Why Microsoft shouldn’t do a “Kin” Tablet

Posted on March 7, 2011 by halberenson

Hopefully I got you with that “Kin” reference, but it wasn’t just for sensationalism purposes.  For the last year every reporter/analyst/blogger out there has been waiting for Microsoft to pull some new Tablet/Slate thing out of its ass and challenge Apple.  The amount of noise around the Courier (a prototyping effort) and its cancellation is but one example of the noise in the system.  What they don’t understand is that at best some skunkworks project like Courier would be another Zune (a great technical achievement that didn’t fit with any other Microsoft product and achieved no significant market presence) and at worst another Kin (an incredibly embarrassing failure that makes everyone wonder how Microsoft could be so screwed up).  What Microsoft needs is not some skunkworks, one-off, counter-strategic tablet offering but a real, credible, 100% strategic, “future of the company” tablet.  And that just isn’t going to, just can’t, happen in 2011.  And I’ll try to go through why.  In the meantime, Microsoft will muddle through with tablets based on existing non-optimal but otherwise strategic platforms such as Windows 7.  And, hopefully Microsoft will reveal its full strategy this year as well.   Because much of the market will wait for Microsoft to deliver something tangible, but people won’t wait long if they think Microsoft just doesn’t get it.

This brings me to the three dynamics at play.  The first is what some not-so-affectionately refer to as “the lost 5 years”.  This is a reference to the Longhorn project and the Windows Vista release it delivered.  Essentially, Microsoft spent 5 years and put out a release that no one wanted.  This has kept Microsoft in catch-up mode for the last few years so, for example, instead of Windows 7 being about doing all kinds of wild and leading edge kinds of things it was about putting out a great traditional Windows release to shore up the franchise.  Mission accomplished.  Unfortunately, the market started to change while the Windows 7 effort was underway and has left Microsoft out of sync with the latest developments.  So whereas it was the pioneer in tablets, at the start of the Windows 7 effort tablets hadn’t caught on and little enhancement for them was planned.  And so Windows 7 shipped just a few months before the release of the iPad, with no focus on tablets other than the traditional Windows Tablet support.

The second part of this is the question of vision.  Does Microsoft just not get it?  There could be a lot of debate about this of course and it is not a black and white subject.  Again, Microsoft was the pioneer in tablets.  When it got into this a decade ago it targeted Information Workers first, both because that is a cornerstone of Microsoft’s business and because the hardware costs of the day would keep the technology out of the reach of consumers for a number of years.  However, lack of IW adoption soured many on tablets and there was a lot of continuing skepticism on when tablets would become mainstream.  Just to avoid making this seem like a pure Microsoft blind spot, at iPad launch most industry observers still questioned its viability.  They thought that a few enthusiasts would buy it, but that it was a niche market.  I’ve seen recent articles that still question the actual size of the tablet market.  Yes Apple sold 15 million iPads in the first year.  That compares to hundreds of millions of PCs sold each year and many more phones.  But I think most of us believe it’s the start of a major transition to computing based on Natural User Interface (NUI) rather than the Graphical User Interface (GUI) style of computing that has dominated since the late 80s.  And Microsoft has indeed demonstrated that it gets NUI.

How much of Microsoft’s tardiness in tablets is execution versus vision?  Look at pretty much any Microsoft video of the future from the last four years and you’ll see NUI and Tablets, and very little in the way of traditional PC (Monitor/Keyboard/Mouse) presence.  Here is a montage of the OfficeLabs videos that Microsoft put on the web a couple of years ago (and which you can also find on Microsoft’s PressPass site):

So then, why isn’t Microsoft aggressively delivering on this vision?  Go back to the “lost five years”.  Now imagine going to discuss the future shown in the above video with the Windows leadership at the start of the Windows 7 project.  Imagine getting told something like “that’s a great future, but we’ve forgotten how to crawl; we have to learn to crawl again before we can run”.  Remember Apple actually got into worse shape,  Not only had they forgotten how to crawl, they had just about drowned.  Microsoft actually bailed them out.  Sadly for Microsoft, Apple was just hitting its new stride as Microsoft found it needed to re-learn how to crawl.  But if you look at Surface, Windows Phone 7, Kinnect, and some NUI work that did make Windows 7, you can see Microsoft is actively working towards this vision even if not as aggressively as many would like.

So there is a third factor that I haven’t talked about yet, and that is Microsoft’s history with one-off projects.  Some years ago a number of people at Microsoft feared that the Playstation 2 Sony was working on would become an alternative to the PC in the home.  They concluded that just making the PC a better home entertainment device wouldn’t be enough to fight off the PS2, but that Microsoft needed to have its own gaming/home entertainment console.  And so the Xbox was born.  Freed from the constraints of compatibility with other Microsoft technology, the PC ecosystem, channel, etc. they focused very sharply on the gaming market and how to win it.  Despite a number of setbacks they had a huge success on their hands.  A model for going after consumer businesses was born and became the Entertainment part of the Entertainment and Devices business.  They tried again with Zune, achieving technical success but no market success.  Moreover, they actually screwed up Microsoft’s media story along the way which is now fragmented amongst Windows Media Player, Windows Media Center, and Zune.  Then with the Windows Mobile effort focused on Information Workers, they tried to create a consumer smartphone with Project Pink which eventually produced the Kin.  But a funny thing happened on the way to Kin; Microsoft woke up to the importance of the consumer smartphone and decided to mainstream the effort and make it a key platform.  Once the Windows Phone 7 effort was real, Project Pink made little sense.   Unfortunately it wasn’t killed, but I will leave that discussion for others.  The same forces saw that consumer tablets weren’t getting enough priority and started the Courier effort, with the same kinds of parameters.  In other words, it was a narrow response to a specific set of consumer needs but not likely a platform to make tablets mainstream.    And so while most observers saw the death of Courier as an indication that Microsoft was stifling innovation, I saw it as an indication that Microsoft realized tablets were too important, too strategic, to produce another Zune or Kin.  However, only time will tell which viewpoint is the correct one.  And “both” is an acceptable answer too.

