See also: Mobile Internet (Aug’11) which is a total update on Aug 26, 2011 with a lot of additions to the original July 19, 2010 content on the following subjects:
– LTE and LTE Advanced — HSPA Evolved (parallel to LTE and LTE Advanced) — Heterogeneous networks or HetNets — Femtocells and Picocells — Qualcomm innovations in all that — Ericsson’s LTE Advanced demo — Current roadmaps on evolutions of current 3G+ broadband mobile networks
The International Telecommunication Union (ITU) press release regarding its ITU Radiocommunication Sector (ITU-R) came a few days ago: ITU paves way for next-generation 4G mobile technologies – ITU-R IMT-Advanced 4G standards to usher new era of mobile broadband communications [Oct 21]:
In its recent meeting in Chongqing, China, ITU-R Working Party 5D, which is charged with defining the IMT-Advanced global 4G technologies, reached a milestone in its work by deciding on these technologies for the first release of IMT-Advanced. In the ITU-R Report, which will be published shortly, the LTE-Advanced and WirelessMAN-Advanced technologies were each determined to have successfully met all of the criteria established by ITU-R for the first release of IMT-Advanced. The Report is expected to be approved by ITU Member States at the ITU-R Study Group 5 meeting in Geneva in late November 2010.
… six proposals received by ITU in October 2009 were individually subjected to a rigorous assessment, supported by the work of independent external evaluation groups that had been established around the world. Industry consensus and harmonization fostered by ITU-R among these six proposals have resulted in the consolidation of the proposals into the two agreed IMT-Advanced technologies. These technologies will now move into the final stage of the IMT-Advanced process, which provides for the development in early 2012 of an ITU-R Recommendation specifying the in-depth technical standards for these radio technologies.
- Latest update: China-version iPhones to adopt China Mobile TD-LTE technology, says paper [May 23, 2011] (emphasis is mine)
China Mobile Communications has reached a consensus with Apple under which the next-generation of iPhones to be sold in China will adopt TD-LTE technology developed by China Mobile, the Chinese-language Commercial Times quoted the China-based carrier’s chairman Wang Jianzhou as saying.
China Mobile has begun voice testing on its TD-LTE experimental networks in Shanghai and commercial operations of the 4G networks in China are expected to begin in 2012, the paper said.
By 2012, China Mobile also plans to set up over 40 experimental networks, 10 commercial networks and 20,000 base stations globally to promote the adoption of the TD-LTE technology, the paper added.
The thing which is talked about here is the future of the mobile Internet as presented by my core information article Mobile Internet [July 19]. Anyone not familiar with magic words and numbers mentioned above could easily get the essence of what is going on here from that “down-to-earth” overview. The explanation was started with the nomenclature of the second and third generation (2G and 3G) technology standards we are all using with our phones, smart ones or not. This allowed to present the whole expanded nomenclature in a form of an extended table coming in the end to the fourth generation (4G) technologies as:
|4G (IMT- Advanced)||3GPP family||LTE Advanced|
|WiMAX family||IEEE 802.16m
now: WirelessMAN-Advanced (“WiMAX 2”)
The only new name here is WirelessMAN-Advanced, actually corresponding to the next version of WiMAX, we may say it will be a kind of WiMAX 2. In the new naming MAN is standing for Metropolitan Area Network which is indeed a better expression of the fact that with this “WiMAX 2” we are speaking of a high-speed, high-bandwidth efficiency and high-capacity multimedia service specifically designed for both residential and enterprise applications. (As well noted in the title of the excellent 2007 book Mobile WiMAX: Toward Broadband Wireless Metropolitan Area Networks).
Those who are interested in the process which led to the final stage of IMT-Advanced can read the materials which appeared in the No. 2 (Nov. 2008) issue of ITU-R e-Flash about IMT-Advanced. According to the IMT-Advanced submission and evaluation process the six proposals received were:
• Doc. IMT‐ADV/4 ‐ Acknowledgement of candidate submission from IEEE [802.16 Working Group http://wirelessman.org] under Step 3 of the IMT‐Advanced process (IEEE [based on evolving draft of IEEE 802.16m, supporting both TDD and FDD duplexing] technology)
• Doc. IMT‐ADV/5 ‐ Acknowledgement of candidate submission from Japan [ARIB] under Step 3 of the IMT‐Advanced process (IEEE [based on IEEE 802.16m, supporting both TDD and FDD duplexing] technology)
• Doc. IMT‐ADV/6 ‐ Acknowledgement of candidate submission from Japan [ARIB] under Step 3 of the IMT‐Advanced process (3GPP [their LTE Release 10 & beyond proposal with both FDD and TDD components ] technology)
• Doc. IMT‐ADV/7 ‐ Acknowledgement of candidate submission from TTA [Telecom Technology Association, Korea] under Step 3 of the IMT‐Advanced process (IEEE [currently using their own WiBro standard harmonized with IEEE 802.16e and going to evolve from that to 802.06m as this proposal, including both TDD and FDD duplexing] technology)
• Doc. IMT‐ADV/8 ‐ Acknowledgement of candidate submission from 3GPP proponent (3GPP organization partners* of ARIB, ATIS, CCSA, ETSI, TTA AND TTC [see: Global Standards Collaboration in wikipedia]) under Step 3 of the IMT‐Advanced process (3GPP [their LTE Release 10 & beyond proposal with both FDD and TDD components ] technology)
* Organisations explicitly named in the proposal (operators from China, Korea and Japan are highlighted in red): Alcatel-Lucent France, Alcatel-Lucent USA Inc., Alcatel-Lucent Shanghai Bell, AT&T Inc., British Telecommunications Public Ltd. Co, China Mobile Communications Corporation, China Telecommunications Corporation, China Unicom (Hong Kong) Limited, DaTang Telecommunication Technology&Industry Holding Co., Ltd, Electronics and Telecommunications Research Institute (ETRI), eMobile Ltd, Fujitsu Limited, Hitachi Ltd., Huawei Technologies Co. Ltd, Japan Radio Co. Ltd., KDDI Corporation, KT Corporation, LG Electronics Inc., LG TeleCom Ltd., Mitsubishi Electric Corporation, Motorola Inc., NEC Corporation, Nippon Telegraph and Telephone Corporation (NTT), Nokia Corporation, Nokia Siemens Networks GmbH & Co. KG., NTT DoCoMo Inc., OKI Electric Industry Company Ltd. (OKI), Panasonic Corporation, Qualcomm, Inc., Samsung Electronics Co., Ltd, Sharp Corporation, SK Telecom, SOFTBANK MOBILE Corp., Telecom Italia S.p.A., Telefon AB – LM Ericsson, Toshiba Corporation, ZTE Corporation
• Doc. IMT‐ADV/9 ‐ Acknowledgement of candidate submission from China (People´s Republic of) [Chinese administration] under Step 3 of the IMT‐Advanced process (3GPP [based on LTE-Advanced TDD standards developed there] technology)
ViodiView’s contributing editor Alan Weissberger, principal of DCT Advisors (see also his profile on WiMAX360 community site) published an excellent clarification arcticle on the further details: ITU-R Progresses LTE Advanced and WiMax 2.0 as 4G RAN standards [Oct 20]. Some notable excerpts:
- the basis for specifying the “LTE-Advanced” technology in Step 8 is Document IMT-ADV/8, which is technically identical to IMT-ADV/6 and IMT-ADV/9 (except that IMT-ADV/9 contains only the TDD RIT component); and
- the basis for specifying the “WirelessMAN-Advanced” technology in Step 8 is Document IMTADV/4, which is technically identical to IMT-ADV/5 and IMT-ADV/7.
