Mini-Byte: Cyber-Security: Spy vs. Spy.

We live in interesting times -- a dangerous age with respect to cyber-security.  Peter Lewis reminds us that some things that we think of as new revelations really trace back to an earlier era.  The song remains the same . . . China's PLA Unit 6139 and the NSA: Breaking Into the Rich Neighbor’s House.

Mircosoft: Changing of the Guard (Have Things Changed?)

"Your hearts must have the courage for the changing of the guards." Bob Dylan

It seems to be the time to talk about Microsoft and whether a changing of the guard really means things have changed.  The key road signs for this question that have been widely reported already.

First, after having known only two masters in its existence, Bill Gates and Steve Ballmer, earlier this year Microsoft named its third CEO, Satya Nadella.  From his official corporate curriculum vitae, Mr. Nadella certainly looks like a departure from his predecessor, Steve Ballmer.

Second, Microsoft officially has parted company with what one commentator has called "the last great operating system," the now aged "XP."  On April 8, 2014, Microsoft officially stopped supporting XP.  This milestone departure prompted some foreign governments to ramp up their own support operations for the beloved OS.  Security analysis are left pondering the fate of practically all of the ATMs in the US, which operate on XP.  XP also is the operating system for many commercial transaction systems used by large retailers; recently, Target had a significant loss of consumer credit card data from its aging XP based transactional network.

We certainly have reason to debate what information the NSA and other governmental agencies have collection on us, but we should be equally concerned with whether the United States can keep its computer systems, governmental and private, safe from increasingly prevalent hackers.

Third, while leaving behind a significant piece of Microsoft's past, Satya Nadella has embarked on a new direction for Microsoft software.  Microsoft is still fundamentally a software company.  It has built commercial success on its widely used Windows operating systems for consumers and businesses and its suite of application software, Word, Excel, PowerPoint, Outlook and it accompanying web browser Explorer and Bing search engine.  By contrast, Microsoft's most tenacious rival, Apple primarily manufactures hardware (Macs, iPads, iPods, etc.) that runs native Apple software.

From time to time, Microsoft has dabbled with the idea of moving into the hardware side of the technology world.  The results have been fitful.  In earlier columns, I have discussed that fact that Microsoft was an earlier pioneer in the field of software for tablet computing, but it drifted out of that picture and let Apple and Google realize the success of both tablet hardware and tablet software.  Microsoft tried to enter the market for portable music players that Apple created with the iPod.  Remember the Zune?  Again, Microsoft failed to stay the course.

Through the success of its hardware devices, Apple has established a significant presence for its software. Apple software like iTunes and its Safari browser now run on other devices.  iTunes has become ubiquitous on computers otherwise using Microsoft software.

Until Nadella's ascendancy, Microsoft has steadfastly resisted the idea of letting its prized office software package (Word, Excel, PowerPoint, etc.) reside on anything other than a Microsoft operating system.  Unfortunately, Microsoft is not dominant in the hardware world of portable devices made by others.

Mobile devices are the future, not only for personal computing, but for business and professional work.  Although Microsoft still has a strong presence in the business and professional world of desktop computing, the business and office workers increasingly want to take their computing outside the office and the desktop, out on the road and at home.  Once upon a time, that happened through laptop computing, with native Microsoft software.  Now, increasingly, business and consumers are  migrating to Apple and Android devices and using work-around software to access their Microsoft Word and Excel files.  I do this on my iPad with an application called QuickOffice.

Trying to contain this migration, Microsoft launched its own very promising tablet computer, the Surface, packaged with Microsoft software (Word, Excel, PowerPoint, etc.) and tried to make the Surface its flagship hardware product to win back customers.  This was the right move and one which I hope Microsoft does not abandon (as it abandoned tablet computing once before in its infancy), because the competition from the Surface will cause all mobile devices to improve.  Microsoft has a fundamental advantage by putting its integrated Office software package on a mobile device, because it will retain many users whose in-office or in-home computing is done on Microsoft Office software.

