Tag Archives: Microsoft

Why Microsoft bought Skype

Cringely thinks it’s simply to stop Google getting it:

“Were Google to buy Skype they’d convert those 663 million Skype subscriptions to Google Voice and Gmail and in a swoop make parts of Yahoo and MSN irrelevant. They’d build a brilliant Skype client right into the DNA of Android, draining telco revenue and maybe killing smaller players like Windows Phone. They’d cut deals with equipment makers like Cisco (Linksys) and NetGear and steal voice revenue from telcos and cable companies alike.  That’s all Redmondesque behavior and if anyone is going to be behaving that way, Ballmer feels, it had darned well better be Redmond.”

That sounds like a perfectly Redmondian argument to me.

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Why “evil” is the most over-used word in tech

One of the things which you often hear reading tech blogs, and particularly the comments, is that such-and-such a company is “evil”. What this usually means isn’t that they’re deliberately employing children or forcing workers to work in polluted factories which damage their health.

Instead, the cry of “evil” is used to describe companies that are trying to maximise their profits. That could be by destroying a market by giving away products to undercut competitors. It could mean locking customers in to platform so they face barriers if they want to switch to something else. Or it could mean trying to take a slice of income off every transaction made on their products.

This is a fundamental error, and it misunderstands what companies are designed to do. In a post on his blog, BBC business editor Robert Peston sums this up in relation to multinationals trying to minimise how much tax they pay:

“But given that company law obliges company directors to give greatest weight to the interests of their shareholders, criticising company boards for striving to minimise tax is a bit like attacking gravity for making the rain fall down rather than rise up.”

The same is true of tech companies. Apple isn’t “evil” because it is attempting to squeeze money out of publishers. Microsoft wasn’t evil when it tried to tie Office and Windows. Google isn’t evil because of its practice of giving away stuff which its competitors make money on.

They’re all just companies, trying to make the best returns for the only people that matter, legally, to them: The shareholders.

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Apple 2011 = Microsoft ’97

Brilliant comment from “Chucky” on a post from from Michael Tsai:

Microsoft in 1997 had a very specific corporate strategy. They had a temporary situation of great market leverage. And rather than concentrating on making better products for their users, they began to concentrate on two objectives:

1 Using their leverage to avoid the rise of middle-wear.

2 Using their leverage to grab a rent-seeking slice of the commerce their users did out on the internet.

Microsoft in 1997 was willing to be incredibly evasive and disingenuous in its pursuit of those goals.

Does any of this remind you of Apple in 2011 in any way?

Apple has steadfastly avoided the creation of middleware on iOS – stuff like Flash, which acts as a layer between the OS and the application. And it is now using its leverage over the platform to grab a slice of all the commerce people do through apps.

Who’d have thought that Steve Jobs would have stuck so closely to the playbook written by Bill Gates?

Bing: Why Google’s Wrong In Its Accusations

Danny Sullivan on Bing: Why Google’s Wrong In Its Accusations:

“Meanwhile, I’m on my third day of waiting to hear back from Google about just what exactly it does with its own toolbar. Now that the company has fired off accusations against Bing about data collection, Google loses the right to stay as tight-lipped as it has been in the past about how the toolbar may be used in search results. Google’s initial denial that it has never used toolbar data “to put any results on Google’s results pages” immediately took a blow given that site speed measurements done by the toolbar DO play a role in this. So what else might the toolbar do?”

I can understand Google’s annoyance at what it sees as “copying”. But if it’s going to throw around accusations like that, it had better make sure (1) it is right, and (2) it’s not doing the same thing itself.

Why Microsoft is right to hold off on a tablet

MUNICH, GERMANY - OCTOBER 07:  Chief Executive...
Image by Getty Images via @daylife

Joe Wilcox, Betanews:

“Ballmer was right not to make any major tablet announcement, showing off something that wasn’t ready. Any zealous tablet push would have led to bloggers, journalists and Wall Street analysts making iPad comparisons. By staying away from Apple and iPad, Ballmer kept the message pure, which is good marketing. Ballmer set the keynote agenda on his terms rather than taking the position of following a competitor. Surely there was temptation, and pressure, to directly respond to iPad. Ballmer showed leadership by waiting.”

