Microsoft_-_IoT_-_final_submission.pdf
Transcript of Microsoft_-_IoT_-_final_submission.pdf
Microsoft-‐Internet of Things
Introduction Since the inception of operating system, the world has changed dramatically. The system
automation we see today is somewhere closely or remotely connected to operating system
of a computer. This ‘Operating System’ is a software, which bridges hardware and the
application software in a computer. Microsoft is the leader in operating system with total of
92% of the world PC using the different versions of Microsoft’s Windows operating system
(NetMarketShare, 2015). As the rapid acceptance of OS in a device gave birth to personal
computing so the interconnected computer became the reason for the birth of Internet. The
quick adoption of Internet in personal PC and workplace systems led to another demand of
unlimited storage space and on demand computing power called Cloud computing. A big
fight over the dominance of cloud computing market is still on. Today the cloud computing
market is extremely competitive. But this is not just the only direction where IT world is
moving. This year 2015 and the years to follow ‘Internet of Things’ are the next big thing.
Cloud computing is the mere foundation of this market. In simple terms, IoT is a network,
in which machines will communicate with each other. Today IoTs exist in two categories –
wearables and appliances. Imagine a stove knows when the rice is perfectly cooked for
‘Mutton Biryani’ (a famous South Indian dish) or a watch tells the air pressure is low in rear
tyre of your car. This is what IoT is all about. It will flatten the vertical structure of Internet,
in which computers, mobiles and tablets are, currently, placed on top. It will happen when
every device, we use, gets its own IP. The 2015 vision of Microsoft tells a lot about this
growing dimension. In IoT, devices will be smart. The world will witness more use of
sensors and machine-‐‑to-‐‑machine interaction than ever before. This document is an attempt
to map the organization theories with Microsoft’s strategies, which has effected the
structure of the company.
Microsoft -‐‑ A giant who is left behind Microsoft is known to be an innovative company. It has kept with the pace of changing
industry. When Windows XP was launched in 2001, it was soon widely accepted in all the
business and personal computer. The excellent coupling of this OS with minimal use of
hardware was the major reason behind this wide acceptance of Windows XP. This
operating system created a new computer culture, where the OS required only 64 MB RAM,
233 Mhz of processor and 1.6 of disc space (Singh, 2013). Because of this feature, still many
enterprises want their apps to be compatible with windows XP. But in past 7-‐‑8 years
Microsoft has lagged behind in almost all the new technologies that have surfaced. After a
long gap of six years in 2007, when hundreds of millions of copies of XP was distributed
and XP configuration was embedded in the work culture, Microsoft launched Windows
Vista, the first major upgrade of XP. User interface was new and more eye catching but the
rest of the things were disaster. The Vista required more RAM (Random Access Memory) to
run its basic applications. The systems with low memory could not keep up with the
memory requirements of Vista. This caused frequent system ‘hang’. Therefore, most of the
enterprise and institutions refused to move from XP. Since then windows underwent
several frequent upgrades like Windows 7, Windows 8, 8.1 and now Windows 10. Despite
of all the efforts and schemes, XP was hardly replaced by its predecessors. As of 2013 data
it remained the baby of 38% of all the computers used on this planet. Most enterprises still
used Windows operating system, but clearly, they lost the ‘favourite’ tag to Apple. The
world witnessed the wide acceptance of MacBooks designed by Apple. Also, Microsoft
failed to see the mobile revolution that was coming when first iPhone was launched in
2007. Google understood the growing mobile market and soon it flooded the market with
Android phones. The online search engine is another area where Google dominated the
market but Microsoft struggled to create a foothold. Even after a deal with Yahoo in 2009,
Microsoft’s Bing search engine has only 19.7% of the total traffic. Google captures 65% of
the total search volume. Today 80% of the mobiles are using android as its operating
system. The cloud platform is another area where Microsoft lost the race because it failed
to see the potential market.
Trap of the Innovation Myths
During late 90’s Microsoft tried to monopolize the active desktop (now called browser)
market by creating ‘Internet Explorer’ and sabotage the growth of Netscape. Both firms
were locked into the ‘war of adding new features’ (nicknamed ‘featuritis’). Eventually,
Microsoft won because of its size and capability. In the years, during 2009 Microsoft was
trapped in Berkun’s third myth where it tried to replicate the same strategy as it did during
the browser war (Appendix list all the myths by Berkun). They expected that the strategy of
using its monopoly on OS with their search engine would work exactly as it worked for
browser market. But it did not go according to their plan. Their search engine ‘Bing’ and
email service ‘Hotmail’, despite of added features, completely failed to match with Google
products. Churning of Computer users to mobile users started almost at the same time. But
Microsoft lacked the vision to see that its dominant area (i.e. desktop OS) is getting lesser
relevance in the computing market. Microsoft has always claimed itself to be one of the
most innovative companies, but it resisted change. It was trapped into the Berkun’s fourth
myth of innovation. They lauded themselves to be innovative but, factually, they were not.
It failed to see the potential mobile and tablet market that has now started eating up the
sales growth of actual computers and laptops. The company, perhaps, had never thought of
the scenario where it will have to enter into the mobile hardware market. It had to, finally.
But Microsoft was too late to the party; the number of apps available for other platforms
(iOS, android) is enormous. Now, Microsoft seems to come out of those traps of innovation
myths and is pushing a fresh start. The next section of this document describes the
dramatic shift in the strategy of this company. It is not easy to innovate but that is what
company claims to achieve.
