Sunday, October 30, 2011

HP pardoned PC biz, but WebOS is still on death row

HP pardoned PC biz, but WebOS is still on death rowJust a day after HP announced that it wouldn't be spinning off its PC division, with its new CEO Meg Whitman citing "together we are stronger", the same feeling does not extend to WebOS. British newspaper The Guardian reports on Friday that the company plans to shut down the division and more than 500 jobs could be cut.



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HP acquired the rights to WebOS through its acquisition of Palm in April 2010. The software was meant to power HP's line of Palm smartphones and the TouchPad, but following the scrapping of both lines in August, the future of WebOS was uncertain.

Both the ditching of the PC division and the end of WebOS were the swan song of ousted CEO Leo Apotheker. The appointment of Whitman led some to believe that there may be some chance that Apotheker's moves would be reversed. The surprising success of the TouchPad at $99 also added to the chance that WebOS may still have a chance.

Top-level executives in the WebOS division have been fleeing the company, The Guardian notes, with the general consensus of the department being that it would be closing down by the end of the year. HP has apparently also attempted to find a suitor, but there appears to be no interest in the mobile operating system.

This could be due to the fact that both Android and iOS have become so dominant in the mobile space: the two platforms control a large majority of the market, with RIM's BlackBerry stumbling and Microsoft's Windows Phone platform unable to gain traction in the market. WebOS would likely struggle to make any appreciable dent in the dominance of Apple and Google in the space.

HP didn't respond to our requests for comment on the status of WebOS were as of press time.

Tuesday, October 25, 2011

Why Google would want Yahoo: A few opportunities could make it worth the effort

Google is reportedly in early talks about a bid for Yahoo. Can these opportunities make the likelihood of regulatory scrutiny worth it?

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That “person familiar with the matter” is talking to the Wall Street Journal again - and this time, that person is whispering tales of early-stage discussions between Google and some potential partners to make a bid for Yahoo.

Now, before anyone starts hollering “antitrust” in a building filled with government regulators, remember that there’s still no formal proposal yet and it’s very possible that Google might not pursue a bid at all. Instead, it seems like we’re at the stage where the key players are just scribbling out their lists of pros and cons about a possible deal.

Imagine the advertising possibilities, what with those hundreds of millions of faithful Yahoos who check in several times a day. But consider the sort of scrutiny that the deal would experience. Are the growth possibilities or the potential dollars-and-cents for the long run worth the efforts of defending the deal to regulators?

Maybe. If I were scribbling some thinking points on a Google bid for Yahoo, here’s what some of those random thoughts might look like:

Search: Google walked away from a search advertising deal with Yahoo once before - almost three years ago - after the Department of Justice said it would file an antitrust lawsuit against it. They went big, pared down and still couldn’t shake the feds - and so they walked. A year later, Microsoft inked a 10-year search deal with Yahoo. Certainly, regulators will be interested in search and how a Yahoo-Google-Microsoft love triangle impacts it. In terms of Google taking out a search competitor in Yahoo, that feels like less of an issue. Yahoo hasn’t been a search powerhouse for years and Carol Bartz, before she was shown the door, had been pushing the “Don’t compare us to Google” message at every opportunity.

Content: The other half of the We’re-not-Google mantra was a “We’re a media company” message that Yahoo backed with partnerships and acquisitions. Going after the likes of AOL, Yahoo stepped up its game in original content - not just YouTube style snippets that Bartz was fond of - but also original news. Remember that news has always driven advertising and Yahoo has millions of eyeballs visiting the site daily. Bartz wanted to make sure that the content they see - both news and advertising - on login and logoff pages, as well as other strategic locations, kept them on the site as long as possible. That’s counter to the Google experience that most people have - where they find what they were looking for and then click away to another site.

Advertising: Speaking of advertising, it’s always been funny to me that most observers still refer to Google as a search engine when, in fact, Google is an advertising company. Sure, search drives advertising. But Google execs have been saying for years that Google makes money when people spend time on the Web because that’s where they’re exposed to the advertising. Yahoo’s advertising strategy has struggled to compete against a giant like Google, but there’s still some value there. In fact, regulators should probably spend more time looking at how a deal might change the advertising business - and industries that are tied to it - rather than focusing their energies on the search issue.

Brand Loyalty: You really can’t downplay the significance of the value of the Yahoo brand and the power that comes with hundreds of millions of daily visitors, many of whose loyalty goes beyond what other Web companies experience. (Between email, finance and news, I’ve already visited a dozen or more Yahoo pages today - all before lunch.)In part, that “stickiness” is due to the company’s long-standing presence on the Internet. It was one of the first to offer Web-based email - and, as such, signed up people before Google could. Still, it’s kept the offerings fresh and relevant in a changing landscape for communicating with others and sharing information.

