In all of the news about Apple and Google and Amazon.com and Microsoft, we forget the other players. The one that I am pondering is Yahoo.
Can Yahoo succeed in the new land of mobile/cloud computing?
People like Yahoo's products. It's e-mail and Flickr offerings are capable and reliable. (I use the "pro" versions of both, so I pay a nominal annual fee for them.)
But Yahoo's success has been on the web. Can it move to mobile/cloud?
One challenge for Yahoo will be living in the world of combined (or at least coordinated) hardware and software. Apple, Microsoft, Google, and Amazon.com all sell solutions that encompass hardware and software, and this is re-enforced with the DRM-enabled walled garden for each. Yahoo's products live in the software realm, and Yahoo has no hardware to augment its offerings. (This may be a good thing. The market is crowded with iOS and Android devices, and even Microsoft is having a difficult time getting its Surface tablet into the market.)
Yahoo does partner with Microsoft for search -- Yahoo search is driven by Microsoft's Bing engine. But I think that Yahoo can survive with other areas.
Yahoo's biggest advantage may be its reputation. It doesn't have rabid followers like Apple or Microsoft; instead of fanboys it has what might be best described as a loyal following. Yahoo has been a quiet if not good member of the software world. It has not unsold books to people, or arbitrarily rejected applications, or treated developers poorly.
One person asked of Marissa Mayer: "Please, make Yahoo cool again." I agree. We need a company that makes computing cool. And Yahoo may just be the company that can do it.
Friday, December 28, 2012
Thursday, December 20, 2012
The Cheapening of IT
The prices for computing equipment, over the years, have moved in one direction: down. I believe that the decrease in prices for hardware has an affect on our willingness to pay for software.
In the early 1960s, a memory expansion for the IBM 1401 provided 8K of what we today call RAM, at a price of $258,000. That was only the expansion pack of memory; the entire system cost several times that amount. With an investment of over a million dollars for hardware, an additional investment of several tens of thousands of dollars for software was quite the bargain.
In 1977, a Heathkit 8-bit microcomputer with an 8080 processor, 4K of RAM, and a cassette tape recorder/player (used for long-term storage prior to floppy disks), cost almost $1500. Software for such a computer ran from $20 (for a simple text editor) to $400 (for the Microsoft COBOL compiler).
Today, smart phone or tablet costs range from $200 to $1000. (Significantly less than the Heathkit 8-bit system, once you account for inflation.) Tablet apps can cost as much as $10. Some are more, and some are free.
What affect does this decrease in the hardware cost have on the cost of software?
Here's my theory: as the cost of hardware decreases, the amount that we are willing to pay for software also decreases. I can justify spending $400 for software when the hardware costs several times that amount. But I have a harder time spending $400 on software when the hardware costs less than that. My bias is for hardware, and I am assigning higher intrinsic value to the hardware than the software. (The reasons behind this are varied, from the physical nature of hardware to the relationship with the vendor. I'm pretty sure that one could find a Master's thesis in this line of study.)
But if a cheapening of the hardware leads to a cheapening of the software, how does that change the industry? Assuming that the theory is true, we should see downward pressure on the cost of applications. And I think that we have seen this. The typical phone and tablet app holds a retail price that is significantly less than the price for a typical desktop PC application. "Angry Birds" costs only a fraction of the price of Microsoft Office.
I expect that this cost bias will extend to PC apps that move to tablets. Microsoft Word on the Surface will be priced at under $40 (perhaps as an annual subscription) and possibly less. The initial release of the Surface includes a copy of Word, although it is restricted to non-commercial use.
I also expect that the price of desktop PC apps will fall, keeping close to the prices of tablet apps. Why spend $400 for Word on the PC when one can get it for $40 on the tablet? The reduced price of apps on one platform drives down the price of apps on all platforms.
The cheapening affect may go beyond off-the-shelf PC applications. As the prices of desktop applications fall, we may see pressure to reduce the price of server-based systems, or server components of multiplatform systems. Again, this will be driven not by technology but by psychology: I cannot justify a multi-thousand dollar cost for a server component when the corresponding desktop applications have low costs. The reduced prices of desktop applications drives down the prices of equivalent server applications. Not all server applications, mind you; only the server applications that have desktop equivalents, and only then when those desktop equivalents are reduced in price to match tablet apps.