Revival strategy of Microsoft – Internet of Things
Microsoft on its 2015 vision note says: “When a call comes in to 911, seconds count. In the
city of New Orleans, a technology solution from Microsoft and Motorola Solutions is
drawing on the potential of the Internet of Things (IoT) to vastly streamline the ways in
which 911 dispatchers communicate with officers and first responders”. (Microsoft, 2015)
This extract from the vision document shows that Microsoft is moving ahead from desktop
computing and, mobile and tablet war. They are trying to realize the potential market. In a
strategy to do that a careful observation gives a good understanding of why the company
whose revenue once based on the sales of OS and other application software is now
distributing it for free. Why the company has started to provide free upgrades to their
products? Lot of people look this as a strategy to fight the growing foothold of open source
systems. But the market share and consumer reliability of Open source is still too small to
bother Microsoft. So there must be some other strategy behind the move.
The actual strategy behind all this strategy is the huge market potential behind a new set of
product lines – Internet of Things (IoT). This IoT is a network of machines. Machines are all
set to communicate, transfer data and take action based on it’s intelligence. These IoTs are
based on sensors. Since there is no human interaction, the interface application will shrink.
Therefore, the sell of OS devices like laptops, tabs and mobile will be minimal compared to
IoT devices. In short and simple words, in a machine-‐‑to-‐‑machine interaction there is no
role of human. Therefore, the actual purpose for a laptop, desktop, tablet or mobile will
start vanishing so is the value of OS in those machines. Still those OS will play role in of
connecting human IoT. In that case the OS will be required to be compatible with the
software embedded into the nanochips attached to the sensors. Microsoft if maintains its
dominance on those OS carrying devices, it can ensure complete inter-‐‑portability and ultra-‐‑
customized data for the user across the spectrum of devices it uses in the future. The scale
of infrastructure -‐‑ the servers, mobile hardware, application software, gaming applications
(Xbox), OS – Microsoft has created enough breeding ground for IoTs. Microsoft is heading
towards creating its own ecosystem, where a user with a Microsoft device gets the
compatibility with the IoT. Apple is their competitor. Apart from Microsoft, Apple is the
only company, which manufactures all the dimensions of mobile and personal computer.
But Apple’s exclusivity makes it less reachable. Microsoft is able to breach into the various
corners of the computing society. Its reach to the majority of the computer user thru its OS
and application software makes it the sole player in this vision. All Microsoft has to do is to
get into the game and start cultivating new IoT devices. In a step to get into the market, on
2nd Feb 2015 Microsoft announced Windows 10 for the credit card sized computing device
called ‘Raspberry Pi 2’ (Microsoft, 2015). Microsoft has also launched Microsoft Azure IoT
services, which enables enterprises to better, collaborate and automate the business
operations (Microsoft corporation, 2015). United Nations has estimated that world’s two
thirds of the population will be living in the cities by 2050 (Green, 2015). Therefore, the
governments are preparing to develop the scheme for smart cities. This will require a huge
integration of sensors and operating platform. This company is moving its strategy to
create a major foothold in this future market. By 2025 the IoT market is potentially going to
touch 2.7 to 6.2 trillion annually (James Manyika, 2013). This is the concept where the
future of the technology rests. Microsoft seems to realize where the next big thing is
coming from. But it is going to be an interesting decade where we will see the sensors
taking on the human role and how Microsoft captures the market of IoT with this strategy.
Bibliography Berkun, S. (2010). The Myths of Innovation. O'Rielly Media. Green, C. (2015, march 23). The rise of the mega cities and data's work -‐ why the budget got it right. Retrieved march 23, 2015, from www.information-‐age.com: http://www.information-‐age.com/industry/uk-‐industry/123459210/rise-‐mega-‐cities-‐and-‐datas-‐work-‐why-‐budget-‐got-‐it-‐right James Manyika, M. C. (2013, May). Insights and Publications -‐ Disruptive technologies: Advances that will transform life, business, and the global economy . Retrieved March 25, 2015, from Mckinsey&Company: http://www.mckinsey.com/insights/business_technology/disruptive_technologies Microsoft corporation. (2015). Microsoft Azure IoT services. Retrieved march 25, 2015, from www.microsoft.com: http://www.microsoft.com/en-‐ca/server-‐cloud/internet-‐of-‐things.aspx Microsoft. (2015, Mar 23). Creating a Safer City with IoT. Retrieved Mar 25, 2015, from Microsoft: http://www.microsoft.com/en-‐us/server-‐cloud/customer-‐stories/orleans-‐parish.aspx Microsoft. (2015, feb 2). Web developer program for IoT. Retrieved march 23, 2015, from dev.microsoft.com: https://dev.windows.com/en-‐us/featured/windows-‐developer-‐program-‐for-‐iot NetMarketShare. (2015). Desktop operating system market share. www.NetMarketshare.com. Singh, M. (2013, 4 4). Why Windows XP Won't Die Soon? Retrieved 25 3, 2015, from Technology Personalized: http://techpp.com/2013/05/03/death-‐of-‐windows-‐xp/ Appendix: The 10 myth’s of Berkun: “1. Myth of epiphany”, “2. The myth that we know history” “3. The myth of a method: a methos successful in the past is always successful” “4. The myth that we all love new ideas and are ready accept it.” “5. The myth of lone inventor” “6. The myth that the good ideas are rare” “7. The myth that the senior boss knows more then the junior” “8. The myth that the best idea always wins” “9. The myth that the problems are less interesting then the solutions” “10. The myth that the innovation is always good.” (Berkun, 2010)