OOPS Challenge Conclusions

OOPS stands for Optional Operating system Perfect Storm. For those unfamiliar with the OOPS Challenge, please read the original challenge and the challenge update.

Utilities and Applets
As discussed in the OOPS Challenge Update, I am surprised at the small number of Windows applications I use routinely. I am equally surprised at the large number of Windows applications I rely on though I use them infrequently. Some of the latter applications are more or less operating system utilities, some device driver enhancers, yet the fact that they are not built into Windows implies that in a Windows-Linux duopoly, hardware vendors will be faced with developing all these programs for two platforms. Examples include the HP applications for my scanner, the Acronis program for disk backups and a Quicken utility for online backup.

Then there are the applets. These include the various graphic editing programs I use from time to time, like Microangelo for icons, FastStone screen capture and the often overlooked Office component, Microsoft Picture Manager. There are also the handy set of widgets that I use powered by the Yahoo Widget Engine, which I actually use all the time but that seem like part of the background. And ePrompter, that lovely little email aggregator that I rely on for monitoring the status of my various email inboxes. I suppose there would be Linux versions of these, but that got me thinking about how many other applets are built in to Windows itself, like Paint, Write and Media Player, and how much leaner Linux is in its definition of what is in the OS and what that means for Linux users. I'm sure this hole will ultimately be filled by one or more web-based services that aggregate a complete set of robust open source applets such that they seem to the average user to be part of the OS. Some may ultimately become browser-based.

Reader Comments
Quite a few readers pointed out that they cannot easily separate their personal computing from their work-related computing. Thus the infrastructure of their employer drives them to Windows for various applications, most notably Microsoft Office and Visual Studio. This is the flip-side of one of the forces driving Linux towards achieving duopoly status, the strategic defection of large organizations to Linux. These are currently mainly governmental and outside the US (see Windows Versus Linux Part 1: How Do You Compete With Free). Employer infrastructure cuts both ways.

I have also heard from a number of you that there are others who are already "OOPSing." See Harry McCracken’s PC World article for an example.

Some readers were stymied by the fact Internet connectivity is not yet 100% available everywhere with sufficient reliability and performance, and at a low enough price. Some found themselves missing a viable browser-based alternative for an essential application. Others found that, like me, the file system remain a stumbling block. These added fuel to my conclusions.

Conclusions
My first conclusion was that we got the gating conditions right for the perfect storm that will usher in the Linux-Windows duopoly. These are the following:

1. Universal broadband Internet access, affordable by everyone with superb reliability and performance

2. Robust, full-featured browser-based applications in all categories that make the operating system GUI irrelevant

3. The evolution of the file system into a browser-based, search-based, location-independent paradigm, where local and online storage distinctions move to the background

From reader comments and my own experience, all three are necessary. All of my issues using browser-based applications in place of the major Windows applications I rely on would go away if these three conditions were met. Except for certain employer requirements, the issues raised by readers would also be taken care of.

I also believe that the network effect of widespread strategic Linux adoption, as discussed in my "Windows Versus Linux" posts, will handle the driver, utility and applet concerns.

The issue that emerged as something of a surprise, though it should not have been in retrospect, was the question of who I would trust with my data. If I were to use online applications and if the data were stored online, I realize that I need a high degree of confidence in the vendor. I want to feel sure that my data files will be available, private and secure. This means two things. First, I want to deal with solid providers who I believe are properly funded and will be around in the future. Second, I really want that evolved file system so I can store my files where I want, including locally.

Bottom line: it is only a matter of time.