Joe is absolutely right. The last thing that Microsoft needed from this year’s CES was another version of the Courier debacle. By focusing on products that it was ready to announce rather than products the pundits think it needs, Ballmer did the right thing – and, of course, copied something straight out of the Apple marketing playbook.

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Translating Google

Jeff Jarvis fires off a couple of questions in an apartment in Davos to the Googlers. Here are Eric Schmidt’s answers, with some handy translations from Google-speak.

Schmidt:

Phones: Will they have a tablet? “You might want to tell me what the difference is between a large phone and a tablet,” Schmidt said.

Translation:

You bet. No way will we allow those fuckers in Cupertino to leverage Quattro Wireless into our turf. No fucking way.

Schmidt:

How will they make money on phones? “Not to worry,” Schmidt said. “We do not charge for Android because we can make money in other contexts.”

Translation:

We will leverage our massive monopoly in online advertising to cross-subsidise mobile handset development. By the time the DoJ notices what we’re doing, hopefully the competition will be dead and we’ll rule. There’s no way we’re giving Apple, Microsoft, or anyone else the chance to undermine our ad sales. I studied the Microsoft playbook, and it worked for them for 20 years. Why not for us?

Schmidt:

“In the last year, Chad managed to figure out a way to make money using partners and their video content on YouTube,”

Translation:

Chad’s going to charge for content and stick it behind a paywall. You can do that if you have premium content. That’s What Google Would Do, Jeff, we just forgot to tell you that bit before you wrote your book.

(Photo by World Economic Forum)

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2009: The year tech blogging died

Most years are full of idiocy. But I think I can make a decent case for this year being the worst on record, at least from the perspective of writing about technology.

This was the year when tech writing plumbed new depths of stupidity, repetition, and sheer unadulterated circle jerking. It was the year when blogs picked up each other’s stuff, no matter how ridiculous, and strove to take it to the next level of dumb. You get what you pay for – and with tech writing, nothing could be more true.

There were three perfect examples of the tech blog world’s increasing descent into infantilism and irrelevancy. These were, in no particular order, the CrunchPad; the Apple Tablet; and pretty much everything written about the iPhone and market share.

Example One: The CrunchPad
TechCrunch – which almost defines awful tech blogging on a daily basis – was guilty of probably the worst example of narcissistic stupidity with its foray into actually trying to make a product.

Now making products is hard. Very hard. I have nothing but admiration for people who get up off their behinds and ship a product, because it’s a tough thing to do. Even the shittiest products usually take thousands of man-hours and thought to bring to market. In fifteen years of writing about tech, I’ve been privileged to know hundreds of people at companies all over the world who have managed to ship stuff. It’s tough.

So when Mike Arrington – the blowhard’s blowhard – decided he was going to create a product – the CrunchPad –  ship it at an absurd price point, and all within the space of a year I was prepared to applaud. Then I remembered this was Arrington we were talking about, and knew without a moment’s uncertainty that it was going to implode at some point.

Lo and behold, it imploded. Why? Because making stuff is hard and writing about it is easy, and Arrington confused being a big wonk in the tiny world of tech media with actually being a serious businessman capable of harnessing the energy to ship a product.

What the CrunchPad demonstrated perfectly was the tech blog world’s hubris and utter lack of perspective. Just because you can bang out 200 words about what some drunk coder from Company X said at a party doesn’t make you capable of defining, designing and building a product – nor of harnessing other people to do so. And, more importantly, making a product which you and your tech blogging friends think is cool is an almost guaranteed method of creating something that no one else in the world will want.

Example two: The Apple “Tablet”
More words were probably written about this nonexistent product in 2009 than about all the great hardware that every company not called Apple actually shipped. Google now lists 1.8 million documents referencing “Apple tablet”. That compares to 20,700 documents referencing “Acer Tablet PC”. One of these companies has actually shipped tablet hardware. The other has not. Can you guess from those Google figures which one is which?