Other opportunities: The first thing that popped into my head when I thought about Google getting its paws all over those content relationships that Yahoo has established was how it could impact the efforts around Google TV. Like Apple TV, Google TV is still a work-in-progress. I’ve long said that I’m a fan of the concept - making both broadcast content and Internet content searchable for a more customized TV watching experience - but Google had a tough time getting the content providers on board. With Yahoo’s content offerings, Google TV - and Google News, as well - could get a boost in inventory. Now, if only they could work on that technology.

Some might argue that the time is right for Google to make a bid for Yahoo. The competitive landscape has changed, the technology has evolved, the global economy is in a different state and the political climate in Washington has shifted since the last time the mutterings of a Google-Yahoo deal were heard. Others might argue that the many tentacles of both businesses could prompt a long review of the deal while regulators sift through it all.

I wouldn’t be quick to place any bets on a deal happening - but it’s good that Google is at least exploring the possibilities. Yahoo has been through a lot in recent years and while it’s future might not appear to be so rosy, there’s a lot of life left in the company. And if Google (or Microsoft) could get their hands on it - or key pieces of it - the landscape in the tech industry could have some interesting twists and turns on the road ahead.

Monday, October 24, 2011

Microsoft signs Android licensing deal with Samsung

Microsoft has signed a cross-license patent agreement with Samsung Electronics that grants Microsoft royalties from Samsung's Android-based smartphones and tablets, Microsoft said in a statement on Wednesday.

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Microsoft didn't disclose details on how much money Samsung will have to pay Microsoft for every Android-based device it sells. Last year, HTC, which together with Samsung dominate the market for Android-based smartphones, also signed a licensing deal with Microsoft.


In the past three months, Microsoft has signed Android deals with Acer, General Dynamics Itronix, Onkyo, Velocity Micro, ViewSonic and Wistron, Microsoft's general council Brad Smith and deputy general council Horacio Gutierrez wrote in a blog post.

That leaves Motorola Mobility, with which Microsoft is currently in litigation, as the only major Android smartphone manufacturer in the U.S. without a license, they said.

It seems unlikely that Microsoft and Motorola Mobility will agree on a licensing deal without litigation. Motorola Mobility is in the process of being acquired by Google. "Our acquisition of Motorola will increase competition by strengthening Google's patent portfolio, which will enable us to better protect Android from anti-competitive threats from Microsoft, Apple and other companies," Google CEO Larry Page said about the $12.5 billion acquisition.

Smith and Gutierrez had this message for Google in their blog post: "We recognize that some businesses and commentators -- Google chief among them -- have complained about the potential impact of patents on Android and software innovation. To them, we say this: look at today's announcement. If industry leaders such as Samsung and HTC can enter into these agreements, doesn't this provide a clear path forward?"

Samsung signing a deal with Microsoft makes more sense. The company is already busy battling with Apple in courts around the world. Samsung did not reply to questions about the deal.

Also, earlier this week, Samsung announced the Omnia W, its first smartphone based on Windows 7.5, also known as Mango. In addition to the licensing deal, the companies also agreed to cooperate in the development and marketing of Windows Phone, Microsoft said on Wednesday.

Samsung and HTC are close partners to Microsoft, so signing licensing deals make their lives easier, according to Francisco Jeronimo, research manager at IDC.

But, on Tuesday, Samsung joined Intel to help develop Tizen, a new OS that merges MeeGo and Limo. So the company is keeping its options open when it comes to OSes.

Friday, October 21, 2011

Microsoft to talk cloud at Tech Ed

Cloud computing will once again be a major theme for this year's Microsoft Tech Ed conference, according to the company. And attendees seem to be interested in finding out how the cloud can be used in conjunction with their own operations.

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"Over the past six months, Microsoft has thrown new words at us -- like 'hybrid cloud' -- so I think a lot of people will be there to try to get their minds around these terms," said Rod Trent, the CEO for myITforum.com, which will provide the community forums for Tech Ed.

Participants, Trent said, seem eager to "understand how the cloud will fit within their organization. How much data can they push to the cloud? How much costs savings will it offer?"

Microsoft reckons that many of their customers are testing cloud deployments, evaluating these services and products for production use in the years to come. So this year's show, being held May 16 through May 19 in Atlanta, will focus on Microsoft's cloud offerings, and explain the development tools from the company and partners that were designed to help organizations better use the cloud.

The conference will kick off 9 a.m. Eastern Time Monday with a keynote by Robert Wahbe, Microsoft corporate vice president for server and tools marketing. He will be joined by Jason Zander, corporate vice president overseeing Visual Studio, who will showcase new technology.

