Partners, take note: As if you didn't know this already, a new CDW survey has
found that confidence in IT spending is
on
the decline. It looks as though that nasty old economic downturn is hitting
IT...but the numbers really aren't that bad. Look at it this way: You could
be an investment banker.
Posted by Lee Pender on 10/30/2008 at 1:22 PM0 comments
Finally! Microsoft Office is going Live...for real this time. Microsoft announced
this week at the PDC in L.A. that there will be
browser-based
versions of Word, Excel and PowerPoint, with a beta probably available sometime
in 2009.
But let's read the fine print from the CNET article linked above:
"Microsoft will offer browser-based Word, Excel, and PowerPoint in
two ways. For consumers, they will be offered via Microsoft's Office Live
Web site, while businesses will be able to offer browser-based Office capabilities
through Microsoft's SharePoint Server product."
Hmm...so the business offering is really more of a distributed, on-premises
model running on SharePoint as opposed to a pure SaaS offering with Office running
in a datacenter. OK. Then, there's this:
"Elop said that not all of the editing capabilities of the desktop
products are in the browser versions. 'The editing we are characterizing as
lightweight editing,' he said."
Ahh...OK. So, browser-based Office will be a scaled-down version of the (very
bloated, we must say) original.
All of this gets back to what we've said here before -- for all its talk
about and investment in cloud computing, Microsoft still sees the cloud as being
very much tethered to on-premises deployments. That's a model that might work -- but
what we still haven't seen from Microsoft is a true, un-tethered, Salesforce.com-style,
pure SaaS model.
And we all know why: Office is a big moneymaker, and giving up those license
sales and replacing them with monthly subscription fees would be a shock to
Redmond's system. Hey, we're not saying that browser-based Office isn't welcome
or isn't a good model -- only that it's clear that Microsoft is having trouble
letting go of its desktop roots. That's what Redmond really means by Software
plus Services -- services plus the software revenue the company can't live without.
Hey, it could work, but it won't really be SaaS. Not really.
Posted by Lee Pender on 10/29/2008 at 1:22 PM1 comments
It's getting serious now, this cloud computing stuff. It's not just the up-and-coming
vendors or the Web-era giants (think Google and Amazon) that are offering some
sort of Software-as-a-Service model. Oh, no.
As
of this week, there's an old-school player in this game in a serious way:
Microsoft.
Microsoft is investing
heavily in the cloud with Windows Azure. And some observers, at least, including
one at analyst firm Forrester,
believe that enterprises are ready to get serious about SaaS and start using
it for critical applications rather than just messing around and experimenting
with it. SMBs, presumably, are way ahead of their enterprise counterparts in
terms of SaaS adoption, mainly because the cloud is a good model for modest
SMB budgets.
So, there's money to be made in the cloud, right? Well, Microsoft thinks that
there is -- or will
be, anyway. And what's good for Microsoft is good for Microsoft partners,
right? Well, maybe. It depends, really, on the type of partner we're talking
about.
Pure hosting partners, if there are that many of them left out there, will
probably need to diversify their business pretty quickly or find another line
of work. Microsoft is in the hosting business now in a big way, and you know
what that'll probably mean: impossibly low pricing from Redmond that no partner
could ever match, at least not on an ongoing basis. Steve Ballmer said way back
at the Partner Conference that the partner-hosting model had a future...but
not as lucrative a future as Microsoft's
own hosting business will have. Hint, hint.
But if hosting partners didn't know by now that they needed to diversify their
offerings, they're probably not in business anymore, anyway, or won't be for
much longer. The question, really, is how much partners should invest in datacenters
and how much they should focus on hosting -- or whether they should continue
to do it at all. In any case, as with everything else these days, the cloud
is going to be all about services.
Well, of course it will be. But that brings up another question -- which
services will those be? Microsoft is in that business, too, to some extent,
with Azure. Companies can develop using tools in Azure and then have Microsoft
host their applications -- all of which sounds great for customers and for
Microsoft. But whither partners?
Oh, sure, there'll be opportunities to create custom applications, consult
on SaaS strategies and develop specific vertical functions. But how much of
those opportunities does Azure actually take away by giving customers more opportunity
to work directly with Microsoft? And what exactly will those custom apps and
vertical functions involve if SMBs prefer pre-packaged, minimally customized
applications and enterprises are doing the development themselves with Azure?
Will partners have to be content with referral fees and whatever consulting
they can manage to squeeze out of accounts?