Copyright © 2006 Philip Bookman

Technorati: Windows versus Linux Microsoft OOPS webtop

Apple Should Acquire Adobe

While we are on the subject of Apple Computer's strategy (well, I was, last Thursday in Apple, Lose The Hardware, Free The Software), let's complete the advice. I said that Apple should stop selling computers and free the Mac operating system, OS X, to run on generic PCs. Today I add this: Apple should also acquire its Silicon Valley neighbor, Adobe Systems. Adobe's offerings would give Apple, the premier design-focused technology company, an unmatched array of content design and delivery tools. Apple and Adobe already have large, committed followings of web site and graphic designers, and both of their respective camps should feel at home with the combined company. Add the iPod/iTunes franchise to the mix, and an audio-video design and delivery powerhouse emerges.

Adobe is a well run, focused company which nicely strengthened the breadth and depth of its offerings with its 2005 acquisition of Macromedia. What Adobe lacks is marketing pizzazz and fussiness about the details of its products (how long did we suffer with Adobe Reader's interminable load times?). These are both Apple strengths. Apple needs a broad, coherent product line to unleash on both the Windows and Mac OS platforms. This is what Adobe brings to the party.

Let Microsoft have Office, which it produces for Windows and Mac OS and whose presence would just help the unleashed Mac OS gain market share. Office is old news, a mature suite that has nowhere much to go, all the so-called Office 2.0 hoopla notwithstanding. Important, yes, but boring. The new Apple would focus on hip, easy-to-use content design and delivery systems. Very Web 2.0. Who exactly would be its serious competition?

Besides, it would be great fun to watch.

Copyright © 2006 Philip Bookman

Technorati: Apple Computer Mac software strategy Adobe Systems

Oracle Stole It Fair And Square

At its OpenWorld conference in San Francisco, Oracle yesterday announced that it is stealing Red Hat Linux, fair and square. OK, I stole that phrase from former California Senator Hayakawa, who in a 1977 debate on the Panama Canal treaty said, "Why, it's ours, we stole it fair and square." But back to Oracle. Oracle is now offering full support for Red Hat Linux and will provide its own version of Linux based on Red Hat's. It will simply take Red Hat's source code (it's open source, you see) and base its future Linux version on it. It will owe Red Hat not a cent for this (it's open source, you see).

Larry Ellison promises that Oracle's support costs will be half of Red Hat's. He also pledged to fix bugs and back-fill fixes for Oracle Linux customers who are tardy in updating to future releases. To complete the rule of three bullet points per slide, Ellison said that Oracle will indemnify customers against intellectual property claims related to Oracle's Linux (it's open source, you see).

This move should come as no surprise. In an April interview with the Financial Times, Ellison said he intended to have a "full stack" of enterprise software, which just might include Linux, since a full stack requires an operating system. Ellison has also said in public on a number of occasions that if the open source community is intent on developing software for free, Oracle ought to take advantage of it. Long time Ellison watchers may be fooled into thinking he is jawboning when he says things like that, but that was the 20th century Larry Ellison who loved to say provocative things that were never seriously followed up. The 21st century version says what he means, means what he says, and then does it (see Oracle's Unsubtle Strategy). Those who fail to pay heed when Larry Ellison speaks will suffer the consequences.

Copyright © 2006 Philip Bookman

Technorati: Oracle Linux Red Hat software strategy

Apple, Lose The Hardware, Free The Software

In a just released report entitled Apple Should License the Mac to Dell, the analysts at Gartner got it partially right. They say that Apple cannot get much beyond its current market share of under 5% of PC shipments and maintain its historically fat margins, which are running at 40%. They reason that to further grow share would require becoming price competitive with Windows PCs. At the same time, Intel and other component providers are tiring of giving Apple price concessions that they normally reserve for much higher volume customers such as HP and Dell. A partnership with Dell in which Apple provided the Mac software and Dell manufactured and distributed the computers would, Gartner argues, be the route to a 20% market share.

My advice for Apple is bolder. Quit the computer business. Now that Mac's operating system, OS X, has been ported to the Mac-specific Intel platform, finish the job and free OS X to run on generic Intel compatible PCs. Sell OS X like Microsoft sells Windows, with the initial price hidden for most customers in PCs delivered with it. Make Mac the name of the OS. Make moving (of course, call it upgrading) from Windows to Mac easy. Expand Apple's software business beyond this, focusing on categories where Apple's customer savvy and design prowess can add value and differentiation. Why settle for 20% share?