The general reduction of prices for desktop and server applications may create difficulties for the big consulting shops. These shops charge high prices for the development of custom applications for businesses. Psychology may cause headaches for their sales teams: why should I spend hundreds of thousands of dollars on a custom app (which includes clients for desktop PCs, tablets, and smartphones, of course) when I can see that powerful, competent apps are marketed for less than $10 per user? While there is value is a custom application, and while a large company may need many "downloads" for their many users, the argument for such high prices becomes difficult. Is a custom app really adding that much value?
Look for the large consulting houses to move into new technologies such as cloud and "big data" as ways of keeping their rates high. By selling these new technologies, the consulting houses can offer something that is not readily apparent in the off-the-shelf apps. (At least until their customers figure out that the off-the-shelf apps are also using cloud and "big data" tech.)
All of this leads to downward pressure on the prices of apps, whether they are simple games or complex systems. That pressure, in turn, will put downward pressure on development costs and upward pressure for productivity. Where a project was run with a project manager, three tech leads, ten developers, three testers, two analysts, and a technical writer, future projects may be run with a significantly smaller team. Perhaps the team will consist of one project manager, one tech lead, three developers, and one analyst. I'm afraid the "do more with less" exhortation will be with us for a while.
In the early 1960s, a memory expansion for the IBM 1401 provided 8K of what we today call RAM, at a price of $258,000. That was only the expansion pack of memory; the entire system cost several times that amount. With an investment of over a million dollars for hardware, an additional investment of several tens of thousands of dollars for software was quite the bargain.
In 1977, a Heathkit 8-bit microcomputer with an 8080 processor, 4K of RAM, and a cassette tape recorder/player (used for long-term storage prior to floppy disks), cost almost $1500. Software for such a computer ran from $20 (for a simple text editor) to $400 (for the Microsoft COBOL compiler).
Today, smart phone or tablet costs range from $200 to $1000. (Significantly less than the Heathkit 8-bit system, once you account for inflation.) Tablet apps can cost as much as $10. Some are more, and some are free.
What affect does this decrease in the hardware cost have on the cost of software?
Here's my theory: as the cost of hardware decreases, the amount that we are willing to pay for software also decreases. I can justify spending $400 for software when the hardware costs several times that amount. But I have a harder time spending $400 on software when the hardware costs less than that. My bias is for hardware, and I am assigning higher intrinsic value to the hardware than the software. (The reasons behind this are varied, from the physical nature of hardware to the relationship with the vendor. I'm pretty sure that one could find a Master's thesis in this line of study.)
But if a cheapening of the hardware leads to a cheapening of the software, how does that change the industry? Assuming that the theory is true, we should see downward pressure on the cost of applications. And I think that we have seen this. The typical phone and tablet app holds a retail price that is significantly less than the price for a typical desktop PC application. "Angry Birds" costs only a fraction of the price of Microsoft Office.
I expect that this cost bias will extend to PC apps that move to tablets. Microsoft Word on the Surface will be priced at under $40 (perhaps as an annual subscription) and possibly less. The initial release of the Surface includes a copy of Word, although it is restricted to non-commercial use.
I also expect that the price of desktop PC apps will fall, keeping close to the prices of tablet apps. Why spend $400 for Word on the PC when one can get it for $40 on the tablet? The reduced price of apps on one platform drives down the price of apps on all platforms.
The cheapening affect may go beyond off-the-shelf PC applications. As the prices of desktop applications fall, we may see pressure to reduce the price of server-based systems, or server components of multiplatform systems. Again, this will be driven not by technology but by psychology: I cannot justify a multi-thousand dollar cost for a server component when the corresponding desktop applications have low costs. The reduced prices of desktop applications drives down the prices of equivalent server applications. Not all server applications, mind you; only the server applications that have desktop equivalents, and only then when those desktop equivalents are reduced in price to match tablet apps.
The general reduction of prices for desktop and server applications may create difficulties for the big consulting shops. These shops charge high prices for the development of custom applications for businesses. Psychology may cause headaches for their sales teams: why should I spend hundreds of thousands of dollars on a custom app (which includes clients for desktop PCs, tablets, and smartphones, of course) when I can see that powerful, competent apps are marketed for less than $10 per user? While there is value is a custom application, and while a large company may need many "downloads" for their many users, the argument for such high prices becomes difficult. Is a custom app really adding that much value?
Look for the large consulting houses to move into new technologies such as cloud and "big data" as ways of keeping their rates high. By selling these new technologies, the consulting houses can offer something that is not readily apparent in the off-the-shelf apps. (At least until their customers figure out that the off-the-shelf apps are also using cloud and "big data" tech.)
