Microsoft building an ecosystem with Barnes and Noble investment

Microsoft is one of the largest players in the next generation of platforms and operating systems but it’s the only one with out an ecosystem. That is, it’s the only one without revenue generating services that can help power and guide those platforms

In a previous blog post, “Windows 8 will succeed, but Microsoft could still fail“, I talked about Windows 8 and the impact it could have on the antiquated business model Microsoft has for their Windows Division. Specifically, I talk about how their business model is in trouble due to pressures on providing free upgrades like Apple and Google do for the iOS and Android platforms. I further propose that, without additional revenue generating services, Microsoft is going to have a difficult time competing in the platform space moving forward. In order for Windows to succeed in the Post-PC era, Microsoft needs to build an ecosystem that provides their main source or revenue in the consumer space.

Oddly enough, it seems Microsoft understands this and its recent injection of money into Barnes and Noble is proof.

It’s no great secret that Microsoft is years behind Apple, Amazon, and Google in providing online services. In addition, Microsoft will not be able to build these services in a reasonable amount of time and, to be honest, their track record has proven they aren’t necessarily very good at it. They have attempted multiple music services, either through building it themselves or via partnership, and none were very successful. In addition, their implementation had a long lasting impact on users because they took down DRM servers making some music no longer able to be played.  Bing has been somewhat of a bomb and continues to cost Microsoft money.

The “funding” of a new Barnes and Noble digital and educational company is brilliant. This allows Microsoft to complete against all three major e-book players on a fairly level playing field very quickly. Without Barnes and Noble, Microsoft would be in a world of hurt, plus they have added another piece to their ecosystem.  Microsoft is already planning to come out with an App Store for Metro, which will provide some decent revenue opportunities, but having access to the Barnes and Noble customer base and providing their e-reader on all Windows 8 versions is a step in the right direction.

Now the question is, where is Microsoft going to get video?

A friend of mine, Jeff Hardy, sent me an email and suggested, albeit sarcastically, that Microsoft buy Netflix. The funny thing is, I agree 100% with the idea.  Netflix is in trouble. They don’t have enough money to get enough content and they’re stuck.  Companies such as NBC, CBS, FOX, Showtime, HBO, etc. don’t like the Netflix model. Plus, Netflix has another issue: their model works great for older content but you can’t sell customers on older content. New and ever-changing content drives revenue. That’s why CBS, NBC, et. al. have their own apps and websites for customers to consume “new” content.

Microsoft has the perfect opportunity to get into the TV and movie service, immediately and across ALL platforms.  Microsoft could go from zero ecosystem to a complete ecosystem, across every device and platform available, practically overnight. Once Microsoft has their new media service (i.e., post-Netflix), they will have the money and the leverage to bargain with the NBC, CBS, HBO and other media companies. Microsoft will now own the platforms – Windows Mobile and Windows for desktops and tablet – and will have the ability to extend Netflix into a rental service as well, just as Apple has with iTunes and Amazon with their Prime service. The Amazon model is really the one everyone needs to move to. What’s holding Amazon back is that their video can only be played on limited devices and the service is very dependent on Flash.

So that leaves Microsoft with a need for a music service, and it sounds like they’re going to try to develop their own solution again. This time it should be simpler both because they’ve tried it before, and this time there are a few good models to use moving forward.

Investors, and even politicians, are giving Microsoft a lot of heat for sitting on nearly $60 billion in cash. This might have been a very smart decision and will give Microsoft a lot of flexibility in their direction and development of online services as there are some very well established companies that can make Microsoft very relevant very quickly, for the right price.

It would be a pleasant surprise if Microsoft could erase their consumer failures over the last 5 years. Apple’s iOS has had the same look and feel for the last few years and I don’t think Apple has felt pressure from Google and Android from a “user experience” standpoint. Microsoft, especially with there Metro interface, might be the nudge that Apple needs to evolve their very functional, but somewhat boring, mobile platform.

After all is said and done, what do you think of a Microsoft acquisition of Netflix? Does it make sense? Do you think Microsoft has what it takes to build a comparable ecosystem to Apple, Amazon and Google?

Kindle Fire, Round 2

So it’s been a few days since I picked up the Kindle Fire and I wanted to revisit some of the items I brought up in my initial review. Specifically, I want to review some of the enterprise “have nots” that I noted.

First and foremost, I stick my my original impression: the Kindle Fire is a good device for the price but its missing a couple a few things.

As a content device, specifically used for consuming books, movies, music and more it’s absolutely awesome and in some ways its even better than the iPad.

