Much Ado About the MS Surface is Puzzling

| Editorial

There has been a lot of jumping on the Microsoft Surface bandwagon. One has to wonder why, in this very technical era, why there is so much wish fulfillment.

I’ve been vastly amused by the analysis of the business prospects of the Microsoft Surface, a product we don’t really know a lot about, whose price hasn’t been announced and which is not yet shipping.

One might look into the product, strip away the hype and size up its prospects. On the other hand, when a new product comes out, there is also an immediate temptation to tap into the curiosity about the product and then embellish that need with a lot of unfounded speculation, indeed, misplaced and irrational enthusiasm.

MS Surface

Image Credit: Microsoft

No doubt there are websites that want to cash in on a perceived distaste for Apple. Perhaps there’s a thread of desire to see Apple get its comeuppance. Perhaps there are Microsoft fans of old who fear for the company in the Post-PC era and desperately want to see the company make a comeback.

Been There, Done That

There was a time when we had high hopes for the Hewlett Packard TouchPad. The hidden assumption was the H-P had the technical talent, engineering resources, technical leadership and manufacturing experience to execute a competing tablet. And H-P had Jon Rubinstein, a virtual icon when he was at Apple. What could go wrong?

What led us astray at the time was that we assumed that H-P had the same ability as Apple to execute on all fronts: OS, hardware, manufacturing and marketing.

Then came the Amazon Kindle Fire. We (and by we I mean Bryan Chaffin) correctly estimated that a tablet without backend infrastructure fails. If it can’t provide music, video, shopping, books and a vast app library, a tablet by itself is a doorstop. But Amazon couldn’t compete with Apple’s manufacturing juggernaut and technology base. Amazon could only compete on price, and so the very limited Fire relegated itself to a small part of the tablet market.

Surface Effects

Today, we’re looking at a new horse in the race, the Microsoft Surface. Looking at the specs, what little we have, nicely summarized by Bryan Chaffin, we see a product that isn’t well defined. That makes it really hard to construct an objective analysis of its prospects.

We can probably assume that it will leverage Microsoft’s current rights for content that are delivered on the Xbox. We can probably assume that Microsoft has done its homework and catered to the business community, checked the IT boxes and catered to its legacy Windows product.

The real question, however, is that Microsoft has bet the farm on the idea that a tablet is simply a portable PC. It’s a notebook in function, but disguised as a tablet. For 28 months, Apple has demonstrated that the tablet is a new animal, a new life form on the computer tree of evolution.

Ten years from now, when we trace the development of personal computing and draw those ancestry charts, the family tree of devices, we’ll likely see that customers embraced Apple’s vision of a tablet as a new breed of product that’s used in many new ways. Tim Cook himself expressed that vision when, in the last Apple earnings call, he voiced no interest in convergence, the infamous toaster-fridge. For Microsoft to force the convergence of a tablet and Windows for the sake of turf protection is an approach that goes strongly against the grain of two plus years of Apple experience, earning billions and converting customers. Natural evolution is a good bet, and for Microsoft to go against that is a major, risky bet.

iPad 3 RetinaA new breed of product, laser sharp focus by Apple

Image Credit: Apple

Questions have been raised about the profit margin stolen by Microsoft by not having to pay OEM licence fees for Windows 8. Question have been raised about Microsoft greatly upsetting its OEM partners, placing that product in its flagship stores. Questions have been raised about whether there is a large enough market to support the Surface, as Microsoft envisions it. More questions can be raised about Microsoft’s capacity to execute on the same level as Apple. As Bryan Chaffin wrote, so concisely, “If Microsoft is right, they will sew up the market for toaster-fridges.

Predictions About Predictions

I think you’ll see a lot of predictions. Analysts who get paid to project market share don’t typically use thousand node supercomputers with a million lines of simulation code to assess the market forces. The best they can do is look at history and surmise that Microsoft’s Surface will have a certain appeal and it will, most assuredly, gain market share against Apple’s iPad. Warm fuzzies will abound. But remember, Apple fought brilliantly against Windows with OS X for a decade and could only grab single digit market share of an already entrenched market. Asian companies fought valiantly against the iPod and could never gain a serious foothold. And then there was the Zune.

This is why Apple is embracing the iPad as a brand new product category. Sales and customer preference bear that out. The notion of the Post-PC era can’t be negated by a single Microsoft presentation.

The optimistic prediction that Microsoft can grab much more against Apple’s iPad will be comforting to many, but it has no technical basis, based on simulations, analysis, sales data or previous experience.

I’ll be very interested to see how this product evolves. But it’s going to take a year’s worth of sales data before we can determine if Microsoft’s big bet has paid off. Until then, all the giddy articles about the Surface seem to be either hit-mongering, wish fulfillment or both.

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35 Comments Leave Your Own

geoduck

At this point the MS Surface is just a Rorschach test. People are going to project their hopes and fears into the unknown specs and then the web will pontificate about these ersatz configurations.