We re-iterate that the LTE that will soon be deployed is NOT a 4G technology, but a 3G technology (3GPP Release that is included in ITU-R M.1457-9 Detailed specifications of the terrestrial radio interfaces of International Mobile Telecommunications-2000 (IMT-2000 recommendation for 3G RANs). We are worn out by all the 4G hype over LTE and Mobile WiMAX and feel compelled to set the record straight. No, 4G is not a technology that’s faster than the initial 3G RANs. ITU-R defines the criteria for 3G and 4G and we wonder why so many pundits make up their own definition.
Motivation of LTE Release 8 (soon to be deployed)
Need to ensure the continuity of competitiveness of 3G systems for the future
-User demand for higher data rates and quality of services
-Public Safety optimized system
-Continued demand for cost reduction (CAPEX and OPEX)
-Avoid unnecessary fragmentation of technologies for paired and unpaired band operation
LTE Release 8 Key Features:
The 3GPP candidate technology submission for IMT-Advanced (4G) is 3GPP Release 10 & Beyond (LTE-Advanced) has been accepted as a 4G technology at the Chongqing meeting of ITU-R Working Party 5D, having successfully completed Steps 4 through 7 of the IMT-Advanced process in ITU-R, complying with or exceeding the ITU established criteria in all aspects.
Mainland China went enthuasiastic about this ITU milestone. The leading English-language newspaper in the country, China Daily reported on the event as Chinese 4G mobile standard goes global [Oct 20]. A few notable excerpts [emphasis is mine]:
The TD-LTE-Advanced technology has a download speed of 100 megabytes per second, faster than the preceding third-generation TD-SCDMA technology. Industry analysts said Chinese telecom enterprises are set to benefit from the TD-LTE 4G standard, as it will help to open both domestic and overseas markets for them.
“The situation now is very different from 10 years ago, when TD-SCDMA was set up as a 3G international standard,” said Yang Hua, secretary-general of TD Industry Association in China. He said because China lacked an industry eco-system at that time, the use of TD-SCDMA technology was largely restrained to the domestic market. International enterprises were wary of investing in a technology developed in China, especially when it had not undergone a market test.
China Mobile launched its TD-SCDMA service in January 2009, and the largest mobile operator in the world will have invested 100 billion yuan ($15 billion) in it by the end of this year. Prior to September, the company had 15.27 million TD-SCDMA subscribers. Overall, it has 507 million subscribers, most of them using second-generation technologies.
Nearly all the best known international telecom companies, such as Ericsson, Nokia and Samsung, are engaged in the TD-LTE industry. They are determined not to miss out on the Chinese market again as they did in TD-SCDMA era, Yang at TD Industry Association said. “They lost many China Mobile contracts when bidding against companies such as Huawei and ZTE, because they ignored the development of TD-SCDMA and offered very few competent products,” Yang said.
Shi Guang, secretary-general of TD Forum, said Chinese telecom companies in the TD-LTE industry chain will be presented with a great business opportunity when they enter the international market. “They will go head-to-head with global companies. Who dares say that another Huawei or ZTE may not emerge in the process?” Shi asked.
According to a survey by Ovum, an international market consulting company, the TD-LTE technology will earn about $150 billion in revenue by 2015.
So China is triumphant because they own licences of their home-grown TD-LTE technology, therefore a much bigger chunk of that revenue will come to them (or remain with them) than before. In addition to that they will be able to move to real 4G (LTE Advanced) through their already accelerated TD-LTE program as noted in my post 3.9G TD-LTE rollout in 2012 with integrated 2G, 3G and 4G? [July 19]. Their leading operator, China Mobile, also the one with TD-SCDMA and TD-LTE technologies, published the following roadmap in its August 19 Interim Report (see slide 9):
The US situation has been described in my earlier post, “4G” WiMAX vs. 3.75G HSPA+ [July 24]. Please note that both the current major WiMAX provider, Sprint and the HSPA+ provider T-Mobile are absolutely wrong in calling their offerings 4G. (BTW this is what was meant by Weissberger’s words “We are worn out by all the 4G hype over LTE and Mobile WiMAX and feel compelled to set the record straight”. They are actually not alone with such mislead ing statements among operators.)
A kind of introduction to the worldwide competitive situation has been provided by another post of mine: WiMAX/WiBro <=> TD-LTE and LTE in general [June 28], which is also providing sufficient information on the roadmap of the global LTE leader, the Japanese NTT-DOCOMO . This had also a follow-up: Intel dismisses WiMAX Program Office [July 1]. The Mobile Broadband reality by Akamai [July 29] post provided actual data on average and average maximum connection speeds from 109 mobile carriers around the world.
The most important strategic market assesment, however, is in my post: Could China close the gap in mobile Internet? It should! [July 21]. The most dramatic findings were expressed with the following two diagrams (copied here as a kind of reminder):
October 2010 update
According to statistics released on Wednesday by the Ministry of Industry and Information Technology (MIIT), China’s 3G service subscribers reached 38.64 million by the end of October, up 10.4 percent month on month, and up 295.7 percent year on year.
By end of October, China Mobile’s TD subscribers came to 16.98 million, China Unicom’s 3G subscribers amounted to 11.66 million, and China Telecom’s 3G subscribers reached 10 million.
I’ve made an update of the above numbers which is showing a similar gap, but for China Mobile relying on TD-SCDMA and TD-LTE only, there is an even more threatening situation.
China Unicom and China Mobile announced their subscriber statistics for September on Oct. 21 and 20, respectively. For the 3G part the results are 10.554M and 15.279M. Month by month 3G statistics are as shown on the following two diagrams:
The third operator, which also has wire business, China Telecom also released some statistics. Unfortunately they are providing only quarterly 3G subscriber information on their website (see: http://www.chinatelecom-h.com/eng/ir/kpi.php?cat=quarterly ) so I had to rearrange data to quarters in order to show both the absolute number changes and their own 3G penetration rates, as you could see both on the below diagram:
As you could see China Mobile was able to increase its own 3G penetration rate from 1.89% to just 2.68% during the last quarter. At the same time China Unicom had a significant increase of 3G penetration from 4.82% to 6.51%.
China Telecom achieved even more with Q3CY10 penetration rate of 11.03% since they made heavy invesment into CDMA2000 EV-DO 3G technologies. Their chances to grow even spectacularly during the current quarter could be even bigger since they were the first operator to release quite attractive smartphone subscription packages for less than 1,000 yuan [~ US$ 148] apiece. In both Huawei and ZTE versions there is a true, even mid-range level smartphone with 990 yuan calls included!
– China Telecom roll out it’s first 3G-smartphone-Packages around 1000 yuan, with 990 yuan free calls [Oct 21]
– ZTE N600 cheep Android handset spotted [Oct 16]
– Huawei C8500 bargain Android phone hands-on video [Oct 14]
China Mobile therefore is taking urgent actions to accelerate its competitiveness. One of the most important elements is certainly to provide similar to China Telecom’s low priced bundles:
… with prices ranging from 350 yuan [US$52.7] to 650 [US$97.8] yuan.