Nadella's predecessor, Steve Ballmer resisted a wider distribution of Microsoft software beyond Microsoft operating systems.  Somewhere in the transition, strategists at Microsoft seemed finally to have realized that there is a much bigger market out there for software than the pure office and business core purchasers.  Within days of becoming CEO, Nadella first significant announcement was that Microsoft's Office software suite would be available on other platforms.

As I wrote this (in mid-April, 2014), I went to the iTunes App store on my iPad and downloading, for free, Microsoft Word for iPad.  It enables you to read Word documents in their native format.  Microsoft wants you to buy a full version of Word, however, if you want to edit those documents and perform other functions of Word.  It will be interesting to see how sales of the Word (and Excel and other Microsoft software) application go.  If you are an office user of Microsoft software, you may know that Microsoft has made great strides in integrating its Office software suite.  Microsoft's email and calendar program, Outlook, in particularly is now a center piece for other applications in the Microsoft suite.

 As Microsoft moves these programs onto more mobile platforms, a particularly interesting synergy to watch will be whether the Office suite becomes even more integrated.  Last year, with a new version of Outlook and the rest of the Office suite on my desktop, I experimented with a lesser known part of the Office suite, OneNote.  This is a program that allows you to take notes or otherwise save information in files, organized like a file cabinet in your office.  It is pretty easy to use and has advantages in its integration with other Office programs like Word.  In addition, OneNote was already available free on mobile devices like my iPad.

I was comparing OneNote to a non-Microsoft application that I was already using on my iPad, Evernote.  I like Evernote because it allows you to do a wide variety of things in the office or on the road:  take notes at meetings and conferences, receive email as a note (whether to save the text of the email for future reference or to attach documents that you wanted to send to your mobile device), and handle both work and personal chores.  As a web-based program, the app on my iPad and my desktop at work could access the same files, allowing for editing and revision back and forth, inside or outside the office.

I found OneNote very competitive with Evernote in many ways, but lacking a true advantage that would lead me to replace Evernote.  Now, with the availability of other Microsoft applications on mobile devices, Microsoft does have a potential advantage that it can exploit:  if it can develop true integration among it desktop software applications and their mobile counterparts, that synergy may bring together many users who want such integration.  Instead of looking for Microsoft work-around applications like QuickOffice on mobile devices, as users, whether for professional purposes, we can have a more seamless option.

Nadella's initiative in make in making the Microsoft Office suite available on all mobile platforms is groundbreaking and hopefully a signal the Microsoft intends to develop, improve, and market its software for mobile consumers.  This too will be good for all consumers, because it will bring more competition to the mobile device market.  Another key indication that Microsoft is going to take mobile devices more seriously can be seen in its acquisition of mobile phone maker Nokia.  This seems to foreshadow an announcement that Microsoft software soon will have a native cellular device to compete with the iPhone and Android cellphones.

Only time will tell, but these may be a clear signals that things have changed at Microsoft.

Postscript:  As I finish this post and work on another about the Heartbleed vulnerability, Microsoft announced a major vulnerability in its Explorer browser that could result in hackers gaining access to your computer, a so-called zero-day bug.  The wide spread use of Explorer makes this a major issue.  Microsoft even goes so far as to suggest that Explorer users may want to use another browser until a patch for Explorer closes this vulnerability.

This news also is significant to anyone still using the XP operating system, as Microsoft's discontinuation of support for its XP operating system means that there will be not a fix for this bug for those who continue to use XP.

Where Are We Going? (Part I): The PC is Dead! (Or Is It?)

All Things Digital ("ATD") is a rather good website for commentary on technology and the business of technology.  It features two Wall Street Journal standouts, Walt Mossberg, who authors the WSJ Personal Technology column/blog, and Kara Swisher, who does the same for BoomTown. A few years back, ATD decided to host a conference about, well ... all things digital.  In early June, this year's conference, D8 rolled around and the opening night featured an expansive Mossberg/Swisher interview of a modern day Lazarus of sorts, Steve Jobs.

