11
Mar

A consumerized enterprise IT realm is de rigueur in early 2015

2-Color-Design-Hi-Res-100px-widthFew consumer tech commentators, if any, would argue there is much of a market for laptop PCs within their target audience. If these devices are in demand anywhere, the likely market segment is enterprise computing.

So the new 12 inch Macbook with Retina display, which was presented to a global audience during Apple’s “Spring Forward”, March 9, 2015 event is targeted to the enterprise computing market, right? Perhaps. But where, then, is the usual CAT5 port for wired Ethernet data communications? The answer is it does not exist.

Almost every commentator writing about the debut of this device emphasized the strategic forward thinking of the design of this laptop based on a USB Type C port as its sole interface for networks, charging, etc. To simply quote from one of these reviews, readers might want to consider the following comment, which appears in a post to The Verge blog titled Hands-on with the new 12-inch MacBook with Retina Display (http://www NULL.theverge NULL.com/2015/3/9/8173685/macbook-retina-display-usb-type-c-hands-on-video). Dieter Bohn, who wrote the post, remarks “the screen actually isn’t the most important part of this new MacBook. No, instead it’s the small port on the side, a USB Type-C port that serves as the power jack, a do-anything USB port, a display port, and essentially anything else you could imagine using a cable for.”

The strategic impact of this decision to dispense with a hard wired Ethernet option for a device intended to compete with Windows PCs (or, is the target Microsoft’s Surface 3 two-in-ones?) within the enclaves of businesses, only makes sense in a brave new world of enterprise computing, one ruled over by an autocratic obsession with consumerized IT. It just is not safe to look to wireless data communications for everything.

Readers need not fear Microsoft has been left out of this criticism. The Surface Pro 3 two-in-one also lacks a native Ethernet interface. But there is a docking station option for the Microsoft entry in this category. Per the March 9, 2015 presentation, there does not appear to be one for the 12 inch Macbook.

No industry expert argues for entirely wireless data communications for mission-critical information. It is just too dangerous from a data security perspective. The 12 inch Macbook should have a docking station. One would hope Apple will announce one very soon.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2015 All Rights Reserved

2
Feb

Consumers pass on smaller tablets to take advantage of offers for smartphones with bigger screens

2-Color-Design-Hi-Res-100px-widthOn Monday, February 2, 2015, Tiernan Ray of Barrons reported on a research note published by Canalys. Ray’s article is titled Tablets Fall 12% in Q4, First-Ever Decline, Says Canalys; 7-Inch Models Cannibalized (http://blogs NULL.barrons NULL.com/techtraderdaily/2015/02/02/tablets-fall-12-in-q4-first-ever-decline-says-canalys-7-inch-models-cannibalized/). Ray mentions this note claims “that shipments of tablet computers fell in Q4 by 12%”.

Anyone with an interest in consumer preferences for small, smart devices for computing on the go will likely look at the Canalys claim, especially if other published research affirms the numbers, as an indication of how Apple’s product marketing has successfully convinced buyers in mature markets, and even China, to value the iPhone as a status symbol. When this product magnetism is combined with carrier incentives, consumers apparently passed up opportunities to buy tablets to obtain an iPhone 6 or 6S.

Apple does not appear to be suffering much pain from these changing consumer tastes. According to Apple’s most recent quarterly earnings report, the surge in iPhone buying more than offset the 18% drop in tablet sales Canalys notes. But will the same scenario play out next year, when Apple debut a new iPhone? Would it not make sense for analysts to discount future earnings estimates based on an understanding of just how consumers of luxury electronics might behave, over time?

Unfortunately there is not any mention of this type of skepticism in Ray’s article. When buyer sentiment can turn quickly negative when products “[fail] to wow” it is reasonable to call a market top, of sorts, for this category of products. Regardless of the size of Apple’s operations, and its deep pockets, it is not likely we will continue to see widely popular new product releases time after time after time when the only real incentive for buyers is to announce to their peers they can still afford to buy the newest pricey gadget.