At Apple's last annual meeting, Steve Jobs, referring to the PC market, said, "One of the nice things about having four or five percent market share is you don't really care if the market is down." Get off it, Steve. Are you just waiting for Zune to be out so you can ratchet down iPod sales to reduce Apple's share of that market to 5%?

Lose the hardware. Free the software. This move would be as bold as Intel's move in the 1980s to quit the memory business and focus on CPUs. Go for it!

Copyright © 2006 Philip Bookman

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The Zune Attack Is Working

In Why Microsoft Needs Zune, we saw that Zune serves Microsoft two purposes. First, it is a weapon Microsoft uses to attack iPod/iTunes and divert Apple resource away from unleashing OS X against Windows on generic PCs. Second, it is a long term investment in a new growth line of business.

The first purpose is already being served. Music player news and analysis reports are now dominated by the iPod versus Zune debate at a time when not a single Zune has been shipped. Steve Jobs, who to my knowledge has never publicly even mentioned the existence of another MP3 player, discussed Zune in a recent Newsweek interview. He had cute quotes, like this one about Zune's wireless music sharing capability: "It takes forever. By the time you've gone through all that, the girl's got up and left! You're much better off to take one of your earbuds out and put it in her ear. Then you're connected with about two feet of headphone cable." Analysts and reporters have mainly focused on the choice of brown as one of Zune's color choices, and other silly transitory details.

This must be music to Steve Ballmer's ears. This is exactly what he wants at this stage, a feature discussion. That implies that consumers should compare Zune and iPod features. That's all he wants now, for the word Zune to appear close to the word iPod, in whatever context, as often as possible. Microsoft knows not to worry about feature issues at this stage. Does anyone remember how clunky Word was for the first few years? Excel? Windows? Microsoft wrote the book on focused, relentless, continuous improvement. What they want now is what is happening, Apple focusing on them as the competition and the press and analysts pumping the idea of a two-horse race.

Microsoft is content to wait for several years before they find their groove in this market, so long as Apple focuses on them as a strategic threat. They trust in their proven ability to win over time. Microsoft can wait years to master the music player market. Microsoft can wait years for Zune to be profitable. Apple has neither luxury.

Copyright © 2006 Philip Bookman

Technorati: Zune Microsoft

OOPS Challenge Update

For those unfamiliar with the OOPS Challenge, please read about it here.

Here is a summary of my own experience since issuing the challenge on October 4.

It was interesting for me to discover how few Windows applications (as defined by the OOPS Challenge rules) I routinely use: Quicken, Word, Excel, Outlook, TextPad and Wise FTP. There are a bunch of infrequently used applications, but first I want to focus on the major ones.

Quicken
I immediately gave myself a pass on Quicken. I had tried Quicken's web version not too long ago and it was painfully slow and missing some of the slick features and functions of the Windows Quicken that I rely on. But I did realize that I am willing to give up on having my Quicken data on my PC. In reality, all of the data is already "in the cloud" on the web somewhere. I can access all my financial transactions online, I just have to use a different site for each bank, brokerage and credit card company. Quicken, as Lenny Greenberg pointed out to me, is where I aggregate all of this data in one convenient place. That place happens to be my hard drive, but I would willingly give that up. I could not find a web based alternative to Quicken that would import all my Quicken data and that I would also trust with my data.

Word
I started using Google's Writely, which changed its name to Google Docs a few days ago. Not bad! I could use it for everything I use Word for, with one major exception. I am writing a book and Word has all of the capability I need to publish it, without using a pure desktop publishing application. Google Docs falls short in about a dozen major functions and many minor ones. I could live without these for routine word processing, but even if I could find a web-based desktop publisher, I do not want a separate application for what to me are a continuum of word processing uses.