But to accomplish that feat they had to sacrifice a few things that affect a user like myself, and these sacrifices make it difficult for me to use the device to get work done. Now, I realize that this device isn’t intended to be a laptop, much less desktop, replacement. However, neither is the iPad but I find I can use the iPad as a consumption device but also use it to get work done when needed. As far as the Fire goes, there are three specific items I mentioned in my original review that are lacking. The good news is that I found a solution for one of them.

  1. They didn’t provide VPN access to get into corporate networks.
  2. They didn’t provide EAP to log into corporate WIFI networks.
  3. The didn’t provide a Mail client that could connect via ActiveSync to mail servers like Microsoft Exchange and SmarterMail. This means no push email, calendars, contacts, etc. and is a big deal for many users. Sure, you can use our web interface to access SmarterMail and get your messages, check your calendars and contacts and more, but you won’t be able to get push notifications if you don’t have a client that is compatible with that technology. Thankfully, this is the issue I found the solution for. More about that in a minute.

The reason Amazon isn’t providing an in-depth mail client on the Fire, and why you don’t see in-depth mail clients on other Android devices, is because it costs money to license ActiveSync, the premier synching technology from Microsoft. At SmarterTools we had to license the server side of this to include it in our mail server but clients that connect to servers also need to license it. As Android is a “free” OS, it’s difficult to include paid, licensed software as a part of providing it to device manufacturers. In addition, Amazon is pricing this device so low they’re losing a little bit of money on every device, further affecting their ability to justify adding an ActiveSync client.

Now to the “How do we solve the Mail issue” part of this blog.

There is a mail client called Moxier Mail that supports push for mail, calendars and contacts. It works well on at the Kindle Fire but it only supports one Exchange-type account (an account that uses ActiveSync). Also, your calendar and contacts are stored within Moxier Mail and not in the native Android contacts and calendar system which can be accessed by other applications on the tablet – something I wasn’t aware that Android allowed. Also, Moxier Mail is not available from the Amazon app store so it needs to be “side loaded” it from an Android phone after downloading it from the Android app store.

The second solution, and one that I like more, is using Enhanced Email which IS available in the Amazon app store. It is $9.99 but I was fortunate enough to get it for FREE as the Amazon “Application of the Day.” This program supports multiple Exchange accounts and also synchronizes calendars and contacts to the Android system itself. Doing this allowed me to open up the address book application that came with the Kindle Fire and “voila”: there were all my contacts. Now, the Kindle Fire doesn’t come with a calendar application to view the calendars stored within the Android System. However, for $5.99 I was able to download an app called CalenGoo from the Amazon app store. This allowed to connect the two accounts that were syncing via ActiveSync.

Sure, it cost a few bucks to get some additional functionality that is available for free on other tables, but those tend to be on the $500 tablet variety. My extra expense was only $15 on top of the $200 for the tablet, and now I own these applications and can use them on future devices.

So, all-in-all, $15 to solve one problem I had with the Kindle and I’m now managing my 4 mail accounts (two of which are using ActiveSync) against SmarterMail servers. This device continues to become more and more functional!

A Review of the Kindle Fire

SmarterTools is a company full of gadget and technology freaks.  Whether its Android phones and tablets, Roku or Boxee media devices, virtually all Apple products, Plex media server, any manner of television (yes, someone actually bought a Google TV), off-brand tablets and phones, computers (including laptops, desktops, gaming machines, netbooks and others), even various cloud services and more. If you can buy it or build it, someone here probably has it. Some of these devices and services benefit our products and the company in general – we use them to test things on and play with here at the office and at home. Some of them don’t benefit the company as much as they benefit the individual. Regardless, the hobby keeps us on our toes and familiar with the latest and greatest, but more importantly it keeps us happy.

Knowing all of this, we felt it might be a good idea to harness some of our geekdom and start reviewing differing products and services for our readers.

So welcome to a new category of blog post: the Review. Now, we’re not Engadget, the Verge, Joystiq, Kotaku, Metacritic or even Consumer Reports. We’re users, and that’s how we’re going to approach our reviews: from a user’s perspective. With that in mind..

The Kindle Fire

The Kindle Fire

Today we got some Kindle Fires to play with.  First impressions? It’s a great device for $200. That’s not a knock and I don’t mean it would be a bad device at $400.00, but the $200 price tag is definitely a plus.

To start off, I think this is a much better device to give to kids and to older people (like my grandparents) than an iPad. After using the Fire I found the iPad to be bloated with too many icons and too many different ways to do things.  With the Kindle Fire, the layout of books, magazines, documents, applications, videos, the Web is just – to use a very “Apple-like” phrase – simple.  It’s very obvious to people where to go for whatever it is they want to do as the overall layout and distribution of services is easy to understand. And for many, the Amazon services (books, music, streaming content) will be more than sufficient. What’s funny is that I had an iPad, then an iPad 2, for a very long time and I never really noticed how complex the icon sets and groups were until I picked up the Kindle Fire.

