Microsoft
Analysis of Microsoft’s efforts in the database management, analytics, and data connectivity markets. Related subjects include:
- (in DBMS2) Microsoft’s efforts in the database management and analytic technology markets
- (in The Monash Report) Strategic issues for Microsoft, and Microsoft Office
- (in Software Memories) Historical notes on Microsoft
Google declares total war on Microsoft
Google blogged Tuesday night about a new project, the Google Chrome Operating System. Highlights include:
- Open source
- Targeted to appear in netbooks in the second half of 2010
- Google Chrome browser + new windowing system + Linux kernel
- Minimal user interface
- Data stored or at least backed up in the cloud, and hence available on any computer
- Hardware compatibility hassles allegedly eliminated
- Ditto for software update hassles
- Ditto for security problems
- Apps apparently assumed to run inside the browser. (Not clear if this is required or just recommended.)
Obviously, Google Chrome OS is a direct attack on Microsoft — even more so than Google Wave, which I’ve predicted will “play merry hell with Microsoft Outlook, Microsoft Word, Microsoft Exchange, Microsoft SharePoint, and more,” or for that matter than Google Mail and the rest of Google Apps. Taken together, Google’s initiatives suggest that an all-out Google-Microsoft war is coming, in a conflict that many people have been expecting — and analyzing — for years.
So how will this all shake out? Well, let’s start with some basic points:
- Google Chrome OS Release 1 is expected over a year from now, and then only on a limited subset of PCs, namely netbooks.
- Google Chrome OS Release 1 is supposed to have great performance and be bullet-proof. Hmm …
- Google is evidently assuming that the apps people want to run will either be browser-based, or else be new ones written for Chrome OS. Hmm …
- Google is signaling that Chrome OS will be very limited in features. That makes sense for Release 1 — but what will be missing?
- Consumers have proven their willingness to buy non-Microsoft computers, especially Apple ones, specifically in the Mac and iPhone/iTouch product lines.
- A lot of people would have compatibility issues replacing Microsoft Excel or PowerPoint with partially-compatible alternatives. I’m not so sure about Microsoft Word, however. Other than those three, Outlook, and the Windows family itself, I’m not aware of any Microsoft client products that have much lock-in. (Well, maybe Xbox, but that’s not in the main stack.)
- Open source software often gets most of its community support in a couple of areas, namely compatibilities and language translation. Google probably doesn’t need the help in languages, but letting other people fix Chrome OS compatibility issues whose importance it didn’t recognize is potentially valuable.
- Google probably won’t make any direct revenue from Chrome OS. So how much will it invest in the project?
- Notwithstanding Danny Sullivan’s concern, there isn’t much of an antitrust issue here. Google’s search can’t easily be used to favor Chrome, Chrome OS, or Google Apps. And the other way around — e.g., using Chrome OS to favor search — Google clearly isn’t a monopolist.
| Categories: Google, Microsoft, Software as a Service (SaaS) | 10 Comments |
Google Wave — finally a Microsoft killer?
Google held a superbly-received preview of a new technology called Google Wave, which promises to “reinvent communication.” In simplest terms, Google Wave is a software platform that:
- Offers the possibility to improve upon a broad range of communication, collaboration, and/or text-based product categories, such as:
- Search
- Word processing
- Instant messaging
- Microblogging
- Blogging
- Mini-portals (Facebook-style)
- Mini-portals (Sharepoint-style)
- In particular, allows these applications to be both much more integrated and interactive than they now are.
- Will have open developer APIs.
- WIll be open-sourced.
If this all works out, Google Wave could play merry hell with Microsoft Outlook, Microsoft Word, Microsoft Exchange, Microsoft SharePoint, and more.
I suspect it will.
And by the way, there’s a cool “natural language” angle as well. Read more
| Categories: Google, Language recognition, Microblogging, Microsoft, Natural language processing (NLP), Search engines, Social software and online media, Software as a Service (SaaS) | 3 Comments |
A savage critique of Microsoft’s online efforts
Loose Wire Blog offers a savage critique of Microsoft Encarta (whose discontinuation was recently announced). Although the blog seems in general to be a bit over-the-top curmudgeonly, that particular post seemed well-reasoned.
