Microsoft's New Surface Makes A Strong Case For Device Consolidation

JP Gownder

Yesterday, Microsoft released the Surface Pro 3, a 12" touchscreen device billed as "the tablet that can replace your laptop." Sporting some hard-core computing bona fides (including Intel processors and Windows 8.1) and new innovations (like an active stylus that activates note-taking outside of the lock screen), the device in its third generation offers a new level of mobility despite having a larger screen than its predecessors in the Surface line. It's worth taking a look at:

Microsoft designed the Surface Pro 3 with a variety of seemingly incremental improvements that, once assembled in the same device, make it surprisingly innovative. In fact, you should think about it as quite a departure from the earlier Surface models. With this product, Microsoft makes its best yet argument for device consolidation for the workforce, potentially allowing some workers to stop carrying separate laptop and tablet devices in favor of Pro 3. For consumers, the Surface Pro 3 doesn't act as a substitute for popular 8" form factor tablets, but it might make for a good laptop replacement.

That's not to say it's (to quote the cliche) any sort of "iPad killer"; the starting price of a Surface Pro 3 is higher than the iPad's starting price. It's more like a successor to the laptop -- but one that takes mobility quite seriously. Altogether, it's likely to be popular among prosumers, BYOD consumers, and perhaps some other segments.

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Negotiating with Microsoft in June; do you take it to the wire or settle early?

Mark Bartrick

June is a such great month – the days are getting warmer, Wimbledon merges tennis with strawberries and cream, the kids are all pleasantly subdued while revising and sitting exams, the football World Cup is just around the corner, and (how could we possibly forget) it’s also Microsoft’s financial year end.

Many of you will already be in the throes of a negotiation with Microsoft for an Enterprise Agreement (EA) renewal. Or perhaps you are looking at the pros/cons of their Office 365 solution. If you’re planning to take the negotiation to the wire on June 30th in order to squeeze the very best deal at Microsoft’s year end, be aware that Microsoft would like you to dance to a different tune. They are pushing really hard to complete negotiations sooner rather than later. In fact, you might well have been told that Friday, June 20th is their deadline.

Microsoft will tell you that they need a few working days to get signed paperwork through their internal system in order to formally book the deal. While there is some truth in this, it’s also true that the Microsoft sales rep and their reseller doesn’t get commission until the deal has been booked and the revenue formally recognized – hence the pressure to get stuff signed by the 20th!

Whichever date you choose to conclude your negotiation, rest assured that the later it is in June then the more stressed your Microsoft rep will become.

Here are four tips to think about while you negotiate with Microsoft in June:

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Microsoft CEO Satya Nadella’s first earnings call – talks about courage, challenges and the future.

Mark Bartrick

It’s been an interesting few weeks for Microsoft. XP has gone off Support and left many clients exposed to security risks. At the same time, the US Government has just warned all users to avoid using Internet Explorer (IE) versions 6 to 11 as they say that there is a serious flaw that hackers are already apparently exploiting.

Against this backdrop, Satya Nadella, Microsoft’s newly minted CEO, joined Microsoft’s recent earnings call to talk about the ‘courage’ they will exhibit as they move forward. Let’s hope that courage includes supporting clients who find themselves in difficulty from product flaws.

Microsoft reported earnings were $6.97 billion on revenue of $20.4 billion; this is roughly flat with a year ago. But this third quarter fiscal 2014 earnings call might be more memorable for the fact that the company's CEO was on the call than for anything about the earnings report itself. Nadella spent an hour on the analyst call on April 24 talking Microsoft strategy and answering Wall Street analyst questions. That's something former CEO Steve Ballmer rarely did.

While Nadella didn't make any major announcements, he did drop a few hints that might tell us more about his plans and where Microsoft may be going.

"What you can expect of Microsoft is courage in the face of reality, we will approach our future with a challenger mind set," Nadella told analysts. Here are a few challenges that spring to my mind; cumbersome and sometimes conflicting contractual paperwork, product divisions working in isolation from each other, Google and IBM competing hard in the email/collaboration/cloud space, having to cut Azure prices to more closely align to Apple and Amazon, and a frustratingly slow start in the tablet space.

