I'm not sure I entirely agree with this. Office on iOS and Android is (in my opinion) geared at being able to read and maybe edit Office documents. While these apps can certainly create Office documents, they're not really suited to it. One would ideally do that using a laptop or PC. And that then simply makes mobile a way of further entrenching Office - people who use it at work can now use it on their devices. People who use it at work and on the road are (again, my opinion) more likely to use it at home. Win for Microsoft.
On the devices side? Sure, Surface and Lumia are nowhere near as successful as the iPhone, iPad and Android. That was Microsoft coming late to the party. But come to the party they must. Before Windows Phone shareholders screamed for an iPhone competitor from Microsoft. After Windows Phone shareholders screamed for an iPad competitor from Microsoft. Windows Phone is good, and has some loyal fans. Windows 8 didn't do much for Surface, or Microsoft. Surface hardware is however also good, but new.
Ultimately the devices strategy strikes me as being sound - it's a platform to showcase the services side of Microsoft, and in time may be profitable to a point where the critics are satisfied.
MS doesn't really have any choice but to offer office for free in the age of App Stores, and more importantly free alternatives are everywhere. Apple pages/numbers aren't going anywhere outside their garden, but Google docs are real deal. It's painful for MS to take this move, but it is really impressive to see them coming out of the comfort zone.
Clearly the strategy of MS is to expand their services across all platforms, and by eliminating differences between platforms, then they can rule again.
Interesting to see how this plays out in the next few years.
They only had a small market share some ten or fifteen years ago. Most people were on Palm and Psion (and Sidekick in the US). They still only have a small share, it's mainly the competition who has changed.
Maybe "touch party" would been a better choice. I know, I used to build MSMQ apps for Pocket PC and Windows Mobile. My GPS app from the early 2000's (1) makes me cringe today and yet still leaves me with fond memories.
"by releasing most of the functionality of Office for free, Microsoft is giving up on the iPad as a growth driver for Office 365, but it seems like they can’t quite wean themselves of incremental income from Office diehards. The problem, though, is that not only could this limitation manifest itself as incremental annoyance, it also limits the defensive utility of this move (members-only)."
This paragraph stuck me as funny as it is decrying Microsoft upselling premium subscriber only features for Office 365 and then it ends on a link that is a "members only" upsell to a $10 a month subscription feature for this blog.
I think the guys enterprise map is off - while the future might be the cloud, the current is still firmly rooted in windows desktop, windows server, active directory and exchange.
While I don't completely disagree, I think with the relative success of Azure, and with the opening up on .Net itself (just announced) that MS is clearly hedging some bets on being a tools/application stack provider as well as it's services.
I actually really like Office 365 and their hosted mail offerings, though I think Outlook has become a bit more annoying with the changes for scalability that MS needed to make. The world is moving away from windows as a platform, so it makes sense to double-down where they have a lot of hold...
Developing end to end solutions with VS is usually more pleasant than competing options, and windows licensing has been their bottleneck. With the push to cloud hosting, MS is in a better position than most to leverage their tooling... Though I really hated the early marketing of Azure within the .Net community, for a while it seemed like every MS tech presentation was an advertisement for Azure. (which kind of pushed men out)...
That said, actually using Azure is pretty nice, and imho quite a bit easier, even for Linux than using AWS and others. I'm not developing new solutions with MS's windows+.net in mind. But opening up .Net more may change my stance there.
How is a company that makes OS X, iOS, iCloud services not a software company? Sure it sells hardware, but not hardware that's a brick.. People buy the hardware so they can use the software which pretty much means they sell a package that includes both hardware and software..
Ben means that the end goal of OS X, iOS, and iCloud are to sell more hardware, not to be individually thriving SKUs (as evidenced by the declining price of any non-hardware offering by Apple over the past decade). Every (or, at least almost every) decision made at Apple is made with the goal of improving the experience of owning Apple hardware, which is their main profit center.
This is a useful way to understand Apple, but not companies in general. Movie theaters make the majority of their profit off of concessions, but they are not popcorn companies.
They now give away all their software (despite upcharging for more iCloud space). On the Macs, Apple has embraced that people want to run Windows and supported Boot Camp for generations of hardware now. The entire retail outlet is dedicated to selling the hardware and accessories for said hardware, with a single vertical column (maybe that much) left over for software. They provide an App Store on both platforms, but produce a minority of what they sell there. Apple is a hardware company.
For what it's worth, I get your point, though. My preference is to use OSX over Windows these days, but that's because I find it to be the best intersection of *nix boxes (which all of my servers run) and a pleasant UI with great apps (because I'm still a human, and sometimes I tire of the command line). But look at the way iCloud took forever to become stable - if it's even there now - or the recent decreased in perceived QA (iOS 8.0.1, Apple Maps), and you can tell Apple's focus isn't on software as much as hardware.