While the latest quarter business performance of China Mobile has been not bad, as reported by China Mobile Jan-Sept net profit up 3.9% on 3G [Oct 20], the same report states that:
China Mobile and its two major rivals, China Unicom (Hong Kong) Ltd. and China Telecom Corp., are competing for subscribers to their 3G services, whose faster data speeds and pricier service plans could boost the companies’ average revenue per user–a key gauge to determine long-term growth for telecommunications operators.
China Mobile’s ARPU fell to CNY72.0 in the nine months ended Sept. 30, from CNY75 a year earlier. The company’s ARPU has fallen as it has pushed farther into less developed regions of China to keep adding subscribers, including users of its less expensive 2G services.
Analysts said China Mobile’s introduction of new handsets could boost growth in the firm’s 3G business in coming quarters, though subsidies for these handsets and depreciation expenses for the carrier’s 3G network are likely to continue to weigh on profitability this year. The firm said in a statement its average revenue per minute of usage has been declining due to low usage by new customers, while its value-added services business has become the major driver of revenue growth.
In the mid-term 2012-15, however, China Mobile is going to have enormous advantage as ITU paves way for next-generation 4G mobile technologies one of which is the future Release 10 version of their TD-LTE (China Mobile is calling it TD-LTE+ on its roadmap slide included above). Whether they will be able to exploit that will solely depend on the value added services they should bring out to the market masterfully. But that is another story.
Really big thing, an industry milestone similar to SAP’s (see: SAP’s Business ByDesign SaaS to be relaunched on July 31 with mobility as one of key attractions [July 28]).
Now Microsoft Announces Office 365 [Oct 19]. The number after its familiar brand name is reflecting the idea of “always on”, i.e. the cloud services to be provided by this new product are meant to be available throughout the 365 days of a year. Being curious I have signed up immediately to experience this new kind of cloud service. In return, however, I got an e-mail saying (emphasis is mine here and elsewhere):
We appreciate your interest in our recently announced limited beta for Microsoft Office 365. Due to the high level of interest, we will let you know if space becomes available. In the meantime, we hope you take the opportunity to learn more about Office 365 and keep up with the buzz.
Update: Mary-Jo Foley of ZDNet’s All About Microsoft has three excellent posts about Office 365:
– The road to Microsoft Office 365: The past [Nov 30]
– The road to Office 365: The present [Dec 1]
– The road to Office 365: The future [Dec 2]
Update: General Manager of the SharePoint Product Management Group Eric Swift on Office 365 [Oct 26]:
SharePoint Online helps organizations and professionals create sites to securely share information, insights, and important documents with colleagues, customers, and partners.
It’s simple to create Office documents and save them directly to SharePoint Online, easy to access your content off-line or on your phone, and quickly share information and insights using familiar tools.
And, with Office 365, organizations get the full benefit of Office, Exchange, Lync, and SharePoint because it is designed to work together.
For SharePoint developers and independent software vendors (ISV’s), the opportunities to configure and extend SharePoint Online today include the ability to:
– configure master pages, templates, page layouts, and site columns
– customize the site UI with custom Silverlight controls, navigation or functional controls
– build customized document workflows, using data and documents contained within SharePoint Online
– customize lists and content types
– use Sandbox Solutions to build custom web parts
– design browser based forms using InfoPath forms
Update: Azure, jQuery & SharePoint: Huh? [Nov 26]
… three permutations of how SharePoint can map to or integrate with the cloud:
- Office 365 (with specific focus on SharePoint Online). Office 365 represents the next wave of hosted productivity applications (and includes Office 2010 Client, SharePoint Online, Lync Online, and Exchange Online).
- SharePoint WCM. Essentially, building Internet-facing web sites using SharePoint 2010.
- SharePoint integrating with wider cloud services. This might be leveraging Twitter or Facebook to harvest social data and creating ‘socially intelligent’ solutions in SharePoint or using Bing or Azure to create expansive applications that integrate/leverage the cloud.
… a number of different patterns that cut across Twitter and SharePoint integration, oData and Office/SharePoint integration, Office Server-Side services, and SharePoint and Azure.
One pattern … was integrating jQuery and Azure in SharePoint. This pattern is interesting because you’re leveraging jQuery as a client technology in SharePoint and also using Excel Services, and you could potentially divorce yourself from server-side dependencies to integrate with Azure, thus no need to install assemblies on the server. This means that you have improved code reusability across SharePoint On-premises and SharePoint Online.
… Using jQuery is interesting; using it in the context of Azure service-calls to update views is compelling (think financial models that depend on a cloud-service that delivers daily integer values that have significant cascading effects on the model).
Update : Chris Mayo’s Blog – SharePoint Development in the Cloud for more information continously updated
So this is what I could only do now.
Microsoft characterizes Office 365 in the press release as:
… the company’s next generation in cloud productivity that brings together Microsoft Office, SharePoint Online, Exchange Online and Lync Online in an always-up-to-date cloud service. … Office 365 is built on years of experience delivering industry-leading business cloud services ranging from the first browser-based e-mail [i.e. Hotmail] to today’s Business Productivity Online Suite [BPOS], Microsoft Office Live Small Business and Live@edu.
… With Office 365 for small businesses, professionals and small companies with fewer than 25 employees can be up and running with Office Web Apps, Exchange Online, SharePoint Online, Lync Online and an external website in just 15 minutes, for $6 or 5.25 euros per user, per month.
… Office 365 for enterprises introduces an array of choices for midsize and large businesses as well as government organizations, starting for as little as $2 or 1.75 euros per user, per month1 for basic e-mail. Office 365 for enterprises also includes the option to get Microsoft Office Professional Plus desktop software on a pay-as-you-go basis, for the first time ever. For $24 or 22.75 euros per user, per month1, organizations can get Office Professional Plus along with e-mail, voicemail, enterprise social networking, instant messaging, Web portals, extranets, voiceconferencing and videoconferencing, webconferencing, 24×7 phone support, on-premises licenses, and more.
… Office 365 will be available worldwide next year. Starting today, Microsoft will begin testing Office 365 with a few thousand organizations in 13 countries and regions around the world, and the beta will be expanded to include more organizations over time. Office 365 will be generally available in 40 countries and regions next year.
And here are two screenshots to illustrate the kind of capabilities (see more on Microsoft’s image gallery):
With Office Web Apps, you can review documents and do lightweight editing
from virtually anywhere and on any device with a browser. (The image is courtesy of Microsoft)
With co-authoring, edit the same document at the same time with others.
No more multiple versions or waiting your turn. (The image is courtesy of Microsoft)
From the Hello Office 365 [Oct 18] post on the new Microsoft Office 365 blog comes a more detailed overview of the differences from the well known Office product suite on our PCs:
… Office 365 is the next step in the future of productivity. Is this what’s next for BPOS? Yes. Is this what’s next for Office Live Small Business? Yes. Is this what’s next for Live@edu? Yes. Will Office desktop software be available as part of a cloud service? Yes. Is this productivity in the cloud? Yes. And, it’s even more than that.
