What "devices and services" really means to Microsoft
Ever since Microsoft announced its "Devices and Services" strategy, there's been a question about what it might mean. Is it a pullback from the ecosystem model that's been at the heart of its business for nearly 40 years, taking a leaf from the Apple playbook? Or is it something new?
There's a lot to be said for keeping your devices and services close to your chest. Google does that with its services, and Apple with its devices, so one might Microsoft to do much the same. But that doesn't seem to be the case, as several recent announcements have shown.
It's a mission thing
First, take a look at the company's new mission statement: "To create a family of devices and services for individuals and businesses that empower people around the globe at home, at work and on the go, for the activities they value most."
Microsoft has always been ambitious: "A computer on every desk, in every home" was a big reach for a future, and now we live in it. That ambition hasn't gone away, and while this statement may not have the same ring to it, it's still a compelling vision for tomorrow's ubiquitous computing world, where everyone has multiple devices.
That ubiquitous computing vision is the heart of what Microsoft means by "devices and services." It's a vision that's a direct descendent of the "three screens and the cloud" story which Microsoft has talked about for the last five years or so, and it's guiding most of the company's recent decisions -- all filtered through its internal One Microsoft reorganization.
One Microsoft also means that those one-time separate elements of the company are working closer together, forcing the consumer parts of the business to share DNA with the enterprise (a model reminiscent of the way HP used Voodoo's high-end gaming PC work to rethink its server business). It's building out a devices business while supporting third parties, and it's ramping up its available services through Azure, Office 365, and Bing. It's why the new Xbox OS builds on Windows technologies like Hyper-V and offloads compute to Azure-hosted services.
That's where the company's history as a platform vendor comes into play. While Steve Ballmer may have told employees that they needed to stop thinking of Microsoft as a platform company, that very platform supports both parts of the new devices and services vision. Windows is at the heart of the devices story, and Azure at the heart of the services story, and it's all held together by development tools.
On the devices side of the story, Microsoft is clearly building out its own device business with Surface and its planned purchase of a large chunk of Nokia, but it's also still supporting third parties like Dell, and showcasing them at its events and in its advertising. There's a lot of value in that Windows ecosystem, and it's not going away overnight, so Microsoft needs to ensure that its services work well on those devices. It's also well aware that there are other ecosystems out there, and that its services can't be limited to just its own devices.
In a world where users have loyalty to services rather than platforms, users will choose the devices they use based on the available services. With that in mind, much of what Microsoft is doing at the moment is to make its devices service-friendly, and its operating systems as open as possible.
In this growing service-centric environment, it's important for Microsoft to get other companies' services to run on its devices. The recent, much-heralded arrivals of Flipboard on Windows 8.1 and Instagram on Windows Phone just one facet of the outreach its marketing teams have been making, bringing the services users want to Microsoft devices.
Getting services on your devices isn't easy. Competition between technology giants is fierce, and that means key consumer services are unlikely to appear on Microsoft devices -- just look at the ongoing impasse between Microsoft and Google over delivering a Windows Phone YouTube application -- unless there's a significant increase in market share. While users want services, they're not free, and delivering the appropriate endpoints (and keeping them up to date) requires resources.
This is a tricky game to play, and one where Microsoft has to leverage that wider Windows ecosystem as well as delivering its services across the whole industry. That will mean continuing to support and market devices from Dell, from HP, from HTC, from Samsung, from Sony. It'll also mean delivering touch-first versions of Office to iOS and Android, continuing to support Office 365 on MacOS, and building Bing so it works as well in Firefox and Chrome as in Internet Explorer.
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