In case you have been out of touch, Steve Jobs is legend.  Having co-founded Apple somewhere around the dawn of the personal computer age, Jobs helped steer the company to be one of the only true alternatives to the hegemony of Bill Gates' Microsoft. He left Apple for a while, and then returned when Apple seemed to be foundering.  During this return engagement, Jobs has reshaped Apple and the world of computing yet again, revitalizing Apple's core line of computers, both desktops and laptops, and revolutionizing a somewhat definition-less space loosely called personal computing devices.  A few years back, personal computing devices amounted to not much more than a few smart-phones that were struggling to become smarter and more integrated through wireless connection to the Internet.

Jobs did a flanking maneuver with a personal music player called the iPod.  He built an online store called iTunes and started selling music to fill iPods.  The industry took this as a noble little gesture befitting of Apple's technology wizardry:  a sleek little device to entertain us, but hardly a big threat.  Still, people seemed to like this idea and started buying iPods, filling them with their own music and downloading songs from iTunes.  Soon other things came along, like a new thing called a "podcast" and videos.  Othe companies brought out generic MP3 players.  Microsoft thought that it could compete in this market and launched a player of its own, Zune.

The first iPods were relatively primitive.  (I know, because I still have a second generation Mini, which but for the lack of any battery life, still works.)  By the time that Zune arrived, however, Apple had newer versions of the iPod that were better and fancier and started to do more things, like play video that could be downloaded from iTunes.  The first generation Zune never had a chance. Nowadays, I am told that there is an outstanding new generation Zune that outperforms the iPod in a number of areas.  Unfortunately, not many people care.  Apple's iPod dominates.

This pattern bears watching, because Apple repeats it.  Jobs admits that Apple needed to make much more strategic choices.  Apple is a hardware company that does particularly innovative things with the software it develops for that hardware.  Its computers remain a much smaller part to the market compared to the legion of computers that run Microsoft's Windows operating system.  What Apple does is look for openings in the market where it can excel and innovate.  It has succeeded and, in doing so, has moved the market toward Apple.

Apple brought out the iPhone to take on other smart-phones that were having trouble figuring out how to integrate their functionally with the Internet.  Several generations of iPhones down the line, Apple dominates the creative side of this space, with the rest of the industry still trying to keep up.  It has made this market interesting enough to draw Google into the operating system competition.  Microsoft recently released a new version of its mobile phone operating system, again trying to catch up in this competition.

Apple also brought out an iPod called the "Touch" or "iTouch" that connected to the Internet via WiFi.  Built with many features in common with the iPhone, the iTouch started to capture the attention of younger users who wanted mobile access to the Internet for emailing and social networking, but did not necessarily want to get an iPhone (just yet).

Finally, Jobs unveiled the iPad this year.  The iPad is a tablet computer that appears to be redefining the non-desktop computer sector.  Of course, we still have laptop computers, which thanks to Apple's leadership again, are getting small and lighter, but are capable of providing full-function computing on a par with a desktop computer.  We also have "netbooks", devices that are smaller than a laptop, which connect to the Internet and provide some computing capability, but lack the memory and other features of laptops.  Finally, we have e-readers for electronic books, such as Kindle, Nook, etc.

Building off the iPod, the iPad is a uniquely different computing device.  Through it, Apple definitely has designs on furthering its emergence as a media company.   Apple is making a play for the market held by e-readers like the Kindle.  The iPad also is designed to build on the iTouch and provide more utility as an access point to the web.  The competition has followed Apple's lead by announcing its own tablet computers.

Through all this, Microsoft largely has been missing in action.  It failed to mount any meaningful competition to the iPod.  It has meandered around in the cell-phone operating systems wars without much distinction.  Google's Droid operating system is a more formidable challenge to the iPhone.

Apple recently surpassed Microsoft in market capitalization.  And, Jobs dodged the grim reaper in his bout with liver disease.  So, getting him to sit down and talk on opening night of D8 was huge.

There are significant problems in the forgoing success story, some of which are attributable to Jobs' insistence on doing things the "right" way (his way?).  First, the iPhone has only been available on the ATT network, which, for all its technical synergy with the iPhone, is universally viewed as a lousy network.  Apple will now be selling a lot more iPhones, as the rumors that the iPhone will be available on Verizon next year appear to be confirmed.