… With Office 365, everything is designed to work together. Earlier this year, the launch of our flagship products, Office, SharePoint, and Exchange 2010 ushered in the future of productivity. Together with Lync, these products provide the backbone for the modern business. Customers using these 2010 products are benefiting from super productive employees who can work from anywhere, on any device and from anywhere in the world. But what if you are the local cupcake shop on Main Street – have you been using all these kinds of tools for your business? Probably not. What if you are a bigger business, trapped on legacy technology that limits accessibility behind the firewall – have your people been as productive as those using the latest innovations? Probably not.
Now, you can have it all with Office 365. We’ve not only designed and built our flagship products to work together, but with Office 365, we’re taking the next step and delivering all these capabilities as designed in the cloud. ‘Rich presence’ suddenly lights up everywhere in Office, and you can see at-a-glance if a colleague is available and call, IM, e-mail, or even start a video conference in one click. You can bring social networking to everyday work tasks like document sharing and collaboration – but with all the security and privacy that a business requires. These are just a couple of the many amazing features you get with Office 365.
… You’ll be able to pick and choose services and tailor the package to fit your needs – whether you are a government agency, small business or enterprise company; whether you have information workers or factory floor workers, store managers on location or on the go, or a combination of all types.
‘Game changer’ is a big statement, but we believe this will change the way you do business. The technology is the latest, most up-to-date and comprehensive service you can find. It’s based on Office, so you already know how to use it. It’s online and designed to work with the software, phones and browsers people use most today, including the new Windows Phones as well as a host of others. We are investing deeply and have tens of thousands of people around the world backing this service. We have secured the industry’s most rigorous security and privacy standards and will bring those to Office 365 along with 24/7 phone and community support. …
What Is Office 365? an official Microsoft video [Oct 19]:
What is Office 365? What the product-related Microsoft leaders are saying about a few of the productivity, communication and collaboration benefits of Microsoft Office 365?
Watch Chris Capossela, Senior Vice President, Microsoft Business Division; Betsy Webb, General Manager, Microsoft Business Division; Ron Markezich, Corporate Vice President, Microsoft Online Services, and Takeshi Numoto, Corporate Vice President, Microsoft Business Division.
From the Office 365 site:
[mixed with a little additional information from this:] Office 365 Fact Sheet (docx file)
Microsoft Office: The world’s leading productivity tool on the desktop (Office Professional Plus) and on the Web (Office Web Apps) now seamlessly connected and delivered with cloud services – for the best productivity experience across the PC, Phone and Browser.
Sharepoint Online: Cloud-based service helps businesses of all sizes create sites to share documents and insights with colleagues, partners and customers. Includes enterprise social networking and customization options.
Exchange Online: Cloud-based email, calendar and contacts with the most current antivirus and anti-spam solutions. Includes the ability to get e-mail on virtually any mobile phone and options for voice mail, unified messaging and archiving.
Lync Online: Cloud-based instant messaging, presence, and online meeting experiences with PC-audio, video conferencing and screen sharing.
In the Cloud With Kurt DelBene [Oct 19]. Microsoft News Center caught up with newly appointed Microsoft Office Division President Kurt DelBene to discuss the strategy and his view of cloud services. A Q&A type article.
Microsoft Office 365: The Power to Think Big and Be Small, to Be Big and Act Fast [Oct 19]. A Microsoft provided feature story to illustrate that the productivity power of the cloud just got a turbo boost for customers of all sizes. To show via a number of case studies that:
Any business will be able to transform the way it works with Office 365, and make it dramatically easier for people to connect to co-workers, partners, customers and the information that keeps business moving forward – instead of spending valuable time on technology management and maintenance.
Microsoft Online Services gives your business the powerful productivity capabilities of Microsoft Exchange Server, Microsoft Office SharePoint® Server, Microsoft Office Communications Server, and Microsoft Office Live Meeting —all hosted online and all up and running quickly and easily without the upfront costs of an on-premise deployment. The suite of productivity tools enables your workers to communicate and collaborate effectively, while enabling your IT team to focus on more business-critical tasks. And with services hosted by Microsoft, you can have peace of mind knowing that experts are managing your IT and that your services will be available when you need them.
Erik Gunvaldson, Senior Program Manager, Microsoft Online, http://www.microsoft.com/online
Office 365 and the Family Tree – Leadership [Oct 19]. New customers for the current BPOS (as the previous, not so full version available in production version, is named), and illustration of the completeness and leadership quality of the Office 365 composite parts via their evaluation by Gartner in their “Magic Quadrants” as:
Horizontal Portal Products – Leader
Corporate Telephony – Visionary
Web Content Management – Challenger
Unified Communications – Leader
Externally Facing Social Software – Challenger
Enterprise Wireless E-Mail Software – Leader
IT Project and Portfolio Management – Leader
Secure Email Gateways April 2010 – Leader
Business Process Analysis Tools – Leader
Unified Communications as a Service North America – Challenger
Social Software – Leader
Enterprise Content Management – Leader
Managed File Transfer – Challenger
Web Conferencing – Leader
… the State of California awarded CSC a contract to migrate its current multiple e-mail applications to a cloud-based solution with Microsoft Business Productivity Online Suite (BPOS).Please take time to read more about the announcement.
This decision for Microsoft is similar to recent announcements by the State of Minnesota’s, Commonwealth of Kentucky DOE even the Royal Mail in the UK to upgrade their messaging and collaboration software with Microsoft’s technology.
I found it odd when Google went very public with complaints of rigging and trickery on behalf of the State during the bid process only to later acknowledge Google Apps couldn’t meet the needs of the state. Such a PR smoke screen is a way to go on the offense with ton’s of players so no one notices you have an empty net. Gretzky would be proud.
What’s even more odd about Google’s tactics are that from what I understand some of their questions and concerns were answered or remedied by the State. The Ad Company complained that many of the requirements put forth were too Microsoft centric or simply wrong to ask for in the first place. Some of these radical features included elements like:
- allowing a user to create a mail ‘folder’
- ‘request delivery receipt’ for a email.
- ‘ability to invite attendees as optional in calendar notices.’
- ‘ability to create calendar appointments or task while off line’
Sorry Google, these are actual features used in businesses, especially in government where understanding and tracking information flow can be the law.
It’s not unfair for a company in any sector to request a set of features that reflect how they work. I’ve said it many times before, developing software is hard. It’s gets harder the more users you get because everyone has different needs. As a software company you balance this by building for what they need AND building for what you know they’ll want. Google must understand that simply showing up isn’t good enough. Despite their attractive price, more and more customers share that ‘you get what you pay for’.
Then some more information is provided on this Google competitive situation with heated comments following that by Jim McNelis from a Google Apps Authorized Reseller, with answers to them provided by the same Microsoft author. An excellent glimpse into the current competition which could just intensify when Office 365 will become production ready in [the first half of] 2011 [presumably, as seen below]. A must read!
Ten more tidbits on Microsoft’s new Office 365 cloud play [Oct 19] from Mary Jo Foley of ZDNet. A very good analysis. Greatly recommended. Things like this are mentioned by the author:
1. When do the BPOS v2 services — the new Exchange Online, SharePoint Online and Lync Online — go live?
A: Microsoft execs are saying 2011. But a Microsoft fact sheet I saw today said “early 2011.” This past summer, Microsoft execs told partners that the new version of BPOS would be out in the first half of this year. So I’m saying (unless there’s a delay) that “first half of 2011″ is probably a safe bet — even though Lync Server 2010 still has not been released to manufacturing and the Lync Online update of that product won’t be ready until early 2011, at best.