Most observers yearning for a Microsoft (consumer) tablet in 2011 seem to either want a “Kin Tablet”, or a Windows Phone 7 tablet, or to put a better skin on Windows 7.  I’ve already dismissed the idea of a “Kin Tablet” so lets talk about the other two.  Windows Phone 7 was a crash effort to product a smartphone competitor, and the team was consumed morning and night (and weekends and holidays) with that task.  They produced a V1.0 release which didn’t ship until a few months after the iPad.  There is no way they could have produced a tablet version at the same time, at least not without having slipped the Windows Phone 7 release into 2011.  And that would have been fatal in the phone market.  They could have started to work on WP7 Tablet support this past October after the Smartphone shipped, but they do still have a lot to do to be competitive in the smartphone market.  Which should they prioritize, CDMA support so they can bring Verizon and Spring on board or a tablet?  What about support for Asian languages so they have a global product?  And now the Nokia deal.  Etc.  So while they could indeed be working on a WP7 Tablet, I think the primary mission for the WP7 team is to fight the Smartphone battle, and even if they want to do Tablet support they are tied up.  Yes, if Microsoft is desperate enough they could put together a separate team to tabletize WP7, so I don’t entirely rule out this possibility.  But I’m a skeptic.  One of the things Apple did right was to downsize Mac OS to create IOS rather than building something else that sort of looked like Mac OS inside.  As they upsize their IOS-based offerings, including potentially replacing Mac OS with IOS someday, this is a real advantage for them.   Android has a similar advantage with its Linux kernel.   Meanwhile Windows Phone 7 is still based on the Windows CE operating system kernel, and it has scale up issues.  Whatever other componentry is in play, I think Microsoft will want a mainstream tablet to be based on the Windows NT kernel used in mainstream Windows and Windows Server.  They should also bring the Windows NT kernel to their smartphones, but again that is off topic.

That leaves one other short-term possibility, skinning Windows 7.  That’s what Microsoft is encouraging OEMs to do, but it doesn’t provide a satisfying answer.  As we all found with the skinning of Windows Mobile 6 and 6.1, it wasn’t a competitive answer because as soon as you got below the skin the UI wasn’t finger friendly.  Even Windows Mobile 6.5 (and particularly 6.5.3), although finally fully finger friendly, was not a modern enough experience to maintain let alone grow market share.  For Microsoft to have a competitive tablet you need developers to build finger friendly apps, and for that you have to give them the tools, APIs, and guidance for them to really fit into the platform.  That also implies an optimized NUI experience for the platform.  And what about an App Store?  Are you competitive without one?  And you don’t want to send developers down the path of developing for one application model/UI model in 2011 and then introduce a different one a year or two later.  So I don’t see Microsoft trying to take Windows 7 too far down the consumer tablet path as it would just be another WM 6.5.  Too little, too late.

So what will Microsoft’s real consumer tablet solution be?  Well, to quote Sherlock Holmes, “when you have eliminated the impossible….”

Posted in Computer and Internet, Microsoft, Mobile, Windows, Windows Phone | Tagged , , , , , , | 3 Comments

No Windows Phone 7 “Mango” in 2011? Really?

Posted on March 7, 2011 by halberenson

I haven’t spoken to any of my “sources”, so this is pure analysis and not an attempt to add to the rumors.  I believe there will be a fall release of Windows Phone 7, but that doesn’t mean there couldn’t be something true in the rumors.

One of the things that Terry Myerson (CVP of Windows Phone Engineering) and his team have proven is that they know how to do schedule driven releases.  And I think they understand better than anyone out there how critical it is to have a major update to WP7 in the market to support holiday 2011 phone sales.  So let me dig into things a bit and explain why I think there could be some conflicting information floating around.

There are two important developments that have occurred since the original WP7 plans were put in place.  The more recent, the deal with Nokia, is very public but none of us know the details.  The other is the way the Update mechanism works.  Let’s talk about Nokia first.

Unlike other deals with device manufacturers the deal with Nokia is a strategic partnership in which Microsoft has clearly made commitments for changes to WP7.  No doubt some of those changes have been committed for this fall to support Nokia’s desire to ship its first WP7 devices late in the year or early 2012 at the latest.  I suspect that the changes for Nokia are putting pressure on the “Mango” work.   As I’ve opined before, it is very difficult to do multiple releases concurrently and thus shipping a pre-Nokia “Mango” as well as a Nokia-specific release only a couple of months apart wouldn’t fly.  Not only that, but if the Nokia driven changes have app developer impact then Microsoft has to get releases to developers months in advance.  So I suspect Microsoft has indeed pushed out the “Mango” schedule by a month or two in order to incorporate some “must have” Nokia requirements.

Which brings us to the update strategy.  When the WP7 project started I’m sure Microsoft was hoping to have the same level of control over updates that Apple has.  But Apple has a very different situation.  They control not only IOS, but also the hardware.  And most importantly, from a carrier’s perspective, they handle support.  So if the IOS 4.77 update breaks something on your phone then you go to Apple for support.  WP7 and Android ship to hardware manufacturers who add to the base operating system, test it for their devices, and then ship those devices to carriers to sell them to end users.  When a problem with your ATT Samsung Focus or Verizon Droid Incredible occur you call ATT or Verizon.  And there is the rub with updates.  If the carrier has to do the support, and they rely on the device manufacturer to add drivers and other software and then stand behind the individual devices, then both the carriers and the device manufacturers need time to do their own updates and testing before a Microsoft (or Google) update is pushed to a device.  So you add months, anywhere from 2-4 I would guess, from the time Microsoft is done with an update until that update is ready to be pushed out by the carriers.

