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Posts tagged with ‘Microsoft’

Best Buy: Can stores be asset vs. Amazon? →


Larry Dignan:

The advantages to the store-as-fulfillment center plan are that Best Buy can deliver products faster and cheaply. The downside to that strategy is that Best Buy’s in-store inventory visibility isn’t good and the staff may not be as efficient as people in a distribution center.

The conventional wisdom would say that Best Buy’s stores are an albatross around their neck — much like they were for Blockbuster. But what if they can shift them into being more along the lines of warehouses — much like the ones Amazon is trying to build as quickly as possible — for fast local delivery? And what if only a small area of those warehouses were actually a storefront to show off their goods?

This would all take a lot of logistics (and possibly some re-zoning?) but it doesn’t sound like the craziest idea in the world. Again, what if your weakness is actually your strength?

Sounds like Joly might be onto something. But he can forget the ‘Microsoft Experience Stores’.

Microsoft’s Ballmer stepping down in next 12 months — Stowe Boyd via GigaOM Pro →


Microsoft needs to hire a new CEO with a vision to make the company the market leader in a new era of enterprise software and one who will avoid the entanglements of consumer devices. Ballmer made a huge gamble on consumer demand for Microsoft gadgets, and it’s just not there. The board could make a stupendous strategic error and continue to pour billions down the drain chasing that chimera, or instead it could get with the present. Instead, hire someone who will acquire Box or Dropbox and pull in promising startups like Asana. And who will spin off, shut down, or ramp down money losing sinkholes like Surface, Windows Phone, and, yes,  even Windows itself. It should definitely spin out Xbox, so maybe Windows could go with that as a short-term source of cash.

Azure may have legs, but cloud computing infrastructure is going to be a tough, tough market, with a number of wounded dinosaurs hoping to play there, like HP, IBM, Cisco, and of course, the giants like Amazon and VMware.

We’ll see how far this past year’s crash has radicalized Microsoft’s board. I don’t know Qi Lu, who now heads up Applications and Services Engineering at Microsoft, which is the enterprise computing heart of the company. He may not be the guy for this cycle at Microsoft, but it should be someone who sees that group as the future for the company. Perhaps David Sacks, the founder of Yammer. He’s a visionary, anyway, and so is Adam Pisoni, the Yammer CTO.

I still think there is a future for Microsoft, as I laid out in “Microsoft will rise from the ashes of Windows and Surface failures,” but it’s not the future Ballmer gambled on: It’s the enterprise.

PC Makers's Forecasts Dim as Mobile Pressure Weighs on Profitability - Eva Dou via →

Hardly any touch screen PCs are being bought, so the world is breaking into a small number of successes: growing number of touch-oriented smartphones and tablets, stable numbers of keyboard + touchpad laptops, and a falling number of keyboard + mouse desktops. Strangely, PC manufacturers continue to over estimate people’s desire for oddball hybrids and touch laptops.

from the article

Acer and Asustek this week said touchscreen laptops championed by Microsoft Corp. haven’t made as a big a splash with consumers as previously estimated.

"Our first wave of Vivobooks was not a success," said Asustek CEO Jerry Shen at an investor conference Friday, referring to the company’s line of touch notebooks. "We are working very closely with Microsoft and Intelin an effort develop game-changing devices to launch in September.”

Mr. Shen said Asustek also plans to “attack” the nontouch notebook segment in coming months, as many customers still aren’t willing to pay extra for a touchscreen.

Acer and Asustek have pushed heavily into the low-cost tablet market this year to try to counteract the consumer preference shift away from laptops, but so far it isn’t clear whether sales of their Android tablets, which sell for less than $200, can offset the sales decline of more-expensive laptops.

Acer Chairman J.T. Wang said the company is shifting its product mix away from the traditional Windows system “as soon as possible,” with its percentage of devices running Google Inc.’s Android or Chrome operating systems to grow from about 10% this year to as much as 30% next year.

Asustek, which sells under the brand Asus, had up until this spring managed a better performance than many PC industry peers, partly because of a partnership with Google to make the popular Nexus 7 tablet. The sales helped boost Asustek ahead of Kindle-maker to become the No. 3 tablet maker behind Apple Inc. and Samsung Electronics Co.

But even with the success of the Nexus 7, Asustek is now struggling. After the release of the second-generation Nexus tablet, Asustek was hit by a crush of inventory of the first generation, as well as poorer-than-expected sales of Windows RT tablets, analysts said. Windows RT is a version of Windows 8 geared to work with ARM mobile-device processors.

Touchscreen laptops, which PC makers initially saw as their defense against threat from the mobile advance, haven’t taken off.

I expect that we’ll see a huge surge in Android and Chrome laptops, and the near-term collapse of Windows. It will be Apple OS X and iOS v Google Chrome and Android, and maybe Ubuntu as a distant third, starting with smartphones.