Excel
Google Spreadsheets, now linked at the hip with Google Docs, can handle my modest Excel chores. I'd have to give up some of the charts I use, but I could live with that. Yes, there are other spreadsheet applications that do charts as well, but I realized I would not trust them with my data.

Outlook
I use Outlook for just two things, my calendar and contacts. I sync it with my cell phone. I could give up Outlook for a web-based calendar and contact manager, but I do not have web access on my phone because I have no need for it. I do not use my phone for email or web browsing and do not want to.

TextPad
If you assume that a text editor is really part of any OS, then I could use Notepad and finesse this issue. I like TextPad better than Notepad because it has features that make it a better tool for developing and maintaining web pages. Yes, I use a text editor to do that, I want the control I get when I author the html and javascript myself. I develop my web sites on my desktop, then upload to a web server host for production. If I changed my approach, using a hosted development environment, I could use the hosting service's editor instead of TextPad.

Wise FTP
Because of the way I develop web sites, I need a good FTP client. I could use Windows Explorer's FTP capability, but Wise is easier to use. This too would go away if I changed the approach I use to developing web sites.

Stay tuned for another OOPS update in which I will discuss the applications I use infrequently, some reader comments and my conclusions.

Copyright © 2006 Philip Bookman

Technorati: Windows versus Linux Microsoft OOPS webtop software strategy open source

Bamboozle Update 2

Google continues its bamboozle campaign against Microsoft. As we discussed in Google Bamboozles Microsoft, Google uses a diversionary attack strength defense against Microsoft's search capability by attacking Microsoft Office. They do this by creating just enough of a potential threat to affect Microsoft's plans without much real Google investment.

The bamboozle continued today, when Google launched a new product called Google Docs & Spreadsheets. This is the old Writely word processor acquired from Upstartle combined with the old Google Spreadsheets. They both lose their separate identities. So what exactly is new? The awkward name is about it.

The other parts of what could become a Google Office suite are trapped in the equally artlessly named Google Apps For Your Domain, as discussed in Bamboozle Update 1. "Will they ever come together?" the analysts ask breathlessly, and Ray Ozzie scratches his head and wonders, "Do I take this threat seriously?"

Meanwhile the Googlers smile primly and deny that this is in any way a precursor to Google Office. It is different, say the Googlers. The wonderful thing is that their denials only make the analysts more breathless and Ray Ozzie's scalp more itchy.

Copyright © 2006 Philip Bookman

Technorati: Google Microsoft

YouTube MeToos

The rumor we reported Friday has become fact. Google announced Monday that it is acquiring YouTube for $1.65 billion. Expect this to lead to ever more Startups in Wonderland, aiming to become the next YouTube by attracting Tribble Traffic. I call them the YouTube MeToos.

To save MeToos a lot of time, here is the prototype for the business concept section of a MeToo business plan:

[company name] will develop a web site which [optional adjectives] people can use to share [plural noun] for free. We will focus on building traffic to the exclusion of all other considerations. We will delay as long as possible attempting to monetize our traffic because that might get in the way of building it. Our exit strategy is to be acquired by a large established company that believes it can monetize the traffic, before we reach the point where the cost of scaling up our infrastructure to handle our traffic becomes prohibitive.

Fill in the company name. Add optional adjectives to describe the subset of the human race you expect to turn into tribbles, or leave them out and the whole world is your audience. Fill in the plural noun that names the bait for the tribbles. Then seek venture funding.

Here is an example:

StartupsInWonderland will develop a web site people can use to share MeToo business plans for free. We will focus on building traffic to the exclusion of all other considerations. We will delay as long as possible attempting to monetize our traffic because that might get in the way of building it. Our exit strategy is to be acquired by a large established company that believes it can monetize the traffic, before we reach the point where the cost of scaling up our infrastructure to handle our traffic becomes prohibitive.