The selective carrier/OEM update dynamic, which was one of the most frustrating aspects of the old Windows Mobile world, is showing itself very painfully in the Android world.  Many Android phones are running a version or two behind the current version of Android and many of those will never see an update to a newer version!  What we don’t yet know is what will happen with WP7.  If I had to guess it would be that Microsoft is trying to split the difference between the Apple and Android worlds on Update just as it has on so many other things with WP7.  So, for example, it may have explicit agreements with both the device manufacturers and carriers and how long they can take to push an update out and when they can drop support for a particular device.  Maybe they tie this to the Chassis (e.g., they’ll retire all 2010 Chassis 1 spec devices at the same time), or maybe they require something like “you must make available any updates Microsoft publishes for a device whose last date of sale is within the previous 12 months”, thus making sure customers will get at least one major update after they purchase a phone.  Actually this makes a lot of sense if customers really upgrade devices every two years since it both means that customers don’t fall behind while they wait out their contract and the carrier still has a way to incent you to get a new device and contract at the two-year mark.  But this is a little off topic.

Now let’s get to the fall holiday shopping season and put all this together.  The big priority for device manufacturers, carriers, and Microsoft is to have a great lineup of new devices ready and in the market for the holiday shopping season.  So we can expect to see the Samsung WeGotTheBestTech, HTC WeOwnYourAss, LG WeGotItToo, Dell WeveGotThisPhoneThingFigured Out, and perhaps the Nokia NowYouKnowWhoseBoss coming out in October or November at the latest.  Now Samsung, HTC, LG, and Dell (as well as the carriers) have limited resources and the question you need to ask is, will those resources be focused first on getting out their new fall lineup or on getting the “Mango” update out to existing Focus, HD7, etc. customers?  I think the answer to that one is pretty obvious.

When you put all this together I think a very plausible scenario is that new devices running “Mango” will ship on time in the fall of 2011.  But that the push of “Mango” updates to existing devices will slip into early 2012.   Anyway, this explains the conflicting rumors.  Microsoft will meet its fall schedule for “Mango”, but because of the way the update process works, and the resource conflicts with shipping new devices, it may indeed be impossible for existing devices to be updated until 2012.

Posted in Computer and Internet, Microsoft, Mobile, Windows Phone | Tagged , , , , | 3 Comments

Nokia/Microsoft: Why was it important to industry dynamics

Posted on February 14, 2011 by halberenson

Yesterday I spotted a chart on another blog showing what would have happened had Nokia chosen to go with Google Android.  If you simple converted Nokia marketshare to Android, Android starts to dominate the way Microsoft Windows dominated in the 1990s.  If you read my earlier post about it being game over in Smartphones that is pretty much what I predicted the outcome of the Smartphone war would be.  Of course that’s exactly the scenario that caused Nokia and the other mobile phone manufacturers to partner in creating Symbian.  Back in 2001 they didn’t want Microsoft to gain the same dominance on phones that they had on PCs.  Now in 2011 Nokia doesn’t want Google to gain that equivalent level of dominance on phones.

From Microsoft’s perspective they probably viewed Nokia partnering with Google as an existential threat, at least in the non-PC device space.  As a result I suspect Elop was able to get Nokia an awesome deal, both financially and in terms of influence over the Windows Phone platform.

Overall the Nokia/Microsoft deal probably means that we are on path for there to be three viable mobile operating systems.  It is unlikely that any one vendor can dominate the way Microsoft dominated the PC market.  And this increases the power of the phone manufacturers and carriers.  Which is exactly what they wanted.

Nokia has probably ensured Microsoft’s success in Smartphones.  And it may have ensured Microsoft success in Search (which is increasingly about Mobile Search).  But Microsoft will likely never have the power in either space that it enjoys in PCs.

 

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The real significance of the Nokia/Microsoft deal

Posted on February 11, 2011 by halberenson

When you think back over the history of the “Wintel” PC industry what you really think about is all the partnerships that made it thrive.  Of course you have the cooperation of Microsoft for software and Intel for silicon at the industry’s core.   But you also have all the large system vendors, then existing as well as those that emerged, committing to the platform.  It was IBM (#1 in the IT industry) who first established Wintel as the leading PC platform.  Digital Equipment Corporation (#2) jumped on board as well.  HP (#3).  Unisys.  Fujitsu.  NEC.  Etc.  On top of that new industry giants such as Compaq and Dell were born.  Consumer-focused giants like Sony jumped on board as well.  All of these players committed to Microsoft DOS and later Windows as their primary, if not exclusive, operating system in the PC market.  Other platforms did pop up from time to time, such as OS/2 and more recently Linux, but essentially these companies had truly committed to the Microsoft platform.  Many people tried to replace Intel in this equation, but only AMD (with a clone x86 strategy) had significant impact.  DEC tried Alpha.  A number of players offered Windows NT running on MIPS processors (based on a MIPS PC reference design done by Microsoft).  A port of Windows NT to the PowerPC architecture for IBM was apparently started by never released into the market.  So we ended up with Wintel.  But the system vendors played an equal, if not greater, part in the success of the PC ecosystem.  Other than hobbyists and some power users, who buys an Intel processor and a copy of Windows and builds their own computer system?  The real successes came from IBM creating the first system with mass-market appeal, Compaq creating the portable PC market, Dell creating a new business model that brought inexpensive, customized, good quality computers directly to your doorstep, Sony bringing some of the design magic that had eluded companies whose origins were in computers, etc.  More recently you can see examples like HP investing in and introducing all-in-1 PCs with touchscreens based on Windows Vista while Microsoft itself didn’t get serious about touch until Windows 7.