In addition, I think the Amazon cloud and service infrastructure is in a much better state than Apple’s. Sure, Apple has the App Store, but after seeing iCloud and the new music match service I think Apple has a LOT of work to do to transition users off of iTunes. The only possibility is for Apple to move people in stages, and that means it is going to be complicated, frustrating and will cause them to lose ground to competitors.

Overall Impressions

What is good about the kindle?

  • Its simplicity and access to a wide variety of media
  • Decent sound for a 7″ device
  • Bright display
  • Quality for the money (its not iPad quality but good for $200 – much better feel than the WebOS TouchPad!)
  • Amazon doesn’t discriminate on side loading applications and most of the applications that I moved from my Android phone to this device worked perfectly.  I was able to have a VERY capable tablet VERY quickly!
  • Gingerbread was a good idea for a 7″ tablet as my phone applications work GREAT on this device. It’s almost as if the Fire was just a big Android phone!
  • Surprisingly good WIFI reception on a variety of access points and routers.

What is bad about the kindle?

  • The Amazon Marketplace is limited but developers will quickly be submitting applications to both the Android Marketplace and now Amazon’s Marketplace.
  • No enterprise features at all (EAP Wireless, VPN, or ActiveSync support)
  • Like any Android device the battery life is lagging. It looks like it will have 4 to 5 hours of battery life.
  • Limited local device storage space.
  • Lack of camera and microphone

But are the “bad’s” really that bad?

Amazon will clearly alienate some people because they want a camera, microphone or need more local device space. The iPad 2 really spoiled people with all of that. Sure, 64 Gigs might not seem like a lot anymore, but on a mobile device it’s a ton! However, for a user like myself, those aren’t deal breakers. I rarely Face Time on my iPad.  I rarely Skype with my iPad.  I mostly use my phone for these activities, and I have that on me all of the time anyway which (I have with me all the time).

I do like to carry gigs and gigs of movies, TV shows and music, but to be honest, this is something I can probably manage a bit better, especially since I subscribe to Netflix, Amazon Prime, Hulu, Spotify services.  I also have Plex media servers setup for other random videos and I also stream my music without having to put media on all my family devices. iTunes is now obsolete in my house.

With the 8 gigs the Kindle has on the device I can see putting only a portion of music and/or videos that I might want to watch on a flight or a trip.  My Android phone has all the music I need, and then some, so duplicating on the tablet is just more time than anything.

Fire running SmarterMail


As far as enterprise features go, we put up an access point in our office not using EAP for random devices like this. Not having VPN capabilities is an issue, though I’m not sure, just yet, how it’s going to affect me. Fortunately, I can control IT aspects at SmarterTools, but other users aren’t so lucky. As for no native ActiveSync support, I’m working around that by using TouchDown and Moxier Mail as both offer calendars, tasks, contacts and mail via Exchange ActiveSync and work with SmarterMail. In addition, there are definitely some browser and web interface issues with SmarterMail and SmarterTrack and we will have to decide if the default browser that’s on the Fire is the issue. I’m guessing it is because after side loading Firefox onto the Fire, I could use the SmarterTools products. (See, improving our products by testing new gadgets).

So, to answer the question, I don’t think the “bads” are all that bad, especially if you are comfortable with some of the workarounds available.

Options, Options, Options

Overall, the Kindle Fire is a great product. I’m going to try and put down my iPad and use this device exclusively for awhile and see how it goes. The 7” size and weight is much nicer to carry around and the keyboard is the perfect size (without having to reach across the tablet to click a key). I know iOS 5 resolved the keyboard issue for most people, but I’m not a fan of the split keyboard on the iPad and I actually prefer some of the third party keyboards for Android devices.

Overall, the world is full of options and choices when it comes to gadgets and electronics, and all of the options are keeping us busy on the server side of things making sure our applications work, and work WELL.

Until next time…or maybe a better sign off is “Until next gadget!”

Cloud Computing – Challenges, Benefits, and the Future

Last week, SmarterTools had the opportunity to present at PubCon, a technology conference hosted by Webmaster World.  I represented SmarterTools in a panel discussion on Cloud Computing–specifically to give our perspective as an independent software vender who is looking at writing software applications for the Cloud to be delivered as a service (SaaS).  For all the hyperbola and sales pitches, this is the essence of Web 2.0.

