PCs: "The news of my death has been greatly exaggerated!"

With Apple's iPad storming the scene, some felt that the PC was dead giving away ground to the tablet form factor. What I felt that Apple achieved with the iPad, was the "toasterfication of IT": turning the relative complex device in something that is easy to operate as a toaster. This lent it to be something that would a fan favourite with the elderly and kids.

Things don't look as rosy for the iPad. Fortune reported that "the iPad is the current leader in the tablet market, accounting for 24.5% of all tablet sales, its market share has consistently decreased by about 18% over the last few years".

Nick Statt of CNET posted a great article that discusses some possible reasons as to the declining fortunes of the tablet. Once seen as a PC killer, now is in a state of normalization. One could argue that the tablet is entering into the "trough of disillusionment" after slide down the "peak of inflated expectations". Nick explains in his article that mini-tablets have lost market share to the the phablet (as I have noted in previous posts, I strongly dislike this term. But phonelet isn't much better!). Quoting IDC analyst, Jean Philippe Bouchard, "When your phone is only an inch or two shy, what's the point".

I find his analysis dead on: when I migrated from the Blackberry, I went straight to the Samsung Note to get a larger screen that would be easier to type because I was so used to the physical keyboard. However, when I was contemplating getting the Nexus 7 from Google, I thought exactly that: why bother with the tablet when my Note is already a "pocket tablet"? 

When it comes to the larger tablet form factors, Nick points out that tablet owners are favouring to keep their iPads for a longer period of time and now are opting for the 2-in-1s (like Lenovo's Yoga line of laptops), which enable more productivity than the tablet counterparts.

Why is this the case?

It seems to me that people have realized that tablets are more of a consumption device rather than a productivity device: they are great for reading, listen to podcasts or watching videos. However, if you want to churn out a blogpost, document or even email - you need that physical keyboard.

Wall Street Journal also had an interesting op-ed pointing to the continued usefulness of the PC. Geoffrey Fowler attempts to convince us  that the next computer should actually be - wait for this - a desktop! Mr. Fowler, not without humour, mentioned how a friend asked him whether he still drove a horse and buggy!

Jokes aside, I think he does a pretty good job in pointing out that when you are able to connect remotely via multiple devices to cloud based software to get your work done, desktops make a lot of sense. In the article, he included the following link that points to the improved productivity (17% more to be exact) of using a full keyboard and mouse. The article includes a number of suggestion, including the HP Pavillion mini, which looks quite tempting (see the CNET preview below). Definitely agree with the tip about using the keyboard and mouse: I actually lug around my ergonomic Microsoft mouse and keyboard connecting to my work issued 2-in-1 Lenovo Yoga to save my wrists and neck.



The revised interest in the PC and retreat in sales of the iPad highlights the importance of being on top of tech trends and avoiding the "bleeding edge": executives should be sure of the business value of the technology before jumping the bandwagon.

Technology and Audit: Rising tide of tech floats all boats

Norman Marks, evangelist at SAP, neatly summarizes  in this 5 minute video the implications of the how the recent technologies, such as cloud, analytics, and the like has implications on the auditing profession.

As he notes, "if it's good enough for our clients, it's good enough for us" (i.e. us being the auditing profession).  He mentions how individual analysts and other business professionals are using tablets and other devices to perform analytics. He also cautions that we should not make the same mistake as we did when analyzing the potential for desktop computing. In the video he narrates an amusing anecdote about the reaction of the accounting firm that he worked at to the nascent, desktop computer in the 70s.

Although I agree with his comments, I would say that this also extends beyond the corporate IT environment I have written in the past about cloud and mobile tech and what I see is that these technologies favour the small and medium sized business (SMBs) over the large ones. Basically, SMBs can now afford enterprise class technology and are probably using this technology within their personal spheres. Hence the term "consumerization of IT": advances in technology are focused in the consumer space not the corporate IT Department. As illustrated by the use of the iPhone within the corporate IT, consumers brought or demanded that IT let them use the iPhone instead of the standard  issue (e.g. BlackBerry) smartphone. Furthermore, widespread familiarity with these technologies allows SMBs access to employees who know how to use these technologies - without specialized training. The sum of it: it is much harder for auditors to justify being low-tech, when even the employee of the SMB has gone high tech.

Tablet: Who will challenge Apple - Google or Microsoft?

Microsoft: Enters with a tablet that it manufactures
On June 19th, Microsoft unveiled it's Surface tablet. Microsoft did its best to enshroud the announcement in secrecy creating a buzz in the press (attendees did not even know until the last minute where the location of the event was - they just knew it was in Los Angeles). Microsoft released the following promotional video of the device: 




The big surprise is that the company is following Apple's lead and getting into the hardware manufacturing game. Although Microsoft has experience successfully manufacturing hardware (i.e. the X-Box gaming console), the issue is that it is now competing with the OEMs that have been the key distribution channel for Microsoft's Windows OS. One key advantage of this approach is that they will be able to control the product end-to-end and seamlessly integrate the Windows 8 software and the hardware. The second key advantage is that they will have more control over the pricing, as they can effectively waive the licensing fee and just make profit off of the hardware. 