It could still die due to MS’s legendary internal infighting. Remember Kin.

Gareth Harris

I agree with geoduck:

At this point the MS Surface is just a Rorschach test.

All this reminds me of the days of long ago and the originators and masters of FUD - IBM, who trained their child, M$, well. For those of you younger than us geezers, IBM, whose cabinets were blue was also called “Big Blue.” And there were a couple of sayings:

1 - Nobody ever got fired for buying IBM.
2 - You could sell s—t if you could paint it blue.

Some days life is a tragedy, some days a comedy. Take your pick.

Mike

my prediction: it will be a second Zune. Two years from now we will be asking Surface? What’s that? Microsoft has no taste. Microsoft has no brilliance, has no vision. Doing a tablet with a keyboard and having it crash on the presentation to the press is an example of how half cooked they show stuff and probably release.

peter c

Some days life is a tragedy, some days a comedy. Take your pick.

The difference between Tragedy and Comedy is timing. Most Comedy is past Tragedy.

MS appears not to have learned from the more tragic elements of its past. It continues to focus on products instead of purpose, and so opens itself to future lampooning.

The bottom-line is that we don’t buy tools for themselves, but for their use. By that metric, the best tool is the one we least notice when we use it. For the more we see the product, the less useful it becomes.

Microsoft provides products, not solutions. This approach to design addresses the wrong ends and so tends to create its own set of problems whenever its products are used.

Contrary to solutions, products always get in the way.

The Tablet contest isn’t about Tablets, no one knows that better than Apple and because of that it will continue to dominate the market.

Nemo

With Siri and dictation coming to the iPad, who needs either a keyboard or a pen.  However, for those who, notwithstanding Siri and dictation, still want or need those options, Apple provides a Bluetooth keyboard for its iPad, and I believe that there is or can easily be a third-party pen for the iPad.  Considering the foregoing, what do the known features of the Surface offer the enterprise or anyone else that would cause them to switch from Apple’s iPad to Microsoft’s Surface or, with first-time buyers, choose the Surface over the iPad’s Retina display, aggressive pricing, and vastly greater and vastly more mature ecosystem of software and accessories?

MacFrogger

Nemo asked:

[W]hat would cause them to…choose the Surface over the iPad?s Retina display, aggressive pricing, and vastly greater and vastly more mature ecosystem of software and accessories?”

With my apologies for changing the “t” to a “w” - but it now reads as a question.

Its rather simple really: familiarity.  You make the assumption that the end user chooses his/her products, but in many large orgs that’s simply not the case.  In most large orgs corporate IT decides what to buy (e.g. crappy Dell laptops) and if you don’t like it, tough.  In my own org we just received a brand new crop of touch screen Blackberries - just what everyone was longing for (NOT!). 

By familiarity, I mean the comfort that most Enterprise IT people have with MS and their strong desire to remain a MS shop. Its employment security for one…

garethharris insightfully reminded us:

You could sell s?t if you could paint it blue.

MS is already selling s—t (in some, but not all respects), and they know it and so does your local MS-certified IT guy.  Which is why so many corporations and govt agencies are still running Windows XP.  “Are you having problems with that sir?  No problem, we’ll be right up there to help you!”

I beg to differ with y’all, but the Surface - even if its half-baked - will do well. But it will take time. I don’t think for one minute that MS’ demo of vaporware was aimed at Apple, it was a pre-emption of Google’s pending new tablet announcement next week.  Just as Google’s Maps announcement a week before WWDC was aimed at pre-empting Apple’s new maps capabilities.  MS simply MUST show the Enterprise something to reassure them that a MS tablet is on the way - these guys are getting scared!! This gives them everything they need to hold off even more massive adoption of iPads, or worse (in their minds), connecting “risky” untested Android tablets to the network.

MacFrogger

Oh yeah forgot the second part of the answer to Nemo’s question in my long-winded reply

[W]hat would cause them to?choose the Surface over the iPad?s Retina display, aggressive pricing, and vastly greater and vastly more mature ecosystem of software and accessories??

Microsoft Office. Their trump card.  What very few businesses can do without.

skipaq

Well said Nemo.

Nemo

Dear MacFrogger:  There are at least two fatal flaws in you analysis.  First, the iPad is the virtual incumbent in the enterprise.  The enterprise, both for general use and in vertical markets, has rapidly adopted the iPad, so much so that the Surface will be facing enterprise markets that are familiar with and have adopted the iPad, while the surface will be the new and untried product.  CTOs and CIOs that want to be conventional will choose or stick with the iPad.  After all, no one ever got fired for choosing the iPad.

Second, perhaps you missed it, but Microsoft has announced Microsoft Office (Office) for the iPad, which gives you some idea of both how well entrenched the iPad is in the enterprise and how doubtful Microsoft is that the Surface will succeed even in the enterprise. 