The mobile market has evolved very differently, particularly for Microsoft.  While Microsoft was an early player in smartphones, with both its first operating system (then called Pocket PC Phone Edition, later Windows Mobile) and industry leader Symbian coming out in 2001.  Both, by the way, were evolutions of PDA operating systems (Microsoft’s Pocket PC and Psion’s EPOC).  But while Nokia and other mobile phone industry leaders lined up behind Symbian as their primary platform, Microsoft failed to attract any major mobile phone makers to fully commit to its mobile OS.  While no doubt there were technical reasons for this, there were huge industry political issues as well.  This was the era of the DOJ antitrust suit, EU investigations, and a strong “Anybody But Microsoft” movement.  No doubt the mobile phone “system” vendors feared Microsoft gaining control of the mobile phone ecosystem the way it dominated the PC system vendors in the PC ecosystem.  Symbian was their solution.  Though Motorola, then #1 in the U.S. and a strong #2 worldwide, went their own route.

For Microsoft the savior in the mobile space was Taiwanese startup HTC.  HTC initially gained notoriety for designing and manufacturing the iPaq for Compaq Corporation.  The iPaq, for those unfamiliar with PDA history, was the device that finally clicked with consumers and allowed Microsoft’s Pocket PC to challenge and eventually (just as the market for PDAs evaporated) beat Palm at its own game.  The device was in short supply for many months due to demand.  They were so highly prized that Microsoft used them as contest giveaways, the way that an XBox 360 with Kinnect would be used today.  Of course HTC’s name wasn’t on the device, but it had established itself as the leader in design and manufacture of PDAs for others.  When Microsoft entered the smartphone market so did HTC, with many devices under many brands actually being designed and manufactured by HTC.  Later HTC would start to create and sell smartphones under its own name, and become the lead maker of Android-based smartphones.  Essentially HTC is the “Compaq” of the smartphone system vendors.  The new kid on the block who made good.  Without HTC, Microsoft would either have had to makes its own smartphones or abandon the business.  HTC continues as a key Microsoft smartphone partner, but now devotes more attention to Android.  On top of that, HTC wants to heavily differentiate its offerings from those of other manufacturers.  This is something in conflict with Microsoft’s desire to have a fairly uniform experience across Windows Phone devices.  HTC can and does customize Android, and has even made noise about creating their own smartphone OS (although that seems like a level of arrogance that will eventually be their downfall). 

Because of Pocket PC/Windows Mobile’s popularity with corporations (particularly prized for its ability to access corporate Exchange email servers) many phone manufacturers adopted it in niche portions of its business.  Motorola, after considering and abandoning several Windows Mobile concepts, introduced the Q series to compete with RIMM’s Blackberry.  And Samsung, who toppled Motorola to become the #2 industry player, has long had a presence in the Windows Mobile market.  They’ve also made some of the best devices, such as the Blackjack and most recently what is probably the best Windows Phone 7 device, the Focus.  But at the same time they were more focused on Symbian last decade, and are now quite focused on Android (and the proprietary Bada).   LG (#3 in the industry) also is a multi-OS player.  Motorola (currently #4) eventually decided to focus all its smartphone energy on Android.  The bottom line here is that, at least until today, Microsoft had no phone vendor partner who is either dependent on Microsoft for their own success nor dedicated to making sure their own best ideas are brought to Windows Phone devices.

Which brings us to Nokia.  It appears this isn’t just a “Nokia will offer a few Windows Phones” deal, but rather a “Nokia is betting its future on Windows Phones” deal.  That makes it the first time ever in smartphones that a major player has committed to the Microsoft platform.  It brings the dynamics that Dell, Compaq, HP, and others had over the years with PCs into the mobile device market.  It means that Nokia’s best hardware ideas will show up on Windows Phones.  And as the first, and so far only, phone manufacturer with this level of commitment, it means that they will have considerable leverage in shaping Windows Phone.  Not as much as they would have had 2-3 years ago, but considerable leverage nonetheless.  Let me give an example.

In late 2008 I suggested to the lead on the Windows Phone 7 Chassis 1 spec that they ought to include a front-facing camera (or more precisely, raise its status to one where Microsoft would directly support them).  Since I lived remote from Redmond I was involved in video conferencing from my PC nearly every day.  I’d also observed the growing adoption of video calling by consumers using Live Messenger, Skype, etc.  So I thought that there would be great demand for this capability on smartphones as I often found myself needing to participate in a video conference or call when I was away from my PC.  The chassis team asked for market data, etc. that would justify prioritizing my request (meaning, they didn’t reject it but felt there were many more important things to do first; and they were right).  I had no data because this was just an observation, I was hoping their hardware partners would provide the justification.  Imagine if this request had not come from me but rather from Nokia?  By the time I made my suggestion the Nokia E71, with its front facing camera, had already shipped and established itself as a leading smartphone of its day.  Nokia would have been in a position to tell the chassis team not only real market data, but that it was critical to them in order to not have a Nokia Windows Phone be a step back from their existing Symbian line.  I’m sure Samsung, HTC, and others gave them some feedback in support of a front facing camera.  But none could have the leverage of “we’re betting on you, and we will fail if you don’t prioritize this appropriately for us”.

One of the major features Apple introduced on the iPhone 4 was a front-facing camera.  One of the criticisms of Windows Phone 7, coming a half-year after the iPhone 4, was its lack of front-facing camera support.  Imagine how differently this would have turned out if the deal announced today between Nokia and Microsoft had been in place two years ago.  For Microsoft it would have meant being a leader rather than a laggard.  For Nokia it would have meant having a really cool (and WP7 is, even if still a little immature) OS that supported building the kinds of devices they are leaders in.

So how does this deal impact Microsoft’s other mobile device partners?  I’ve previously mentioned that in a deal of this nature Microsoft would have to be careful not to alienate their other partners.  For those partners I think there are three options.  One is to maintain the status quo of having Windows Phone 7 devices as one of their offerings, but continue to focus on Android.  A second is to abandon Windows Phone 7.  There may be players who decide that since they can differentiate from Nokia more strongly using Android, and they already have a bigger investment in Android, they should simplify their offerings.  The third option would be to join Nokia in more fully committing to Windows Phone.  Nokia is going to do a lot to legitimize and popularize Windows Phone, making it easier for others to grow their Windows Phone business.  With the first option they just ride Nokia’s coattails, and that might be ok.  But those who want the same kind of influence over Microsoft as Nokia has now achieved would have to step up to the plate and show Microsoft the same kind of commitment.