“Nonexistent?” you say. “But I’ve read all the details on TechBlogDailyShit, it’s launching in March with an OLED screen and will kick Amazon’s butt/save the publishing world/cure cancer!”

No. No. No.

What you have read is a load of stuff that bloggers in desperate search for page views have made up on the basis of bar-room rumours, anonymous emails, stuff some random guy posted on Twitter, and just general shit. No one, outside of probably a hundred people in and around Cupertino, have a solid line on what Apple is doing – if, in fact, it is doing anything.

Almost everything you have read about an Apple tablet is geek wish fulfilment, from people who stared at a lot of Star Trek merchandise when they were young and really, truly wanted a tricorder. This is standard practice with a lot of sites that cover Apple: they assume Apple is designing products not for ordinary people, but for them, the tech blogging elite. Well guess what: they’re wrong! Apple wants its products to sell outside Silicon Valley, so it does not take Robert Scoble as its typical customer.

Outside of possibly the Wall Street Journal, almost no media sources are doing any serious investigative reporting to actually find out what Apple is doing either. Why? Simple: Doing real investigative tech reporting takes time, effort and balls. What’s more, if you’re a tech blogger you don’t have to do it because you can write some second-hand speculative bullshit about the “Apple Tablet” and it will get you lots of page views. This will lead to some “blog network” owner like Arrington or Nick Denton paying you more, because you are paid on page views. And all without you having to make a single call or talk to a single real person. Result!

Seriously, the standard of investigative tech reporting now is so low that it makes me long for the days of MacOSRumors. Those guys had standards compared to what we have at the moment.

Example three: The iPhone and market share
Here’s a strange thing about the world of tech writing: there is an obsession with market share winners and losers which isn’t seen in any other product area. Of course, companies talk about their market share in all realms, whether they make cars or sell groceries. But what they don’t do is imagine that they will DIE AS A COMPANY unless they have what amounts to a legal monopoly.

In tech, though, we do this all the time. Nokia is DYING because its market share is falling compared to Apple. Apple is DYING because its market share isn’t as big as Microsoft. Microsoft is DYING because twelve and a half customers have stopped using Office in favour of Google Docs. Google is never dying, for reasons I have yet to fathom – I suspect they are either the golden child, or they simply give out better freebies than anyone else.

Is Mercedes dying because its share of the luxury car market isn’t over 80%? No. Is Samsung dying because it doesn’t dominate TVs? No. Is Bosch dying because it doesn’t sell the majority of drills in the world? No. Only in tech do we play this bullshit game.

Tech bloggers constantly play the zero sum game. For Apple to win, Microsoft must lose. For Microsoft to win, Google must lose. For Google to win, Apple must lose. And nowhere is this more obviously seen at the moment than in the world of the mobile phone.

The funny thing is that prior to the launch of the iPhone, you really didn’t see much writing about the mobile phone market that worked this way. No one wrote screaming headlines about Sony Ericsson dying because Nokia took a few points of market share that month. People didn’t talk about the impending end of Nokia when Motorola was sweeping all before it with the original StarTac.

Only with the influx of “tech geek bloggers” post-iPhone did you suddenly get the same kinds of breathless bullshit that characterised the computer media applied to mobiles. All of a sudden, these guys became experts in the dynamics of the mobile phone market and brought the same depth of analysis to it that they’d brought to things like the question of whether Duke Nukem Forever would ever get released.

The fact that they called the iPhone “the Jesus phone” tells you all you need to know about their lack of perspective and ego. Mobile phones were dull and stupid and now the computer guys were coming along to SAVE YOU ALL.

Earth calling tech bloggers: shut up, you don’t know what you’re talking about.