Second, and more problematic, Jobs could not get satisfaction out of Adobe over weaknesses in its Flash Player, so neither the iTouch, iPhone or the iPad run Flash Player.  As Flash Player is integral to the operation of many website audio/visual clips, particularly on Google's YouTube, Apple has wonderful devices to reach the Internet, but spotty content once you get there.  No word at this writing on how this standoff will end, but Jobs is asked about it in the interview.

Finally, the newest iPhone model, iPhone4 received bruising criticism for reception problems related to the device itself (not ATT's network).  The New York Times reported that Consumer Reports would not recommending the iPhone4 because of a flaw with its antenna.  The furor dragged down Apple's stock price for a while, but seem to have blown over.

With apologies for the long lead above if you already knew all this stuff, what I want to discuss are comments by Jobs at D8 on the future of the computer and a response from Microsoft CEO Steve Ballmer on the last morning of D8.  Let's clarify terminology first.  The term "PC"seems to be a bit of a sore spot between Jobs and Ballmer.  My take on these interviews is that Jobs uses the term to refer to full size desktop computers generally and to some extent fully functional laptops (with hard drive memory and CD/DVD capabilities).  At one point he says as much to Walt Mossberg, describing himself and Walt "as people from the PC world" and saying that "PCs have taken people like us a long way".  Ballmer seems to respond as if he interpreted the remarks to apply strictly "PCs", i.e. -- computers running Microsoft Windows (or the next OS from Microsoft, which may not be called Windows anything).

Remember that Apple is a hardware manufacturer.  Microsoft is a software company.  Except for the Xbox game system, Microsoft has not really succeeded in developing any significant hardware business; it makes its money on operating systems that are installed in the vast majority of full scale desktop and laptop computers.  So, Ballmer may simply be defensive about Microsoft losing market share, but he comes off sounding like the PC half of those famous Apple Mac-PC ads.  (Ballmer is certainly defensive about a lot of things these days;  listen to his comments about Google and Android and Chrome.  Here is a mash-up putting the Jobs and Ballmer comments side by side in a point-counter point debate.)

Jobs essentially made an analogy that the full scale desktop computer is like a truck:  it has great utility and will continue to have great utility to accomplish the jobs for which we need a full scale computer.  (And, like trucks, there will be some people "driving" a full scale computer when they do not really need one.)  Jobs thinks, however, that we have already entered an era where typical computing needs can be handled by small devices, that there is a paradigm shift under way.

Ballmer made some jokes about "Mac trucks" and offered some backward-looking platitudes about Windows PCs being "mass popularizers", but ultimately conceded that there will be smaller devices that serve different functions.  Jobs, of course, does not say that the iPad is going make the PC obsolete (at least not any time soon), but that new order is coming.

Microsoft is really besieged on several sides by the forces of change.  Google (which Ballmer called a "behemoth", as if Microsoft is somehow the new David to Google's Goliath) is focused on more and more functionally occurring online, with the need for resident operating systems and programs in our personal computers becoming less important.

My take on this is that Ballmer's smugness hides an unease about Microsoft's ability to adapt.  With the desktop computers beginning to wane and Microsoft missing in action on most other fronts, Microsoft faces the prospect of watching is its operating system business for PCs slowly (or rapidly) disappear.

One can only hope the Ballmer and others at Microsoft can read their own corporate history and understand its implication for the future.  After all, what Jobs said embodies and extends the vision that Bill Gates had many years ago when he foresaw the personal computer becoming a part of every day life, empowering people and moving us out of the era of mainframe computer.


Ballmer seems to lack a vision of the future.  His comments are reminiscent of a backward looking discussion last year by Mircosoft's chief strategist, Craig Mundie.  Jobs is not clairvoyant.  He is just a keen observer of what has happened with computer technology and where the future lies.  Historically, as Gates foresaw, computers and computing devices have gotten smaller, more affordable, and have empowered more and more people and have rapidly broken down definitional lines in the process.  The Internet has driven this process even faster by allowing people to do many things online that they used to need a desktop (or mainframe computer) to do.