New "Nimble, Collaborative, Decisive" Microsoft So Far None Of Those Things →


Lydia Dishman’s sub-headline says it all:


“This organization does not answer the following question: What happens to Microsoft if PC shipments continue to go down?” asked Jean-Louis Gassée, a venture capitalist and former Apple executive, referring to Microsoft’s new structure.

Nick Wingfield, Microsoft Overhauls, the Apple Way

Actually, Gasseé is wrong. The Microsoft reorg does ‘answer’ that question. As Windows OS sales go down, the Windows engineering team can shrink, and the company’s sales and marketing resources can be shifted toward enterprise products. 

But that’s not really the issue. this reorg does not equal uniting many Microsofts into one Microsoft, as Ballmer claims. It has consolidated many fiefdoms into four independent engineering teams, and consolidated sales and marketing at the corporate level. What is unanswered is user experience. As I wrote the other day at GigaOM Research

The new Microsoft has no place for a Jonny Ive controlling user experience.

Microsoft reorganizes and this time it’s for all the marbles — Stowe Boyd via GigaOM Pro →

Stowe Boyd via GigaOM Research

We’ve already see the push in Office 365 to make Yammer the default user experience in Sharepoint (see Yammer is becoming the social UX for Microsoft). They are going to enlarge what Yammer is, and make it the social stream for the passage of all sorts of newly socialized information.


The missing piece of the puzzle for me — along the lines of Sullivan’s comments about ads and social having no owner — is this question: Who owns the mobile experience at Microsoft, now? The new Microsoft has no place for a Jonny Ive controlling user experience.

The simple and wrong answer is Julie Larson-Green, who is building devices like tablets and smartphones. Another wrong answer is Terry Myerson, who is building the Windows software that runs on those devices. These are both wrong — and especially wrong in the enterprise area — because many Microsoft customers are having their primary interaction with Microsoft software through the browser, or on non-Microsoft devices. And if the trend lines are to be believed, in the near future those proportions will continue to rise. So, already today the most important user experience to consider is in the browser, and soon it is likely to also include mobile apps running on hardware not produced by Microsoft. And I don’t mean Internet Explorer, either.

Yes, I know that Ballmer, Qi LU, and anyone else in authority at Microsoft will have to publicly stick to the party line — “Windows will continue to be a dominant operating platform for decades to come, we are turning the corner with Microsoft smartphones and tablets, yada yada yada” — but the numbers say different. Ballmer’s memo only mentioned PC four times, and mostly in retrospect, phone only three, and Internet Explorer zero. (I noticed that Surface’s price was dropped today by around $100. Too little, too late?)

However, behind the scenes, Qi Lu and his colleagues must be planning for a transformation to a very different operating model: a leading enterprise software company, integrating a collection of tools necessary for the functioning of business in the past decade, right up to the business of today. But the battle now is to contrive the software platform for the emergent company of next year, and the decade that follows. Qi Lu, with the people at Yammer, Office 365, Sharepoint, Exchange, and Skype, will have to connect the dots in a way that transitions to a very different tomorrow while delivering value at every today along the way.

[Go read the whole thing, if you’d like.]

Microsoft Restructuring Set for Thursday - Kara Swisher - AllThingsD →

So the Microsoft reorg is coming, and it looks like, as expected, Ballmer is structuring the company to play defense:

Microsoft Restructuring Set for Thursday - Kara Swisher - AllThingsD

The effort, said many insiders who have talked to Ballmer and other involved, is to create something that is being called “functional coherence” at the company, although it is not among Microsoft’s talking points when the restructuring will be made public. That also includes putting more wood behind fewer efforts and eliminating overlapping functions.

In theory, it also presumably means things going where they belong in product cycle. In practice, which is a lot messier, that means moving a lot of important people around.

As as been reported by Bloomberg and earlier, in part, on, top jobs in the new structure are going to a number of longtime high-ranking execs.

That includes a new cloud computing and business-focused products unit headed by current Servers and Tools head Satya Nadella; Online Services leader Qi Lu could add Microsoft Office and other apps to his portfolio that already includes the Bing search service; Julie Larson-Green, who now co-heads Windows efforts, is in line to be in charge of all devices from Surface tablet to Xbox game player, as well as music and TV services; and Windows Phone chief Terry Myerson is expected to take over Windows engineering and platforms.

Meanwhile, Windows CFO and CMO Tami Reller is expected to have a larger marketing job; and current Skype president Tony Bates gets purview over all of business development, corporate strategy and M&A, playing the role of outside guy to Silicon Valley and developers (complete with a giant checkbook for acquisitions and other investments).

It’s not clear where Microsoft Office president Kurt DelBene or Microsoft Business Solutions president Kirill Tatarinov could land in the new set-up, but presumably either out the door or under new units headed by Qi Lu (DelBene) and Satya Nadella (Tatarinov), respectively.