Also, with Apple’s iWork’s file compatibility with Office, who needs Office any way?  I’ve quit using Office.  I compose all my briefs and other documents in either iWork’s Pages or OpenOffice’s Writer and routinely file those documents in courts’ electronic filing systems and with clients and opposing parties and have had no complaints.  And this another reason why Microsoft is compelled to get Office for the iPad shipped, because, if Office for iPad doesn’t ship soon, the enterprise may well movie to standardizing on the much less expensive and at least as capable iWork office suite.

geoduck

Welcome back Nemo. Haven’t seen you ‘round here for a while.

aardman

A mobile computer with a smallish screen and a matching undersized keyboard.  We’ve seen that come and go before.  Starts with N, ends with K and has ETBOO somewhere in between.

Oh but this is different.  The keyboard is flat with minimal vertical travel.  Plus the computer’s innards are there behind the screen rather than underneath the keyboard.  So this thing is top heavy and you can’t lay it on your lap and type.

It’s just an ill-conceived product and I expect it to be the next Zune.  Or UMPC.  Or media center PC. Or Bob.

When Apple started work on the iPad, they first sat down and carefully laid out the use case for the device.  It’s all out there when Steve unveiled the device.

Microsoft, as usual, didn’t seem to do anything remotely similar to defining the use case for Surface.  It all feels so throw-in-the-kitchen-sink haphazard.  I can picture that Jon Lovitz character saying “Uh yeah, let’s put a keyboard in.  And uh, yeah, it’ll be like a laptop except that it’s a tablet.  Yeah. That was our plan all along.”

MacFrogger

Hi Nemo,

Yes, it is good to see you back. But even if I disagree with your reply, I hope you won’t confuse me with Bosco.  wink

Here is the same take I have, expressed much more eloquently:

The trend of “Bring Your Own Device” causes both IT and compliance departments numerous headaches. How many corporate documents are wallowing in Google Docs? It is one thing for the IT department to support the CEO’s iPad, but with the explosion of devices, operating systems and services, how CIOs must yearn for the day when they could issue recruits with a company laptop and a company phone and it was all integrated. That is the promise of Windows 8; it puts the IT department back in control, just like the good old days.

While iPad sales are booming overall and while Apple has certainly made headway in the Enterprise, there is still enormous “wait and see” to see what MS will deliver. I respectfully disagree with your premise that iPad already has a lock on the Enterprise tablet market.

On your second point, no I did not miss that Office for iPad is coming. But I do think perhaps you missed my comment that the Surface announcement was an attempt to pre-empt Google’s upcoming tablet announcement, and that over the short term MS goal has to be to establish themselves as a solid #2. That means taking on Google, not Apple, as to take on Apple’s iPad right now is folly and they know it. But they can deliver a knock-out blow to Google’s tablet ambitions, and buy some time to catch up with Apple over the long term.  Coming out with Office for iPad - and it will be a version with limited functionality compared to its MS brethren - is not incompatible with buying time to better position themselves to take on Apple at some future point.

Tiger

Rorschach test, or Mondrian art?

The “tiles” display reminds me too much of the Partridge Family bus from three, make that four, decades ago.

John Dingler, artist

The MS OS crashed and the keyboard did not work. Geez.

FlipFriddle

So who wants to take bets that once MS announces Outlook integration into Surface, they push an update to Exchange Server that breaks compatibility on iPad, or makes it so it “sorta works” to avoid anti-trust. Entourage anyone?
If Surface gives IT a lot of control, they will sell lots of them. IT is currently worried about their usefulness when lots of people are realizing they can do plenty of work with Apple devices that they configure on their own. Locking in job security means Surface will work for many Mega-Corps.
I still think it was moronic to host a keynote and not be able to say when or how much, or to show off the best feature (keyboard) but it doesn’t work.

Nemo

If Microsoft is basing its hopes for Surface’s success, at least in the enterprise, on Surface’s alleged innovations of a keyboard cover and/or pen-based input, it should despair.  See the collection of third-party keyboard covers for the iPad, infra:

http://www.youtube.com/watch?v=zsIJUiTlrGI&feature=player_embedded

http://www.youtube.com/watch?v=L5JX0Vj7cVw&feature=related

During its introduction of Surface, Microsoft on its website and at the event implied that pen-based input and the keyboard cover were somehow its innovations that would help win the day for Surface.  Well, for those of you, along with me, who are old enough to remember, pen-based input goes back to and beyond Apple’s Newton.  And, as I said supra, I am pretty sure that there is a third-party pen for the iPad, which was available for the original iPad. 

As for keyboard covers, there are plenty available for the iPad without Apple needing to lift a finger to make its own, which it could, of course, do.  And, as you can see from the second websites, supra, one could certainly make the argument that the Surface’s keyboard cover is nothing more than more of Microsoft copying, legally or illegaly, others’ inventions.