The Canalys report also mentions a serious drop in sales for Samsung tablets. In my opinion there are legitimate reasons for this, not the least of which is a combination of Google’s decision to no longer support “early” versions of Android, and Samsung’s own poorly timed introduction of new tablets, too often to the detriment of customers unfortunate enough to buy a product about to be obsoleted. But I argue the luxury market condition also weigh heavily on Samsung’s results. By crafting product promotion around a “competition to be the best” assumption, Samsung rendered its own small form hardware devices fair game for buyers to cannibalize in their frenzy to consume an iPhone 6 or 6S.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2015 All Rights Reserved

5
Dec

Look for even more feature hype as ISVs present new features somehow failing to reach consumers as promised

In an earlier post to this blog, titled Enterprise IT ISVs Contributed to the Bloated Feature Set for PCs this writer published comments about how the very close relationship between Intel and Microsoft, which first began, one can argue, when IBM turned over the chip manufacturing pieces of the original PC to Intel, actually worked to the disadvantage of both parties. The outcome of this mismatch of efforts was, we argued, the Complex Instruction Set Computing (CISC) hardware architecture, which covered far too many bases to successfully compete with its Reduced Instruction Set Computing (RISC) rivals. The RISC machines won the contest. The mobile device world is filled with small, smart devices built to conform to RISC architecture principals.

Now, in late 2014, we think it would be better, (and consumers would, ultimately, benefit more) if hardware, firmware, and software all actually worked closer together. Unless/until these players warm up to each other, devices are simply not going to work as advertised. Marketing communications messaging about new features will simply devolve into just more hype.

Over the last several posts to this blog we’ve presented some examples we’ve found of this problem eating away at some of the opportunities computing hardware consumers may hope to enjoy from their purchase decisions:

  1. Solid State Drives, purchased after market, do not work well with Intel PCs running Microsoft’s Windows O/S.
  2. Android devices, at least from Samsung, can’t be upgraded to new versions (for example, a Samsung Galaxy Note 10.1, 2.1, requires a “root canal” if a consumer wants to avail of the new KitKat or Lollipop O/S, and chuck JellyBean).
  3. A new Apple iOS O/S is made available to older iPhones and iPads, but performs poorly once it is installed; consumers suspect they have been hoodwinked into downloading and installing the new O/S as a means of pushing a new hardware sale.
  4. Finally, Personal Assistants aren’t equipped to understand complex verbal linguistics, and fail to work in high demand situations. Bi-Directional voice conversations don’t sync well with hands free bluetooth audio in cars

This list could go on for quite a while.

In this writer’s opinion, ISVs will do better to either completely abandon the notion of an after-market for new hardware products, or work closer together, perhaps via standards committees, etc.

But there is nothing on the horizon pointing to either of these events happening any time soon. For now, consumers are simply better off researching very carefully each nuance of any planned changes before embarking on them.

Ultimately ISVs will likely suffer more than consumers from this condition.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2014 All Rights Reserved

3
Dec

Consumers likely to maintain a healthier appetite for new PCs for the near term future

PC manufacturers, across the board, including Dell, have reported better sales results over the last several quarters. We think this trend will continue for the near-term future (meaning at least through to Q2 2015). We see four factors at work, which promise to continue to drive new PC purchases:

  1. the debut of ultra low cost PCs, price competitive with Google Chromebooks
  2. an improved Windows 8.1 O/S, complete with better integration of tile/app and desktop computing environments
  3. consumers hungry for storage and computing speed, exhausting upgrade efforts and buying new hardware
  4. developer community acceptance and implementation of Microsoft’s API and SDK strategies, which will deliver more computing features to PC owners, thereby narrowing the feature gap between Windows, OSX, and Android PCs

Here’s some point by point detail: 1) with the 2014 holiday buying season, consumers are finally able to purchase PCs powered by Windows 8.1 at price point parity with Google Chromebooks. At $199.99 the HP Stream (http://store NULL.hp NULL.com/webapp/wcs/stores/servlet/us/en/mdp/Laptops/hp-stream-notebook-11-135508--1) is, arguably, an affordable option for the widest possible consumer segment requiring a Microsoft Windows computing experience. In what we can only call a major achievement for Microsoft, HP’s low end Chromebook entry, the HP Chromebook 14 (http://store NULL.hp NULL.com/webapp/wcs/stores/servlet/us/en/mdp/Laptops/chromebook-14-88376--1) carries a street cost nearly 50% higher than the HP Stream 11.

Now to the second of our four points: The difference in computing experience quality between Windows 8.0 and Windows 8.1 is substantially. It is not likely enterprise buyers have satiated their appetite for new PCs. Further, another year has passed on the PC lifecycle, so even more older PCs will have to be upgraded. Windows 8.1 resolves many of the Windows 8 issues enterprise buyers complained about, so it is likely the uptick in PC buying will continue for some more time to come.

Consumers looking for a better PC computing experience at a reasonable cost still have the best opportunity to meet their objectives with a PC running Microsoft’s Windows O/S. So the mid to high end of the PC market, meaning the segment requiring solid state drives, HD monitors and matching graphics, etc, are more likely to stick with Wintel than to gravitate to OSX PCs.