As to the fate of COO Kevin Turner, sources expect he’ll stay (at least until he is offered a tasty and big operationally-heavy CEO job outside the company).

Current CFO Amy Hood — who was just appointed — is also stay in place, as will HR head Lisa Brummel, who has played a key role in this reorg effort. Chief lawyer Brad Smith also seems safely away from the hubbub.

The key phrase for me is ‘putting more wood behind fewer efforts and eliminating overlapping functions’ which translates into 1/ closing down some products and services, and 2/ consolidating control of the remaining products and services into the hands of a small number of actors. 

This can be good for Microsoft customers, potentially, although it’s been pointed out that people buy products not organizations.

Consolidation of all Windows operating platforms makes real sense, even if it is a business line with a seriously precarious future, or near-term collapse, depending on how pessimistic you are. (I’m very.)

Some things are still head-scratchers though, like putting Microsoft Office and other apps together with Bing.

Mostly I’m interested in the final disposition of enterprise services and products. I’ll wait for the dust to clear, and I’ll write something in more detail after the formal announcement is made, over at GigaOM Research.

One comment: Looks like Tony Bates won’t be heading up Skype anymore, and that is likely to be consolidated into Qi Lu’s Office + apps + Bing world? And Bates new role — biz dev, strategy, M&A — could be read as either a sidelining while looking for a new CEO job or operating as Ballmer’s lieutenant, looking to buy new startups to reboot Microsoft’s future. We’ll have to see.

Microsoft will rise from the ashes of Windows and Surface failures — Stowe Boyd / GigaOM Research →

Here’s the closing paragraphs of my weekly update at GigaOM Research. I started by looking at recent news about Zygna, Accenture, and Intel, who are all being whipsawed by the shift away from the PC and the rise of proximal devices (smartphones, tablets, and other ‘mobile’ devices). I finish with Microsoft:

Stowe Boyd, Microsoft will rise from the ashes of Windows and Surface failures

Last fall, Microsoft CEO, Steve Ballmer, outlined his new vision for Microsoft in a letter to shareholders, and rumor has it that this week he will be announcing a major reorganization of the company to try to make that vision a reality. Bottom line: I think much of that reorganization will fail because he is still gambling on Windows and Surface to break through, and they won’t.

But what might emerge from the ashes of that house on fire could be a credible player in the very different world of enterprise IT coming down the pike. Let me characterize it:

100% Cloud — We are continuing to hear reasons why companies cannot move everything into the cloud, but in the final analysis they are quibbles disguised as prudence. Ultimately, anything that can be done on premise will be possible in the cloud, with the exception of physical on-site security (which is like pretending that your money is safer in the cookie jar under your bed than in a bank).

100% Proximal — There will be functionally zero stationary computing devices in just a few years, and people will be always on, wherever they are.

100% IT-less — The downturn in Accenture’s fortunes is the start of a collapse in enterprise IT consulting, and that will rapidly cascade across the industry. Why? The use of cloud-based enterprise software and proximal hardware cuts a huge hole out of the middle of what those consultants configure for their clients. Note that this won’t stop with outsourced IT staff: it means the end of IT internally, too. (Yes, companies will still own computing devices — on the factory floor, and in the hands of retail clerks. But increasingly they will be communicating with back office software running in the cloud.)

I am going to get a lot of flack for zooming ahead five years based on these trends, but I will stand by the prediction.

This is the deep background on the future of enterprise software in general, and specifically the form factor of future cowork (collaborative and cooperative) tools.

The enterprise software companies that will weather this sea change will be the ones that drop their efforts to stop the tide. They will have to make the change that Krzanich is making at Intel, betting on the future instead of fighting it.

One last prediction: Ballmer’s reorg this week — if it comes as expected — will be a hedge. The reorg that will indicate that Microsoft has turned the corner will be when Ballmer leaves the company, and a new CEO joins, shuts down the company’s hardware efforts, and deadpools Windows. I give Ballmer another year, at most, before the shareholders demand his head.

Android invades the desktop - John Morris →

Morris gives a quick summary of some Android ‘desktop’ machines — mostly tablets that can dock with a keyboard, like HP’s Slate 21, various Acer products, and Samsung’s ATIV Q — but misses the point completely, sounding almost  apologetic for suggesting these things might have utility.

I’ll go strongly in the opposite direction. Windows is (nearly) dead, especially on smartphones and tablets. Android will soon be the largest OS in the world. Inevitably, Android will become the largest player in the shrinking laptop/desktop market. Mac OS X and Android are the one-two punch for Windows, and that includes the desktop/laptop market, too.

Microsoft continues to move away from a commitment to its own OS and hardware platforms. We’ll be playing Xbox games on iPhones in no time.

Perhaps no coincidence this is announced a week before the rumored reorg in Redmond?

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