Browser Requirements (for Administration Center and My Company Portal): Internet Explorer 7 or above, Firefox 3.x, Safari 4.x
Browser Requirements (for Outlook Web App): Internet Explorer 7 or above; Firefox 3 or higher; Safari 3 or higher on Macintosh OS X 10.5; Chrome 3 and later versions. Note: Outlook Web App also has a light version that supports a reduced set of features across almost any browser
The lowest-priced option is the basic version of Office 365, which is the new name for the Deskless Worker SKU. It includes e-mail and is priced at $2 per user per month.
For SMBs (primarily 1-25 users), Microsoft is offering a $6 per user per month SKU that was codenamed “BPOS Lite.” The high-end version of Office 365 is the full enterprise SKU, which includes licenses for Exchange Online, SharePoint Online and Lync Online for $10 per user per month. Users can add licenses for their users of Office desktop software, on a subscription basis), raising the price to $24 per user per month.
Office Live Small Business is going away. From Microsoft: “The Office Live Small Business service will continue to run as it does today through at least October 2011. As a valued Office Live Small Business customer, you will be offered 3 months free of the Union (the codename for Office 365) service should you choose to transition your account to Office 365. Nothing will change for Office Live Small Business customers now.”
Live Meeting, the conferencing component of BPOS, goes away as a standalone product with Office 365. That functionality is going to be part of Lync Online.
Microsoft christens its cloud business suite as ‘Office 365’; launches beta [Oct 19] also from Mary Jo Foley of ZDNet. Equally good. Some additional “information nuggets”:
It’s been known for some time that Microsoft was refreshing its BPOS elements with a number of the features it has delivered (or soon will deliver, in the case of its Lync offering) as part of its “Wave 14″ on-premises software releases. Exchange Online in the new version of BPOS will get features from Exchange Server 2010 Service Pack 1. SharePoint Online will get some of the features — especially the Office Web Apps support — that are part of the SharePoint Server 2010 release. Lync Online will get selected features from the Lync Server 2010 product that Microsoft is expected to release to manufacturing any day now. (The Live Meeting conferencing product, which used to be part of the BPOS bundle, is being subsumed by Lync.)
On the promised feature list, in addition to updates to the core products in the suite, were also single sign-on with identity federation; a redesigned User Interface (for the console); More administration and access control; support for new markets and languages; and an enhanced Syndication partner interface. (”Syndication” is Microsoft’s program allowing mostly telco companies, but also some other partners to private-label its BPOS services.)
Major updates: HTC expects business performance to bottom out in 1Q12 [Feb 7, 2012]
Taiwan-based smartphone vendor HTC expects its business operation in the first quarter of 2012 to bottom out due to a decreased average selling price along with the process of transitioning from old smartphone models to new ones, with consolidated revenues projected to decrease by 31.0-35.9% on quarter to NT$65.0-70.0 billion (US$2.19-2.36 billion) while gross margins and net operating margins are expected to slip to 25% and 7.5% respectively, according to company CFO Winston Yung at an online investor conference on February 6.
HTC expects sales to increase beginning in the second quarter of 2012 along with the launch of several new flagship smartphone models, with gross margins and net operating margins to rise to levels seen in the first three quarters of 2011, Yung indicated.
HTC has been faced with hot competition from Apple and Samsung Electronics in the US market and less competition in the Europe market, but has performed well in the Asia market, especially in China, Yung pointed out.
As smartphones are increasingly popular, HTC will cater to each market segment by launching price competitive models yet with functional differentiation to increase added value to maintain gross margins, Yung pointed out.
While sales performance of LTE (Long Term Evolution) smartphones fell short of expectation in 2011, HTC expects increased adoption of LTE models by mobile telecom carriers in the US, Hong Kong, Japan and South Korea in 2012, Yung indicated.
HTC: Financial report (NT$b)
down 0.89 percentage point
down 1.79 percentage points
Net operating margin
down 2.15 percentage points
down 1.06 percentage points
Net earnings per share (NT$)
Source: Company, compiled by Digitimes, February 2012
– Mid-market Android Meltdown – HTC Warns Big Again [Forbes, Feb 6, 2012]
HTC has issued another massive revenue warning.The company is now guiding 1Q12 revenues to T$65-70 Billion, way below the T$89 Billion consensus expectation. January revenue crashed by 52% YoY. You read that right – in the overall smartphone market where at least volume growth probably was close to 50% in January, HTC sales halved year on year. Operating margins are now heading below 8% in 1Q12. What seemed like a triumphant success story just last autumn is rapidly turning into a bitter rout that has some intriguing parallels with Motorola in 2007.
This follows two major warnings from 4Q11 – warnings that should have lowered analyst expectations to realistic levels for 1Q12. Instead, many leading firms like Sanford Bernstein have continued insisting that HTC will do just fine. The size of the latest sales guidance cut clearly indicates that HTC is suffering from a post-Christmas inventory hangover that is far more serious than Wall Street expected.
We see once more how dangerous the impulse to protect strong operating margins can be. It demolished Ericsson‘s once so proud handset division in mid-Nineties, it killed Nokia’s innovation in mid-Noughties, it hamstrung Motorola around 2006.
In 2011, HTC refused to dive deep into low-end smartphone market in order to protect its mid-teen operating margins. It opted to compete head-to-head against iPhone at the high-end.
As a result, HTC now risks losing the handset success it spent half a decade building. Welcome to the club.
The market capitalization showing the real value of HTC, however, is just right on the spot:
- US$14.8 billion as of Feb 7, 2012 vs. the US$8.01 on March 1, 2010 when according to the Forbes 2000 list below HTC forged ahead of Acer and Asustek, and thus becoming the source of this original post as “the most promising ICT brand in Taiwan”.
- That promise had already been well fullfilled with Acer just at US$3.88 billion (vs. US$7.6 billion in Marc 1, 2010) market capitalization, and Asustek at US$6.2 billion (vs. US$7.57 billion in Marc 1, 2010).
- The changes in market capitalization are well reflected by the historical values of the HTC stock over the last 5 years:
End of major updates
The news 4 days ago were HTC Becomes Most Profitable Listed Company in Taiwan [Oct 14, 2010]:
Thanks to increasing popularity of smartphones worldwide, the Taiwan-based High Tech Computer Corp. (HTC), a globally leading vendor of smartphones its under own brand, reported an EPS (earnings per share) of NT$30.29 for the first nine months of this year, unseating MediaTek Inc., a world-caliber handset IC designer, as the most profitable listed company on the island in the period. Launching a couple of hot-selling smartphones, such as Desire, Wildfire, Legend and Incredible, to boost its market shares worldwide, HTC has enjoyed explosive sales growth and remained one of the most successful brands in Taiwan.
