Shifting Sands in the PC World

In a matter of just a few months we have seen the IT 'Client' market change dramatically. The definition of this is what we use on the desktop to compute with - desktop, laptop, notebook and now tablet.

We all knew that tablets are trending - Apple will likely manufacture and sell 20 million iPads this quarter alone and by 2014 it is reckoned that of the total 1.3 billion PCs on earth, over a quarter will be tablets. To reflect this, Gartner Group issued some appalling figures on the PC market for last quarter - of notebooks alone, there was a 53% drop in sales and PCs fell by 21%.

It is very clear that despite industry pundits trying to dismiss the Apple iPad and other tablets as just fancy gadgets with no business worth, the tablets are very quickly becoming productivity and relaxation tools. Finally, the world of computing is truly reflecting what mobile workers does - we work and relax while we travel.

The Apps are getting better. While I type this I am also keeping an eye on the Ireland v USA RWC game in the ITV Player window. I use Evernote to capture my research and notes for all meetings and projects in handy notebooks that synchronise over all devices immediately over The Cloud - at just £27 per year for the Premium version, it is one of the best productivity tools on the market. I use Pages to generate lose documents and blog articles on my iPad and then upload them into my blog as it is easier and quicker using things like WordPress or Blogpress. I can open and review large PowerPoint presentations in my iBooks App as PDFs. Realistically the only two things I don't do well are spreadsheets and presentation building where the world is dominated by Microsoft Office although I like the functionality of both Numbers and Keynote.

It's the cost that gets me. I have yet to pay over a few quid for any App - even the iWorks suite cost less than £20 in total on the iPad. It's revolutionising the way we work and buy Apps because at no time has any corporate restriction or IT manager defined what App I use. I just buy them.

The outcome of this is that I have changed my workhorse laptop from Lenovo PC to Apple MacBook Pro. From here there is no turning back. I have the iWorks suite installed for £14 each but Office Mac Home & Business for around £180 is simply the best suite from Microsoft for years. Apple is steadily getting back on executive desks and Steve Jobs' incredible journey of rescue has got Apple back into mainstream computing by the back door.

No one could have predicted all this in just a short period. Edifices have crumbled and the once mighty HP has not only surrendered early in the tablet market, it has capitulated in the entire PC market - a $43bn business to the company - as the death knell of the PC market sounds.

Channel players will be sanguine. As long as everyone needs clients, there will always be need for resellers and distributors. Right?

It's rapidly becoming unclear how that looks in reality. If Apps and the Cloud will be the main 'shop' by which everyone buys product - perhaps bespoke App Stores for corporations - then where does the channel get the incremental sales from? The infrastructure will change dramatically and more of the delivery of products may well change too.

App vendors like Google will be salivating as they are reckoned to be the winners in the tablet operating system market with Apple as No 2, the obvious follow on thought will be that Google Apps will become more prevalent as a result. With Google Android getting a huge share of the Smartphone operating system, this seems to be logical. For Apple, iCloud will lead the way for serving their applications and business needs.

I haven't mentioned Microsoft in all this. They have proved with Office for Mac that they can innovate again but their future in the tablet market operating system market is put at just 13% and this may be less if they cling onto the hope that tablet users want full versions of operating system and applications - and for the usual big money. 

Google Apps at $50/user/month and iWorks at perpetual licence costs of less £20 have defined the future of software. 

It will be very hard to predict what happens from here. But the channel needs to start thinking. The issue is 'clouded' by Cloud generally as traditional vendors try to stake out their roles. But Cloud is a great deal more than this. It's about how products will get to users and what they will pay also. And as client technology changes so dramatically and quickly, the future is arriving faster than we would all like.

So much of what is written about the Cloud tries to translate what we do today to a world of tomorrow. Vendors talk of 'transformation' of worlds of software from on-premise to Cloud and how resellers must do this and that. 

The reality is rapidly evolving that the new world will have little to do with the old world. Transforming existing software into the Cloud may be one option but there will be many more. In the last year or so, thanks to the tablet's explosive start, thousands of innovators are starting up and charging little amounts for cool software.

There is a strong argument that says that the winners of the world of tomorrow will be new vendors who will throw off the need to adhere to legacy, solve the issues of integrating into corporate directory structures and explode lower cost, clever office software to be used on any device, anywhere.

There is also a strong argument that says the new channel of distribution of software generally has yet to emerge. 

Many of the channel players today are standing around waiting for some light to emerge which they can follow to lead them to what the future holds. Many look to their vendors for the answers but some of these vendors have ploughed their own furrow without channel following the likes of Google and Salesforce.com ahead of them. 

It's a pretty confused state. Or is it?

At Google and Apple, life isn't very confused at all. This is client technology and these companies have worked out exactly how they will make and deliver their products to all the users. Out of the box, my Apple MacBook Pro worked with my Microsoft Office 365 and absorbed all the iCalendar and directory structures without a hitch. I cut the umbilical chord to the PC world but for one application - my Sage accounts. That will be solved soon as I trial NetSuite.

