This isn't shaping up to be the transcendent week that Microsoft wanted it to be. The Windows 8 announcement isn't a failure by any means, but the coverage is a lot more mixed and confused than I'm sure Microsoft would have liked. That's partly due to some clever marketing by Microsoft's competitors, and partly due to some mistakes made by Microsoft itself.
The situation all came together for me this morning when I did a brief appearance on Bloomberg TV, a cable business channel in the US. The segment was supposed to cover the new iPad Mini and Windows 8, with equal time given to each one. The Bloomberg folks spent time with me yesterday prepping the questions on each subject.
The equal billing of iPad Mini with Windows 8 is itself bad news for Microsoft. Windows 8 represents the reinvention of Microsoft, one of the biggest changes the company has ever made. The iPad Mini is a follow-on product in the iPad line. It's a very nice follow-on, and probably one that will sell very well, but it's not at the same level of importance as Windows 8. However, hardware gets more attention in the tech press than software. It's more tangible, and people react to it emotionally. So the Mini jumped right into the mix.
Apple very cleverly timed the Mini announcement a couple of days before the formal Windows 8 rollout, distracting the press from Microsoft's story. It reminds me a bit of the way the iPhone rumors undercut the Microsoft Zune launch in late 2006.
Leaking Flagship
Even with the competitive game-playing, Microsoft's announcement should have been OK. But then Microsoft failed to ship the Intel-compatible "Pro" version of its new Surface tablet on time. Instead, the only Surface device being reviewed right now is the Windows RT version, which can't run existing Windows software. Since Surface is the Windows 8 flagship, and hardware gets more coverage than software anyway, the concerns about Windows compatibility in Surface RT are dominating a lot of Windows 8 press coverage.
One of the most biting Surface reviews was David Pogue's in the New York Times, who compared Surface to owning "a new Ferrari...that has to be refueled every three miles." (link). PC Magazine called it "a disaster" (link). You can see more reviews summarized here.
There's an answer to the concerns about Surface RT: wait and buy the pro version. But the last thing a vendor wants to do right before the December buying season is tell customers not to buy. You'll hurt sales of not just Surface RT, but all other Windows 8 products as well. So Microsoft can't push that message aggressively. (Hey, Microsoft -- you say you want to be a device company? Lesson No. 1 is that you have to ship your high-end flagship product before Christmas, not right after it.)
The Windows 8 muddle was in full play for the Bloomberg segment, which started with video of Bloomberg's Sara Silverstein and Gizmodo's Sam Biddle trying to use Excel on Surface. Sara tries and fails to copy a formula using the touchscreen. Sam tells her Microsoft claims you can use all of Excel in the touch version. Sara replies sarcastically, "I believe that you would...if you're making a spreadsheet about, you know, lemonade stands" (link).
Then the segment jumps to the iPad Mini, with a discussion of how it stacks up against Amazon's subsidized tablet hardware. That's a great topic, and deserves a lot of thought. In fact, it goes on so long that Bloomberg runs out of time and never comes back to Windows 8 (link). So Apple and Amazon steal most of the oxygen, and the only impression you get about Windows 8 is that it's not ready for serious business use.
Not all the Windows 8 coverage is negative. For example, Walt Mossberg did a nicely balanced piece on All Things D (link), and Wired was pretty positive about Surface (link). But the story of Windows 8 is complicated. In a world of quick sound bites, it's very easy for the press to caricature Windows 8 as "that touch screen thing that doesn't run your stuff properly." Clever marketing by Apple is giving Microsoft less time in the press to explain the nuances of Windows 8, and the failure to ship Surface Pro on time makes Microsoft's job even tougher. Microsoft has enough money to wait out the bad coverage, but I think it's less and less likely that Windows 8 will deliver the massive initial sales that Microsoft promised for it.
The Windows 8 Muddle
"Social" as a Business Tool, and Richard Windsor Unchained
I'd like to call your attention to two new information resources on the web.
"Social" as a business tool. First, my friend and former colleague Nilofer Merchant has written an ebook on the role of "social" tools in business strategy and operations. It's called "11 Rules for Creating Value in the Social Era," and is published through Harvard Business Review. In the book, Nilofer addresses a flaw in thinking that we saw in many businesses while we were consulting at Rubicon: when you say "social," most established companies think of a new medium for marketing their products, like a new form of advertising. So they assign social responsibility to their marketing team, and treat it as a method to shove one-way messages into the eyes and ears of customers.
But some companies, especially startups, are learning to integrate the full range of what we call "social" tools deeply into all of their business processes and decision-making. It requires a fundamental rethinking of everything you expect a business to do. To give you one very minor example from the startup I'm involved in, when you have a small team and Skype, do you really need to pay for office space and the time involved in commuting every day? Do you even need all your team members to live in the same country?
It sounds simple to folks who live online, but you'd be amazed by how hard it is for an established company, even a tech company, to rethink its business processes.
Nilofer's book is, as she says, a "quick read" designed to help you rethink business from a social perspective. You can learn more here.
Richard Windsor Unchained. In this age of tweets and shared videos, I'm delighted to see a new old-fashioned blog on the mobile industry. Richard Windsor has been for a long time one of my favorite financial analysts covering mobile. His short bullet-point e-mails analyzing earnings reports were always pungent and on-point, and since he's based in London he's outside the Silicon Valley groupthink. Richard recently left Nomura and is now free to share his opinions online, in a new blog here.
An excerpt from his recent comments on RIM:
"• RIMM also managed to grow the subscriber base by 2m to 80m but the mix and quality of these subscribers is falling fast despite this quarter’s blip.
• Out go the high spending corporate executives spending $100+ per month and in come the teenage texters in Indonesia spending more like $5 a month."
Yup.