Where next Columbus?
I’d like to end this post on a high note, but I’m actually not in the mood for happy endings. There are some really sharp writers in the world of tech, but the problem is that they struggle to be heard over all the bullshit. Old hands like Kara Swisher and Mary Jo Foley do real reporting. Newer guys like CK Sample at least know how to write stuff which is entertaining, fun and (mostly!) accurate. John Gruber is always good value, even if he’s wrong rather more often than his biggest fans would admit.

But most of the best tech writing at the moment comes from people who don’t actually do it for a living. Odd posts, here and there, that shine light on to some small part of the tech world that they deal with on a daily basis. I’ll leave you to find them, but here’s a clue: they usually aren’t linked to from any of the big blogging networks.

(Photo by Vicki’s Pics, under a Creative Commons license)

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Why the Google Phone will not be released to the public

Image representing Google as depicted in Crunc...
Image via CrunchBase

The hype machine is in overdrive. Google has confirmed that it has issued special Android-running “dogfood” phones to some of its employees, and every tech blog is speculating about when this will be released to the public and how it’s going to change the world.

I’m willing to bet that Google will not release a Google-branded phone in the next year, unless “Google branded” means what it did with the T-Mobile G1 – a subtle logo on a phone sold by other companies.

Why? Three reasons. Before we get to these reasons, though, let’s look at what people are actually talking about.

First, Google is not getting into the hardware manufacturing business, except in the way it already does with the Google Search Appliance. The Google Phone is, according to all the reports, made by HTC. It’s not built to Google’s spec, but instead is reported to be a rebadged HTC Passion, a phone that’s long been in the development pipeline.

Second, at present (as Google has stated in its public blog post) this is a testbed phone distributed to employees only. Phones like this are designed to be used for development purposes, and are commonly called “dogfood” – as in the old programmers phrase “to eat your own dogfood”, meaning to use software that is still in development to iron out issues. If you’re interested in how dogfooding works, that’s a great description of it in Zachary Pascal’s book about the development of Windows NT.

And, in terms of things we know, that’s about it. So is this a herald of a phone released to the public under Google’s name? I think not.

1. Google’s lack of experience

The first reason is simply that Google doesn’t have the infrastructure or experience to support a sizeable consumer hardware project. It has no support system, no outlets, no distribution – in short, none of the things that what would be a major hardware launch actually requires. Neither does it have any experience in consumer hardware products.

At this point, someone will probably point to Microsoft and Xbox as an example of how a software company can more into hardware quickly. But this ignores the fact that Microsoft had been in the hardware business for years, on a much smaller scale, with mice, keyboards, and other peripherals. This gave it a valuable set of experience of hardware and how to market and sell it. Had Microsoft launched Xbox without this experience, I doubt it would have been a success.

2. Where’s the network in this?

Second, there’s the Network Effect. No, not that network effect – I mean the fact that in order of a phone to be useful, you need a contract from a phone network.

When selling phones, manufacturers face two choices: they can either sell the phone “off contract”, at full price to consumers; or partner with a network, which buy phones (at full price) and sell them with the up-front cost hugely reduced, getting the cost back over the course of the contract.

This is why you can buy an HTC Hero unlocked in the UK for £369, or get it for free with a 24 month contract on the 3 network. Unsurprisingly, very few consumers choose to buy the phone for the upfront cost.

In fact, Nokia has suffered massively from this in the US, where its smartphones have tended to be sold unsubsidised and thus have had minimal impact. People don’t want to pay $500-600 for a phone – period.

That’s why the talk of Google selling its phone off-contract is, frankly, silly. Why would anyone other than the kind of hardcore geek who MUST have the latest phone pay full price to buy one with a Google logo on it, when they can get the same phone with an HTC logo on it for much less money upfront? Even if the HTC Passion becomes the Google Phone exclusively (something I doubt given HTC’s record), there are many other manufacturers of Android phones and many good devices coming down the pipeline – and consumers will buy them if they’re free/cheap upfront.