This concept has special importance for SmarterTools.  We have been developing hosted applications since we were founded in 2003 and more than 15 million end users access our software through hosting providers for their email/collaboration and Web site statistics every day.  In addition, we are building the infrastructure and preparing our SmarterTrack customer service software application for purchase and delivery over the Web as a service.  Is Cloud something for us to consider?

Cloud Computing Options and Alternatives

We looked at all of the major Cloud Computing initiatives coming online: Microsoft AzureAmazon  Web Services, and Google Cloud Computing Service in addition to lesser-known initiatives by hosting providers such as Rackspace.  We heard all of their ideas, visited their Web sites, and attended their Webinars.  Then we dug deeper.  For the presentation we identified 12 basic arguments used by those who are advocates of the Cloud Computing model.  Then we spent time trying to determine which were real potential benefits of Cloud Computing in the near term, which were possible benefits going forward, and which were all hype.  The result was a 15-20 minute Power Point presentation for our part of the panel, followed by Q & A.

Presenting the Cloud

The presentation is called Seeing Through the Fog – The Current State of Cloud Computing from an Independent Development Perspective (PDF format) and I enjoyed sharing the stage with Mike Culver from the Amazon Web Services division.  My presentation covered all 12 points, but for the remainder of this post I will focus on what I think is an important misconception regarding Cloud Computing as it is constructed today.

The Biggest Misconception in Cloud Computing

In my view, the industry is fostering a misconception in the minds of the IT consumers who will ultimately be the customers of this potentially valuable service.  This Cloudy issue is the perception that hosting Web sites and applications “in the Cloud” means that those sites and apps are not tied to a structure–that they are free and loose in the nebulous Internet, unencumbered by restrictions of space and geography.  Even the term “Cloud”  reinforces this perception.

While this may be true on a machine-to-machine level, it is not true from a broader perspective–meaning that it is important for us to remember that even Cloud Computing (as it is defined and constructed today) is tied to specific data centers operated by the Cloud vender.  An application may “appear” on any single or number of servers in a data center, but they are on a server–just not necessarily the same server(s).  In this way it is only a small step forward from conventional hosting environments (though rapid scalability–up and down–and reduced start-up costs are significant advantages).  The technology is moving to where applications and Web sites will potentially exist in/on multiple data centers in geographically disparate locations, but there will still be a finite number of locations.  This important concept changes the way we will think about true scalability, stability, performance, and security as Cloud Computing develops and gains adoption.

Cloud of Clouds

Make no mistake, Cloud Computing is a revolutionary concept that will–more than most other advances–bring us to Internet ubiquity where space and bandwidth are delivered like municipal water service or electricity.  But we are still a long way from there.  Remember that, in the early days of electricity, local utilities and even individual neighborhoods had vastly different ideas about how electricity should be delivered: different amperage, wattage, etc.  This is a pretty good analogy for where Cloud Computing is today.  Each Cloud under development is unique and incompatible.  Applications and sites will need to be developed for a specific Cloud platform (an important cost-basis to consider).  But this will change in the long term.  As I said in Seeing Through the Fog:

“Just as the OS is being subverted by the advent of browser-based/Web-based applications, independent Cloud platforms will be subverted by the need for cross-cloud compatibility. Efficiency will demand it if Cloud computing is to ultimately succeed. Therefore there will eventually be a ‘Cloud of Clouds’ delivering computing capacity seamlessly and transparently.”

It took many years for the various competing ideas on electricity to be ironed out into one standard and for appliances and other uses to adapt to that standard (those who did not adapt perished).  Now, power companies share power and generating capacity without regard for geography or distance.  As I type this post, the electricity consumed by my computer may have been generated by my local Arizona utility (SRP), or it may just as well be excess electricity from Nevada, Washington, or any other utility on the grid–but it is still delivered to me by SRP.

One of the problems with most contemporary Cloud Computing providers is that they still see the creation of Cloud networks as a way to “lock in” customers for other products and services–not as the viable multi-billion user access model that it might more naturally be.  Amazon gets some credit in this regard because their “device-based” approach makes it a bit less complicated to migrate out of their Cloud into a more conventional hosting environment.  However, Cloud to Cloud migrations are still very complex or not available at all.  But I digress.

Conclusion

Cloud Computing holds a lot of promise and we believe that it is likely to be a major influence on hosting and application development.  SmarterTools is preparing all of our products for potential Cloud compatibility in the future because we have confidence that the incumbent issues will be satisfactorily resolved as this new technology matures.

All trademarks are the property of their respective owners.  Microsoft Azure [MFST], Google [GOOG], Amazon [AMZN], Rackspace Hosting Inc. [RAX].

This post was written by Jeff H., vice-president of business operations for SmarterTools. If you liked this post, please consider subscribing to the SmarterTools Blog so you don’t miss an update.

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