And Dear MacFrogger:  Neither Google and its tablet OEMs or Microsoft’s Surface can avoid competing with the iPad.  The iPad is fully in the market as a choice that consumers, both retail and enterprise, have as an alternative to the impending Surface and to any Android tablet.  There is no market where Microsoft can enjoy an isolated competition with Android.  The iPad is present, offering the choice between it and all other tablets.

Bosco (Brad Hutchings)

Good to hear from you again, Nemo! I heard about your recent accident which prevented you from offering us your much needed commentary after the Oracle victory. My thought are with you, my friend.

Ethan

Why will the Surface succeed? Simple - it’s legacy.
-Enterprise can migrate there internal apps using the same code
-IT can bulk upgrade their existing licenses to win 8 on surface tablets
-The user can run in metro touch mode or switch to the cover keyboard mode with regular Win 8 desktop to utilize any old apps not updated.
- The ability to host and manage their enterprise metro apps internally allows them far more control than letting the OS vendor be the gatekeeper of app rollout

The familiarity and ease of transition will drive adoption over the next few years. My clients all have their users on Win XP, some are just now switching to IE 7. Are those companies rolling out fleets of iPads right now? Nope. They have no interest or budget for it. Their upcoming rollouts are win 7 focused or waiting for win 8. Buying hybrid surface tablets give them options. Hell the thing can be docked in a more robust docking station and spend 90% of it’s existence as a desktop. I expect we’ll see a transformer-like keyboard solution that makes it an ultrabook for your lap at the airport as well.

In some places iPad has made great strides but so many on this board imagine that they are in every enterprise out there already. They are not. Yeah some high profile companies have highlighted how they are using iPads. That’s very different than saying we only use iPads and have dumped our windows software stack. There will be a continual back and forth but I don’t see the iPad having the success in enterprise that it has in the consumer area.

Nemo

Dear Ethan:  The flaw in your analysis is that those legacy apps aren’t written as touch-based apps, so they won’t fully exploit a touch-based interface and thus be touch apps, unless they are significantly rewritten.  And if a legacy app still needs a keyboard and a cursor, there is no reason to run it on any version of the Surface.  That is what you and Microsoft are missing:  That there is a divide between touch-based UI and the legacy UI of traditional computing.  That divide exists both in UI code of legacy apps and in the UI function of legacy apps.

Can you run a legacy app on the Windows 8-Pro version of the Surface?  Probably, yes you can but only as a PC app, and not as fully as touch-based app, unless you substantial rewrite that app’s code.  And having to substantially rewrite a legacy app’s code to exploit touch breaks the existing Windows stack.

Ethan

“an you run a legacy app on the Windows 8-Pro version of the Surface?” Yes and that’s the benefit. When upgrading users in “X” department IT will know that the user can, with the 8-pro version, connect with their ancient Documentum deployment, the 5 internal custom .exe, the WPF app built by the vendor sales hired 2 years ago, internal web apps in IE 10 (metro/desktop), and new custom metro apps and new windows desktop apps (via whatever language the developers chose to use in Visual Studio.) So they will have backwards support and forward access. Flexibility is important as not all internal calendars can be lined up. If they go to iPad everything has to be in place before deployment as there will be no legacy support.

What your saying is that all these enterprise IT departments want to do is hire a bunch of ObjC programmers or force their current devs to learn the intricacies of C++ when tying it to the iOS APIs (plus they need to have a mac running xcode). That is a non-starter for many orgs. Their IT just wants a set of devices they can target with their existing developer staff and code library as cheaply as possible. Add on to that a upgrade of their Windows OS license to defray cost. Now I admit we have no idea what these will cost but I’m assuming it will be less than a mid range laptop.

When there is the scenario that to move to a new device will break the old apps and the company decides to rewrite the app, why do you assume that IT will switch the user to an ipad as their full time device and have the app built in ObjC? That’s the least likely scenario once these surface devices hit the channels and are pushed by resellers to their clients.

Note: I’m not speaking of public facing apps. I’m talking internal process apps where the device is controlled by the enterprise.

I do think you’ll continue to see the iPad used in specific scenarios but in a few years many enterprises will be able to offer the touch experience but keep it on the MS side. Basically the majority of enterprise users across the world will not be switched to and locked into iPad use before MS has a valid solution.

MacFrogger

Amen Ethan - well said.  With all due respect to Nemo, he seems to miss some essential points here.  Most importantly, as I said from the get go, is that the end user is often not “The Decider” in the Enterprise, corporate IT is. And as corporate IT is often an extension of MS, MS will win a significant share of the Enterprise tablet market - it doesn’t matter what the specs of Surface are vs the iPad. 

Nemo - its not about logic here, that is what you are missing. If it was, Apple would be even further ahead in market share than it is currently.  IMO, you need to stop categorizing those who disagree with you as having “fatally flawed logic” as It smacks of arrogance on your part. Those who hold opinions that differ from yours are not necessarily stupid, we just exist in a reality very different than yours. Need proof? Re-read my earlier comment on the B-berry touchscreens my org just bought that nobody wanted nor asked for. Why? Because Enterprise decided we needed an “upgrade” to an iPhone/Android-like device!