In a recent interview, Bill Gates attempted to quell OEM fears that have emerged as a result of this move. But to put things in perspective, Microsoft has been aware of the issues related to relying on the OEMs to produce a great Windows experience. In early 2011, they started Microsoft Signature program. For $99, Windows 7 user can remove the "bloatware" installed by OEMs and get Microsoft to install a suite of Microsoft software, such as Windows Security Essentials (but this has to be done in a Microsoft Store and there is only rumours of one to open at Yorkdale). Alternatively, users can buy a Signature certified PC from Microsoft directly from its web store. The result is a better performing PC. Consequently, the move to manufacture its own device is a good way to ensure that Microsoft is setting the standard for performance of Windows 8. That way if there are any issues it can be blamed on the OEMs and not the actual OS. 

Google's Regroups and Attacks with the Nexus 7 Tablet
Last week at Google I/O, Google unveiled its much rumoured 7 inch tablet, the Nexus 7:

Google, like Microsoft, is manufacturing the tablet itself and has already made it available for pre-order via the Google Play store (and yes, unlike Amazon's Kindle Fire, it can be bought in Canada!). 

Google's challenge is similar to Microsoft, with an added snag: they depend on the carriers to roll out their OS releases. This, speaking from personal experience, can be a tedious process. As an owner of the Samsung Galaxy Note, I am still waiting on Bell Canada to roll out Ice Cream Sandwich (Android 4.0) - even though Google has already moved on to the next relase of their OS:Jelly Bean (Android 4.1). With this wifi only tablet, they can reach the consumer directly and give the consumer access to the latest and greatest OS.  Similar to what Apple does with its iDevices and what Microsoft is attempting to do with the Surface, Google is controlling the hardware, so they can also create a seamlessly integrated product. 

Microsoft vs Google: Who will give Apple a run for its money?
The two offerings compete against Apple in two different domains: Microsoft is relying on consumerization to eat into Apple's domination, while Google is going after portability and price. 

The primary focus of the Surface tablet (as illustrated by the fancy ad, revealing the tablet in LA, etc) and Windows 8 in general is the consumer market. In the short term, Microsoft is hoping that their tablet offering will be appealing to Corporate IT because of its easier fit into the enterprise (i.e. in contrast to the iPad): executives and other employees that want a tablet can get an easier to integrate Microsoft tablet (e.g. Active Directory, etc) instead of the iPad. Furthermore, it has Microsoft Office - which is a key standard in office productivity that iPad users have to had work around. However, this is a minor aspect of the Microsoft strategy which is more about stopping the bleeding of their corporate stronghold to Apple. 

In the short term, the majority business users will resist the move to Windows 8 because it is so radically different. And according to Paul Thurrott, it appears that Microsoft has given up on the business users with this release of Windows 8. However, this may not be a bad strategy. Microsoft realizes that corporate IT was going to take a few years to switch to Windows 8 - even if it was not radically redesigned. During these years between when corporate IT would have migrated from Windows 7 to Windows 8, Microsoft is expecting users to become  accustomed to the new windows 8 interface in their personal lives. Once this occurs, Microsoft is hoping that trend of consumerization will play in its favour: home users who enjoy the Windows 8 Metro interface will put pressure over time for corporate IT to switch to the new version of Windows - just as the iPhone users put pressure on corporate IT to dump RIM in favour of Apple. 

This is coupled with the fact that users will no longer need to carry a laptop and a tablet: the Microsoft window 8 machines can act as a laptop when you are at work or at home and as a table when you are on the go. There is no need to sync files between the two machines. Of course, this assumes that Window Surface machines have a long battery life and will be as reliable as iPads. But the new Windows 8 is smooth and responsive (I had an opportunity to try it out on a Windows 7 Acer Iconia tablet), so there is a reason to hope that this will work out. 

Google's recent foray into the tablet market is a little different. Google is working off its previous failed attempts, specifically Honeycomb, to get something out there that will compete against the iPad. With the success of the Kindle Fire, Google has zeroed in on price and portability as key features of the tablet. Will the fact that it is WiFi only hurt its appeal? I don't think so. With the majority of smartphone (even BlackBerry!) being able to act as WiFi hotspots, this is not much of an issue. More importantly, users are not locked into 3 year contracts with cell phone providers.  From Google's perspective, it also removes the carriers as an obstacle to getting the latest-and-greatest Android OS to the end-user. Initial reviews of the device are positive. Although I was tempted to buy this, I realized that since I have the Galaxy Note "phablet" (a term that I despise) it doen't make sense to get a 7 inch tablet. Besides, I should save up for the Surface :)

It appears that Apple is aware of Google's strategy: they have lowered the iPad 2 by $100 (i.e. when they released the 3rd generation iPad) and rumour has it that they are preparing to launch a 7 inch tablet themselves.  But is the company underestimating Microsoft? Microsoft's Windows 8 Metro interface appears to be unique enough that Apple can't rely on its armies of lawyers to sue Microsoft (i.e. as it has done to "compete" with Samsung's products). The other problem is that Microsoft still dominates not only corporate IT, but also office productivity - people are addicted to Word, Excel, PowerPoint, etc and it is hard to let go. That being said, Microsoft is rumoured to have a version of MS Office for the iPad. If this is true, then Microsoft would be shooting itself in the foot as it would hand over this key strategic asset to Apple on a silver platter. On the other hand, Microsoft could become a dominant force for tablets when it comes to business users (anyone ranging from a business student, entrepreneur, or cubicle dweller). However, I think that Apple will continue to dominate the pure consumer market because they have been successful a the "toasterfication of IT": using the iPad is almost as easy as operating a toaster. Anyone with kids or older family members, can see how intuitive the device is. Microsoft is attempting to get into the space with the ARM version of the Surface Tablet. However, this is a long shot because they are behind in apps and, more importantly, the device is quite a bit more complex than a toaster.