Monday, May 03, 2010

Understanding the computer market

The simple fact is, the computer market is changing—traditional PC makers have been having a torrid time of it lately. And whilst everyone might be thrilled that their SuperMegaFast™ Windows™ Funky Series 7 WhizzoGraphics GameMonster Workstation now costs only tuppence ha'penny, they should accept that these may become rather rarer quite soon.

Because computer manufacturers whose business model depends on shifting ka-gillions of units, on very slim margins, are soon going to realise that people just don't need yet another black/blue/beige gamebox even if it the light-up translucent bits are red rather than blue.

As a quick illustration of where it's all going, John Gruber has a concise summary...
Jean-Louis Gassée:
The center of financial gravity in the computing world—the Center of Money—has shifted. No longer directed at the PC, the money pump now gushes full blast at the smartphones market.

He backs this up with a striking financial comparison: Apple makes six times the profit from iPhone OS device sales than HP makes from PC sales — despite the fact that by unit sales, HP is the world’s leading PC maker, and Apple is not the leading smartphone maker.

HP’s purchase of Palm shows that they understand this opportunity.

Palm's WebOS got quite good reviews when it came out, but it was too little too late for a company that basically bet the farm on the PalmPre thrashing the iPhone in the market place. Yes, they did.

In March 2009, major Palm investor Roger MacNamee said... [Emphasis mine.]
Palm Inc.’s new Pre smart phone will lure customers away from Apple Inc.’s iPhone when subscribers’ contracts start expiring in June, Palm investor Roger McNamee said.

“You know the beautiful thing: June 29, 2009, is the two-year anniversary of the first shipment of the iPhone,” McNamee said today in an interview in San Francisco. “Not one of those people will still be using an iPhone a month later.

How the mighty are fallen, eh? But, as has been pointed out, Palm has now been bought by Hewlett Packard (HP): speculation has been rife for some time that HP have been frustrated with Windows and desired to create their own operating system. With Palm's WebOS on board, they now have the foundations of an operating system in what is fast becoming the single most profitable area of the computer market.

Again, here's John Gruber, commenting on HP's purchase.
MG Siegler, interviewing HP senior VP Brian Humphries:
“This is a great opportunity to take two Silicon Valley idols and put them together,” Humphries noted. That’s an obvious statement, but he quickly moved on to the meat. “WebOS is the best-in-class mobile operating system. Our intent is to double down on WebOS.”

I really do think this is a great move for HP. I don’t know that it’s going to work, but it certainly gives them better opportunities in the mobile space than they would have had otherwise. They should announce that the Windows 7 “slate” they pre-announced a few months ago has been canned, to be replaced by a version running WebOS. Just saying they’re “doubling down” doesn’t mean squat if they don’t act on it. The easiest way HP could screw this up is by not committing fully to WebOS for all mobile devices — phones, handhelds, tablets.

Only a couple of days later, HP did announce the death of the Slate—and Microsoft the death of its Courier slate concept. HP, it seems, has plans of its own for tablet computing—and I'm pretty damn sure that they don't involve Microsoft or Windows.

For some time, I have opined that Microsoft is over the hill and on its way out. Sure, it'll take a very long time, but the company is an utter irrelevance in terms of technological enhancements. The money is in mobile computing and—given the limitations of form factor in these devices—in "cloud" storage and services.

Cloud storage and services are led by built-in applications—such as the way in which the iTunes Store and the App Store are built into the iPhone—or though web browsers. And the simple fact is that in web browser technology too, Microsoft is way behind Mozilla or WebKit (which is fast becoming the de facto rendering engine for built-in mobile web browsers).

Although Internet Explorer 9 (IE9) will provide enhanced support for HTML5 and CSS3 (including rounded corners. Finally) it is unlikely to be released before the first quarter of 2011. And whilst many corporate set-ups still run IE6 or 7 (irritatingly), more and more people are switching to Firefox (Mozilla) or Chrome (WebKit) for home use.