Finally, Microsoft’s decision to release a number of APIs and SDKs empower app developers to build Office 365, and even hooks to Azure into their solutions. As developers consume these new tools, consumers should be able to use Wintel PCs to consume a lot of the apps, heretofore, only available via Android, or iOS devices. Effectively the feature (and, one can argue, the entire computing experience) gap between device architectures should narrow, which should further pump up PC sales for sometime to come.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2014 All Rights Reserved

14
Nov

Any meaningful feature gap between high end and low end smartphones has been obliterated

Consumer markets for smartphones no longer present any gap, whatsoever, between high end and low end entrants as regard high value features. With this gap obliterated, industry players will do well to implement product marketing strategies with a proven effectiveness in pure commodity markets or else risk extinction. This means product marketers should emphasize methods of lowering the cost of manufacture, and secondary markets to prop up revenue expectations while closely scrutinizing new model planning.

Here’s a case in point. We just purchased, outright, an LG Optimus L90 Smartphone (http://www NULL.lg NULL.com/us/cell-phones/lg-D415-optimus-l90) from our wireless data provider, T-Mobile. Our total cost to acquire this device amounted to a one-time charge of $99.99. We should also note we maintain 2 Nokia Lumia 925s, which we purchased from T-Mobile at a cost of approximately $600.00, each. We are still paying, monthly, for each of the Lumias and will likely continue to do so for at least another few months.

But with an Android KitKat O/S, and a very extensive set of app options, we can’t find anything we’ve given away by opting to purchase the LG-D415 instead of a new Lumia, or even an iPhone 6. Sure the Lumia and the iPhone 6 offer many more powerful features than our LG Optimus L90, but we have no need for them. In this writer’s opinion, when features reach a usefulness plateau as they have in the smartphone market, consumers have zero incentive to migrate up the ladder to more expensive versions of the same commodity.

Leading manufacturers of smartphones are already exhibiting a set of strategic moves befitting general agreement about the nature of the market as, in late 2014, entirely commodity driven. Accordingly, Apple is talking about producing a gold version of its iPhone 6, which is already available for custom monogramming. This move makes sense for a manufacturer with a leading product whose principal attractiveness is its position as a status symbol for a highly concentrated set of consumers habituated on only buying the leading product in the category.

At the low end manufacturers like Samsung are feeling the pain as competitors with a substantially lower cost of manufacturing, for example, Xiaomi, seize market share. For this segment of the market, app stores look to be an oasis in a profit desert. No wonder Microsoft is racing to win a place on the radar of app developers as its best hope to capitalize on the smartphone market.

Look for further consolidation in this market as manufacturers either drop out, or consumer rivals.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2014 All Rights Reserved

30
Oct

Mature ISVs converge and compete on the “productivity” theme

Microsoft, Google, and the recently announced joint marketing effort by Apple and IBM, are all presenting solutions to the consumer market for computing solutions around the theme of “productivity”. But, in stark contrast to how this type of competition plays out around commodity hardware (smart phones, tables, PCs, laptops), each of these ISVs is working hard to articulate a niche, highly differentiated message.

Satya Nadella, CEO of Microsoft mentions “productivity” as early as two and a half minutes into the forty nine minutes of the Microsoft Cloud Briefing (http://news NULL.microsoft NULL.com/2014/10/20/cloud-event-webcast/) event, which was held on October 20, 2014 in San Francisco. The core, mission-critical foundation stone of this brand message is, as follows: in 2014 there is simply too much information. Too much information results in no information (kind of like Samuel Coleridge’s line from his Rhyme of the Ancient Mariner, “water, water everywhere, but n’ary a drop to drink”). So the real imperative driving (and you can substitute your favorite mature ISV on this one) product marketing for computing is acquiring, understanding, categorizing, and prioritizing all of this information, behind the scenes (via machine learning) so an individual can do something with it.

Whether the solution is Delve, or Google Now, or Watson really doesn’t matter. Each of these intelligence platforms is out there to service individual needs to better manage information in a world where, literally, one thousand times the amount of information is available, at comparatively little or even no cost. Each of the competitors in this market is betting on the enormous value of this low cost pool of information, once it is packaged effectively, for consumers.

It’s refreshing to see how none of these competitors has reverted to a “competition to be the best” strategy. The market for the type of computing capability behind the notion of “productivity” as each industry spokesperson articulates it, promises substantial revenue. Treating it as a commodity would be real fool’s play.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2014 All Rights Reserved

27
Oct

Apple is likely to hit serious headwinds rolling out two innovations

Update: as of Monday morning, October 27, 2014, Bloomberg reported CVS had joined Rite-Aid is nixing Apple Pay

Apple doesn’t appear to have a lot of history successfully accomplishing change management campaigns, but, in this writer’s opinion, two recently debuted Apple iPhone and iPad innovations — a software reconfigurable SIM card, and Apple Pay ™ — will need change management to deliver on their promise.