…. The firm raked in NT$27.058 billion [US$0.88B] in combined revenue for September, sharply up 129.65% from a year earlier to hit an all-time high. This pushed up its combined revenue and net profits for the third quarter of the year to NT$75.849 billion [US$2.47B] and NT$11.098 billion [US$0.36B], or NT$13.61 per share, respectively. Meanwhile, HTC`s aggregate combined revenue and net profits for the first nine months of the year reached NT$174.756 billion [US$5.7B] and NT$24.735 billion [US$0.81B] …
- Update: HTC faces challenge for 2011 shipment goal [July 5, 2011] (emphasis is mine)
HTC has set an internal goal of shipping 54 million smartphones in 2011 but the goal is expected to be difficult to attain because the company will be faced with strong competition from Apple’s new generation of iPhone and Nokia’s Windows Phone 7-based new smartphones in the fourth quarter, according to industry sources in Taiwan.
Based on the ASP of US$359 recorded in the first quarter of 2011, HTC’s second-quarter shipments of smartphones will top 11.5 million units, an increase of 18.6% from 9.7 million units shipped in the first quarter, and better than the company’s projection of 11 million units, the sources indicated.
With demand for HTC’s Android-based smartphones still growing steadily and HTC set to begin selling its naked-eye 3D model, the HTC EVO 3D, in Europe in July, the company is expected to garner revenues of NT$135-140 billion (US$4.7-4.88 billion) in the third quarter with its smartphone shipments reaching 12.5-13 million units, estimated the sources.
HTC is also expected to roll out new models for the year-end holiday season and to fulfill its annual shipment target, said the sources, noting that HTC will be able, at least, to ship 50 million smartphones in 2011, double from the amount shipped in 2010.
- Update: Cher Wang and Wenchi Chen (her spouse) are now Taiwan’s wealthiest people worth US$ 6.8B [Forbes, March, 2011]
- Update: HTC announces December revenues of NT$33 billion [Jan 6, 2011]
Smartphone vendor HTC has announced that unaudited consolidated revenues for December 2010 totaled NT$33.087 billion (US$1.131 billion). Total consolidated revenues of fiscal 2010 came to NT$278.761 billion [US$9.529 billion], up 92.92 % on year. Consolidated operating income was NT$44.185 billion, consolidated net income was NT$44.696 billion before tax and NT$39.330 billion or NT$48.24 a share after tax based on 815,239,000 weighted average number of shares.
- Update: HTC aims to roll out 60 million handsets in 2011 [Dec 10], we may add that this is an almost 100% increase in their market share, from 7.1% in 2010 to 13.6% in 2011, as per the earlier Digitimes Research published forecasts of the device manufacturers
HTC has reportedly informed its suppliers that it will eventually need parts and components for the production of up to 60 million handsets in 2011 compared to shipments of 20 million units projected for 2010, according to industry sources.
- Update:HTC Aims to Double Smartphone Sales in 2011 [Dec 8]
… to 50 million units in 2011 from an estimate of 25 million units for 2010, according to institutional investors.
… Worth mentioning is that HTC is likely to announce its foray into the tablet PC segment soon, and will launch its first model in 2011 as its ace in the hole to drive business operations. So far, the firm has kept completely silent on the product launch plan though.
- Update: HTC November revenues hit record for second time straight [Dec 6]
HTC has reported consolidated revenues of NT$38.484 billion (US$1.258 billion) for November 2010, hitting a monthly record for the second consecutive time. HTC’s November consolidated revenues were 4-10% higher than the originally expected NT$35-37 billion, according to investors. HTC is expected to generate consolidated revenues of NT$33-35 billion in December, resulting in fourth-quarter figures of NT$105 billion [US$ 3.49B] which is higher than HTC’s forecast NT$100 billion, the sources pointed out.
HTC’s shipments of Android and Windows Phone 7 smartphones have been short of demand and its booming shipments will continue and reach 8.5 million units in the first quarter of 2011, the sources indicated.
- Update: HTC acquires office space in Taipei from VIA Technologies [Nov 23]
… The office space is to accommodate HTC’s expanded R&D staff during the construction of its headquarters building 230 meters away from the purchased property, HTC pointed out. The building, with 17 stories and five basement levels, will have a total floor area of 85,620 square meters to accommodate 2,200 employees, with completion scheduled for the end of 2011, HTC indicated. 11 floors of the new building will be used to house R&D capacity, HTC noted.
In related news, HTC is expanding its production capacity at a factory in northern Taiwan, and another in Shanghai, eastern China, with combined monthly capacity to be increased to four million smartphones at the end of 2010, HTC noted. [This will be ~48% of total Taiwan handset output capacity. See the report below.]
- Taiwan handsets – 3Q 2010 [Nov 19]:
Taiwan’s handset shipments hit a record in the third quarter of 2010. First-tier handset vendors Nokia, LG Electronics (LGE), Sony Ericsson and Motorola all expanded JDM or ODM orders to Taiwan, and Taiwan’s own-brand smartphone vendor High Tech Computer (HTC) also saw shipments increase, spurring Taiwan’s total handset shipments to top 21 million units.
In April this year HTC was positioned among the Global 2000 ICT companies from Taiwan as follows (source: Forbes Global 2000 Country List [Apr 21]):
The red line above corresponds to the ~10% average increase for those ICT stocks, so here we can also see the above the average new increased (or below the average new decreased) value of the companies by looking at the columns themselves (while the data label numbers show the percentage value as of Oct 15 vs. March 1).
It is also worth to look at the exact numbers (by clicking on the link here you will get a PDF which provides all the source data links as seen on the image by the usual hyperlink presentations, so you could have full background, including company overviews):
One could see here that HTC became the #3 most valuable ICT company from Taiwan jumping from the #5 place to the current #3 in just 7.5 months. Meanwhile such well established Taiwanese brands as Acer and Asustek are much behind of HTC. Also all of the PC/notebook ODMs (Original Design Manufacturers), Quanta, Compal, Wistron and Inventec are much behind HTC now. Only Hon Hai Precision Industries, well known outside Taiwan as Foxconn Technologies, is significantly bigger in market value, but Foxconn Technologies is a huge contract manufacturer owning 50+% of the worldwide Electronics Manufacturing Services (EMS) market. And certainly Taiwan Semiconductor Manufacturing Company (TSMC) is even more valuable, not surprisingly, because TSMC is the #1 chip foundry in the world.
Ranking (2008 ranking)
Brand value (US$100 M.)
Source: Taiwan External Trade Development Council (TAITRA)
Here is an Oct 23, 2009 ranking from Global Recession Reshuffles List of Top-20 Taiwanese Brands 2009 rankings show China`s rising [Oct 23, 2009]:
The reason? Here are two press releases from iSuppli which might somewhat explain (I will devote a whole post later to this question):
Android Drives Success in Q2 Smart Phone Market by [Oct 14] – Makers of Android-based handsets outperform the market (emphasis is mine):
Droid phone specialist HTC Corp. achieved industry-leading growth, with its smart phone shipments rising by a stunning 63.1 percent in the second quarter compared to the first.
… HTC’s Android success can be traced to wireless operators that want to showcase the capabilities of their upgraded networks by offering handsets with sophisticated features to subscribers. For example, U.S. wireless carrier Sprint Nextel Corp. is offering HTC’s EVO 4G, a feature-packed Android handset that can capitalize on the high speed of its WiMAX-based 4G network. To keep its momentum going, HTC is expected to offer an Android phone that supports Long Term Evolution (LTE)—the other major standard for 4G.