I’d like to make a more general comment about Microsoft: its online stuff is awful, and Encarta is no different. There are already plenty of people musing on why Encarta died, but I’d say one good reason is that it’s hard to access and get your mind around as pretty much every Microsoft online property.
| Categories: Microsoft | Leave a Comment |
Lynda Moulton prefers enterprise search products that get up and running quickly
Lynda Moulton, to put it mildly, disagrees with the Gartner Magic Quadrant analysis of enterprise search. Her preferred approach is captured in:
Coveo, Exalead, ISYS, Recommind, Vivisimo, and X1 are a few of a select group that are marking a mark in their respective niches, as products ready for action with a short implementation cycle (weeks or months not years).
By way of contrast, Lynda opines:
Autonomy and Endeca continue to bring value to very large projects in large companies but are not plug-and-play solutions, by any means. Oracle, IBM, and Microsoft offer search solutions of a very different type with a heavy vendor or third-party service requirement. Google Search Appliance has a much larger installed base than any of these but needs serious tuning and customization to make it suitable to enterprise needs.
In particular, her views about FAST (now Microsoft) are scathing.
| Categories: Coveo, Enterprise search, FAST, Microsoft, Search engines | Leave a Comment |
Google vs. Microsoft search, per Seth Grimes
Seth Grimes did a head-to-head comparison of Google and Microsoft Live Search results about the Microsoft/DATAllegro deal, 10 hours after it was announced. He found that Google had picked up a number of relevant results, while Live Search hadn’t. (And this was on the main search pages, not on News or Blogs.) He goes on to note that Yahoo’s “contextual” ads were badly irrelevant (Google didn’t have any at all).
What this boils down to, mainly, seems to be a major win in spidering speed for Google vs. Microsoft Live Search.
And yes Seth — I like you too. 
| Categories: Google, Microsoft, Search engines | Leave a Comment |
6 trends that could shake up the text analytics market
My last two posts were based on the introductory slide to my talk The Text Analytics Marketplace: Competitive landscape and trends. I’ll now jump straight ahead to the talk’s conclusion.
Text analytics vendors participate in the same trends as other software and technology vendors. For example, relational business intelligence and data warehousing products are increasingly being sold to departmental buyers. Those buyers place particularly high value on ease of installation. And golly gee whiz, both parts of that are also true in text mining.
But beyond such general trends, I’ve identified six developments that I think could radically transform the text analytics market landscape. Indeed, they could invalidate the neat little eight-bucket categorization I laid out in the prior post. Each is highly likely to occur, although in some cases the timing remains greatly in doubt.
These six market-transforming trends are:
- Web/enterprise/messaging integration
- BI integration
- Universal message retention
- Portable personal profiles
- Electronic health records
- Voice command & control
| Categories: BI integration, Enterprise search, Google, Microsoft, Search engines, Social software and online media, Text mining | 1 Comment |
Yahoo indeed seems to want an all cash deal
The Microsoft/Yahoo negotiation is in a very public phase right now. In its latest letter, the Yahoo board makes two references to “certainty,” in one case spelling out that this encompasses “certainty of value” and “certainty of closing.”
It’s hard to imagine what the former could mean other than “Please make an all-cash offer (or, better yet, go away).” But I previously noted, Microsoft can indeed afford to buy Yahoo entirely for cash.
The latter part is a reference to the antitrust boogeyman, obviously a non-trivial concern whenever Microsoft is involved.
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| Categories: Microsoft, Yahoo | 2 Comments |
Yahoo wants to follow AOL into the dead pool
Yahoo CEO Jerry Yang has put out a shareholder letter in which he commits Yahoo to pursuing the strategies that have already devastated AOL. To wit:
- Yahoo wants to be the internet “starting point” for ever more relatively naive users.
- Yahoo wants to be an advertising “must buy.”
- Yahoo doesn’t need to excel technologically in its user experience.
This is exactly what AOL tried in the late 1990s, except that they also had the best dial-up connectivity in the world. I know; Linda and I were strategic consultants to AOL then.* And we told them that while the rest of their strategy was excellent, it would be to no avail unless their tools matched the quality of what people could get in the office or elsewhere online. Because if AOL’s technology didn’t catch and keep up, people would just laugh and go elsewhere. (Even my parents, who still use AOL mail, go outside AOL for their web surfing. AOL is getting very little revenue from them, and they’re about as captive as AOL users get.)
*Please note — AOL was a great client, but the people we dealt with are (for the most part) long gone, and our NDAs ran out years ago.