All of this leads to downward pressure on the prices of apps, whether they are simple games or complex systems. That pressure, in turn, will put downward pressure on development costs and upward pressure for productivity. Where a project was run with a project manager, three tech leads, ten developers, three testers, two analysts, and a technical writer, future projects may be run with a significantly smaller team. Perhaps the team will consist of one project manager, one tech lead, three developers, and one analyst. I'm afraid the "do more with less" exhortation will be with us for a while.
Tuesday, December 18, 2012
Windows RT drops some tech, and it hurts
Say what you will about Microsoft's innovation, licenses, or product quality, but one must admit that Microsoft has been quite good at supporting products and providing graceful upgrades. Just about every application that ran on Windows 3.1 will run on later versions of Windows, and most DOS programs will run in the "Command Prompt" application. Microsoft has provided continuity for applications.
The introduction of Windows RT breaks that pattern. With this new version of Windows, Microsoft has deliberately selected technologies into "keep" and "discard" piles -- and it has done so without even a "deprecated" phase, to give people some time to adjust.
The technologies in the "discard" pile are not insignificant. The biggest technology may be Silverlight, Microsoft's answer to Adobe's Flash. It is allowed in Windows 8 but not in Windows RT.
Such a loss is not unprecedented in the Microsoft community, but it is infrequent. Previous losses have included things like Microsoft Bob and Visual J#, but these were minor products and never gained much popularity.
The most significant losses may have been FoxPro and the pre-.NET version of Visual Basic. These were popular products and the replacements (Microsoft Access and VB.NET) were significantly different.
The loss of technologies hurts. We become attached to our favorite tech, whether it be Silverlight, Visual Basic, or earlier technologies such as Microsoft's BASIC interpreter (the one with line numbers), the 6502 processor, or DEC's PDP-11 systems.
Microsoft fans (with the exception of the FoxPro and Visual Basic enthusiasts) have not experienced a loss. Until Windows RT. Microsoft's strong support for backwards-compatibility in its operating systems, languages, and applications has sheltered its users.
Those of us from certain graduating classes, those of us who were around before the introduction of the IBM PC, have experienced loss. Just about everyone from those classes lost their favorite tech as the "new kid" of the IBM PC became popular, set standards, and drove out the other designs. The Apple II, the TRS-80, the Commodore systems, (and my favorite, the Heathkit H-89) were all lost to us. We had formed our loyalties and had to cope with the market-driven choices of new technology.
Folks who joined the tech world after the IBM PC have experienced no such loss. One may have started with PC-DOS and followed a chain of improved versions of DOS to Windows 3.1 to Windows NT to Windows XP, and a chain of upgrades for Word, Multiplan to Excel, and Access to SQL Server.
Windows RT marks the beginning of a new era, one in which Microsoft drops the emphasis on backwards-compatibility. The new emphasis will be on profitability, on selling Surface units and (more importantly) apps and content for Windows RT tablets.
To the Windows developers and users: I'm sorry for your loss, but I have gone through such losses and I can tell you that you will survive. It may seem like a betrayal -- and it is. But these betrayals happen in the tech world; companies make decisions on profit, not your happiness.
The introduction of Windows RT breaks that pattern. With this new version of Windows, Microsoft has deliberately selected technologies into "keep" and "discard" piles -- and it has done so without even a "deprecated" phase, to give people some time to adjust.
The technologies in the "discard" pile are not insignificant. The biggest technology may be Silverlight, Microsoft's answer to Adobe's Flash. It is allowed in Windows 8 but not in Windows RT.
Such a loss is not unprecedented in the Microsoft community, but it is infrequent. Previous losses have included things like Microsoft Bob and Visual J#, but these were minor products and never gained much popularity.
The most significant losses may have been FoxPro and the pre-.NET version of Visual Basic. These were popular products and the replacements (Microsoft Access and VB.NET) were significantly different.
The loss of technologies hurts. We become attached to our favorite tech, whether it be Silverlight, Visual Basic, or earlier technologies such as Microsoft's BASIC interpreter (the one with line numbers), the 6502 processor, or DEC's PDP-11 systems.
Microsoft fans (with the exception of the FoxPro and Visual Basic enthusiasts) have not experienced a loss. Until Windows RT. Microsoft's strong support for backwards-compatibility in its operating systems, languages, and applications has sheltered its users.
Those of us from certain graduating classes, those of us who were around before the introduction of the IBM PC, have experienced loss. Just about everyone from those classes lost their favorite tech as the "new kid" of the IBM PC became popular, set standards, and drove out the other designs. The Apple II, the TRS-80, the Commodore systems, (and my favorite, the Heathkit H-89) were all lost to us. We had formed our loyalties and had to cope with the market-driven choices of new technology.