HTC’s share of global smart phone shipments in the second quarter rose to 8 percent, up from 5.3 percent in the first quarter, allowing the company to solidify its No. 4 position in the market.
HTC shipped 5.4m smartphones in Q2 2010, an 80 per cent increase year-on-year. HTC owes this strong performance in no small part to its Android-based devices which were greeted with both critical and commercial success.
Initially a white label manufacturer catering to operators, HTC changed course two years ago and invested heavily in building its own brand identity, mostly on the high-to-mid end of the market. This led to the launch of Sense, which is aimed at maintaining a differentiator in a market increasingly crowded by Android devices. Screen Digest believes this strategy should prove successful in helping HTC reach 20m handsets shipped in 2010.
The move towards online services might seem surprising at first given the existing syncing options offered by Google as part of Android, but can be interpreted as a way for HTC to build further loyalty through additional complementary services.
WHAT? … Windows Live Spaces SaaS moving to WordPress.com SaaS? … It is part of a NEW strategy with Windows Live Essentials 2011 released now!
The news from Microsoft: WordPress.com and Windows Live partnering together and providing an upgrade for 30 million Windows Live Spaces customers [Sept 27]
Then Paul Kim, the VP of user growth from WordPress.com: Welcome Windows Live Spaces Bloggers [Sept 27]
Then a 3d party correction from the web: Microsoft: Windows Live Spaces already dead, WordPress.com will only get 1% of 30M users [Sept 30] which could be much understated as noted by Paul Kim’s response in the end:
Paul Kim, Automattic’s vice president of user growth, responded: “We don’t have an exact estimate for how many Spaces bloggers will move over to WordPress.com in the next 6 months, but in the first 48 hours we’ve completed close to 50,000 migrations which is very promising.” That number is impressive enough. Real measure will be the next 48 hours or 48 days.
There was a real surge in posting activity on wordpress.com. After 5 days the graph showed the following:
As you could see from the numbers there were approximately three times as many additional postings in the last 3 days of the first 5 days period, than in the first two. That quite probably would mean ~150,000 additional migrations giving the total number of migrations to ~200,000 already in the first 5 days.
So the 1% of 30 million Windows Live Spaces customers could indeed be an understatement, even a great one. Would be interesting indeed to see the numbers in the coming months. Microsoft PR meanwhile made a refinement by saying that those 30 million include the viewers as well, while the number of authors is “just” 7 million.
If the final number of migrated blogs will be in the range of several millions than this will indeed be a huge gain for the WordPress.com. The current number of blogs on that site is 13.9 million, so an increase of 10% to 30% for nothing would indeed be a great win for them.
But what is the win for Microsoft? Their announcement is giving the following reason:
WordPress powers over 8.5% of the web, is used on over 26 million sites, and WordPress.com is seen by over 250 million people every month. Not only that, Automattic is a company filled with great people focused on improving blogging experiences. So rather than having Windows Live invest in a competing blogging service, we decided the best thing we could do for our customers was to give them a great blogging solution through WordPress.com.
The Why is Microsoft giving away web traffic and abandoning users? [Sept 28] question is answered by Tim Anderson as:
Part of the reason may be that blogging itself has changed. The original concept of an online diary or “web log” has fractured, with much of the trivia that might once have been blogged now being expressed on Facebook or Twitter. At the other end, blog engines like WordPress have evolved into capable content management systems. Many blogs are just convenient tools to author web sites.
Microsoft gives up on Live Spaces: blogs to be shifted to WordPress.com [Sept 28] on the guardian.co.uk has a similar reasoning:
You’ve got six months before it disappears into the great Bit Bucket where Geocities has gone. …
Following the news that Vox is closing (on 30 September), and that its parent Six Apart (which created Movable Type) is joining with VideoEgg to create a new company called Say Media, one has to think that the pool of hosted blogging platforms is shrinking rather rapidly. Atthis rate, pretty soon it’s only going to be Blogger and WordPress.
And if that’s what it comes down to, you’d have to say that WordPress has the edge. It’s being taken up by the British government, even for non-blogging websites, where it acts as an effective content management system.
That though may overlook the emergence of “superfast blog” systems such as Tumblr, which strip away a lot of the stuff on the outside – which can make blog upkeep complicated or tedious.
Even so, it’s not clear from here where blogging, as a separate activity, is really going. I still have the sense – as I said last year – that the long tail of blogging is dying. Microsoft’s capitulation over Live Spaces seems an acknowledgement of that (its previous post, linked in that quote above, notes how much of a problem spam blogs and comment spam have been; indeed, when I used to trawl blogs for Technology content, Live Spaces blogs were notorious for being pure splogs or copy/paste jobs).
WordPress.com has done a better job keeping the spam out. The question now is whether it is building its business on top of an iceberg in a warming sea – or on dry land.
And indeed quoting from the referred The long tail of blogging is dying [June 24, 2009] post on the guardian.co.uk (emphasis is mine):
But recently – over the past six months – I’ve noticed a new trend: fewer blogs with links, and fewer with any contextual comment. (I’m defining a blog here as an individual site, whether on Blogger or WordPress or an individual domain, with regular entries.) Some weeks, apart from the splogs, there would be hardly anything. I didn’t think we’d suddenly become dull. Nor was it for want of searching: mining for blog comments, I use Icerocket.com. Technorati.com and Google’s Blogsearch.
Where is everybody? Anecdotally and experimentally, they’ve all gone to Facebook, and especially Twitter. At least with Twitter, one can search for comments via backtweets.com – though it’s still quite rare for people to make a comment on a piece in a tweet; more usually it’s a “retweet”, echoing the headline. The New York Times also noticed this trend, with a piece on 9 June about “Blogs Falling In An Empty Forest“, which pointed to Technorati’s 2008 survey of the state of the blogosphere, which found that only 7.4m out of the 133m blogs it tracks had been updated in the past 120 days. As the New York Times put it, “that translates to 95% of blogs being essentially abandoned”.
I see it: NetNewsWire, my RSS feed reader, has nearly 500 feeds. When one of them hasn’t been updated for 60 days, it turns brown, like a plant dying for lack of water. More and more of the feeds I follow are turning brown. Why? Because blogging isn’t easy. More precisely, other things are easier – and it’s to easier things that people are turning. Facebook’s success is built on the ease of doing everything in one place. (Search tools can’t index it to see who’s talking about what, which may be a benefit or a failing.) Twitter offers instant content and reaction. Writing a blog post is a lot harder than posting a status update, putting a funny link on someone’s Wall, or tweeting. People are still reading blogs, and other content. But for the creation of amateur content, their heyday for the wider population has, I think, already passed. The short head of blogging thrives. Its long tail, though, has lapsed into desuetude.
It is important to realize that Microsoft didn’t get WordPress.com hosting in exchange for this migration. Matt Mullenweg made this quite clear in his last year’s post of WordPress and Windows Azure [Nov 29, 2009]:
Are you moving WordPress.com to Azure?
No. WordPress.com, which is Automattic’s hosted blogging service, is going to stay on its existing infrastructure. Martin Cron from the Cheezburger Network launched a new blog Oddly Specific on Azure, which some people confused with Automattic.
Do you use Azure at all?