It’s only been a a couple of weeks since the last of Apple’s big annual events, the presentation of new iPads in advance of the holiday buying season, but negative industry feedback has already hit the press for both of the above mentioned innovations. Rite-Aid corporation, which, currently, maintains a US network of 4.6K retail locations (https://www NULL.riteaid NULL.com/about-us/our-story) recently announced its intention to block consumers from using Apple Pay at the check out counter. AT&T also just announced its intention to stop its mobile smartphone subscribers from using the SIM reconfigurable feature built into the iPhone 6 family of smart phones and the iPad Air ver 2 mobile-connected tablets.

But both of these features are truly innovative, right? So what’s the problem? Perhaps adding some definition to the worn-out abstractions “innovative” and “innovation” helps here. Arguably products, services and even solutions cannot be judged to be “innovative”, or examples of “innovation” if they fail to streamline what this writer would refer to as the “total 360 view” of how they might be applied, implemented, and even planned for.

Apple’s software reconfigurable SIM card, and its NFC Apple Pay ™ hardware actually amount to a stake in the ground into two markets product marketing may not have planned for Apple to enter — mobile telecom, and retail point of sale (POS). But neglecting to plan for these points of entry can lead up to the kind of abrasion the public is witnessing, given the press announcements from AT&T and Rite-Aid. The phenomenon is a bit like Tesla’s changing fortunes as it finds itself dealing not only with issues familiar to automobile manufacturing, but the broader issues of employment, and the actual sales structure for satisfying consumer needs for the automobiles produced through the manufacturing effort. Tesla’s issues arose when it decided, and publicly announced its intention, of selling automobiles direct to the public, leaving out the car dealer middlemen used by every other automobile manufacturer.

In this writer’s opinion, the apparent holes in Apple’s product plan for these two new features of both its smart phone and tablet offers represent a breakdown in innovation. The holes should be filled in before Apple proceeds further. Disrupting industries and supply chains requires a lot of change management. If nothing else, these issues point to a big, new, opportunity for adoption champions to help Apple fill in the above mentioned holes.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2014 All Rights Reserved

20
Oct

When features reverberate from product to product, consumers are likely to become indifferent while markets take the on ramp to commodities

Over the last year, or more, the same computing hardware feature set — very thin portable computers with ultra sharp displays, light weight, and rapid boot times — has reverberated across devices from different manufacturers targeted to the same market. This type of condition is a harbinger of product marketing producing commodities, leaving little room for brand differentiation. It’s time product marketers did their homework. Consumers are not likely to be lulled into complacency and just continue buying new versions of devices they already own.

Apple’s recent debut of the “new” iPad Air 2 (http://www NULL.apple NULL.com/apple-events/2014-oct-event/) is a case in point. The web site promotion for this device emphasizes features already claimed by Apple competitors, principally Microsoft, for its Surface Pro 3 2-in-1 computing devices.

But if I’m someone who recently bought a Surface Pro 3, does Apple product marketing really believe I’m going to chuck my investment of somewhere between $1 and $2K, or more, to buy yet another product claiming to be the thinnest device ever? If they do, I’m afraid they’re not likely to successfully achieve their objective. As Dr. Michael Porter has illustrated, competition to be the best is a comparatively low profit, zero sum game.

What the Apple iPad Air 2, and Microsoft Surface Pro 3 MARCOM illustrates is a disconnect between personal computer product marketing and its targeted customer base. To be fair, the video included with Microsoft’s Surface Pro 3 debut did include several portraits of how customers are actually using the first and second generations of Microsoft’s Surface. Post Surface Pro 3 launch, Apple purchased a series of online ads, which were displayed on the New York Times web site, providing much of the same information about organizations using iPad tablets. But connecting with your customers and coming to market with inherently unique products, which, in turn, deserve a fitting MARCOM statement conveying what’s unique, and different about them, is something altogether separate from a set of portraits of how customers are using your light, very bright, and thin ultra portable personal computers.

Actually, connecting with customers, as a short video presentation titled Managing the Uncertainty of Innovation (http://t NULL.co/4UBy6ICae9) illustrates, is the kind of high-value activity early stage ISVs can and should use to mine for truly unique product notions.