I’m off to Sand Hill Road to pitch my plan…

Copyright © 2006 Philip Bookman

Technorati: Google YouTube software strategy venture capital

GooTube?

TechCrunch today reports a rumor circulating in the VC community that Google is in talks to acquire YouTube for $1.6 billion. Regardless of whether or not this is true, the deal would make strategic sense for both parties.

YouTube suffers from The Three Curses Of Internet Success. These are success without revenue, success without profit and success without barriers to entry. As I said in that post:

"First mover or not, there is no substitute for a credible business plan that spells out a scalable business model that includes revenue and profit. Failing that, the plan should be for more of a proof-of-concept business model and to be acquired as an early exit strategy."

The problem is what I call Tribble Traffic:

"Tribble traffic is one root cause of The Three Curses of Internet Success...These Startups in Wonderland are becoming the experimental labs for established companies."

Google could use YouTube as the foundation for a searchable site for video content. As TechCrunch points out, the copyright issues that face YouTube are not new to Google and it is well equipped to deal with them.

Copyright © 2006 Philip Bookman

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The OOPS Challenge

I've gone on record predicting that a perfect storm is coming that will make Linux a viable alternative to PC consumers worldwide. The conditions that will produce this storm will make the operating system interface irrelevant and drive it nearly as far in the background as the BIOS. These conditions are the following:

1. Universal broadband Internet access, affordable by everyone with superb reliability and performance

2. Robust, full-featured browser-based applications in all categories that make the operating system GUI irrelevant

3. The evolution of the file system into a browser-based, search-based, location-independent paradigm, where local and online storage distinctions move to the background

I call this the Optional Operating system Perfect Storm, or OOPS.

So, I asked myself, how close are we to #2? How close are we to replacing the need for the Windows desktop? What would happen if I stopped using Windows applications and only used browser-based applications? This has been a very revealing exercise, and I will share my personal results in the near future. Now, though, I invite you to join the experiment that I call the OOPS Challenge.

The OOPS challenge is to replace as many Windows applications as possible with browser-based applications. Here are the rules:

1. OS utilities (applications that are used only for the care and feeding of the operating system) do not count. This includes things like disk cleanup, defragmentation and backup utilities; virus, spyware and malware blockers and scanners; and software firewalls.

2. It is OK if the application uses an ActiveX control or plug-in, so long as the only user interface is the browser.

The ultimate OOPSer would not click on a Windows desktop or taskbar icon or use the start menu for anything but launching the browser, exiting Windows and running OS utilities. How close to this can you come?

So come on, take the OOPS Challenge. Then share your comments with us or send an email with the subject OOPS Challenge to philbookman@hotmail.com.

Copyright © 2006 Philip Bookman

Technorati: Windows versus Linux Microsoft OOPS webtop software strategy open source

SaaS, SaaP or Hybrid?

The hybrid model is being touted as a short-term bridging strategy for SaaP (software-as-a-product) vendors attempting to switch to a SaaS (software-as-a-service) model. Also, some SaaS vendors have found themselves embracing a hybrid model in order to land big deals, though they often do so while holding their noses and swearing that it is only opportunistic and they will kick the habit. I believe that in the future we will see many business software vendors adopt long-term hybrid strategies, focusing on how to best serve customer segments instead of on the delivery model.

A number of business model differences between SaaS and SaaP business software vendors have emerged as the SaaS delivery model has been increasingly successful. Many of these differences are not, however, inherent to SaaS. They are instead consequences of the customers who have been attracted to SaaS offerings and may not be enduring differences.

Before SaaS, SaaP vendors presented customers with a take-it-or-leave-it choice. This was not because SaaP vendors were bad guys. It was because the SaaP model worked for so many customers. SaaP vendors sought the most lucrative of these customers, often meaning big organizations with enterprise deals. The rise of enterprise software as the dominant SaaP category left smaller organizations out in the cold. These were the unserved or poorly served customers that the emerging SaaS model served well.