Some might argue that Google could reduce the up-front price of a Google Phone on the grounds that it will increase their overall ad revenue over the course of the phone’s lifetime. But this would be a massive punt for the company, as there is no way of definitively showing ROI on a project like this. While they could show that X number of ads had been served on their phone, how many of those ads would be served anyway on another Android phone, an iPhone, or even a Nokia or BlackBerry? Working out the incremental revenue delivered, which would be required to work out how much the company could afford to subsidise the phone, would be impossible.

3. What’s unique about the Google phone?

Third, there is the issue of uniqueness. In order to be a success, there would need to be something other than the Google brand that differentiated it. Given that Google doesn’t make hardware, that means one thing: different software. And that’s the one thing that Google cannot do with Android.

Why? Because the moment that it started keeping “good” Android features to itself, it would alienate current and future Android phone makers, and fragment the platform. And that’s exactly what it wants NOT to do at this stage of the game. Android is already beginning to suffer from fragmentation. Anything which increased this will be avoided.

Could it offer additional, branded-phone-only services? Yes – but what would be the benefit to it doing so, over offering the same services on subscription (or even free) to the wider Android audience? Google has historically trod a very careful line with its services, making them as widely-available as possible for a very simple reason: The wider they are available, the greater the potential for ad revenue from them.

Show me the money

Put simply, unless Google has some unique business plan or completely radical technology that no one knows anything about – in other words, unless they have some magic pixie dust to sprinkle – it makes no sense for the company to release a unique, category-dominated Google Phone. We might get an HTC Passion, Google-branded in the way that the T-Mobile G1 was, sold through networks – and hey, that might be a very good phone. But it won’t be anything like the predictions we’re seeing now.

Remember when the iPhone was early in its hype-cycle, and how it was referred to as the “Jesusphone”? What we’re seeing now is a classic case of “Jesusphone” hype, the need of the tech blogging world to find a next big thing and portray it as massively different to what we have. The truth is more prosaic, and more dull. Category-defining products happen rarely, tectonic shifts in markets come along only occasionally. But hey, it keeps the geeks amused.

Update: John Gruber digs a little and finds the Google Phone identifies itself as “Nexus One” (smart reference). He’s also hearing that it’s GSM, but only works on T-Mobile’s 3G band.

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Dumb Windows users write dumb things about malware. News at 11.

Over at PC Pro, my old chum Chris Brennan is conducting a brave experiment. As an ardent Mac user, in the cause of science, he’s put aside his Mac and is living with Windows 7 for a while (catch up with his posts here.)

After a couple of weeks, a story about some Windows 7 security issue prompted him to install Microsoft Security Essential (free, not bad security software). He posted about the experience, and has promptly been jumped on by a bunch of sneering Windows folk, with comments like “totally pointless article” and “He’s clearly a Mac fanboy. Any further articles are totally pointless. He’ll choose a Mac no matter what windows 7 does.”

Now read his post, and there’s nothing there that’s actually wrong – and unlike some Mac commentators, Chris’ writing is entirely reasonable. He’s not jumping up and down and lying about security, which I’ve seen some Mac zealots do. But it appears Chris’ (entirely factually accurate) post has hit a raw nerve with some of the commenters there.

No matter what the reasons, malware is a problem for Windows users in a way which it just isn’t for Mac users. Now I’m largely on the side of the epidemiological theory: Macs are less of a target because there’s less of them, and because there’s less of them it’s much more difficult to spread malware. Malware is a lot like disease: it takes a critical mass of vulnerable people in a population before a disease can spread effectively.

But what the commentors have ignored is the key point that Chris is making: anti-virus software isn’t (and never will be) 100% effective, and different packages protect to different degrees. While Security Essential is a decent package, as PC Pro’s review points out, there are some kinds of malware against which it will offer little protection.

The point is this: if you’re a naive computer user, you need to know not only to install malware protection on Windows, but that not all packages are equal, and how to differentiate between them. Unless you read computer magazines avidly, you might not know any of this.

And that, in my book, is another reason just to get a Mac if you’re not a geek. The Mac’s lack of significantmalware might not last if it ever gets to 20, 30 or 40% installed base – but until it does, take advantage of the lack of worry.

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