We shouldn’t fool ourselves however, Windows Phone 7 remains an underdog and Nokia a badly wounded giant.  But whatever the final outcome for both Microsoft and Nokia, this deal certainly changes the dynamics of the mobile phone industry.

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Ken Olsen: Tractors and Computers

Posted on February 9, 2011 by halberenson

Olsen – Tractors and Computers

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Satya Nadella replaces Bob Muglia as head of Microsoft’s STB

Posted on February 9, 2011 by halberenson

As internal candidates go Satya is an inspired choice to lead STB.  He’s done a great job since taking over the Search/Ad/etc. engineering team.  He has a background in servers, spent a good chunk of time building apps on top of STB’s offerings so he has the customer perspective, and of course he’s been operating in the cloud world the last few years.  He also shares some of Bob Muglia’s better characteristics and I think there will be less culture shock to STB than other candidates would have brought.  Great choice Steve.

BTW, one of the things about Satya is that people consistently underestimate him.  I think Bing may finally have put that to rest.  But if the folks at Oracle etc. are saying “Satya Who?” with a chuckle, they are making a mistake.

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Microsoft: Ken Olsen’s ultimate success?

Posted on February 8, 2011 by halberenson

Ken Olsen, founder of Digital Equipment Corporation (DEC), passed away last weekend.  I’ll get to personal memories in a moment, but first I wanted to comment on his real impact on computing and the high-tech world we live in.  While DEC’s direct influence within the computer industry ended in the 1990s, the influence of its employees continues on today.  Look at the list of the most senior engineers (“Fellows”, “Technical Fellows”, “Distinguished Engineers”, and the like) at companies like Cisco, Intel, and Microsoft and you’ll find a disproportional number who came from DEC.  Microsoft has hundreds, if not thousands, of ex-DEC employees.  They’ve been responsible for some of its greatest successes, most notably Windows NT and its successors (Windows 2000, Windows XP etc.).  Microsoft Sr. Technical Fellow and former DEC Sr. Corporate Consulting Engineer Dave Cutler is still at it, helping drive Windows Azure.  And of course I can’t get away without mentioning that SQL Server 7.0 and its successors owe a significant part of their success to a few of us ex-DECies.   Cisco was founded by ex-DECie Len Bosack and his wife, and Len has talked about how Cisco’s first product was an Ethernet board for the DECsystem-10.  But Ken’s legacy is about more than the success of DEC, or the employees it produced and their subsequent successes.

In Bill Gates’ library, not far from Leonardo da Vinci’s Codex, sits a set of DECsystem-10 (aka, PDP-10) manuals.  Microsoft co-founder Paul Allen is so passionate about the DECsystem-10 that he has long owned one and more recently started a living (meaning you can still use them) computer history museum with the DECsystem-10 and other DEC PDP computers at its core.  For the last 20 years most young people have gotten their introduction to computers, and their passion for technology, from the personal computer.  For the 20 years prior to that it was from using computers produced by DEC.  Most of what we know of in computing today has connections to DEC.  Java, Open Source, Ethernet, web search, Unix (and thus Linux), etc.  Storage giant EMC started out making memory boards for DEC computers.  One could write a book about DEC’s involvement (directly and indirectly) with the creation of the Internet.

Bill Gates and Paul Allen discovered, and developed their passion for, computing thanks to a DECsystem-10 they used in High School.  Without that DECsystem-10 it is very possible they would never have developed a passion for computing and started a software company.  Instead of creating Microsoft, perhaps there would have been a Jr. Gates joining his father at Preston, Gates, and Ellis.   So I think it is quite fair to give Ken Olsen some of the credit for Microsoft.

I’m another one of those whose passion for computing was ignited by DEC.  Although I was born into a computing family (my father was ex-IBM, and ran IT organizations throughout his career) and had exposure and access to computers literally from birth, it was using a PDP-8 running TSS/8 and DECsystem-10 that switched my career ambitions from Microbiology to Software Engineering.  After a couple of years working for DEC’s customers I fulfilled one of my earliest career ambitions and joined DEC,  initially as a software support specialist in the NY District.  A few months later I met Ken for the first time.  The NY District held its annual sales meeting (really a 2 day party) at one of the famous Catskill Mtn resorts, Grossinger’s.  Ken flew in to give the keynote and hung around for the cocktail party.  Somehow Ken, a tea totaler who would later use the results of a lawsuit that Wang lost to ban alcohol at all official DEC functions, managed to be gracious while chatting with (drunk) sales people and (tipsy) support people.  A small group of us must have spent 10 minutes trying to get him out on the basketball court.  We came THIS CLOSE to success.  I think he really wanted to go shoot some hoops, but didn’t think it was appropriate for the event.

The last time I was able to talk to Ken 1-on-1 (other than to say hello in the hall) was in the mid-80s.  Ken was trying to get DEC’s leadership to really understand how difficult it was to install and configure DEC systems, so he set up an offsite and gave each of his direct reports an assignment.  They had to order the hardware and have it delivered to an area of DEC’s  huge (largest computer manufacturing plant in the world) Westminster facility.  There they had to set it up and get the system configured and working.  While the original assignment required these senior executives to do it all on their own most ended up bringing along a technical person to help.  I was one of those technical people.  Fortunately I was able to actually attend Ken’s staff meetings during the offsite and see how his staff interacted.  Before the start of the wrap-up meeting Ken and I chatted for about 10 minutes about the problem and what I thought needed to be done.  About a minute later the meeting came to order and Ken just started beating the crap out of his directs.  You could tell who were the experienced hands and who was new to this.  Jack Smith, who owned both engineering and manufacturing (and might have held the COO title by that point) wasn’t phased at all (actually, he joked about it during the meeting).  My boss, who technically reported to Jack but had recently started essentially dual-reporting to Ken, was visibly shaken by Ken’s somewhat personal attack on him.  In the end it worked as Ken was able to fairly quickly drive everyone to agreement on a set of (then groundbreaking) decisions.   One was a recommendation I made during our 10 minute chat.  In my career I have often reflected on the dynamics in that meeting.  Ken created a culture at DEC that made leadership, even for the CEO, an exercise in herding cats.  Herding, even with pack animals, is not a gentle activity.  Cats take extra-large prods.