That’s brain-dead. Just consider how far technology has taken Google, how fast gaming technology advances, or how fickle internet users are about switching to the latest and greatest online services. What’s worse, Yahoo seems to mean it, given how many serious technology leader types are out on the street in connection with the recent layoffs.
Pretty much the only remaining hope for the Yahoo brand(s) and services is for the Microsoft acquisition to go through, and for Microsoft/Yahoo to unlock the deal’s huge potential synergies — which, while far from being certain, is at least realistically possible.
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| Categories: Microsoft, Yahoo | Leave a Comment |
Microsoft could EASILY pay $40/share for Yahoo, in cash
The Microsoft/Yahoo negotiations are underway. Mike Arrington and Henry Blodget are fretting about Microsoft’s stock price decline in reaction to the deal.
It’s all nonsense. According to Microsoft’s 10-K statements, they have $27 billion in cash and equivalents and have $14-17+ billion/year in cash flow from operations. Assume they have to pay $40/share for Yahoo’s 1.4 billion shares in an all-cash deal (meaning they have to borrow around $30 billion). Assume that building out data centers adds a couple of billion of dollars a years in new capital costs. They can still pay all the debt back in three years. It’s all a non-issue, if they think the acquisition is worth it.
So is it? I see tons of synergies, but I’ll confess to not having quantified them. I’m also more optimistic about post-merger execution than many observers are. I do think Microsoft will have to pay up to complete the deal.
And I think Henry Blodget is proposing a false dichotomy when he suggests Microsoft is wrongly favoring ad-supported online software over subscription online software. Ad-supported personal use and subscription-supported enterprise use can co-exist.
EDIT: I forgot about the FAST deal when I wrote this, which will cost a few billion dollars more when it closes. But there was enough slack in the calculations to cover it. Microsoft could indeed pay the debt off over 3-4 years, although it would surely arrange a somewhat longer term for flexibility.
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| Categories: Microsoft, Yahoo | 2 Comments |
A game theorist’s view of Microsoft/Yahoo
Edit: Microsoft/Yahoo could easily end up being an all-cash deal.
Larry Dignan encourages a game theoretic view of the Microsoft/Yahoo merger, following Trip Chowdhry. I actually have a Ph.D. in game theory, so I’ll bite.
In most negotiation games — including pretty much all in which money can change hands — there’s one outcome that makes the most sense for all concerned. They should agree to that outcome, and haggle about nothing except price.* In this case, the best outcome for Microsoft and Yahoo is a quick Microsoft takeover of Yahoo. That’s what I thought all along, due to a whole lot of Microsoft/Yahoo synergies. Michael Arrington reports, in confirmation, that there are no viable alternative bidders.
*A fancy way of saying that is “The feasible set has a continuous and effectively one-dimensional Pareto frontier.”
In such cases, the haggling over price depends a lot on each side’s “threat point” — i.e., their fallback position, and the (un)desirability of that fallback position for each side. Yahoo’s fallback position is probably one or more aggressive deals with other major internet players. Merely outsourcing its search business to Google would be stupid. Selling the search business to Google could fetch a wonderful price, because Google would be even more entrenched — but for exactly that reason, it would surely fail to pass antitrust muster. That’s why the Amazon idea that’s been floated is so crucial; a Yahoo/Amazon merger would actually be synergistic in its own way, and hence could command a price at least somewhat competitive with Microsoft’s offer.
As for Microsoft — despite successes in individual Internet areas, it has consistently failed to build a coherent Internet business. Yahoo has its own issues, obviously, but on the whole it’s maintained pretty decent Internet status even as its technological efforts have been consistently disappointing. If Microsoft doesn’t buy Yahoo, it probably needs to buy somebody else with a consistent record of Internet leadership, such as Amazon. That would also involve paying a large premium. And here’s a twist: If Amazon for any reason wants to sell to fellow Washingtonian Microsoft at a big premium, it’s best move may be to sabotage the Microsoft/Yahoo deal somehow.
One final note: If Yahoo outsources its search business to Google, the possibility of a Microsoft deal is gone forever. Microsoft can not be assured of winning a waiting game, the way Oracle outlasted Peoplesoft.
Bottom line: The Microsoft/Yahoo deal should and probably will happen, and Yahoo should and probably will be able to squeeze Microsoft for more money than has first been offered.
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Technorati Tags: Trip Chowdhry, game theory
| Categories: Microsoft, Yahoo | 2 Comments |