Food for thought – If you ask Microsoft, Windows 8 is the
idea how an aging operating system is modernizing itself and transitions
into a new application and usage model for the next ten and possibly 20
years. On the hardware side, Intel appears to have dropped the tablet
mantra a bit and is instead heavily pushing the ultrabook to support its
core business, while fending off ARM on the lower end with its Medfield
processor. While both Microsoft and Intel are succeeding in marketing new
products, one could argue that they are merely technologies that
already exist and, conceivably, ignore the true opportunity to change
the way we interact with computers – despite the fact that such
technologies are available today. Both Windows 8 and the ultrabook are
stuck in the Now, rather than being guides to the future.
The Ultrabook: Subtle Innovation
There is an interesting dynamic surrounding the ultrabook. It
seemingly came out of nowhere. A name that suggests something different
than the product actually is, we are now seeing ultrabooks being
displayed in local Best Buy stores where the public can get a first
glance at a new, much thinner notebook that is supported by a $300
million marketing injection from Intel: For roughly $1000, you can buy a
Macbook Air-like Wintel-notebook that promises much faster startup
times. However, if you were very critical, then you could argue that the
ultrabook is just a faster version of the failed netbook generation,
or, depending on your view, a slimmer version of previous performance
notebooks.
The thin&light notebook idea isn’t new and came forward first in
the 2002 timeframe, when Intel heavily pushed its SpeedStep Pentium
processors. If you were to go back in time, you could easily make the
case that the ultrabook is simply another evolutionary step in notebooks
and is closely related to the Compaq LTE, widely considered to be the
original notebook. The LTE was released in 1989. Or, you could draw a
line to the PowerBook 100, considered the first compact notebook
released by Apple in 1991. Since 1989, the notebook has not changed:
There is still a keyboard and there is still a fold-up screen. It has
been an idea the industry has been warming up with different form
factors and better processors, memory and storage devices for the past
23 years.
Since 1989, mobile computing has seen several inflection points that
fragmented the market, but did not impact the Wintel notebook. For
example, ultracompact computers began succeeding in 1996 with the
original PalmPilot, enabled by a platform approach that focused on both
hardware and software. In 2000, we met early versions of the web tablet
and the first smartphone, the Handspring Treo, in 2001. Tablet PCs,
predicted to replace the traditional notebook, were released in 2001,
but failed to change our usage behavior, because they were outrageously
expensive and featured software that did not specifically cater to the
new hardware. The UMPC was first marketed in 2006, but faded because of
high prices, confused hardware UIs and lack of dedicated software. In
2007, the netbook sparked, but eventually declined due to a lack of
attention to detail and innovation. In the same time frame, Apple
released the iPhone as a distant successor of the PalmPilot, replicated
the idea of success with a cohesive hardware and software platform – and
a focus that changed from technology behind the screen to technology
that is directly facing the user’s eyes. The iPad followed the same idea
in 2010 and it is the seamless fit of hardware and software as well as
diligent focus on usability that allowed Apple to change the usage model
successfully from physical keyboard input to touch. If we forget that
the ultrabook already exists as a commercial success in the form of the
Macbook Air, the innovation of the ultrabook as we seen it in 2012, is –
in a best case – subtle.
Windows 8: Forced Innovation
The history of the notebook teaches us that only software can make
hardware successful. The Compaq LTE succeeded, because it ran Windows
and Windows applications at the time and changed user behavior. The
PalmPilot succeeded because of PalmOS. The iPhone succeeded because of
iOS and applications. Can the ultrabook succeed because of Windows 8?
Unlikely, since Windows 8 is not built for PCs. It is built for tablets.
If you were to break out the key selling feature of Windows 8, it
would be the Metro touch UI, whose huge tiles are reminiscent of the
Windows Phone screen and work extremely well in touch scenarios. The
problem is, however, that we are using touch on horizontal devices such
as tablets and phones – devices we leisurely call “lean-back devices”.
You can use them easily while sitting in a coffee shop, swipe screens
and write emails while “leaning back”. Notebooks are not lean-back
devices, but “lean-forward” devices by default. You need to lean forward
to engage with notebooks. Touch is a challenging proposition for
notebooks: While touch is convenient to use on a tablet, it is unlikely
that we will find touch on a vertically aligned, back-and-forward
bouncing screen to have advantages over a keyboard/mouse data input
model. In 2010, Steve Jobs argued during a earnings conference call that
touch would not work on a vertical screen and that Apple had therefore
abandoned that idea.
Common sense suggests that Jobs was right: Touch never worked in the
history of computing on any vertical computing device. It is unlikely to
work now. Of course, Metro can be used with a mouse as well, but it is
substantially more inconvenient and ineffective to use. You could remove
Metro and and replace with a legacy interface, but then you would have
to wonder where the appeal of Windows 8 will be. The mainstream consumer
does not care about hidden benefits such as memory improvements.
Using touch on a vertical screen on notebooks because we got used to
it on tablets, is not a conclusive thought. It is innovation that is not
natural and appears to be rather forced. Naturally, Windows 8 will
break the sales records of Windows 7, because more computers are likely
to be sold and Windows 8 will expand to ARM PCs and tablets. However,
the true success of Windows 8 will be on tablets where Metro can shine.
On PCs, Windows 8 could turn out to me a major blunder beyond the
proportions of Windows Vista. Metro will be fantastic on tablets, but it
will be irrelevant on PCs.