Microsoft plans to run the keynote as a webcast. Additional interviews and sessions will be broadcast over Microsoft's Tech Ed site.

As far as cloud computing, the company will have much to discuss. Over the past few months Microsoft has touted a number of higher-profile customer adoptions. The Target chain of department stores, for instance, now runs 15,000 virtual machines across its retail stores, using Windows Server 2008 R2 Hyper-V and System Center. Toyota is using Windows Azure for its next-generation telematics services.

But the company also has had its share of high-profile mistakes. Just this week, users have been complaining of outages from Microsoft's hosted Exchange offering.

Attendees should pay very close attention to how Microsoft details its cloud strategy, advised Charles King, principal analyst for the firm Pund-IT. Like Microsoft itself, companies such as VMware, Red Hat, Rackspace, Google and others have all made significant progress in their cloud software and offerings. "How does Microsoft think its approach is better than the competitors?" he said.

"If you've watched Microsoft over the last year or so, and all the reorganizations, it looks like they may be heading more quickly to the cloud than they were a few years ago," Trent said.

Trent set up a page, called Twitter Army, for attendees who wish to file reports of what they have learned at the show, so the knowledge can be shared with others.

Not to say that other topics won't be addressed at the conference. In addition to cloud computing, session tracks are also dedicated to topics such as databases, business intelligence, developer tools, middleware, Microsoft Office and SharePoint, unified communications, security, virtualization and Windows for the client, server and the mobile phone.

For one attendee, learning about Microsoft's Lync unified communications server will be one of the chief draws of the show.

Scott Ladewig, information services networking and operations manager for the Washington University in St. Louis' Olin Business School, is attending the show "to see what is current and what is coming" from Lync and other Microsoft technologies, he said.

The business school, like several other schools within the university, runs Microsoft Office Communications Server, Lync's predecessor. Ladewig will be looking for information on how to unify these systems, as well as get them to interoperate with other unified communications offerings, such as the one offered by Cisco.

"OCS has pretty much everything we are looking for but obviously we want to stay current," he said.

Thursday, October 20, 2011

Apple, Oracle and EMC part of Microsoft-led patent LLC

Apple, Oracle and EMC are involved with CPTN Holdings LLC, the Microsoft-led consortium that is purchasing 882 patents from Novell for US$450 million, according to a Dec. 9 posting on the website of German antitrust authority Bundeskartellamt, or Federal Cartel Office.

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News of the sale emerged last month when Novell announced it was being purchased by Attachmate for $2.2 billion.

Little remains known about which patents CPTN Holdings will acquire, although speculation has run rampant in recent weeks. Many had also wondered which other companies were involved in the LLC, and the nature of their interest in the patents.

An Oracle spokeswoman declined comment. Apple and EMC did not immediately respond to a request for comment.

There seems little cause for immediate alarm, according to open-source advocate Florian Mueller, who flagged the Bundeskartellamt notice on his blog Thursday.

"I don't have a crystal ball that would tell me what their business plan with those patents is, but those organizations have a track record and, very importantly, they have a reputation to protect," Mueller wrote. "They all want to enjoy excellent relations with software developers, and software developers expect large players to make reasonable and constructive use of whatever patents they own. I guess that's exactly what will happen in this case."

Tuesday, October 18, 2011

Microsoft: Windows Azure will outcompete Amazon Web Services on features, total cost

Despite unveiling prices for its upcoming Windows Azure cloud platform that appear merely on par with incumbent rivals such as Amazon, Microsoft Corp. says Azure will gain ground with Web developers by offering more and better features for the money.

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Free from today until its official launch in November, Azure's still-in-beta services range from a hosted .Net platform to an online version of the SQL Server database called SQL Azure.

At its Worldwide Partner Conference in New Orleans on Tuesday, Microsoft detailed three pricing models for Azure: a consumption model, a subscription model for partner resellers, and an option for volume-license customers such as large enterprises.

The first "pay-as-you-go" model aimed at small developers attracted the most attention, though, because the pricing was closely comparable to services offered Amazon.com, Salesforce.com's Force.com and Google Inc.'s Google App Engine.

Microsoft is charging 12 cents per CPU/hour, 15 cents per gigabyte of data per month, and 10 cents per 10,000 transactions for storage purposes.

While The Register declared Azure to be cheaper than Amazon.com's price for hosted Windows and more expensive than a Linux instance, Silicon Valley Insider called Azure's price "not significantly different than either Google or Amazon."