No doubt the iPad Air 2 has some truly unique capabilities, which can be compelling for a specific audience/market, but the current promotion about the product isn’t getting this message across. The same opinion covers current promotional efforts for the Surface Pro 3, and even very high ticket software — Microsoft’s Delve, IBM’s Watson, and Salesforce.com’s entry into the same space.

Bottom line: “the same space” is a mirage. No two “spaces” are ever the same. Product marketers need to find out just what “space” they want to target and then go for it.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2014 All Rights Reserved

3
Oct

iPhone 6 and iPhone 6 Plus consumers are not likely to maintain an insatiable appetite for these devices

On Thursday, September 25, 2014, Barrons ran an article by Tiernan Ray. This short piece, Apple: ‘Bendgate’ Irrational, Says Cantor; Apple Comments via CNBC (http://blogs NULL.barrons NULL.com/techtraderdaily/2014/09/25/apple-bendgate-irrational-says-cantor-china-iphone-demand-insatiable/?mod=BOL_hp_highlight_1), which was included in Ray’s Tech Trader daily feature amounted to a quote from an analyst at Cantor Fitzgerald, Brian White, along with some comments from Ray.

White’s quote speaks to the current controversy about these new smart phones, and points to what he refers to as an “insatiable appetite” for these devices on the part of Chinese consumers. No product has ever, or, in this writer’s opinion, will ever stimulate insatiable consumer appetite. Anyone with a keen interest in the fortunes of these newest smart phones from Apple should maintain a skeptical stance about the usefulness of any comments like White’s.

If readers are skeptical about the veracity of our take on White’s comment, we simply point to the fate of Apple’s stock in market activity on Thursday, September 25, 2014. The stock dropped over 3% precisely around the set of concerns White calls “irrational”. If these concerns are, in fact, “irrational”, then why the deep dive on Apple’s stock price?

In this writer’s opinion, consumer concerns about these new smart phones are not irrational. As we have published earlier in this blog, and some other people (who we consider to be astute) have also written, the price of these devices will fall out of the range of the “average” smart phone consumer by a substantial amount. So, with the very high end of the consumer market not only targeted for these products, but, even more, already rapidly consuming them, the market reaction is entirely understandable.

Folks shopping at Burberry’s expect perfection. Sure they are willing to pay for it, but, in return, they are the most demanding of consumers. So market dissatisfaction with Apple’s mistakes and, perhaps, PERCEIVED trickery (why would an affluent consumer throw away a perfectly functional iPhone, albeit a previous model, for a slick new entry, which, nevertheless is “bendable”), should be entirely acceptable.

Further, an analyst who looks at market reaction and attempts to DENY its legitimacy is an analyst whose words will likely receive a lot of careful scrutiny.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2014 All Rights Reserved

30
Sep

No Technology Solutions on the Near Term Horizon for a Better Defense Against Online Hacking

ISVs with popular online computing offers (notably Apple, Google, and Microsoft) have each adopted and endorsed an “App” model. This writer has a lot of conceptual familiarity with Microsoft’s version of this approach. Microsoft has positioned its Office 2013 App Model as a better approach to online security, but is it really?

For readers unfamiliar with the broad technical structure of “Apps” and how it might enhance online security for consumers, the key principle is “isolation”. In theory, “Apps” transition a lot of computer processing from servers to clients. In other words, a lot of the activity handled in the past by the server is transitioned over to the PCs, smart phones, tablets, and even game consoles consumers use to process computing tasks online. The method of processing this activity is to instruct these computing clients to act on commands written in some version of the JavaScript programming language, or the latest version of HTML (HTML 5 at the time of this post).

In the case of the Office 2013 App Model, the jQuery (http://www NULL.jquery NULL.org) function library is heavily used by developers to add procedures quickly, which already exist somewhere online, with all of the supporting libraries required for successful execution. But this practice poses several difficulties, a couple of which directly impact on online security for consumers. First, there are different versions of the jQuery function library. So, when an App is developed with one version, and another App is added to a computing environment (for example, Office 365), the potential for App conflict arises, which can result in degradation of service for the end consumer.

Second, inadvertently to advocates of this type of development, the App model’s reliance on a client-side method like JavaScript can be said to insulate the server, but, inadvertently, this approach shifts the burden of security over to the client. Since their are hundreds, if not thousands, and even millions of different clients in use to interact with one server (or many servers in a load-balancing scenario, which act as one server), there is a much higher likelihood of a security breach on a client machine. Once clients are successfully compromised, they can be added to bot networks and re-purposed for other types of malicious activity.

For better or worse, in late 2014 the best defense against malicious online activity remains best represented by a correct set of operational risk management processes, at least for large organizations of users.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2014 All Rights Reserved