Microsoft, Apple and Google….this round may be for keeps

May 18, 2010   //   SWC Technology Partners, , , , , , ,

The technology sector is pretty funky. It’s always morphing, always changing. The trick is to know when these changes actually mean something. It’s not so easy. Too often we hear the beating drums of change from our industry’s publicity machine. It’s weeding through the clutter and finding the real news, the real trends that can be the challenge and, in some rare cases, the opportunity.

Recently I found myself thinking about Microsoft, Apple and Google. I found myself connecting some dots, drawing some conclusions and wondering if I had developed a notion based on reality or publicity. I thought it may be interesting to throw these thoughts out here at SWC Perspectives and collect your reactions.

Arguably the strength of Microsoft lies in the fact that, through the Windows operating system, it owns the desktop. For decades over 90% of the world’s desktops have run  on Microsoft. The result has been dominance in the application market and then eventually the browser.  Ultimately, Microsoft parlayed this position into creating a “stack” of enterprise applications that, integrated together, are arguably the best value in corporate information technology.

But perhaps things are changing?

Over the last couple of years we have come to include the term “Cloud” computing within our daily vernacular. The definition of Cloud computing seems to be a moving target but there are some key principles to agree on, most notably the notion that technology, whether in the form of infrastructure or application, can be utilized from a third party, over the Internet. Frequently the first benefit to be considered is that this architecture saves the customer from investing capital in hardware, license acquisition costs and administration.

I think the cloud model is living up to its promise of creating a new approach to investing in IT. I also think, as time is moves on, that most organizations are realizing it’s relatively safe to “let go” of controlling the information technology infrastructure. “Big Brother” is not going to steal the data, capital is typically better invested in core competency operations, and the trade-off between a third-party Service Level Agreement and managing a fully staffed IT department is compelling.

But put all of this on a shelf for a second. I need to develop another argument before I can put my entire question together.

I think it is fair to say that the device market has exploded.  To be specific, when I talk about devices I’m referring to the iPhone, Android, Windows Mobile phones, Blackberry devices, etc.  You can probably lump the iPad and Netbook in there as well. And, when I say “exploded” what I mean is that today’s device is universal. It is already the PC, television, automobile of our generation. Everyone has one; it’s universal.

Today, the iPhone constitutes 25% of the smartphone market. It seems that Apple takes chunks of market share with each release of this product. Now, not unlike Google with its recent release of Android. In fact, seemingly overnight,  the Google-driven Android surpassed iPhone for market share. In both cases, what seems clear is that what is driving market growth is the application market.  Of course there are other reasons to buy an iPhone or an Android, but I wonder if this war will be won or lost by the app space?

On another front, I recently learned that Microsoft’s browser dropped below 60% of the market for the first time, while Chrome, Firefox and Safari increased users. Pretty dramatic numbers if you consider that only two years ago, Explorer accounted for over two thirds of the browser market. In point of fact, given today’s trends, Firefox is set to overtake Explorer in market share within the next quarter.

If Microsoft became today’s dominant technology player by controlling the operating system of the desktop, then what does it mean when the device market OS and browser is not Microsoft?

OK, put that question on the shelf as well.  I’ll come back to all of this.

Another thought (related to all of this) occurred to me during a recent sales call. It was one of those meetings that I imagine I’ll remember for a long time.  The account does not fit into our typical profile in that the company has roughly 25 to 30 users.  More frequently our accounts have hundreds to thousands of users. Why I was in the meeting and what compels me about the discussion is what the customer asked for.  Simply put, he said: “I don’t want hardware on my site anymore. Not a single server. And when my users need information, I want them to go to a browser.”

By the way, this is not a company I would call an “early adopter.” It’s a typical Midwestern manufacturer. I imagine the last time they had a technology architecture conversation, I was five years out of college (I won’t dignify this with a date).  But think about that. For a manufacturer, which almost always has at least a handful of proprietary applications along with the usual productivity stuff (i.e., Microsoft Office) this is saying A LOT.

One more statistic to consider before I ask the big questions.

So far the Apple App Store has seen 228,458 applications published in the United States alone.  Every day another 59 join the ranks.

Now for the big questions.

Ask yourself (provided the context of my piece) how you would pull off my client’s request.   Then ask yourself how you may be able to do this in six months or one year?

Ask yourself, if I’m starting a company today – from scratch – how do I setup my technology systems?

Ask yourself, if I’m creating an industry-based application (like the ones my manufacturing client uses), how do I develop it and for what environments?

OK, now take everything off the shelf and look at it. What does the future look like?  I’m not kidding. That’s my question. Is the market really in a state shift? If so, how does this affect us – the customers, the publishers, the integrators? I have my thoughts (which by the way I have conveniently stayed away from in this piece).