All of these questions, of course, seem to point to a worst-case scenario of
Microsoft horning in on partners' turf and claiming the cloud for itself while
leaving the channel high and dry. But we should remember that Microsoft has
always relied on the channel to serve as its sales force and has, for the most
part, been good to partners over the years. And, traditionally, what's been
a moneymaker for Microsoft -- and Redmond clearly thinks it has a revenue
driver in the cloud -- has also been a cash machine for partners. So, there's
reason for optimism. In fact, there's probably more reason for optimism than
for pessimism.
But there's also reason for concern, as there always is when a new model of
computing emerges. It's time for partners to engage with Microsoft, to air their
concerns and demand answers to tough questions. But it's also time for partners
to get creative -- to develop business strategies that will complement Azure
rather than work at cross purposes with the Redmond giant and its ambitious
cloud plans.
The cloud is here -- whether it'll bring sunshine or rain for partners,
though, remains to be seen.
How do you plan to make money in the cloud? How will you interact with Microsoft
regarding Azure and cloud computing? Sound off at [email protected].
Posted by Lee Pender on 10/29/2008 at 1:22 PM1 comments
Microsoft seems ready to stop pretending that Vista will ever gain wide acceptance.
Just take a gander at
this
story's headline: "Microsoft vows Windows 7 will fix Vista mistakes."
Mistakes? Vista? Anyway, Microsoft did demo
Windows 7 at PDC this week, and it does seem kind of cool.
Vista, we hardly knew ye...and we didn't really want to.
Posted by Lee Pender on 10/29/2008 at 1:22 PM1 comments
Well, they're
sort
of talking about it...mostly in press releases and earnings conference calls.
Still interesting, though.
Posted by Lee Pender on 10/28/2008 at 1:22 PM0 comments
So that's what Ray Ozzie was working on all this time. At its Professional
Developer Conference in L.A. this week, Ozzie and Microsoft took the wraps off
of Azure, which Redmond calls an
operating
system for the cloud.
A what? Yeah, we weren't too sure what that meant, either...and we
weren't alone. But the basic idea is that this cloud OS -- of which Steve
Ballmer has spoken a few times recently -- will provide a platform for developers
who want to create hosted applications. (Really, it seems more like a development
platform than an OS...but we digress.) Microsoft will then conveniently host
for customers those very applications in its datacenters.
There's more to it than that, of course. Azure also appears to be an attempt
to bring on-premises systems into harmony
with the cloud, something that tells us two things. First, Microsoft is
pragmatic and understands that most companies now have -- and will have for
at least a few years to come -- an investment in in-house Microsoft technology.
If companies want to dabble in cloud computing now, they're going to do just
that -- dabble, rather than shift everything outside of their walls and into
the cloud.
Second, though, it tells us that Microsoft doesn't seem quite ready to offer
a pure-cloud platform. There seems to be a sense with Azure of cloud-based applications
being tethered to traditional, in-house apps, which, again, makes sense because
that'll probably be the scenario in which the vast majority of customers will
use cloud computing. But the Salesforce.com, pure-SaaS, "no-software"
model doesn't appear to be part of Azure or of Microsoft's immediate plans.
Now, we could be reading that entirely incorrectly, as we'll admit that this
Azure stuff is kind of vague and a bit difficult to understand. From here, though,
we don't see Microsoft cutting the cord between cloud and on-premises applications.
What we do see, though, is more potential trouble for Microsoft's hosting partners.
RCP the magazine covered
this back in September, and today's announcement takes it a step further:
It's pretty clear that Microsoft wants to get into the hosting business in a
big way. Now, with Azure, it's not just about hosting partner-built apps; it's
about bringing customer-developed apps into the equation, as well.
So, again, if you're a hosting partner, now is the time to develop a revenue
stream or services business outside of pure application hosting...because Microsoft
is all over that market. Azure itself might be kind of confusing, but that point
is crystal-clear.
What's your take on Azure? Have you figured out what it is and how it will
work? If you decide to play around with it a bit -- it's available in CTP as
of today -- please let us know. You know the place: [email protected].
Posted by Lee Pender on 10/28/2008 at 1:22 PM0 comments
We've been saying for a while now on RCPmag.com that the economic downturn
that is wrecking finance, insurance, real estate and a bunch of other industries
seems to have only dealt a glancing blow to technology. And with Microsoft announcing
earnings today, we got an idea of just how hard tech's getting hit.
It seems as though we've pretty much been right thus far. If Microsoft is any
indication -- and we feel safe in saying that it is -- the current economic
storm is knocking over a few trees in tech but not ripping roofs off of businesses
or tossing cars around. Microsoft's numbers for its first fiscal quarter of
2009 beat Wall
Street's expectations and reflected a solid trend upward, generally speaking.