Folks who joined the tech world after the IBM PC have experienced no such loss. One may have started with PC-DOS and followed a chain of improved versions of DOS to Windows 3.1 to Windows NT to Windows XP, and a chain of upgrades for Word, Multiplan to Excel, and Access to SQL Server.
Windows RT marks the beginning of a new era, one in which Microsoft drops the emphasis on backwards-compatibility. The new emphasis will be on profitability, on selling Surface units and (more importantly) apps and content for Windows RT tablets.
To the Windows developers and users: I'm sorry for your loss, but I have gone through such losses and I can tell you that you will survive. It may seem like a betrayal -- and it is. But these betrayals happen in the tech world; companies make decisions on profit, not your happiness.
Wednesday, December 12, 2012
Windows blues
Windows "Blue" is the new version of Windows, and it is disruptive.
I expect Windows "Blue" to integrate with Microsoft's cloud services. This is an easy prediction: the industry moving to cloud services, and Microsoft will move with the industry as they have in the past. Also, Microsoft brands its cloud services with the name "Azure". (Get it? "Blue" and "Azure"?)
The more disruptive aspect of Windows Blue is the release schedule. Microsoft will be releasing this version of Windows one year after Windows 8. In doing so, Microsoft increases the frequency of Windows releases and matches Apple and Linux distributions. (The Ubuntu Linux folks release two versions each year!)
It may be that this is a fluke, a one-time occurrence of back-to-back releases of Windows. But it's more fun to assume that this is the new pace for Windows. What does such a change mean?
For starters, the Microsoft teams must be prepared to select features, implement them, test them, and prepare a release (including marketing, advertising, and fulfillment) on a much shorter schedule than before. A faster release schedule forces Microsoft to limit the new features of a release, which in turn means smaller changes from release to release. (Smaller "jumps" in features may be good for the users of Windows, giving them smaller "shocks" from one version to another.)
A faster release cycle lets Microsoft track changes in hardware. Microsoft can add new features (voice recognition, handwriting recognition, support for tablets, support for wireless tech) without resorting to the service packs and developer kits of the past. Keeping up with hardware lets Microsoft compete with Apple and Linux.
More frequent releases also lets Microsoft track changes in software. They can include later versions of browsers in their operating systems, and assume that people who install other browsers will install the latest version. The days of an "IE 6 browser" (outdated but popular from sheer inertia) may be over.
Consumers will probably change their view of PCs and computing devices (tablets, phones) and consider them more like small appliances and less like major purchases. They may be willing to upgrade their equipment every two years, as they do with cell phones.
Corporations and government agencies may dislike the increased frequency of releases. Larger organizations tend to avoid upgrades, trying to get the maximum life out of devices. I suspect that corporations prefer computing equipment to be like water or electricity: present all of the time and never changing. What these long-term users want is computing services, not computing equipment. Cloud computing should appeal to them. Fast releases of Windows (and browsers, and development IDEs) will not. (But where can they go? Microsoft, Apple, and Linux are all playing this game.)
Windows "Blue" will be a step forward in Microsoft's strategy. It may not be the step that everyone wants, and it may cause a few people some discomfort. We can complain, we can cling to old versions, or we can acknowledge the change and prepare for it.
I expect Windows "Blue" to integrate with Microsoft's cloud services. This is an easy prediction: the industry moving to cloud services, and Microsoft will move with the industry as they have in the past. Also, Microsoft brands its cloud services with the name "Azure". (Get it? "Blue" and "Azure"?)
The more disruptive aspect of Windows Blue is the release schedule. Microsoft will be releasing this version of Windows one year after Windows 8. In doing so, Microsoft increases the frequency of Windows releases and matches Apple and Linux distributions. (The Ubuntu Linux folks release two versions each year!)
It may be that this is a fluke, a one-time occurrence of back-to-back releases of Windows. But it's more fun to assume that this is the new pace for Windows. What does such a change mean?
For starters, the Microsoft teams must be prepared to select features, implement them, test them, and prepare a release (including marketing, advertising, and fulfillment) on a much shorter schedule than before. A faster release schedule forces Microsoft to limit the new features of a release, which in turn means smaller changes from release to release. (Smaller "jumps" in features may be good for the users of Windows, giving them smaller "shocks" from one version to another.)
A faster release cycle lets Microsoft track changes in hardware. Microsoft can add new features (voice recognition, handwriting recognition, support for tablets, support for wireless tech) without resorting to the service packs and developer kits of the past. Keeping up with hardware lets Microsoft compete with Apple and Linux.