Apple will launch iCloud next year and this will likely revolutionise how I do all those things for the future.

So if Apple will have around 38% of the tablet market and Google 40% and their shares of smartphones will around the same - and the total number of these devices used by consumers and corporate clients will be around half the number of PCs in the world today, what is the future for the PC as we know it? And what is the future for the world that PCs live in technically?

This is the issue facing channel players today. Sticking with the strategy of staid software and hardware companies may not be the brightest of ideas. Some of these mega-companies don't really want channel players for the future so a question channel players should all ask themselves is, 'Why should I help you sustain the past if you don't want me for the future?'

It's as well that software vendors think about that particular question. 

Keep Taking the Tablets, Boys

This whole tablet thing isn't happening. It won't take off not in the way it actually has done already. It will be the way we design it to be. The market will stop, retrench and come back to our way of thinking. I have my fingers in my ears and I'm saying 'La la la la'. I can't hear you, Mr Tablet Market.

That's the Microsoft way, according to Andy Lees, MS Windows Phone President, who said as much at this week's WPC event in Los Angeles. In doing so Microsoft has banned its OEM Partners from using the Windows Phone operating system as the operating system for tablets.
OK, let's recap the story so far. By June of this year, Apple had sold approximately 25 million iPads, and that rate of growth in sales is accelerating with 6 million sold in the 3 months between March and June. In total between smartphones and tablets around 394 million have been sold versus a global PC population of 1.3 billion and a global mobile subscriber base of 5.1 billion.

Something has changed. Knock, knock Microsoft. Hello, is there anyone at home?

By 2014 it is estimated that there will be more than 400 million tablets sold globally at a rate of 185 million a year by then. It is thought that not Apple but Google's Android operating system (OS) will be the choice of over 40% of those tablet vendors and will be the biggest market share. It is estimated that Microsoft will have less than 13% of the tablet OS market, Blackberry falling to just 5%.

Why is it important to treat these devices as mobile smartphone type devices and not PCs? Don't we want to use them for business? Won't we want Microsoft Office running native on these devices?

The answer is that yes we will want them as hybrid devices as Microsoft describes them but the paradigm has changed. The web has become the platform so we don't need USB ports or adherence to corporate networks, we just need access to the web by WiFi or 3/4G. We want to use these lightweight devices to port business around like a briefcase, sharing folders in The Cloud but having local copies.

Just this morning I blogged that Microsoft Office 365 is already redundant for the iPad because it's SharePoint back end is the wrong animal for the job and it assumes bulky Office client software to be present in full on the local device. Dropbox is the obvious choice. GoToDocs allows creation, viewing and editing of MS files and PDFs and you can print them via WiFi (OK that's ropey for now but it's not rocket science to get it right). This application was downloaded in seconds from iTunes Store and cost less than a few pounds. And cost is key here - nothing in Apple's App Store costs over £30 at the last look. This is good news.

And this is the point. We don't want another device that takes an age to boot and has zillions of processes clogging up the CPU and memory. We want always-on, reasonably priced innovative applications that allow mobile working to be not just effective but affordable. We don't want over-priced, resource-hogging, out-moded operating systems hammering the performance. We want machines with high performance graphics that we can use as a business-grade engine AND as a recreation device - that lasts full day in battery and doesn't weigh a ton.

The tablet market is one of the most exciting things to emerge in the industry for a decade and products like Evernote lead the way in terms of usable business software. A superb MS OneNote alternative constantly synchronises the notes you make on all devices via the Cloud - and it's free. Why do you want vast local storage with that power at your fingertips?

At last the world of computing has wrestled free of Microsoft's grip. And it's fast moving and it's exciting again. This weekend Google Plus will attain 20 million users in just a short period of time - that pulling power is distorting our way of thinking and users like the way it's going. The web is making the world of computing available to any device and it's capturing our imagination.
Microsoft has to change. It is fast becoming a dinosaur and there is a feel of the IBM of the 80s about the management talk as they adhere to only things they know and want to hear. They talk only in the product set they have and cannot seem to innovate new things to tackle the companies stealing their market.

With the European PC market dropping by over 17% this year, the writing is on the wall as the tablet market grows into the space left behind. The world has changed already and Steve Ballmer, Lees and others at the top are standing Canute-like as the 'Sea of Progress' inevitably washes over them.

The problem is that Microsoft's numbers don't reflect it yet. And that IBM feeling comes back once again. The bolt from the blue - the one no one saw coming - has already struck but it hasn't manifested itself in the numbers as yet. The tablet market is established and the main player is not Microsoft - that has got to hurt.

Where a potential 13% of the tablet market leaves MS OS and Office is anyone's guess but with a potential 40% of it, Google would be rather hopeful that they may have a greater say than anyone else with Apple standing beside them.

You could not have predicted this just two years ago. Bill Gates once wrote a book, 'Business at the Speed of Thought'. Well it seemed someone stopped thinking in his company. And Steve Ballmer is reputed to have once fielded questions from an audience where he started by saying, 'Microsoft is right. Now what was the question?'

That about says it all.