You're right, but I would phrase it a bit differently:
I believe Apple is a product company. They make things that people want to buy and use. Their products are built from a combination of hardware and software/services.
Microsoft is also a product company. The difference is that they make a lot of different types of products. Some are things people buy and use like Xbox, Surface, and Lumia. Some are "platforms" like Windows and SQL Server. And they still sell "software" like Office.
NextStep was built with enterprise in mind but became wholly consumer in its next life as OS X and then iOS. The massive consumer success of the iPhone led to employers giving in to employees who wanted iOS devices instead of Blackberry devices, a phenomenon called BYOD, "bring your own device". BYOD has given rise to an entirely new Apple presence in enterprise which I think Apple is just getting started with. Prior to this Macs were used by designers and engineers, creators, but hardly the stuff of serious enterprise.
Right now the services Apple provides are all about fulfilling features that consumers want: email, cloud storage, being able to buy content, and apps. They're meant to augment and also perhaps cynically lock consumers into Apple's sphere. The hardware devices sold at high margins make the money. This may change, and we might also see a two Apples where apple starts selling its services with higher margins for enterprise.
Incidentally long ago Apple really dominated in education. Most of the 80's Apple IIes and macs were popular in K-12, but that went away in the later 90's. Now iOS, in the form of iPads, are making inroads in education once again, competing with Chromebooks. Education isn't enterprise, and I don't see any services Apple would offer schools, but it's related.
Almost every where you look though, Microsoft is under assault. I think the last remaining stronghold is the Windows PC workstation. I don't think Apple, Linux or Android have made any inroads here. I can see Chromebooks becoming more relevant in the future, but for now workstations are dominated by Windows and probably will be for the next decade. The enterprise level services Microsoft provides here with ActiveDirectory and sharepoint, and the sophisticated controls for deploying Windows workstations across big organizations is pretty unrivaled. Maybe RedHat is also in this space, but not at the level of Microsoft.
Just a nit pick, BYOD is when a employee brings his/her own device to work in order to use it to do work. At some places it's viable to let employees choose the tools that work best for them, and not force every employee onto the same 6 pound HP or Lenovo or Blackberry.
New and improved provision schemes will make this even more viable in the future, where applications and data that belongs to the employer can still be kept reasonably secure no matter who owns the hardware.
It's an interesting area. I don't think BYOD has the rosy future the breathless posts on LinkedIn will have me believe. The problem is one of security. If I'm going to enforce security on a device I will need to wipe/reset the BYOD phone and apply my enterprise policy (password on start, device encryption, find-my-phone, remote wipe and so on).
At the other end of that equation you have a consumer who has a shiny new phone, and is being asked by her employer to yield control of the new shiny to the enterprise. Not appealing, when said consumer foots the bill for the phone, data and calls.
That conflict will result in CYOD (choose your own device), I think. And if we get a company phone, will mean we walk around with two phones. One fore work, locked down and able to access corporate email and SharePoint, the other for play, which has no corporate policy applied to it and only has Internet access.
> If I'm going to enforce security on a device I will need to wipe/reset the BYOD phone and apply my enterprise policy
Which is exactly what happens in a BYOD scenario and the process is getting better for both employees and employer. For example, my employer can now "wipe" all my corporate data on my iPhone while leaving all my personal data intact. Of course, as long as I have their data the security policy (password on start, device encryption, etc) is enabled.
We do have CYOD but we only facilitate the connection between the employee and the provider -- the employee owns the device. Mobile devices are very personal things and nobody wants to carry two of them.
Outside this box, I think this critique takes on an even stranger tone:
* Tesla - sells devices (cars) and services (auto repair, charging stations, consulting, etc)
* Equal Exchange - sells devices (Cocoa, Coffee and Coffee gear, etc) and services (reports on working conditions and other quality control data)
* A private university - sells devices (classrooms, living space, all sorts of retail items) and services (classes, research, community outreach, much more)
(getting more abstract)
* A trial lawyer - provides devices (a body to stand in place of a defendant, relevant evidentiary media materials) and services (research, strategy, etc)
* A restaurant - provides devices (table, food, decor, ambiance) and services (cooking, consulting, food sourcing)
OP may say that the intended target of this critique is the "tech" sector (ie, "a horizontal business should be great on every platform, while a vertical business should be differentiated"), but it looks like that becomes a capricious distinction the closer you look.
A university needs to provide compelling courses on research from all sources, including other institutions of higher education, while still being differentiated in its "vertical" market.