The One Core Difference
Everyone in the SaaS business software ecosystem has something to gain from SaaS success. It is therefore not surprising that SaaS hype promotes many SaaS virtues that are not unique to SaaS. There is nothing wrong with this, it is marketing as usual, but let us not forget what is at the core of the SaaS advantage to a business customer: it gets the application out of its IT infrastructure.

Let's take a quick look at the other commonly touted SaaS advantages: ease and speed of implementation, ease of updating, customer service, subscription pricing and ease of exit. None of these are unique to SaaS. If you can design software that makes implementation fast and easy, you can install it behind the firewall. If you can design software that updates seamlessly and transparently, you can install it behind the firewall and update it from outside the firewall. If you can serve customers well, you can serve customers well, SaaS or not. Pricing structure has nothing to do with delivery model, and SaaS is at its core a delivery model. Finally, unless you are using a really lightweight application and abandon it pretty quickly, the true total cost of exiting is not much different for SaaS, never mind trying to get your data to migrate to your new solution of choice.

In fact, you could argue that most of these advantages are actually things SaaS vendors must do to get customers to turn their data and its security over to the care of others.

This single inherent SaaS difference, vendor hosting, has huge implications. To a small business, IT infrastructure is often an oxymoron. The cost of having much more than a decent broadband connection is often prohibitive. SaaS applications are a godsend to these companies and provide them access to applications they would usually have to sub-optimize or forego entirely. Concerns about security and reliability are easily overcome, because the hosting vendor's capabilities far exceed those the customer could afford in-house. CRM is the poster child application, but it is the tip of the iceberg.

For big companies, simplifying IT infrastructure has been an unachieved goal for over 40 years. Yes, there have been waves of change, but not simplification. The core SaaS advantage to these companies is that it provides for the first time the hope of actually moving major applications outside. Concerns about security and reliability are, however, major impediments to SaaS adoption, because these big organizations often have capabilities that exceed the vendor's and major liability if there are problems. Big companies also have more complex integration and customization expectations than do small ones.

The SaaS Blue Ocean
SaaS pioneers like Salesforce.com found that their blue ocean consisted of those customers traditional SaaP vendors served poorly, the smaller ones. It turned out that these small organizations are attracted to short-term subscription pricing and need a lot of hand-holding. This dictated parts of the emerging SaaS company business models. The SaaS pioneers also found that running data centers and designing software to cost-effectively serve many tenants on different releases in a data center drove other aspects of the business model. Price sensitivity of small customers drove the sales and marketing model, as well as the need to emphasize technical support instead of professional services.

Also attracted to these early SaaS offerings were larger customers who, for various reasons, behaved more like smaller ones. These included small units of a big company (the so-called departmental customers) and big companies willing, often eager, to forego in-house control and customization.

A Hybrid Future
As SaaS vendors saturate the low-end of the market, some will attempt to move up-market. They will run into the very forces that drove the SaaP vendors to their current business models. Many SaaS vendors will choose to stay in their sweet spot, serving the low-end customer and those that behave like them. Others will adopt a hybrid model, focusing on customer segments rather than the delivery model. Others will be acquired by SaaP vendors.

As SaaP vendors saturate the high-end of the market, some will attempt to move down-market. They will run into the very forces that drove the SaaS vendors to their current business models. Many SaaP vendors will choose to stay in their sweet spot, serving the high-end customer. Others will adopt a hybrid model, focusing on customer segments rather than the delivery model. Some will do this by acquiring SaaS vendors. In fact, the SaaP vendors need the SaaS vendors, they are their R&D labs.

I know first hand that managing a hybrid model company is a significant challenge. So what else is new? The future belongs to those who best serve customers within profitable business models, not to delivery model bigots. So get ready, there may be a hybrid in your future.

Copyright © 2006 Philip Bookman

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