More frequent releases also lets Microsoft track changes in software. They can include later versions of browsers in their operating systems, and assume that people who install other browsers will install the latest version. The days of an "IE 6 browser" (outdated but popular from sheer inertia) may be over.
Consumers will probably change their view of PCs and computing devices (tablets, phones) and consider them more like small appliances and less like major purchases. They may be willing to upgrade their equipment every two years, as they do with cell phones.
Corporations and government agencies may dislike the increased frequency of releases. Larger organizations tend to avoid upgrades, trying to get the maximum life out of devices. I suspect that corporations prefer computing equipment to be like water or electricity: present all of the time and never changing. What these long-term users want is computing services, not computing equipment. Cloud computing should appeal to them. Fast releases of Windows (and browsers, and development IDEs) will not. (But where can they go? Microsoft, Apple, and Linux are all playing this game.)
Windows "Blue" will be a step forward in Microsoft's strategy. It may not be the step that everyone wants, and it may cause a few people some discomfort. We can complain, we can cling to old versions, or we can acknowledge the change and prepare for it.
Saturday, December 1, 2012
Unexpected success
George Lucas is know for the "Star Wars" movies, some of the most successful movies of all time.
Yet I suspect it started differently.
In 1977, Lucas had the movies "THX-1138" and "American Graffiti" behind him. "THX-1138" is an obscure movie, now most famous for being one of Lucas' creations. It is a decent movie, and respected by science fiction fans, but not known outside of fandom. "American Graffiti" was a successful movie: popular in its day but now more of a fond memory. (When was the last time you watched it?) There is nothing in either movie that says "genius movie maker".
I suspect that George Lucas made "Star Wars" and was hoping for a reasonable amount of success, and that he was not expecting the movie to become the foundation of a franchise and marketing empire.
I believe that Apple, with the first iPhone, was, like George Lucas, hoping for a reasonable amount of success. I also believe that the tremendous response far surpassed Apple's expectations. (I suspect it also surpassed AT&T's expectations, which conveniently explains the difficulties encountered by so many new iPhone customers when they activated their accounts.)
Their successes were due, in part, to the gambles that each made. Lucas used computers to control the models of X-wing fighters, selected classical music, and released in the summer. Apple created an elegant design quite different from contemporary cell phones, leveraged its "easy to install" ideas for apps from Mac OSX, and built an interface that was different from the traditional Windows (and even Mac) OS.
Lucas' work stamped itself onto our culture, with "The Force" and even the quote "I've got a bad feeling about this".
Apple's work changed the course of the industry, such that Microsoft Windows and the "windows, icons, mouse, and pointer" theme is no longer the design leader. Microsoft's introduction of Windows RT and the "Modern" UI shows the effect of the iPhone success.
All of which perhaps is evidence that success is something that cannot be planned, timed, or scheduled, and that success can come from taking risks and ignoring established ideas.
Yet I suspect it started differently.
In 1977, Lucas had the movies "THX-1138" and "American Graffiti" behind him. "THX-1138" is an obscure movie, now most famous for being one of Lucas' creations. It is a decent movie, and respected by science fiction fans, but not known outside of fandom. "American Graffiti" was a successful movie: popular in its day but now more of a fond memory. (When was the last time you watched it?) There is nothing in either movie that says "genius movie maker".
I suspect that George Lucas made "Star Wars" and was hoping for a reasonable amount of success, and that he was not expecting the movie to become the foundation of a franchise and marketing empire.
I believe that Apple, with the first iPhone, was, like George Lucas, hoping for a reasonable amount of success. I also believe that the tremendous response far surpassed Apple's expectations. (I suspect it also surpassed AT&T's expectations, which conveniently explains the difficulties encountered by so many new iPhone customers when they activated their accounts.)
Their successes were due, in part, to the gambles that each made. Lucas used computers to control the models of X-wing fighters, selected classical music, and released in the summer. Apple created an elegant design quite different from contemporary cell phones, leveraged its "easy to install" ideas for apps from Mac OSX, and built an interface that was different from the traditional Windows (and even Mac) OS.
Lucas' work stamped itself onto our culture, with "The Force" and even the quote "I've got a bad feeling about this".
Apple's work changed the course of the industry, such that Microsoft Windows and the "windows, icons, mouse, and pointer" theme is no longer the design leader. Microsoft's introduction of Windows RT and the "Modern" UI shows the effect of the iPhone success.
All of which perhaps is evidence that success is something that cannot be planned, timed, or scheduled, and that success can come from taking risks and ignoring established ideas.
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