At orientation on my first day at DEC our District Manager told us that the way DEC does things is to treat each of us like we were running our own business.  We wouldn’t get much oversight, and we’d have to sink or swim on our own.  My immediate manager made it clear he wasn’t going to interfere much in day-to-day activities, but that he was always available to help when I needed it (and indeed he was, and was quite good at it).  Over the coming weeks I would learn that DEC (at least in the 70s) had little bureaucracy but was instead “organized chaos”.  Yes, those of us on the front line actually used the phrase “organized chaos” to describe the overall management style.  In management texts what DEC is famous for was being a pioneer in Matrix Management.  You can imagine how those two things go together.  If you have multiple bosses then how on earth could you have a hierarchical management style, or in fact impose much bureaucracy.  Instead it was up to each employee to interpret the potentially conflicting goals and direction from his two (or often more) reporting relationships.  The philosophy Ken espoused at DEC was simple, “do the right thing”.  This made sayings like “do it and apologize later” very real.  After all, if you are doing the right thing then you don’t have to worry that you didn’t actually get permission.  That’s very empowering. 

Another of Ken’s philosophies was that “the engineer is responsible for building the right product”.  He made it clear that engineers couldn’t just take direction from product management, marketing, and sales, build the product they called for, and then point fingers at them when the product failed.  The engineer had to really understand what it was customers needed and build the right product.  It is a philosophy I took to heart and have adhered to throughout my career.  It also was an early source of friction for many ex-DECies when they joined Microsoft.

If you read the book Showstopper, about the creation of Windows NT there is a passage about how Dave Cutler and the other ex-DECies pushed back on Microsoft’s concept of Program Managers.  Microsoft had essentially split the role of software engineer in two, a Program Manager who determined what the software should do and look like (e.g., wrote the functional specs) and a Software Design Engineer who did internal design and wrote the code.  In the Microsoft model the PgM is the one responsible for building the right product and the SDE is absolved of that responsibility.  When I read the passage in Showstopper I immediately understood the reaction of the ex-DECies.  How could anyone who had spent years in a culture where they were responsible for building the right product yield that responsibility to others?  And often far more junior others.  Those of us who grew up with Ken’s philosophy never could quite shake it at Microsoft.  If you look at the organizations where ex-DECies hold leadership positions the SDE discipline tends to have more control over product direction then PgM, unlike those organizations without a significant ex-DEC presence at the top.

Almost everyone knows about Bill Gates’ Internet Tidal Wave memo of 1995, fewer know about Ken Olsen’s “Tractor”, “Puke-Colored Foam”, or “MBA” memos (actually, I don’t recall the real names but those are how I think of them).  Of course they were written in pre-email days so they aren’t floating around the web (though if someone has scanned and posted them I’d love a link).  Tractor was about Ken’s visit to a Ford dealership to buy a new tractor.  He described the sales process and then compared it with trying to buy a computer from DEC.  It was a call to action to for a change in how DEC did business.  Despite one of Ken’s most famous quotes about computers in the home, Puke-Colored Foam, was about Ken’s experience having a DEC computer delivered to his home and how DEC really needed to change in order to address the home market.  For example, the computer came in a box too big to fit through standard house doors.  Ken had to open the box and remove the computer out in his driveway.  But the most amusing part of the memo was Ken’s reaction to the yellow foam the computer was packed in.  Yes, it was puke-colored.  But not for long.  MBA is in some ways my favorite.  As with most companies, DEC had started to hire a lot of MBAs (and specifically Harvard MBAs, so perhaps the memo was an MIT grad taking a stab at Harvard grads) and immediately place them into key positions.  Ken thought this was a mistake.  As with a number of things Ken said over the years, the memo was somewhat misinterpreted.  Everyone thought that Ken was just railing against MBAs.  A careful read of the memo showed that what Ken was objecting to was putting MBAs with absolutely no real-world experience in positions of authority.   Ken’s point made a lot of sense.  You’d never take a freshly minted PhD and make them head of a department.  Even after they have the degree they work their way up from junior pond scum to pond scum  and onward before eventually getting into a position of authority.  So why do companies hire MBAs who have never held a full-time job and put them in charge of departments or give them significant authority starting with their first day on the job?  It’s hard to communicate how insightful these memos were and how great an impact they had.  I guess you had to be there.  But walk up to any DEC employee of the 1970s, mention Ken’s tractor memo, and watch them form a knowing smile.

I think I’m done rambling, but not because there aren’t more stories to tell and more pointers about Ken’s influence on the computer industry.  I also barely knew the man.  But I did work for the company he founded for 18 years, 17 of those under his leadership.  He had a huge influence on my life and my career.  Ken will be missed.

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Microsoft and Nokia, a match made in hell?

Posted on February 6, 2011 by halberenson

The rumors are once again swirling on the topic of Nokia adopting a Microsoft operating system for its smartphones.  A few years ago there were rumors about Nokia adopting Windows Mobile specifically for the US market, where its Symbian-based phones had essentially zero market share.  It never happened.  Could the rumors about Nokia adopting Windows Phone 7 in some fashion be more accurate?