Interestingly, in September, IBM CEO Sam Palmisano declared the PC business dead in an interview with The Wall Street Journal's Viewpoints.  Remember that IBM invented the PC.  IBM sold its PC business several years ago for a reasonable price. Palmisano went so far as to say that he "could not give [the PC business] away today."

I think that there is little doubt that we will see a growing use of smaller computing "devices", more use of the Internet in place of the desktop and more freedom and power to use this technology in the hands of more and more people.  The desktop will still be around.  Netbooks may or may not survive the advances represented by the iPad.  Our cellphones will get smarter.  We yet may see widespread availability of connectivity through WiFi.  (Google is certainly pushing in this direction.  The major wireless carriers better take notice because their monopolistic pricing structure will be vulnerable to competition for access that is more fairly and properly priced.)  Microsoft's challenge seems to be finding its place in this future.  Jobs is at the crest of the next hill telling us what he sees beyond. Ballmer is still huffing and puffing his way up to get a peak.

Look at the people around you, at work, at home, at leisure.  Increasingly, people are doing many things without a desktop computer (PC or Mac).  Laptops have become more common place, even within offices.  Whether they are using a netbook, a iPhone, a Droid phone, an iPad, an iPod Touch, other similar devices, people are connecting  and computing through the Internet from home or office or places in between.  The Wall Street Journal ran a story recently on the surging sales of portable communication devices, including the iPad, at big box retailer Best Buys.  The article also noted that the iPad was drawing customers away from laptops.
Whether at work, on vacation or at the gym, people are reading email, listening to music, going to websites, linking to their workplace network, making dinner reservations, checking out local movie listings.  I typed part of this column on a laptop at an ACTEC meeting in Pennsylvania.  It is fairly clear that a new paradigm has emerged.  The next part of this series of columns will discuss some of the reasons why the desktop computer and even the traditional laptop computer, while still important, are increasingly secondary in the modern world.


(Disclosure:  The author holds stock in Microsoft, Apple and Google.)

Microsoft: Looking Backward?

Jon Gordon ran an interview on the July 14, 2009 edition of American Public Media's Future Tense entitled "A conversation with Microsoft chief strategist Craig Mundie". Mundie is the Chief Researcher and Strategist at Microsoft. He was commenting on the Microsoft's upcoming Office 2010 and Google's Chrome OS.

In listening to the interview, however, I was amazed that, if you translated out the corporate business speak, Mundie's began by stating that what Microsoft sees happening is a "convergence"of traditional applications for the personal computer with the communications capability of the mobile telephone. Mundie thinks the future will bring a "merging" of "popular communications paradigms" and the "idea that people want to work together." He concludes:

“So the idea that we can support a remote collaboration as something that that supports both the work part and the communications part in a multi-party environment – that’s one of the major focuses in the next generation of Office."
If he had forecast these things in two or three years ago, when most of these developments started to occur, and Microsoft had acted then, Microsoft would be in much better position today."

Mundie sounds like he is just beginning to get the implications of iPods and iPhones. social networking on the web, laptops and netbooks. Google started offering web-based versions of traditional computer based applications like word processing and spreadsheets several years ago.

Gordon then asked Mundie to comment on Google's announcement of a new operating system, Chrome OS, and what Microsoft was planning for its operating system after Windows 7. Here is Mundie's reply:

"The computer itself is going to change in quite substantive ways in the next three to five years. And with that will come a new level of capability to make it easier for people to interact with computer, to put computing in, you know, more places in peoples lives and to make in a more natural experience for how they interact with it.. In my mind, the evolution of our operating system will naturally track forward with these improved capabilities in the underlying hardware and the devices that people will use to access computing. And that will give us many new capabilities in the future, including a natural user interface, where you can speak to the computer and it can speak back, where it has machine vision though cameras, and, so, there will be many, many more components of human-like interaction in our vision of the future.”

This answer really does not say much more than we are going to make a better operating system to do the things people want to do. There is not much vision here about the what people want beyond a "more natural experience" and "more components of human-like interaction." Perhaps, when he said this, Mundie was having a flashback of HAL in 2001: A Space Odyssey.