Given this, web application designers like myself are no longer designing for IE: we are not even aiming to give IE users the same experience as those on more advanced browers—no, we are aiming only to make the applications work in IE.

Microsoft is dead: it just doesn't know it yet.


JuliaM said...

Let's hope the iPad has a better battery life than the iPhone...

assegai mike said...

DK, what's your take on Jobs' boycott of Flash apps?

Wearysider said...

I accept that HP family PCs are a market leader in terms of IBM based PC brands, but as someone who works in IT support I wouldn't say they represent much of the overall market share of PCs (at least to my experience).

The problem is there are umpteen manufacturers before even entering into the realms of systems built by smaller independent outlets, I'd guess around 70% of the clients I've worked for use independently assembled PCs rather then branded systems such as Dell, HP, ACER etc.

I agree to an extent that the whole market is changing but then it always has done like the Earth's climate it doesn't have any fixed values.

microdave said...

"HP have been frustrated with Windows and desired to create their own operating system"

Well if they do, I hope they manage to get it to drive the variable speed cooling fan in their laptops properly.
The useless twats have completely failed to a) understand my numerous communications with them, and b) do anything about this well known fault.

As someone who spent 20 years as a customer facing service engineer, I despair at the lamentable state of the majority of industry these days.

davespink said...

I really hope that Microsoft dies very soon, so that we can be spared all these "Apple are great 'cos they are hippies or something" posts and pub conversations. Apple stuff is nice and expensive, so only clever people who live in Islington can have computers.

johnny nunsuch said...

As Longrider said "Horses for courses"

many companies will still go badged wintel PC's because as with IBM no-one got fired buying Big Blue

The market will change using the marketeers segments - early adopters etc.,

and how many of us want important or sensitive stuff on another server possibly in another country with different laws about government access

Would be nice to see MS and Apple learn some humility though ;-)

Obsidian said...


I have to disagree about SharePoint being only useful as a document managing system, I'm currently part of a SP2007 project and it's functionality as a CMS and intranet solution is of a very high quality. It's client-side code isn't sadly, although SP2010 is likely to alter that - especially as they've taken to jQuery.

A large business can quickly, cheaply and effectively roll out a top level intranet project with amazingly levels of flexibility and fine-grain security. It's not perfect, but with a bit of polish it could be.

I think that what is more likely to happen is a blurring of the distinctions between browser and desktop.

Thats what I'm hoping for too. In the past I've built a couple of desktop solutions for an NHS Trust that consumed web services and users felt more comfortable using that than via a browser.

As for browsers as a rendering engine - again it's having to render a HTML variant which is less efficient than low level control of graphic libraries.

I built a basic jQuery/CSS captcha prototype last year. It wasn't going to win any prizes for speed...

HTML5, of course, contains protocols for precisely that kind of offline storage, using XML or JSON as transport vectors and using built-in OS databases or simple XML storage.

I've not had a chance to really look into HTML5 yet. As a lot of my recent work has been in the public sector (IE6. Oh joy.) I suspect I won't until a specific project rears it's head. I really want to have a look into the data storage though.

The days of proprietary storage formats (by which I mean at the code level, not simply an obscure database structure) are over

I hope so, but I doubt it - look at MP3 over Ogg for example. GIF's are still frequently used over PNGs.

In HTML5 video it looks like Theora will lose out to Apple/M$'s propriety format.

Ryan said...

>Again, I can't agree - I do both M$ and some OSS development, and the majority of jobs are M$.

Oh there will be plenty of jobs for years to come, but the innovation isn't coming from Microsoft

>I yet to find a PHP-based MVC model that isn't nuts or under-documented.

The less said about PHP the better :)

I was hinting at some of the up and coming stuff on .NET for web / restful service development - Openrasta, and FubuMvc, both are designs light years ahead of anything coming out of Redmond. Compare and contrast MVC templates or server controls to the convention based model -> ui transformation in Fubu.UI , or look how Openrasta enables POCO services with full Ioc support and a sweet pipeline model.