We do know that the mobile device market is quite different today.  Three years ago Nokia held an overwhelming lead in smartphones outside North America with its Symbian-based phones.  When I say overwhelming I mean shares of over 95% in many countries and over 80% worldwide.  Two years ago it was obvious that Nokia was in trouble.  You could look at the market share numbers and see that every point of market share that the iPhone gained was coming directly from Nokia.  Nokia wasn’t ignoring the situation, though I suspect in its arrogance it thought its market share, customer loyalty, and carrier relationships would give it a lot of time to respond.  However  Nokia’s attempts to forge its own (later in partnership with Intel) Linux-based OS to replace Symbian have turned out to be too little too late.  Today Nokia looks like it is in a death spiral.  It still has absolutely no presence in North America, its market share continues to drop, it still is surviving on its Symbian legacy, and the ability to build an ecosystem around yet another new OS is questionable at best. 

Of course Nokia has also had a change in leadership at the top, with former Microsoft exec Stephen Elop now its CEO.  While Elop is probably more open to the idea of using Windows Phone 7 than his predecessor, I wouldn’t count on his previous association with Microsoft as necessarily making him lean in that direction.  What I would take into consideration is that Elop knows quite a bit about both the Windows Phone strategy and all the other mobile-related activities going on at Microsoft.   And that gives him an unusual perspective in trying to negotiate a relationship with Microsoft around Windows Phone 7.

Before I dig into the possibility of Nokia using Windows Phone 7 I should point out why this is somewhat of a “match made in hell”.  Had Nokia wanted to partner with Microsoft two to three years ago, when they were still in a leadership position, they would have been operating from a position of strength.  A Nokia-Microsoft partnership would have been compared to the IBM-Microsoft partnership that made MS-DOS, and then Windows, the dominant PC OS.  Nokia’s ability to influence Microsoft, obtain some level of exclusivity or special offering, perhaps even to become an equal co-partner on Windows Phone 7, would have been very high.  Today, with Nokia on the ropes, it isn’t clear that Microsoft would want to do anything with Nokia that harms its relationship with Samsung, HTC, and LG.  So both parties are negotiating somewhat from positions of desperation.

I think there are essentially three scenarios for Nokia adopting Windows Phone 7.  They range from ho-hum to wow.  Lets start with ho-hum.  Nokia’s biggest business weakness is that it isn’t a significant player in the North American market.    Turning around its business overall gets a lot simpler if it can become a big player in the US.  It can’t do that by continuing to beat its head on the wall with Symbian and there really isn’t time to build a successful ecosystem around a new OS.  That leaves Android and Windows Phone 7 as the only vehicles that would allow Nokia to quickly enter the US smartphone market.

On the surface Android seems like a more obvious choice.  Nokia was already going down the Linux route, Android would preserve that and some of their MeeGo-related investments.  Nokia would probably want to customize the user experience to more of a Nokia experience, and Android lets them do that far more than Windows Phone 7.  On the other hand, if this is purely a North America play then these advantages are likely unimportant.  Nokia would be seeking a low software investment approach while it focuses on something else for its world-wide strategy.  And the Android world is just saturated with great devices.  Motorola is hitting it out of the park with both low-end and high-end Android devices.  Samsung’s Galaxy S/Nexus S are perhaps the best high-end phones out there.  And everyone else under the sun is in this business.  Could Nokia really stand out in this crowd?

On the other hand, there is no established leader in the Windows Phone 7 market.  Sure the Samsung Focus is an awesome device.  And the HD7 is well-loved.  But the number of devices is still limited, all of the Windows Phone 7 manufacturers are conflicted in also having Android offerings, and no one really has mind share yet.  A Nokia entering the US smartphone market focused entirely on Windows Phone 7 has a good shot at becoming the leading provider of Windows Phone 7 phones.  As small as Windows Phone 7 is compared to Android right now, Nokia’s unit volume would likely be higher and the mind share it would establish would certainly be higher.  And the mind share is important, because if Windows Phone 7 is only a North America play for Nokia then someday it will want to bring whatever its worldwide play is to North America.

Another consideration is the marketing assistance that Microsoft is likely to provide to Nokia should it enter the Windows Phone 7 market.  We all know Microsoft is spending heavily to establish Windows Phone 7, and no doubt much of that money is going to joint marketing efforts.  For example, do you really think that AT&T is paying the full cost of all those Windows Phone 7 ads? 

Finally, there is an intangible here.  To some extent both Microsoft and Google are competitors to Nokia because of its own software and services aspirations.  So you have to ask who does Nokia fear more, Microsoft or Google.  I have no doubt it is Google.

A second possible strategy is that Nokia goes with a high/low worldwide strategy with Windows Phone 7 as its high-end OS and then either sticks with Symbian, continues the move to MeeGo, or goes with Android on the low-end.  I’m not going to go into this one too much, but it seems like it could be a winner or loser depending on the details.  Sure they could be in both the Android and Windows Phone 7 businesses, just like Samsung and HTC.  Or they could use Symbian to hold the fort as Windows Phone 7 increases its range.  But I don’t understand how MeeGo would fit in, because they still have the problem of building an ecosystem in a world where IOS, Android, and Windows Phone 7 (taking advantage of the large existing .NET/Silverlight/XNA ecosystem) have sucked up all the development resources.