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Your Voice Will Control The Future

James McQuivey

Google acquired Nest for billions, and then Facebook spent several more billion on Oculus VR. We’re only a few months into 2014, and already billions have been spent by some of the world’s largest digital players, with each of these companies eager to own the next big thing. Mobile is right here, right now, but everyone knows that very soon, there will be something else. But what else?

In the battle to find and claim the next device that everyone will want, these companies will soon realize that next big thing is not a thing at all: It’s your voice.

Voice control suffers from the same things plaguing augmented reality or virtual reality: It has been around for so long that we think we know what it is. Any fan of Star Trek: The Next Generation knows that voice control involves invoking an invisible computer with a command, “Computer,” followed by a query, “How many Klingons does it take to screw in a light bulb?” Maybe that’s a question you don’t want the answer to, but the computer — as voiced by Majel Barrett in the TV series — would know it.

It’s possibly a long history of popular depictions of voice control that made us collectively show so much enthusiasm for Siri when Apple first debuted it in 2011. It’s also partly to blame for why we quickly turned on Siri, declaring her soothing semi-robotic tones to be merely amusing at best or irrelevant at worst.

When Microsoft recently announced its long-rumored Cortana voice service for Windows Phone 8.1 as a catch-up to both Siri and Google Now’s own voice interface, the interest was modest, perhaps because if Siri hasn’t changed the way millions of Apple users use millions of Apple devices, how can Microsoft initiate a wave of behavior change when it has so few Windows Phone users?

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Microsoft’s New Personal Digital Assistant Signals The Start Of Something Bigger

Clement Teo

When Clippy, Microsoft’s paper-clip assistant, disappeared in 1998, it was hardly missed; it was both annoying and offered little value to users. Zip forward 16 years: Microsoft has just introduced Cortana, a new personal digital assistant that the firm will launch on Windows Phone in the coming months. Powered by Bing, and about two years in the making, Cortana will be important if Microsoft gets it right. Here’s why it’s an exciting development:

  • Mobile-first is a growing enterprise strategy. The whole idea of creating a mobile-first enterprise strategy has taken root in many enterprises, as they recognize that users now expect any information or service they desire to be available to them, in context and at their moment of need. Users are cognitively and behaviorally ready to embrace wearable technology as an extension of mobility — and to weave it into their business processes. My colleague JP Gownder shares his views on wearables here.
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Microsoft Leads The China Cloud War Into Episode II

Charlie Dai

Microsoft is officially launching the commercial operations of its cloud offerings in China today. It’s been only nine months since Steve Ballmer, the former CEO of Microsoft, made the announcement in Shanghai that Windows Azure — now renamed Microsoft Azure — would be available for preview in the Chinese market.

I call that Episode I of the China Cloud War. In the report that I published at the time, “PaaS Market Dynamics in China, 2012 To 2017”, I made three predictions — predictions that are now being fulfilled. More global players are joining the war; customers have gotten familiar with cloud concepts and are planning hybrid cloud implementations for their businesses; and traditional IT service providers have started to transform themselves into cloud service providers.

I talked with Microsoft and Citrix last week, and I strongly believe that Episode I has ended and Episode II has just begun. In the battle for partner ecosystems and real customer business, here are the three major plots that enterprise architects and CIOs in China should watch unfold:

  • The thrree kingdoms will fight with the gloves off. In my blog post last year, I described three kingdoms of global vendors in Chinese cloud market: Microsoft, Amazon, and vendors behind open source technology like OpenStack and CloudStack.
    •  Microsoft is leading the market as the first company in China to provide unified solutions for public cloud, private cloud, and hybrid cloud across infrastructure (IaaS) and middleware (PaaS). This builds on its deep understanding of enterprise requirements, its massive developer base, and the ease of use on the Windows platform.
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Microsoft Licensing Update: Product Retirements Imminent – You Need To Upgrade Or Run The Risk Of Using Un-Supported Software.

Mark Bartrick

Microsoft retires support for various older products in 2014 and 2015. This means there will be no more free updates or security patches. While it’s a common occurrence to see support for older products retired by software vendors, it’s annoying if either the old stuff is still running perfectly well or if the upgrade option is financially onerous, will significantly disrupt the business or offers little in the way of real added benefit.