Merging Windows 8 and the Ultrabook
Touch for software has somewhat become a requirement, because Apple
has it and continues to build on it. The ultrabook may have been shown
as a prototype first by Intel, but Apple has made it a commercial
success, which will leave the ultrabook the role of being a copycat and
never an original. The biggest problem of merging the idea of the
ultrabook and Windows 8/touch may be that there is not enough
interaction between Intel and Microsoft. It is not a secret that the two
do not like each other very much and as long as there is a substantial
gap that prevents the development of a cohesive hardware and software
platform, we will always get devices such as the ultrabook that do not
appear to be one unit, but as hardware that does not fit the purpose of
the software – and vice versa. Once in a while, we see a product
disasters such as the Origami UMPC or MID
The difference between Microsoft/Intel and Apple is the fact that
Apple can control both hardware and software. Another difference is that
Microsoft/Intel is focused on developing technology and building a user
experience around it. Apple designs the user experience first and then
builds the technology around it, which, in combination, is a significant
disadvantage for Microsoft/Intel. The only way to be able to overcome
this disadvantage would be for Microsoft/Intel to create a joint venture
with much deeper collaboration to be able to compete with Apple.
Competing With Apple?
However, if that is the case, do we really want Microsoft/Intel to
compete with Apple? In such a competitive scenario, don’t we get what we
have been getting for the past decade? Macbook copies. iPhone copies.
iPad copies. Why is it that Apple is creating successful trends and
Microsoft/Intel as well as their ecosystem is following the trend with
an approach that occasionally shifts from copying to evolving – and
back?
A few months ago, I was in discussions with VCs about a notebook
project and it was clear that the entire market is scared of what Apple
might do next. Besides the fact that angel investment money for hardware
is a tough one to attract, the question I most often heard was “How do
you compete with Apple?” HP, Dell, Lenovo and Acer were not even
mentioned. A few days ago, I had a discussion with a leading industry
analyst about future notebooks and he focused notebook innovation on
Apple has well. “You can’t ignore Apple when you are building a
notebook.” Really? Does it always have to be Apple?
If you were to turn this argument around, you would have to ask the
question whether Apple would have been able to evolve as it did, had it
been focused on the market leader, instead of the opportunities the
market leader may be missing. The lack of focus on competition is
critical to Apple’s success. To a certain degree, Apple even ignores its
competition. The same would be necessary for Microsoft/Intel: Only if
they can ignore what Apple does now, they will be able to look beyond
Apple and technologies such as touch to invent the next big thing. If
they stay focused on Apple, we will see a continued era of an industry
that is running behind Apple.
The GestureBook
Here is an idea for Microsoft and Intel to innovate. If we consider
the market as it exists today, we know that the PC market has a
difficult time to sustain existing sales numbers and consumers are
focusing their attention on mobile devices such as phones and tablets.
In September 2011, IDC published this quote:
“By 2015, more U.S. Internet users will access the Internet
through mobile devices than through PCs or other wireline devices. As
smartphones begin to outsell simpler feature phones, and as media tablet
sales explode, the number of mobile Internet users will grow by a
compound annual growth rate (CAGR) of 16.6% between 2010 and 2015.”
PC sales were just 360 million in 2011, 200 million of which were
notebooks. In 2012, that number is unlikely to change very much, as
current forecasts simply point to an increase in more expensive notebook
sales due to the ultrabook introduction. However, since it is an
evolutionary device, the solution could be short-lived for PC makers:
Let me quote Gartner’s Ranjit Atwal:
“More worrisome for the long term is that Generation Y has an
altogether different view of client devices than older generations and
are not buying PCs as their first, or necessarily main, device. For
older buyers, today’s PCs are not a particularly compelling product, so
they continue to extend lifetimes, as PC shops and IT departments repair
rather than replace these systems.“
The takeaway clearly is that there are substantial PC sales that
won’t go away anytime soon, but PC makers will have to dramatically
innovate to sustain their market and possibly grow again. Supporting
this claim is the fact that we are familiar with notebooks as
productivity workhorses, but they have become boring in their usage
model and are therefore easily replaceable with other technologies. On
the other hand, tablets force the user into compromises, suggesting that
these may be transitionary devices on the way to a much more capable
product with fewer compromises. In the future, notebook models may
receive touch keyboards, as soon as high-performance touch technologies
without input delays are available, but that may not be the case until
2010 – 2025. So, what UI innovation is possible until then?
Given the possibly transitionary nature of tablets, one could argue
that the notebook UI has to evolve, but not follow touch to avoid the
comparison with the tablet and rather take advantage of its greater
processing power. Option one would be audio input and voice control.
However, even in a best case scenario with face recognition support,
voice control is only 98% accurate and there is a big privacy issue.
Would you want to talk to your notebook on a plane or in a coffee shop?
Probably not. Voice control may be a supportive UI, but not the main UI.
It may work best in telepresence situations. The other option are
gestures.
We have been familiar with gestures for several years now and use the
technology withd evices such as the Nintendo Wii and Microsoft Kinect.
It enables natural interaction with content, there are no nasty
fingerprints on the screen and would easily control the mindshare of a
future OS UI. Imagine Google Earth being used with gestures while you
are standing a few feet away from the screen. What makes this an even
more compelling scenario is that Microsoft has the hardware and software
IP, and could build a cohesive platform experience far beyond the Xbox.
It could also protect the technology from Apple. What it needs is
engineering talent to integrate Kinect into a notebook.
A Kinect-equipped notebook is what we would consider an ultrabook. It
is, in our opinion, an opportunity that enables the Windows 8 Metro UI
and would deliver the experience promised by the marketing of Intel and
Microsoft.
Wolfgang Gruener in Business on March 28