Bosco: With Rodney King’s death in the news, I’m reminded of his best quote: “Why can’t we all get along?” Or something like that. Can’t you respectfully disagree with someone without resorting to personal insults?  You have alot to contribute here and your arguments are at their best when you stick to the facts. Grow up dude - needlessly insulting Nemo is childish at best as you have no idea what he’s been through since he “disappeared” a while back.

Bosco (Brad Hutchings)

Now wait just a minute Frogman… When the Oracle verdict dropped, I put out the Nemo signal, and was politely told by someone privately that he hadn’t been around because of an accident, that it was more or less public knowledge on around the site, and I PayPal’d $20 to contribute to a little get well gift for him. Since Nemo is sounding like his old self, I’m eager to hear his take on Oracle. I mean, hell, didn’t John or Bryan actually quote him as a resident legal expert with a strong opinion on this case last summer? Of course we can disagree and be friendly, and I’m more than happy to offer hugs when needed—like now, after Oracle will be receiving $0 damages. But still, I am in disbelief how someone who actually practices law (unlike Florian the Clown) and wasn’t purchased by one side could be so totally wrong about this. It is, I feel, a time for serious reflection by serious people.

Bosco (Brad Hutchings)

Yes, it is good to see you back. But even if I disagree with your reply, I hope you won?t confuse me with Bosco.?

Egads, I didn’t even see that Frogman. Stay classy, pal. Because you’re not even in the same league as the shin-kickers here.

MacFrogger

Bosco,

I didn’t realize what was going on with Nemo, cuz as you know I’m only a semi-regular here. I often drop out of site, and must have missed Nemo’s hardships. 

I try to be civil here, as I think we all should as just the fact that we all gather around this campfire means we share more in common than some of us would like to admit. And one of my wisest of mentors in life said to me that “you’ll always learn more from those who disagree with you if you’re open to hearing what they have to say.”  If you took offense at my comment, my apologies.  I really do value your opinion precisely because it is different than most here, but you and Nemo far too often have gotten way too personal in your attacks.  You also lashed out at me once with really - quite frankly - idiotic and totally uncalled for comments.  I won’t hold them against you either, OK?  Quite frankly, I have no interest in being in a league of shinkickers.

MacFrogger

Bosco,

And I forgot to add - I interpreted your comment to Nemo as pure snarkishness. To the degree you were being sincere, I salute you!

Paul Goodwin

excerpt from:?Apple earnings, 2Q12: 5 enterprise takeaways
By Andrew Nusca | April 25, 2012, 5:22am PDT

http://www.zdnet.com/blog/btl/apple-earnings-2q12-5-enterprise-takeaways/75267

Summary: Apple CEO Tim Cook and CFO Peter Oppenheimer discussed the company?s record second-quarter earnings yesterday. Here are five enterprise takeaways.

3.) The next enterprise step: dig in. One caller asked how the company was working with enterprise customers in particular, and Cook shed a little light on its strategy with this group. ?Initially our focus was working with the Fortune 500 and Global 500 to get the iPad certified for their particular enterprise,? he said ? leading to 94 percent of the Fortune 500 and 75 percent of the Global 500 testing or deploying them. ?These numbers are off the charts for a product that?s only 24 months old,? he added. Now the company is focusing on penetration within these accounts, he said. ?It?s absolutely the most broad-based product I have ever seen in my whole career in terms of adoption rate into the enterprise,? Cook said, and Apple is definitely investing more resources and testing and sales people for this group, including working with carrier partners to deliver product-plus-service bundles.

end of excerpt….........................

IMO?forward looking companies are rolling the iPad out early because customers (employees) are demanding them, management is seeing that the costs are minimal, risks are low, and productivity improves..or they wouldn’t be doing it. My personal experience is that my wife’s company ( a top financial services corp ) rolled it out early…and these guys are bean counters by trade. I’m sure they love the BYOD part of it the most. That in itself pays for the minimal security and proprietary SW development required prior to rollout.?

Also, my personal experience is that there are far too many IT “pros” trained in nothing but Windows that look inward on their own domain and how going Win-only is the only way to go. They complain about the exorbitant fees MS charges for licenses for Office but stick with it out of fear. An unjustified fear as the only stuff the iPad won’t read is files that no one should be working on with an iPad anyway. Remote viewing and providing feedback and comments is handled perfectly by the iPad. Even the complex files can be converted quickly into a PDF for viewing/reviewing. The inward looking Win-only mind set is holding back many companies, but it’s evident that business is waking up to the better mouse trap. Why wait for a Surface? It won’t be any cheaper to roll out, and they’d end up with the 2nd, 3rd, 4th, or 5th ranked productivity machine that perhaps won’t be there in 3 years.?

The percentages of the Fortune and Global 500 that have certified the iPad really are astonishing given the time frame that it happened over. And an already significant portion of those have demonstrated how remarkable the tool is.?You snooze, you lose.?

