, but we need some real innovation here, not just another incremental update of the same disconnected model.
However, in terms of an incremental update, Office:mac 2008 is a nice bit of software. It has some of the best bits of Office 2007 but somehow seems simpler and cleaner. Entourage is nicer and even though it is mainly just better lipstick it is much, much nicer to use.
There are some weird Mac only bits like MyDay and the Project Center but I’ve found I just turn these off and try to keep things clean.
If you’re a corporate Mac user, Office:mac 2008 is a no brainer and I recommend the upgrade. We run a mixture of Mac’s and PC’s and they play together nicely. I’ve enjoyed my last year on OSX and find a Mac with Microsoft Office is the most productive way for me to work.
The Microsoft Mac Business Unit has done a great job. But my advice to the Office product managers is that the existing model of desktop productivity software is end of life. There is only marginal incremental value to add.Â Software + Services and using the power of the client for sophisticated real-time collaboration is where this product category has to go.On the proposed Microsoft, Yahoo deal
I’ve been a bit busy to really think about this too much (if it goes ahead) but I thought Fake Steve Jobs had the best analysis so far.
It’s like taking the two guys who finished second and third in a 100-yard dash and tying their legs together and asking for a rematch, believing that now they’ll run faster.
And the real risk to the deal is colorfully described here …
According to our spies in Redmond the general consensus among the Borg rank-and-file is sheer and total dread. At best they see this as a giant pain in the ass, an enormous drain on resources, an unnecessary and pointless distraction with lots of nights and weekends spent slogging away on random useless bullshit and dealing will all sorts of annoying non-Microsoft people who don’t understand how Microsoft does things but can’t be blown off or pushed around like the “partners” the Borg is accustomed to dealing with.
Imagine a circus act in which two enormous, clumsy, awkward elephants that don’t really like each other are supposed to mate while riding on skateboards. Now imagine that it is your job, you lucky bastard, to be one of the little circus clowns standing alongside trying to make this extremely unnatural and unholy act take place. Hundreds, maybe thousands, of people will have their lives completely ruined and flipped upside down for the next two years because of this deal. They’ll see even less of their kids. And those ski weekends? Forget about it. Ain’t gonna happen.
I love Fake Steve Jobs. Maybe I should create Fake Rod to say all those things I want to say but can’t.BillG retirement video
Noticed on Lance but so good I had to repost. Excellent.
Mommy, Where Do Servers Come From?
This is wild …
“Mommy, Why is There a Server in the House?” is a children’s book dedicated to “Helping Your Child Understand the Stay-At-Home Server.” At first we snarked at this over-the-top marketing propaganda. But then it made us crap our pants with laughter.
You can see the entire book here.Entourage and Time Machine
The problem: Entourage has one big store for it’s local mail cache (pst file). So how does that work with Time Machine?
Compatibility with Appleâ€™s Time Machine backup feature in Leopard is a database area that has received a lot of attention recently. Because Entourage uses a single file database, over time it can become large (sometimes really large). In those cases, Entourage data will not work optimally with Time Machine. Our recommendation is to exclude your Entourage Identity folder(s) in the Time Machine preferences
… we understand that our Exchange customers want â€œan Exchange client on the Mac with features, performance, documentation, and reliability on par with Outlook.â€ This is a goal that will be achieved in stages, through Entourage 2008, its updates, and beyond.
Hopefully not another 5 year wait.Leopard Easter Egg
The Apple engineers must have wet their pants with this one.
When you CoverFlow the network computers, here is how a Windows machine is displayed …
Love or hate MS, that is pretty funny.Microsoft and FaceBook
Looks like it’s happening.
$240m at 15bn. Yikes!Microsoft Global Case Study
Another little thing we’ve been working on over the past couple of months is completing this Microsoft Case Study, with a Redmond based team.
I do believe in the Software + Services model. Obviously there is benefit to Microsoft in involving client technology but there are important user benefits as well.
At a simple level, Office is a great example of introducing a rich client. We make sure we can get most data into Excel.
I think in the life cycle of SaaS we are in the early stages where we are pulling everything back to the server into the multi-tenanted SaaS model and implementing new applications over base SaaS frameworks.
Framework services include things like rendering, security, authentication, service points, reporting, provisioning, monitoring and a bunch more things. Communication with the core business logic is implemented in a Service Oriented Architecture (SOA) fashion so it becomes conceptually straight forward to access applications in other ways.
Next year we’ll see the introduction of off-line functionality inside the standard browsers, so new scenarios start to open up. Also I think we’ll see obvious scenarios where having the power of a client makes a lot of sense as well. Say for intensive computational work or for offline useage. These clients will access the server based logic we are all building now. In the browser cross platform client technologies like SilverLight and Flex make it even more compelling.
I think we’ll see more parts of applications delivered for the mobile web or even as mobile applications.
I’m certainly not precious on doing everything on the web but before we go to far in introducing rich clients we need get the applications written for the server first.
So I believe we’re still very much in the early phases of SaaS. The re-architecting and framework development that is going on now build the foundations for all sorts of delivery scenario’s over the next few years.Google Phone
Google are starting to peel back the layers on their gPhone strategy with this article in the NY Times.
Fascinating read. Here are some highlights.
Google is not creating a gadget to rival the iPhone, but rather creating software that will be an alternative to Windows Mobile from Microsoft and other operating systems, which are built into phones sold by many manufacturers. And unlike Microsoft, Google is not expected to charge phone makers a licensing fee for the software.
They will put it in the open-source world and take the economics out of the Windows Mobile business.
Googleâ€™s agenda is to disaggregate carriers
How about this howler from Arun Sarin who clearly does not get the power of software. In a similar vein to Thomas Watsons “I think there is a world market for maybe five computers” …
Arun Sarin, the chief executive of Britainâ€™s Vodafone Group, which offers the Google service on its phones, said it was not clear what compelling functions Google would offer that are not already available.
â€œWhat is it that is missing in life that they are going to fulfill?â€ Mr. Sarin said. â€œIt is not a no-brainer. You can reach Google already through a number of devices. You donâ€™t need a Google phone to do that.â€
Hope PaulB comments on that one :)
Googles intentions come through loud and clear. The battle lines are being drawn between carrier mentality and Internet mentality. With the ground softened by the iPhone launch.
This will be a riveting watch.
Never bet against software.Richer online applications
Has anyone noticed what Adobe’s been doing lately?
Adobe is quietly and steadily becoming a bigger player in Internet computing. I’d written off Flash as great for marketing sites but Adobe is driving Flash into a Virtual Machine. I would not have expected to see word processors and photo editors delivered over the web.
Adobes approach differs from Google. Google is sparse and light - more traditional web apps with lots of wizzy AJAX and CSS. Adobe is taking more of a design led approach with rich Flash applications. But there will be an front load time.
Microsoft should be leveraging their client advantage doing a Software + Services model. Collaborative Word. Imagine being able to jointly work on a Word document across the web. That’s what I want out of Word.
Microsoft of course has SilverLight - but will we see a SilverLight Word? I’m not sure that makes sense.
But no doubt Adobe has become a player and a charting quite a different model. It’s not a two horse race anymore.