A restaurant needs to source food that will excite its clientele (again, even sometimes from various types of horizontal competitors) while still being vertically differentiated.
And so on.
Providing both horizontal and vertical components (whether organized into separate subsidiaries, subcontractors, divisions, or whether blended entirely) is a very old concept and is the natural course of maturity for a successful model.
The distinction in the article is not devices vs. services but vertical vs. horizontal. Tesla sells services, but those services are either vertically integrated with their cars (e.g. they don't repair non-Tesla vehicles) or have strategic value for their primary business (e.g. making superchargers compatible with non-Teslas expands the supply of EV charging stations generally, which is good for Tesla owners).
Yeah, I thought that when I wrote it. The same is somewhat true of Equal Exchange (ie, presumably their advocacy is intended to drive market expansion).
Same situation. Those are all examples of vertically integrated businesses (or alternatively, different components of a single output).
A university sells education. Classrooms, dorms, teachers, etc. are all part of the same 'supply chain' for education.
A trial lawyers sells legal services. Research, evidence, appearing in court, and so forth are just incident to the basic legal service provided.
A restaurant sells a 'dining experience'. The food, wait service, and so forth are all part of that same experience.
What OP means by a company that has both horizontal and vertical businesses is a company offering something as a standalone revenue-generating output (the "horizontal" business) and something else that incorporates that standalone output as part of another output (the "vertical" business).
This would apply, for instance, to a fast food company that not only sold hamburgers via its chain of fast food restaurants (vertical) but also supplied those same hamburgers to other, possibly competing competing fast food restaurants as a separate business (horizontal).
Well, that seems more like a belief as a prelude, and the piece is about how the rift in MS is not services/devices but consumer/enterprise. There's really no question that Apple puts consumer devices ahead of enterprise or services (their services just add value to the devices).
They make their money off the hardware though. And plenty of people use Apple hardware without using Apple services. I have an iPhone/iPad/Mac, and don't use Apple services for email/document/storage/photo backup etc. I appreciate their OS software and hardware, but for the most part think there are better options for pretty much all of their services.
Does not matter. When you buy an Apple product, you are basically supporting their services as well. And as far as I know, you are more or less forced to have an iTune account if you have an Apple device, right ? So you are tied in to their services at least for the distribution of applications (on mobiles).
You can't say "where they make their money" doesn't matter. Of course it does.
An iTunes account is required for App Store purchases, but that's about it. You can load on Google e-mail, maps and browser after that, if you wish. The point is that Apple doesn't make money from its services, so it has less of an incentive to stop you.
ITunes is a distribution service. They make money off it. It's like saying "Valve is just doing games" where most of their money comes from selling the contents of others. When you have a monopoly on distribution on a specific platform, that's a service where people are locked into using. I don't know how to explain it in any other way to you.
No-one is arguing that they make money from it. Nor is anyone arguing that Apple doesn't do services. They are arguing that they make far more money on hardware sales than services, and thus are primarily a hardware company.
Except they're tied. The way you get Apple services is buying Apple hardware. You can't buy most Apple services separately from Apple hardware, and you don't get charged for many Apple services aside from the purchase price of the hardware.
The debate over whether Apple makes money off hardware or software is ridiculous. Every iPhone contains both Apple hardware and software, and works in concert with Apple services, designed to be a cohesive whole. It's ONE experience, designed top to bottom to work together. That's Apple's entire value proposition.
>he problem, though, is that not only could this limitation manifest itself as incremental annoyance
Eh I'd hazard a guess that the vast majority of mobile office users don't need unlimited cloud storage (especially with 15GB free anyway) or advanced editing capabilities. Both of those features would be well served in an enterprise environment, but there are Office 365 Enterprise subscriptions for that. Maybe no dropbox integration is an annoyance, but I question whether that would be enough to push out existing office users.
Does anyone else think that MS folks are just plain and simple desperate and are trying new things ?
I think it is entirely feasible that they haven't really thought through what they are doing. It feels that they are simply streamlining and opening up without an end game in mind.
On the devices side? Sure, Surface and Lumia are nowhere near as successful as the iPhone, iPad and Android. That was Microsoft coming late to the party. But come to the party they must. Before Windows Phone shareholders screamed for an iPhone competitor from Microsoft. After Windows Phone shareholders screamed for an iPad competitor from Microsoft. Windows Phone is good, and has some loyal fans. Windows 8 didn't do much for Surface, or Microsoft. Surface hardware is however also good, but new.
Ultimately the devices strategy strikes me as being sound - it's a platform to showcase the services side of Microsoft, and in time may be profitable to a point where the critics are satisfied.