Of course, these are the summer numbers we're talking about here -- June through
August -- and the real winds of the downturn only started to seriously gust
in September and October. Those are the winds that are going to do a bit more
damage, so Microsoft is preparing the Street for lower-than-expected numbers
for fiscal Q2 and 2009. This
MarketWatch (great site, by the way, if for some odd reason you don't know it)
article has the details:
"For its current quarter ending in December, Microsoft said it expects
earnings between 51 cents and 53 cents a share, and between $17.3 billion
and $17.8 billion in revenue. Analysts have been estimating the company would
post earnings of 55 cents a share in the period and $17.9 billion in revenue.
"For the full year, Microsoft said it expects earnings between $2 and
$2.10 a share, and revenue between $64.9 billion and $66.4 billion. Analysts
have been estimating the company would report earnings of $2.12 a share and
$66.6 billion in revenue for the year, according to FactSet."
Apparently, financial analysts and other observers are cool with that forecast
and were expecting something like it. It reflects a mild pull-back from expectations
but nothing shocking -- which seems totally reasonable to us and obviously seemed
reasonable to more learned observers, as well. As we type, Microsoft's stock
is up in after-hours trading.
So, while the not-so-good news is that technology isn't immune to the effects
of the downturn, the much better news is that it doesn't seem poised for anything
remotely close to investment-bank-style total collapse -- at least judging
from what Microsoft is telling us. And while that shouldn't come as a surprise
to anybody -- after all the current crisis has its origins in different industries -- a
little positive news in an uncertain time is always welcome.
Posted by Lee Pender on 10/23/2008 at 1:22 PM0 comments
HP's got a new line of Blade workstations and thin clients out. There are loads
of details about the new lineup
here.
A major target for HP's Blade business is financial traders -- you know, like
the ones who used to work on Wall Street. Ha ha. Actually, though, there are
still some traders out there, and according to HP folks they might very well
be using Blade workstations in the near future. The financial downturn, HP officials
told RCPU in a phone chat this week (see -- original reporting!) has led to
an increase in interest in HP's wares.
"In this time of turmoil, we're in recent weeks seeing dramatic uptick
of opportunity," said Dan Olsen, worldwide business development manager
for HP Blade workstations. Blade "is a very interesting tool for an acquiring
bank as they acquire somebody else," he said, primarily because Blade workstations
allow the acquirer to get traders from the acquired bank quickly up and running
on the surviving bank's infrastructure. Plus, the thin-client workstation model
is relatively inexpensive, and Olsen says that financial institutions are "looking
for very smart ways to spend in IT."
So, there you go! The downturn turns out to be an upturn for some companies,
including HP.
Posted by Lee Pender on 10/23/2008 at 1:22 PM0 comments
One of the perils of putting together RCPU the way we do is that we rely a
fair amount on other people's reporting. Our general approach here is to take
the biggest or most interesting news stories of the week and add some commentary
and perspective to them -- hopefully with a touch of flair and maybe a few
pop-cultural references that the over-30 crowd will understand.
What we don't often do, though, is go and get stories ourselves. That's mainly
because your editor's responsibilities -- now more than ever -- range
well beyond just writing RCPU three times a week. So, from time to time, you'll
see us quote somebody from a first-hand interview, and we're quite specific
about the fact that we're doing that when it does happen. But, most of the time,
we're trusting that we're using credible sources for our base-level facts, and
that the folks who write the stories we link to know what they're doing. And,
most of the time, that works just fine.
Last week, though, we messed up just a little bit. In writing about the District
of Columbia signing a contract with Google to use Google Apps, we said that
Google had "Boot(ed)
Office out of DC." We took that line from another
story, which suggested that Google was unseating Microsoft in the District.
(That story linked to a Bloomberg story, which we also
linked to...which, upon further review, didn't specifically suggest that
Office had actually packed up and left the capital.)
Well, it turns out that we misread what was happening. Yes, D.C. did sign a
contract to use Google Apps, so (and this is important) we stand 100 percent
by our commentary on Google Apps and the threat it might pose to Office, as
well as on the problems with Microsoft's reticence to take Office fully online.
The commentary stands. We're not here to bury the good folks at ReadWriteWeb.com,
either -- we suspect that they might have jumped to the same conclusion we did,
that Apps was replacing Office. It was an easy mistake to make.
Well, in the interest of setting all records straight, here's what a Microsoft
spokesperson sent to us about what's happening in DC. Yes, Google Apps has a
foothold, but Office isn't sinking into the Potomac. In fact, Office still figures
in D.C.'s computing plans. Here's what Microsoft sent us:
- The government of Washington, D.C., has Enterprise Agreements for Windows
XP, Microsoft Office and Microsoft Exchange. The District school system also
has an Enterprise Agreement, called a "Schools Agreement," and uses
Windows XP and Microsoft Office.