The most exciting strategy is of course the one where Nokia adopts Windows Phone 7 as its full next generation smartphone platform replacing current plans to move to MeeGo.  This is where two things I mentioned earlier come into play.  The first is Microsoft’s likely reluctance to give Nokia much special consideration because it could alienate other partners.  With its other partners, particularly Samsung and HTC, committed to and leaders in the Android market Microsoft would see Nokia’s exclusive adoption of Windows Phone 7 as sufficient justification to risk alienating other partners.  They would probably mitigate this by avoiding doing anything exclusive in the core platform (not that this is out of the question), but rather by partnering in other areas.  For example, Microsoft and Nokia have an existing partnership (negotiated by Elop while he was at Microsoft) around putting Microsoft Office capabilities on Nokia Symbian devices.  One could imagine Elop seeking to expand that partnership to offer greater information worker capabilities on Nokia devices than on those available elsewhere.  One could see taking this another step forward , with Microsoft and Nokia collaborating widely to make Nokia the lead partner as Windows Phone 7 addresses the corporate market.  Elop’s knowledge of other activities around Microsoft could lead to partnerships in other areas.  For example, is there something that Nokia and Microsoft could do to bring enhanced Search-based capabilities to Nokia devices over those in the core platform?  What is going on in MSR that Nokia might want to partner with Microsoft to productize?  What about a broader partnership (Microsoft already licenses data from Nokia-owned Navteq) on maps and navigation?  Or collaboration between Windows Live and Ovi services?  It is also possible that in order to land an exclusive deal with Nokia, Microsoft would make core platform change that were not exclusive to Nokia but that forced Microsoft to change some of its approach with Windows Phone 7.  For example, what if in order to land Nokia Microsoft had to allow them to do more customization than it currently allows or desires to allow?  This is probably something they would then provide to all of their device partners.

The key here just how broad and exclusive Nokia’s commitment to Windows Phone 7 would be.  If this is a North America only play then I think from Microsoft’s perspective they are just another device manufacturer and this is more important for Nokia than Microsoft.  However, if Nokia totally replaces its MeeGo strategy with a Windows Phone 7 strategy then its a game changer.  For Nokia, Microsoft, and the mobile device industry.

Sadly I think the most likely announcement is that Nokia is dumping MeeGo in favor of an Android strategy, or perhaps an Android plus Windows Phone 7 strategy like Samsung and HTC have.  This will be good for Nokia, and in the later case reasonably good for Microsoft.  But it won’t change the dynamics of the smartphone market at all.

Posted in Computer and Internet, Google, Microsoft, Mobile | Tagged , , , , , , | 12 Comments

Windows 8 Rumors

Posted on February 3, 2011 by halberenson

A little over a week ago articles appeared claiming availability for Windows 8 would be January of 2013. I hope not. The tablet space is moving fast and I just can’t see Microsoft coming back from missing two more Christmas holiday seasons. Even missing one, the 2011 season, is going to be painful. They have to be fully in the market for 2012.

As I mention in https://hal2020.com/2011/01/23/is-it-game-over-in-smartphones/ Windows Phone 7 arrived a year too late to keep Android from truely establishing itself as the leading smartphone platform. Missing 2011, an almost forgone conclusion, makes it likely that Android will establish itself as the leading Tablet platform. Missing 2012 would allow it to build a likely insurmountable lead.

Microsoft seems to be counting on its success in the enterprise to allow it to overcome both Apple and Android’s lead in consumer tablets. But history is not kind to those who have held similar viewpoints in the past (e.g., IBM). The end user leads, IT follows.

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What’s all this I keep hearing about 4G?

Posted on February 2, 2011 by halberenson

While I wait for the pipes at home to thaw, or burst and thaw, I might as well get in a quick blog entry. Every mobile carrier in the U.S. is out advertising 4G, so I went in search of it. Now getting 4G at my home is something that won’t happen until hell freezes over (though with last night’s -20F temperature that might be more than an expression) but I figured I probably could get it at my office. I lease a small office in Castle Rock Colorado. Castle Rock is the county seat for Douglas County, which was the fastest growing county in the U.S. in the 1990s and continued to be one of the fastest in the 2000s. Douglas County is also one of the wealthiest counties in the U.S., though I kind of scratch my head on that one (it is basically a very middle/upper-middle class county with relatively modest numbers of either poor or wealthy people). The county is pretty much split in two, with the northern half being Denver suburbs and the bottom half being rural. Castle Rock is pretty much at the center and marks the southern most point for Denver suburbs; it has been growing fast itself. Surely I could get 4G there.

Sprint has been in the 4G market the longest, and recently brought their WiMax offering to Denver. I check Sprint’s website and sadly 4G service doesn’t make it to Castle Rock. I keep hearing good things about Verizon, and LTE is available in Denver, but alas they too are not offering it in Castle Rock. Ok, T-Mobile has not only done a massive HSPA+ rollout but managed to co-opt the term “4G” along the way. Until T-Mobile started calling HSPA+ “4G” most of those in the know considered it a “3.75G” technology. What’s the difference you ask? Well who knows nor cares (ok, if you care about latency then you should care; HSPA+ doesn’t address 3Gs latency issues). Well guess what I found on T-Mobile’s website? It is no surprise that they don’t have 4G in Castle Rock. The real surprise is that they don’t even have 3G in Castle Rock yet! So that leaves AT&T, who is now promoting they have HSPA+ now with LTE (aka, “real” 4G) deployment to start later this year. Sorry, doesn’t look like they have HSPA+ in Castle Rock yet either. Though they do have decent 3G service there.

I really really wish I could say something nice about AT&T. As an AT&T customer I’ve certainly see them try to improve, and at time actually improve. But they just can’t seem to catch a break. This weekend I was sitting in a Starbucks in Kirkland Washington with a friend. I pulled out my Samsung Focus and did a speedtest on AT&T and got just under 500Kbps down. My friend pulled out his HTC HD7 and did a speedtest on T-Mobile and got 5Mbps down. Yes, T-Mobile has HSPA+ in Kirkland! AT&T, Microsoft IT’s favored carrier as well as the “premier partner” for the launch of Windows Phone 7, doesn’t have HSPA+ in Microsoft’s backyard. In fact, I’ve been searching for HSPA+ coverage with both my Focus and an HSPA+ enabled USB datacard ever since AT&T announced the rollout and I have yet to find it.

So hey Verizon, Spring, AT&T, and T-Mobile you might want to stop wasting your money on all those 4G ads and put it into actually deploying your 4G networks. Right now the emperors have no clothes.

Posted in Mobile | Tagged , , , , , , , | 1 Comment