The Tech Market on Stranger Tides
May 30, 2011 5:00 AM PT
This is turning out to be an amazing decade, with companies getting a rebirth, other firms getting new identities, and still others sliding into delusional obscurity. I understand Bill Gates has wandered quietly back into Microsoft, and he is part of the reason a lot of kids are saying "Bing" instead of "Google" at the moment -- which is good, because both Apple and IBM have passed Microsoft in market capitalization this decade, something that should have been impossible.
Microsoft released the impressive Windows Phone platform and recently added 500, yep 500, new features, which should give the Android folks a bit of a scare, though Jobs, who is apparently doing OK, likely thinks they missed a meeting. While we ponder our time off this Memorial Day, let's also ponder the changing landscape and what is yet to come, and say our tearful goodbyes to the tech world that was. Rest in Peace.
I'll close with my product of the week -- another laptop, the beautiful Dell XPS 15z, a product that is as much art as it is computer.
The Story So Far
Let's aggregate all that has already changed this decade: First Apple, then IBM passed Microsoft in market capitalization; we saw that Apple's growth in business jumped up 66 percent in PCs (you know -- that thing they don't sell); and IBM switched from a company that was at its heart hardware-led to one that was software-led. Had you said any of this was likely five years ago, you'd have been branded a nut -- even by IBM and Apple fans.
Oracle bought Sun and changed strategies from a hardware-independent software maker to a hardware/software maker, and HP brought in a software CEO in to run the company. Now Oracle, IBM and HP are similar types of companies, with software leadership and a substantial hardware business. In short, much of the market suddenly went from the model that spawned Microsoft and Novell to an earlier model that prevailed when software-only companies were vastly smaller and less powerful.
Google pretty much replaced Microsoft as the evil empire and started getting hunted by a variety of governments. Ironically, its ex-CEO appears to want to be the Commerce Secretary, which seems exceedingly unlikely given Google's degrading image and reputation for aggressively avoiding taxes during a period when the U.S, government is hard-pressed for revenue. Google, which started out as the anti-Microsoft anti-evil company, appears to have emulated the wrong Skywalker and become Darth Vader.
In what many of us thought (OK, still think) is a declining market -- printing -- Kodak broke through with a reported 35 percent growth rate last year by turning the traditional razor/blade model upside down and targeting heavy print users. The printer side of HP released its first tablet, while the PC side bought Palm and, as I write this, is ramping to bring its own competing platform to market. HP may soon have more small devices using its technology than everyone else combined, as a result.
Finally, Apple -- whose initial Mac hardware-centric model failed against the PC -- returned with the iPad, a hardware-centric Mac-like device leveraging online services. It pretty much kicked the butts not only of the PC makers and Microsoft, but also of most of the major cellphone manufacturers. Oh, I should point out, they did this while their CEO was undergoing cancer treatments and significant surgery. That's even more impressive than beating the crap out of Iron Mike with both hands tied behind your back.
The Big Questions to Be Answered
Can Apple still prosper without Jobs? Because Apple was in so much trouble when Steve Jobs took over, he was able to redesign the company around his strengths and weaknesses. Apple is in amazing shape now, suggesting that whoever replaces Steve Jobs this decade will not be allowed, or want to risk, a major reorganization to adjust the company to the new CEO's skills. Can someone who is not Jobs successfully run a company that was uniquely designed for Jobs? I doubt it, but then the odds were against Jobs being successful as well, and we know how that turned out.
Can Google get off the litigation train? Google has almost singlehandedly turned Silicon Valley into the litigation capital of the world. Will it realize it's on a terminal path in time, and avoid the massively painful result that most companies that can't think strategically enjoy? Will Google ever look at one of Microsoft's mistakes and not make it an item on its own corporate bucket list? Or, in short, will it survive the decade by eliminating its own worst enemy -- itself?
Can Intel, the crown prince of Silicon Valley, move into the emerging tablet and smartphone segments as the PC segment gives way to these new devices? Intel is hellbent for leather trying to put together a group of companies that can recreate Intel's PC success, but it clearly enters this decade well behind, and companies like Nvidia, Qualcomm and Freescale are giving it no quarter.
Like Intel Microsoft is struggling for relevance in the new device-driven world and isn't active on TVs or the new tablet products yet. But this decade will see Windows 8 and the fastest technology ramp it has ever made, with Windows Phone 7.5 and its successors. But will it avoid repeating the Plays for Sure and Zune mistakes and make the right product, marketing and funding decisions to win back the hearts and minds of consumers? Windows Phone 7.5 looks good, but it'll need Apple-like execution, and that has been an elusive goal for Microsoft since Windows 95.
Finally, will China take over as the technology capital of the world? It has the cash and is making massive bets on magnetically levitating trains, solar panels -- even space flight -- well above any other country. Much like the U.S. passed Great Britain last century, the big question is will China pass the U.S. this decade? It sure looks that way.
Last decade was relatively dull. Too many companies focused excessively on cost, and innovation took a near decade-long holiday. This decade is looking far different and is starting to look a lot like the beginning of last century, when the rate of change was astounding and people moved aggressively from horses and kerosene lamps to automobiles and electricity.
Our rate of change appears to be even faster, suggesting the folks of today may not even recognize the world as it will exist next decade. I can hardly wait!
Product of the Week: Dell XPS 15z
Every once in a while, a product comes along that is as much art as it is anything else. A product that you just want to look at and admire for its beauty is a rare find. Yet the Dell XPS 15z is such a product. From the moment you see the box the laptop comes in, you can see it is something special. Simple and elegant, the box opens to showcase the laptop against a black background. Looking like it was formed out of a block of aluminum, the laptop, -- particularly closed -- is sleek, sexy, and tends to cause grown men to drool just a little.
Beauty isn't skin deep either, as this puppy can be configured with up to an i7 processor, a 300 nit high-definition screen (that is 50 percent brighter than most screens), and Nvidia graphics. With a five-to-eight-hour battery life (figure closer to five), premium sound, a 5.5 lb. carry weight, and a starting price under US$1,000 (I'd option it up), this is a lot of beautiful for not a lot of cash. I love beautiful fast things -- you can tell by the cars I drive. As a result, the Dell XPS 15z (which will soon have siblings) is my product this Memorial Day week.
Oh, and the new Pirates of the Caribbean movie, "On Stranger Tides," is a ball. If you have the time, check it out in 3D.