- D.C. agencies are deploying MOSS 2007 [that's SharePoint --L.P.]
and OCS 2007 [and that's Office Communications Server --L.P. again],
while the District is planning its migration to Exchange 2007.
- D.C. agencies are also piloting Performance Point for budget tracking
and analysis, as well as Virtual Earth, Microsoft's enterprise mapping application.
- Washington, D.C. has purchased 5 Surface devices for use in the delivery
of innovative citizen service and educational services.
Anyway, that's a long way to clarify a short story, but we're always concerned
above all else with getting things right. (We also thought that some of our
more faithful readers might be interested in how things work here.) The spokesperson
wasn't sure exactly how D.C. would employ Google Apps alongside Office -- and,
to be fair, there's no reason why he should know that -- but it's clear that
Apps and Office will be co-existing in D.C., at least for the time being.
In a sense, that makes things more interesting. Maybe we'll actually follow
up with folks in D.C. at some point to see which system is working out better.
And this time, we'll make the phone calls.
Posted by Lee Pender on 10/23/2008 at 1:22 PM3 comments
You love these, and we love these. So let's just jump in. Our good friend,
Doug, who has been a big help to both
RCP the magazine and RCPU in the
past, gets us started:
"When I started my company, I bought a Dell Latitude D820 with a
dual core Intel processor, 2GB RAM and a 256MB Nvidia video controller. The
laptop only registered a 3.1 on the 'Vista experience' meter and was slow
from the start. However, since I need to know Vista in order to support my
customers, I kept it and learned to live with it. I considered wiping the
system and downgrading to XP Pro from Vista Ultimate (which isn't ultimate
but a waste). Recently, I've had some physical issues with the system, and
as a result of troubleshooting with Dell, I decided to delete the system partition
and install XP Pro.
"Do I still need to support customers using Vista? In a word, no.
Out of all the systems I've sold and supported over the last year, I can count
the Vista systems on one hand. Heck, I can count the Vista systems on one
finger. My two main vertical markets are health care and financial services.
The software vendors for both of those markets still either require or highly
recommend XP. So, I'm swearing off Vista. My business customers (99 percent
of my customers) will continue to buy XP Pro preinstalled from Dell. If Microsoft
doesn't extend the end-of-life again next July, then I'll probably buy software
assurance licenses for them and manually install XP Pro on new systems until
Windows 7 becomes the new standard..."
Doug, your story sounds familiar -- although the "counting on one finger"
line made us laugh out loud. Of course, Steve Ballmer would still like for you
to believe that Vista
is a big success. In related news, Ballmer also announced that 2+2=7 and
that the sun revolves around the Earth and not the other way around. (OK, not
really...but you know what we mean.)
On to Mike's tale, which includes a considerable but justifiable shouting rant:
"Yesterday, my son, who is a captain in the army, downloaded some
Vista Windows updates -- then the computer got into an infinite loop configuring
the updates. In order to stop this, I had to FedEx overnight ($26) the Toshiba
recovery disk so he could get to a command prompt and turn off this process.
Thank God he was not in Iraq; it would have been one month to get that DVD!
NOW, WHAT KIND OF COMPANY HAS SOFTWARE THAT FORCES A PERSON TO SPEND MORE
MONEY JUST TO MAKE IT WORK? VERY ANGRY!!!!!!
"Think about that, Lee. Here is a great kid serving his country and
getting shot at; he doesn't need any more crap in his life. But he had to
put up with Vista's poorly designed software and be knocked out of the loop
for three or four days, and had he not had a dad who knows computers, his
computer would have been totally useless..."
Well, first of all, Mike, sincere thanks and respect to your son for his service
to our country. Your editor has a couple of cousins who are about to ship out
to Iraq, and obviously we all pray that they (and your son, wherever he is)
can do their jobs effectively and come home safely. And, yes, you have every
right to be angry. There might be nothing more frustrating than having a computer
stuck in an infinite loop -- except maybe having to FedEx a recovery disk to
that computer's owner for $26. We're actually gritting our teeth just thinking
about it, and we're sorry that you and your son had to go through that. We love
your passion, though -- please drop us a line more often!
OK, that's it for this week's Vista rants. If you just have to get something
off your chest about anything you read in RCPU, send your message to [email protected].
And thanks to all those who have written recently. Keep 'em coming.
Posted by Lee Pender on 10/23/2008 at 1:22 PM2 comments