MS had to do something fast because of the response of business to the iPad and Apple. The long term effects of Apple penetrating the business world is probably quite a lively topic at MS these days. Their jobs depend on business not accelerating their adoption of Apple hardware and software. The result of “fast” at MS wasn’t very good. With all due respect, their challenge to do something better than Apple’s iPad was virtually an impossible task. The iPad does what a tablet should do. It was well thought out and very hard to improve on. The keyboard is where it should be since 99% of the time it’s in your hands, or on your lap. The Surface is more like a new pared down Netbook.?

Oh and don’t get me wrong about my opinion of IT professionals. I’ve known many excellent ones over my career. The percentage of really good ones is no lower or higher than any other tech professional field. I have great respect for what they do. They have to over and over present their technology roadmaps to non-technical managers, executives and accountants in a business case. But too many companies have marginally skilled IT people to accomplish this, and when you put them together in a room with business people that don’t understand anything they are saying, the rooms turn into cubes of ignorance. A majority of the Fortune 500 have avoided this and gone ahead certifying the iPad for use. IMO, they won’t wait for something that might be better, or good enough, because they’ve analyzed the costs already before they went down the cert path and it resulted in cost savings and product improvements going with the iPad. It’ll happen.

wab95

John et al:

Your assessment of the Surface vs iPad competition, particularly relative to enterprise adoption is, in my view, sober and balanced, and justifies your concluding comments about the absence of empirical data to justify some of the predictions that the Surface will perform strongly against the iPad where other tablets have failed.

I made a related comment regarding analysis frames in Bryan’s piece the other day. Hence, where I somewhat differ is in my belief that analysts and pundits, in fact, do have data and a model from which to base these MS-optimistic conclusions, but they are both dated and inapplicable to the present.

And while I respect the arguments made by both Ethan and MacFrogger, which do in fact reflect observed behaviour of corporate IT - a sector not celebrated for its early adoption, risk taking, spend-thrift or even visionary skills - those arguments confine themselves to IT?s behaviour in isolation, and not in the broader context of corporate, and more importantly, small and medium business competitiveness. That was RIM?s Waterloo; neither did they. So confident were they that corporate IT was so heavily invested in their (RIM?s) infrastructure, that they convinced themselves that change was simply not an option until the numbers were no longer deniable, and neither was the avalanche of cancelled contracts once that tipping point was reached.

Corporate IT?s power is formidable, but it hath its limits. Even more importantly, the majority of the world?s population do not work directly for large corporations where those dynamics obtain, but for small and medium businesses, including in the USA. My research team qualify as a medium-sized business based on both numbers of full-time staff and financial profile. In that setting, IT does not rule, rather the person or team that brings in the money does, and what they want carries. I just told our IT team to get ready to learn Oracle, and be prepared to take onboard new hardware. It was not a request, nor is that behaviour atypical of other small and medium sized entrepreneurs. Decisions at that level are based on lean margins and cut-throat competitiveness where the least advantage can decide whether you or your competitor gets the next award, an outcome that can spell entrepreneurial survival or death. That sector is intolerant of factors that hamper its competitiveness, and will, without ceremony or sentiment, jettison whatever creates drag in order to keep pace with competitors.

How does this feature into John?s, Nemo?s or others arguments who predict that the Surface will not simply have its way with the iPad? Simple. It has to do with modern reference frames. Our IT solutions are no longer microcosms in splendid isolation, wherein each business engages in parallel play, each with its own solution, where the only point of mutual business contact is on file compatibility. That was the 1990?s, maybe even the early naughties. The teams that are going to have the competitive edge are those who have robust cloud solutions that enable them to work wherever they are, and the functional mobility - the nimbleness if you will - to carry small portable devices to meetings, and not worry about whether they have every file that could conceivably be required on the road, but can access them with ease as exigency demands. The power to pull just the right data literally out of the ether and display it onscreen during dynamic negotiation is not to be underestimated, and will carry the day. It is this ability, I suggest, more than corporate IT?s comfort zones, that will drive enterprise purchasing practices. And at the heart of this, as we move forward over the next 3 - 5 years, will not be a device-specific or even device-software specific decision, but one based on whole ecosystem solutions that provide the best competitive edge.

While nothing I have said so far predicts which tablet will gain the most traction in the enterprise, nor is that my intent, it does suggest that if MS intend to compete against Apple for enterprise tablet dominance, and their argument is confined to what little we?ve seen of the Surface to date, namely features ?It does Windows - and Office too!?, and specs (storage, processing power), then they?re making the wrong argument.

Paul Goodwin

A lot of good points wab. Apple is well positioned to do what you are talking about, and business has noticed.