Gordon presses for details, specifically, whether Microsoft embraces the approach that Google seems to be taking -- an operating system that runs one or two applications, such as a browser, with the rest of the applications being run on web-based platforms through the browser -- in the cloud of the Internet. Mundie thinks that people want something more powerful on their own computer, that Gordon's formulation will be found to be "too restrictive." He cites the evolution of Google's Android operating system for mobile phones and says that it has come to look more like Microsoft's phone based operating systems.

It is hard to have much confidence in this view of the future. Microsoft is clearly looking over its shoulder at the competition from Apple and Google and trying to replicate things they have already done. At this point, it is a safe bet that people want computing to be easier and more natural and they want it to be more mobile, for personal and business purposes. With its massive Windows OS, Microsoft has a vested interest in a future that is still based on complicated multi-tasking on individual computers. (I believe that Future Tense ran another report, however, in which there was speculation that Microsoft would abandon Windows all together after Windows 2010, because it has become too complicated.)

This brings us back to another observation that has already been made: Micosoft is still a software company. Outside of the X-Box, it has not produced a successful hardware product. Its development of the Zune illustrates that even when they can figure out what the market wants, Microsoft is slow to get it right. (In truth, Apple figured out what the market wanted, and Microsoft has been playing catch-up.)

Mundie's vision of the future is to ill-defined to provide much direction. Is Microsoft counting on people wanting more robust netbooks or Internet based "cloud" applications, or both? (As I write this, HP has just begun selling a new, more powerful netbook, the HP Mini 5101. It will be interesting to see how these improved netbooks sell.)

With the growth of activity on social networking sites on the web, it seems reasonable to believe that people (of all ages, judging from recent trend in Facebook demographics) are ready to do more with Internet based applications. Netbooks have been unspectacular so far, but have the potential --as a smaller, portable platform -- to reach such web-based functions. Mundie seems to identify this trend early in the interview when he talks about the "merging" of "video telephony, audio telephony, instant messaging ("ah, you know, the popular communications paradigms") and the "idea that people want to work together." He also cites the interest in being "green" and traveling less.

It is clear that the iPod and iPhone and social networking on the Internet have drive a large number of users into a different kind of computing, one based increasingly on mobile devices. It is also no secret that the history of computing points toward smaller devices with more power. What Mundie cannot quite figure out is where business users are going.

Because Microsoft software has become so ubiquitous in the business environment, one of Microsoft's big challenges is figuring out where business users want to go. It may be logical to conclude that iPhones and other more robust devices may not be able to satisfy the all the needs of business users, but that does lead to the conclusion that such users want or need their laptop or netbook to be as powerful as a traditional desktop. I think business too wants smaller, more agile devices and computing that, as Mundie said, reduces travel.

I have used a old Toshiba laptop on the road for work for several years now and my practice is to put as little on the laptop as possible, both in programs and stored files. I want it to work as access to the Internet when that is available and to let me work on some things when I cannot access the Internet. I started writing these comments at home on a Sunday, not on my desktop, but on the Internet using Google's blogspot. I am finishing them the same way from New Mexico. I do not have to worry about saving them on my hard-drive or a flash drive or e-mailing them to myself. I just have to get to Google online. Why is this not the next paradigm?

What Microsoft may want to do is take a look at its array of software and make it more efficient and more integrated, not big, bulkier, but lighter and better able to handle the basic functions that all users want. Word and Excel may be everywhere, but Microsoft seems to make them maddeningly difficult to use. For example, Microsoft seems intent on forcing everyone to upgrade to the latest version of Word or Excel, because the files produced by Word 2007 or Excel 2007 cannot be opened by older versions of those programs. I have clients who send me new Word 2007 or Excel 2007 files and I need a patch that converts them before I can view them. Walter Mossberg reports at All Things Digital on the difficulties all of us XP users are going to have upgrading to Windows 7.

Fully functional software would serve Microsoft far better in the long run and cleaner, leaner versions will open up new markets. I hope that is what all of Mundie's gibberish means Microsoft is going to do. Mr. Mundie should remember Satchel Paige's famous remark: "Don't look back. Something could be gaining on you."