So in April we’ll be finally bidding farewell to support for the likes of Windows XP, Office 2003, Exchange Server 2003, and in July 2015 we’ll say adieu to support for Windows Server 2003. In addition, some more recent products will be transitioning to extended support in July 2014 - namely SQL Server 2008 and SQL Server 2008 R2 – which puts them next on the path to software heaven.

Windows XP

On April 8, 2014, Windows XP will reach the end of its support lifecycle and Microsoft will no longer provide security or online updates.

Office 2003

As a part of the Microsoft Support Lifecycle Policy, Office 2003 products receive five years of Mainstream Support and five years of Extended Support. April 8, 2014 marks the end of this 10-year support period. Running Office 2003 after the end-of-support date may expose your company to security risks and technology limitations. 

Exchange Server 2003 
While Exchange Server 2003 was a leader in the messaging space, after 10 years of technology progression it will reach End of Support effective April 8, 2014.

Windows Server 2003 

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Rackspace Starts A Process Microsoft Just Finished

James Staten

With Satya Nadella now warming the CEO seat at Microsoft, executive recruiters can shift their attention to another cloud leader — Rackspace — who bids adieu to its 14-year leader, Lanham Napier. While both companies are clearly cloud platform leaders chasing the same competitor, the similarities in the top job stop there. Rackspace's needs in a CEO center more around how it tells its story than concerns about its strategy. 

Where Microsoft is struggling to ensure its ongoing relevancy in a world that is shifting away from the desktop and the on-premise enterprise, Rackspace has strong cloud credibility. Its issues are more around the fact that it isn't a cloud pure play, isn't another managed services cloudwasher, isn't an incumbent enterprise IT supplier, and no longer runs OpenStack. So if you're looking for companies to compare it to in order to value its stock, there aren't good comparisons. And if you’re looking for metrics to use to judge its success, the ones being disclosed don't paint a rosy picture. If you want to understand Rackspace, you'll have to really understand the company and why it isn't what it isn't. So let's start there:

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What Can We Expect At Mobile World Congress 2014?

Thomas Husson

Last year, when attending my tenth Congress in a row, I wrote that MWC 2013 would be more global and more disruptive than ever before. I believe the same will be true this year, with 2014 bringing a very important milestone in the shift to mobile: an install base of more than 2 billion smartphones globally. Mobile is transforming every industry by offering global reach and the ability to offer contextual services. That’s why we'll see many more marketers, agencies, business executives, and strategists attend the traditional telecom show.

Gone are the days when MWC was about operators' supremacy. As my colleague Dan Bieler summed it up in this blog post, telcos are increasingly being backed into a corner. I still remember this quote from Arun Sarin, the former CEO of Vodafone, in the Financial Times in November 2007: “Just the simple fact we have the customer and billing relationship is a hugely powerful thing that nobody can take away from us.” Really? Well, in the meantime, Apple and Google have created two powerful mobile platforms that have disrupted entire industries and enabled new entrants to connect directly to customers.

From a marketing and strategy perspective, I'd categorize the likely announcements in three main areas:

1)    The Asian Device Spec Fashion Week: Getting Lost In Device Translation

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Lenovo Bets On The Mobile Mind Shift And Aims To Be A Digital Platform

Frank Gillett

Lenovo’s made three strategic moves in just one month: 1) Buying IBM’s x86 server business, 2) Reorging into four business units – most importantly including one called “ecosystem and cloud group”, and 3) Buying Motorola Mobility. The later two are driven by the mobile mind shift – the increasing expectation of individuals that they can access information and service, in context, in their moment of need. Smartphones are central to that – as are the ecosystem and cloud services that deliver value through the smartphones.

Lenovo has stated intentions to become a leading smartphone maker globally, building on their leading position in the China market. Buying Motorola Mobility is a much quicker way for Lenovo to access the premium smartphone market with a leading Google Android (not forked Android) offering - than trying to do it with their existing design teams and brand reach. Using Motorola, just as Lenovo used the IBM ThinkPad brand, to gain quick credibility and access to desirable markets, and built critical mass makes a lot of sense. 

But Motorola has not been shooting the lights out with designs or sales volumes in smartphones. So the value is simply in brand recognition to achieve market recognition faster - and to dramatically expand the design and marketing team with talent experienced at US and Western markets. 

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