MacFrogger

Paul/wab,

You both make a number of very thoughtful points.  I do believe that because of Apple’s early lead with a great product (iPad) or perhaps two (IPad + iPhone) that the once monolithic Enterprise ain’t as solidly MS as it used to be.  But still…

Think of this from a strategic point of view - Microsoft’s. What viable business strategy do they have?  What assets can they enlist in their battle to firstly, establish a beach-head in the tablet market, and secondly, take the battle to their competitors?  Well, surely they have observed that because of Google’s bumbling, the Android tablet market is pretty minimal.  I still believe that the Surface announcement was not aimed at Apple so much as it was the pending Google announcement that is due soon. Yes, it was totally FUD, but aimed to stop people from buying whatever Google-branded tablet is going to be unveiled next week.  Because the beachhead they seek has to be to become number 2 in the tablet market as soon as possible after launch (whenever that may be, hence the FUD).

This is an ambitious, but not unrealistic goal, if they actually do bring out a half-way decent product because they have many advantages over Google. Even if its not as monolithic as it used to be, there are many in the Enterprise still hungry for an alternative to the iPad.  And many don’t trust Google.  That’s a big opening from a marketing perspective. Unless MS is even dumber than we think, you can add to that the certainty that MS will include features designed to interface seamlessly with the Enterprise in areas where Google has historically been weak. They will certainly bring out full-featured MS Office for Surface, but I think I already read that have no plans to do so for Android. Again I stress that if I were MS, I would focus ALL OF MY EFFORTS to become number 2 because once they do so, developer attention will begin to shift ON ITS OWN to MS.

Again, this is an ambitious but achievable strategy because they will be competing with a newly-introduced Google tablet - not the iPad. They have to go all out to establish themselves as number 2, just so that they can survive to fight - some day - a even bigger battle against Apple. But if two years down the road they are a distant number 3 behind iOS and Android they know its over.

Paul Goodwin

For sure Apple has to fight the monumental inertia that MS has. So who knows where it will end up? If they produce something really outstanding they most certainly can be very competitive in enterprise. Not sure this Surface is a winner though. That keyboard and stand are worthless on a tablet. If they have a soft keyboard, it might be OK if you can take the tablet out of that case and shed the stand, or if the combined stand and keyboard don’t add any significant weight, you’d just never use them.

Paul Goodwin

Oh. And if they aim low and only target the Google and Android tablet world, they’ll be fighting up an even steeper hill against Apple; especially if Office becomes available on the iPad. Probably one of their toughest issues is going to be getting quality in at a price that beats them all, while having profit margins that don’t turn off a very nervous and fickle Wall St.

MacFrogger

Hi Paul.  I mostly agree with you.  But regardless of how we slice it, MS is still faced with the short-term goals of simply breaking into the tablet market, creating some “buzz”, and generating self-sustaining developer interest in the platform. 

These are goals, achieved with time-tested MS tactics like using sowing FUD and making vaporware announcements to pre-empt the likely intro of a Google-branded tablet at I/O next week and minimize subsequent sales.  Judging from the the way the media ate up the “news” of the MS Surface, who can deny that despite the epic product fail the pseudo-demo was a huge success?  And let me ask you this: Shouldn’t the prudent IT professional who’s looking for an alternative to the iPad - for whatever reason - not buy any new Android tablet until he sees what MS will deliver this Fall?

Of course the big “if” here is still the quality of the execution: MS still has to deliver a decent product at an acceptable price and sooner rather than later - three pretty major challenges for sure!

I found an article where I think the author really nails it - that the Microsoft Surface is all about targeting Google. Perhaps even more presciently, the author closes the article with an almost off-the-cuff brilliant insight that predicts what’s also coming: the Microsoft-branded phone. Makes me say…duh!  Of course it’s coming!  But they will wait to make Nokia a wholly-owned subsidiary when all looks hopeless for NOK.  IOW, likely soon…

Check this out - from South Africa no less!

MacFrogger

Weird - I can’t seem to get that link to work. So here’s the article:

Apple and Microsoft have forced Google into a corner

Hilton Tarrant examines why Microsoft unveiled its tablet when it?s not ready to launch it.

JOHANNESBURG - The timing of the Microsoft?s announcement of Surface was particularly peculiar. ?Hands-on? demos were decidedly hands-off. Microsoft didn?t allow anyone to use the SmartCover keyboards ? bizarre, given that this is the most innovative feature of Surface (and a real differentiator between the iPad). It?s obvious now that Surface is not ready.

So why did Microsoft unveil something that it isn?t launching yet?

The answer is Google. It is expected to launch a Nexus tablet to showcase the ?best of Android? at its I/O conference which runs from June 27-29 in San Francisco.

Microsoft simply had to ?launch? Surface.

It doesn?t matter that it?s not ready. It doesn?t matter that Microsoft is now competing with its hardware partners, breaking a more than 30-year business model.

Of course it was a secret project. The clues are in the utter lack of detail provided by Microsoft last Monday. No pricing details. No indication of availability. No working SmartCovers. No hardware specs.