Yes, we’ve been testing out their blob storage as an alternative to Amazon S3 and Rackspace Cloudfiles. We don’t currently use it in production.
And nothing has changed since then. The Microsoft: Windows Live Spaces already dead, WordPress.com will only get 1% of 30M users [Sept 30] post is mentioning the following:
As for platforms, Kim responded: “WordPress.com, where these migrating Spaces bloggers are moving to, runs on Linux, Apache, MySQL and PHP.” In a follow-up e-mail, Kim responded: “We don’t plan to host any of these blogs on Windows Azure at this time.”
So there should be some additional gains for Microsoft in order to pass millions of authors and tens of millions of readers, as well as the advertising revenue attached to that. And indeed there are:
1. Microsoft’s lost eight years online: More than $6 billion down the tubes [Aug 13] which particularly stating that:
In fiscal 2010 ending June 30, Microsoft reported an operating loss of $2.35 billion on revenue of $2.2 billion for its online services division .
… [see the previous financial year data to see how there is an accumulated loss of more than $6 billion] …
[ZDnet’s conclusion:] Microsoft has generated no return on its Internet ventures. It has been nearly a lost decade for Microsoft online. Looking at the profit and losses, you could make an argument that Microsoft would have been better off avoiding the Internet. Strategically, that argument is absolutely crazy. On the financial front, shareholders may just want a dividend. Things could change. Perhaps Microsoft’s online investment has helped it with the transition to cloud computing somehow. As things stand today, the Web is one big money pit for Microsoft.
So saving some money with Windows Live Spaces migration is an important point for Microsoft, although not the major one as we would see further on.
2. What Microsoft is abandoning now is the thing of the distant past. One can easily understand that when reading again a 3d party authorative source Why are 30 million Microsoft refugees headed to WordPress.com? [Sept 28] (emphasis is mine again):
Microsoft had very good founding concepts for MSN Spaces in 2004 that later overlapped with Facebook. At the time I first met with Microsoft managers about its online services strategy, I was an analyst with the now defunct JupiterResearch. Microsoft product managers outlined a clear and compelling strategy about people publishing content for whom they know. The Web is too big, they rightly asserted. What matters is contenting your stuff to people who would be most interested in it, like family, friends and coworkers. I liked what I heard.
Four years ago, I compared Six Apart’s Vox to Windows Live Spaces. In August 2006, I wrote at the now defunct Microsoft Monitor blog: “Features are highly comparable. Both services are free, ad supported and provide mechanisms for blogging, sharing photos, music or videos and connecting to a widening circle of friends and family.” Vox is shutting down in two days. Windows Live Spaces will be gone in six months. Is it coincidence that these two services with similar design goals and features are shutting down around the same time? I think not.
Facebook has fulfilled most of the same philosophical and development goals articulated by Microsoft managers six years ago. In early 2007, Facebook had about 30 million subscribers — about as many as Windows Live Spaces today. Facebook now claims more than 500 million subscribers, although some people dispute they are all active. Facebook users share photos, status updates and other content with a circle of friends, family and other known or accepted relationships, which is exactly what Microsoft wanted to accomplish with Spaces and connected Live services.
3. Microsoft has reworked all of its Internet and web related strategies. I’ve already reported a few of that (but will report much more very soon). See these posts on my blog:
– Microsoft strengths for the PC -> cloud transition [June 27]
– Mobile search SaaS battle [June 28]
– Windows slates in the coming months? Not much seen yet [July 13]
– Microsoft going multiplatform? [Sept 17]
– Microsoft to lead standards compliance and implementation? … or how Microsoft is aiming to create a radically new Windows client platform via a set of “whole computer capable rich web” standards. [Sept 20]
4. Their on-line services strategy part has just been completely rearranged by Windows Live Essentials 2011 available for download now [Sept 30]. The key elements of this change are (only some of the emphasis is mine here):
Windows Live Essentials 2011 was designed and built to connect your PC to the services you use every day. We’re also announcing today that Dell will be the first global PC manufacturer to ship PCs with Windows Live Essentials 2011 and Windows 7 pre-installed, just in time for your holiday purchases. Many other PC manufacturers are also planning to make Windows Live Essentials 2011 available and we’ll continue to keep you updated as they start releasing.
… Windows Live Essentials 2011 was designed from the ground up for Windows 7. You can pin your applications to the taskbar and use jump lists to quickly get to common tasks. The ribbon brings common tasks to the front, letting you filter photos, change your font, or publish to your favorite services in a single click.
For parents, Windows Live Family Safety gives you the tools to help keep your kids safer on the Internet.
… If you have more than one PC, or a PC and a Mac, Windows Live Mesh helps you sync your files and folders across your PCs and connect back to your PC from virtually anywhere.
- Excellent overview: Windows Live Mesh 2011 [Nov 22]
… Use Window Live Photo Gallery to share photos with your friends on SkyDrive [this is now the one Microsoft on-line service outside of Windows Live Essentials], Flickr, SmugMug, Facebook, and more.
… Create a video using Windows Live Movie Maker and instantly publish it to YouTube.
… Stay in touch with your friends on Facebook, LinkedIn, and MySpace using the new Windows Live Messenger.
… Use Windows Live Writer to update your blog on WordPress.com [with Essentials 2011 it is the default], Blogger, TypePad, and many more blogging services.
… Use Windows Live Mail to keep track of your email from Hotmail [this is now the other Microsoft on-line service outside of Windows Live Essentials], Gmail, Yahoo, and more.
… Together with Windows 7 and the new Internet Explorer 9 beta, Windows Live Essentials completes your Windows experience and connects your PC to the services you use every day. Try it out and let us know what you think!
My final conclusion: Microsoft is not abandoning its eight years of on-line investments (which produced $6B+ loss so far) but splitting that among its classic strategic business lines. What we see now by Windows Live Spaces SaaS moving to WordPress.com SaaS and with the introduction of Windows Live Essentials 2011 is for the current (Windows 7) and the next generations of Windows clients. Windows clients will continue to be free of any advertisements and hence there is no service should be in Windows Live Essentials which could only be financed through advertisement revenue. With Flickr, SmugMug, Facebook, YouTube, Facebook, LinkedIn, MySpace, WordPress.com (with Essentials 2011 it is the default], Blogger, TypePad, Gmail, and Yahoo mentioned as important partner services, there is a clear demarcation line between Windows Live and 3d party services. In addition Windows Mail is that part of Windows Live Essentials which integrates both the 3d party web mailing services (Gmail, Yahoo etc.) and Microsoft’s own Hotmail Service. Hotmail thus remains the critical on-line service for Microsoft as well as the Live Messenger service of the Windows Live.
This is a very nice and rational on-line services strategy for the Windows clients. Please note that Microsoft Bing services are offered on their own, and those are the ones which should be supported by advertisement revenues in the long run. Also the Hotmail and Live Messenger services could be covered — at least partially — by advertising revenues in the long run. And certainly there is SkyDrive and Office Web Apps on SkyDrive which are in fact services that could mostly be covered by the Microsoft Office business line. BTW this is also true to a certain degree for Hotmail and Live Messenger.
Look at the Windows Live site for more information! You will even more clearly see that Microsoft did not lost its mind by migrating Windows Live Spaces to WordPress.com in such a “no return” way.