"The actual per-unit pricing is totally uninteresting in my mind," Prashant Ketkar, director of marketing for Windows Azure, told Computerworld on Tuesday. "What will it cost me end-to-end?"

Ketkar says that Azure offers a number of standard features that, if purchased as add-ons for most competing platforms, cause their prices "to be substantially more expensive than us."

He cited Azure's automated service management as a "killer feature" that enables apps on a downed server to be reloaded onto another server with minimal interruption using Microsoft's "fabric controller".

Azure is also able to dynamically scale on demand, and automatically create two extra backups of data, Ketkar said.

Iein Valdez, product development director for Appirio Inc., a SaaS systems integrator that supports both Google App Engine and Force.com, disputed Ketkar's cost calculations.

"On Google App Engine, you're only paying for the resources you use, unlike Azure where you pay for any running compute instances even if your application is unused," Valdez said.

He said also that Google App Engine is easier to use and more scalable than Azure.


"App Engine has completely transparent auto-scaling, with Azure you'd need to correctly provision and tear down instances as demand fluctuates&and this can be real headache," Valdez said. "From the database [datastore] perspective, the business edition of SQL Azure appears to max out at 10GB, unlike App Engine, which has no data limitations. This can be a real problem for even small-scale applications."

Meanwhile, an Amazon.com spokeswoman said that the company's prices are "intended to give users the most flexibility possible in building their applications." She invited developers to use Amazon.com's online calculator to check the cost of running services such as its S3 storage or EC2 application-hosting service.

While Microsoft is counting on the loyalty of legions of .Net developers moving their apps to Azure, Ketkar said, it also believes it can win over developers who have already moved to rival cloud services.

"It's still 15 minutes into the first quarter, as my senior VP likes to say," Ketkar said. "It's still evolving technology. So I don't think any good developer has committed to any platform."

With its Business Productivity Online Suite (BPOS), Microsoft is letting third parties such as CSC sell a version that is hosted on their own servers, not Microsoft's data centers.

With Azure, Microsoft is remaining more restrictive. Neither partners nor enterprises will be allowed to host Azure at launch, Ketkar said, but that may come "a few years down the road."

Such services, which would parallel the long-term unification of the Windows Server and Azure roadmaps, would likely be called something other than Azure, he said.

Monday, October 17, 2011

Apple's enterprise approach: Passive aggressive

Apple’s approach to the enterprise is passive aggressive. The expenses involved with courting the enterprise highlight why.

Apple could be a bigger player in the enterprise, but chasing CIOs around could be damaging to its operating model.

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In a talk arguing that Google and Apple were disruptive to Microsoft in corporate IT, Gartner analysts Tom Austin and David Mitchell Smith commented on the company’s corporate ambitions. With Steve Jobs’ passing, a few of us expect Apple to be more aggressive about the enterprise.

Jason Perlow recently outlined the case for Apple focusing more on corporate sales. Indeed, Apple CEO Tim Cook is an IBM alum and mentions the enterprise frequently on earnings conference calls. In fact, Cook is just about the only one that talks about Apple’s enterprise gains via consumerization.

Also see: Apple in the enterprise: The road forward

Apple’s R&D spending hits bottom as percentage of revenue

“It’s not that Apple doesn’t care about the enterprise, but the enterprise doesn’t drive product development,” said Smith. “It let’s consumerization happen and then does limited tweaks for the enterprise as long as it doesn’t affect product design.”

You can go through years of earnings call transcripts and find Cook mentioning the enterprise regularly once the iPhone launched. However, I’ve been told that Jobs chose to look the other way about budding enterprise sales—who can argue with profits falling out of the sky. Jobs tolerated small enterprise focused projects—say the B2B App Store and swat teams looking to poach verticals from RIM—but saw corporate customers as a distraction.

It’s a distraction that may pay off though. The room here in Orlando was packed for a presentation about the prospects of Google and Apple as vendors. For our purposes, we’re focusing on Apple here. A separate post looks at Google.


Smith and Austin called Apple’s approach passive aggressive. There’s a good reason for Apple’s approach though—targeting the enterprise is expensive. They said in their presentation:

Apple’s operating expense (OpEx) numbers explain their passive aggressive approach to enterprise business. Enterprise direct selling and enterprise-specific requirements would severely distort that model. Apple wants enterprise business, but not at the type of price paid (in R&D and SG&A) by enterprise providers. Apple’s vertical integration allows it not only to reduce cost of goods but also to exploit new technologies more quickly than competitors who are not as vertically integrated.

This is where consumerization gets so interesting for Apple. the company may not have to focus on selling to corporations because its customers will bring devices into the workplace anyway. In many respects, Apple fans are the enterprise sales team. And they happen to work for free.