And the biggest sign of all that this has been a well-kept secret? A lack of retail partners. This is not about Microsoft wanting to only sell Surface at its own retail outlets and online. It hasn?t got to the distribution part yet (just as it hasn?t finalised the pricing model). Do you think executives at Best Buy are not chomping at the bit to sell this, now that they?ve seen it? Do you honestly believe that Surface will only be available at two dozen-odd Microsoft stores when it ships later this year?

The industry?s genuinely surprised that PC makers didn?t know about Surface. Really? Microsoft pulled this move straight out of Apple?s playbook. Remember iMessage? FaceTime over 3G/4G? Mobile operators found out about this when we did, during Apple?s keynotes.

It had to be a secret. Especially since Microsoft is busy transitioning its classic ?PC? base to multiple platforms. Surface is the PC.

Microsoft?s strength is the most dominant installed base and ecosystem in the world: Windows. It?s pitched Surface as a consumer tablet, but given the consumerisation of technology, Microsoft shouldn?t be surprised when enterprise customers come knocking. There is real demand for a ?proper? Windows tablet in the enterprise space. Especially the Surface Pro with full Windows 8 running on an Intel processor.

So we have a real ?competitor? to the iPad at last (well, if this ships and if the keyboard actually works as well as its hyped up to). No matter how you want to dress this up, Surface isn?t an iPad ?killer?. Yet. The market is still in its infancy.

Right now it?s aiming squarely at Android tablets, which command around 30% of the US market. But the Kindle Fire (which runs on a forked version of Google?s software) has around half of Android?s market share. This is clearly a game Microsoft believes it can win. And winning right now doesn?t mean surpassing the iPad.

The velocity in the technology space is astonishing. Remember just five years ago when Microsoft shipped software, Apple sold Macs and iPods and Google did search?

Today, Microsoft is a software, mobile, search and hardware company.

Today, Apple is a software, hardware, mobile and search company.

Today, Google is a search, software, mobile and hardware company.

There are huge stakes in this war. Right now Google?s stuck in a corner, fending off assaults from any number of attackers. I?m not certain Larry Page gambled on having to fight off both Apple and Microsoft in the tablet space. There was always the view that if Microsoft did anything in tablets, it would be Xbox-focused (and that is coming). But the Windows 8-everywhere strategy is unfolding as the Redmond giant said it would.

And this war is about far more than just tablets. Mobile remains a key front on which battles are being fought.

Next up, Microsoft smartphones?

wab95

Think of this from a strategic point of view - Microsoft?s. What viable business strategy do they have?? What assets can they enlist in their battle to firstly, establish a beach-head in the tablet market, and secondly, take the battle to their competitors?? Well, surely they have observed that because of Google?s bumbling, the Android tablet market is pretty minimal.? I still believe that the Surface announcement was not aimed at Apple so much as it was the pending Google announcement that is due soon. Yes, it was totally FUD, but aimed to stop people from buying whatever Google-branded tablet is going to be unveiled next week.? Because the beachhead they seek has to be to become number 2 in the tablet market as soon as possible after launch (whenever that may be, hence the FUD)


MacFrogger:

I completely agree that this is MS’s strategy, and I have no doubt that they now appreciate the threat magnitude to their company’s longterm survival if they do not enter this market. The slippage in Windows-porting PC sales is undeniable, and has the tablet market’s fingerprints (read Apple’s iPad) all over it. The rush to show a product that the press were not allowed to touch, and many of whose features were not even revealed screams of fear and desperation; however the strategy, as you’ve rightly articulated, in my opinion, is to signal a message to the loyal troops. Hold the line. Reinforcements are en route.

Never mind the absence of an ETA for those reinforcements, my point was a bit different. As essential as is that strategy for MS’s longterm relevance, if not survival in its present weight class (I think it premature to speak of MS’s doom - we’re far from that), my point was that their launch of that strategy was tactically flawed.

Just as MS appear to have paid attention, and cobbled together potential solutions to many people’s complaints of existing tablets (e.g. lack of a keyboard from a generation weaned on tactile keyboards) and perhaps netbooks (they’re slow), they appear to be inert to some of the key factors that have endowed the iPad with advantages over the competition, including Google. The appeal of the iPad is not as a device, per se, sitting in isolation; but rather as a solution, part of a toolset in a rapidly evolving ecosystem, to the growing problem of managing and accessing our personal and professional data when and where we need it, in real time and under changeable conditions.

Were I their tactical advisor, I would have argued, given the state of incompletion of the device, avoid specs and don’t talk up features except to address how the device will play into an ecosystem that solves the problem of data management and access. Make the ecosystem the focus and address how this device fits within it in a way that is essential to business competitiveness and talk up its potential advantages - indeed its indispensability going forward - over existing hardware. Then step away from the mike.

They did not.

Otherwise, I concur with your argument.

Paul Goodwin

Hi MacFrogger. Yeah. I mostly agree with you too. It’ll be interesting to see what happens at MS, Apple and Google, Samsung et al. They’ll probably all be suing each other forever.

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