Microsoft Surface: UCStrategies Reaction

Marty Parker moderates this UCStrategies Industry Buzz podcast, the topic of which is the announcement of the Microsoft Surface tablet. The discussion includes Russell Bennett, Art Rosenberg, Don Van Doren, Steve Leaden, and Phil Edholm.

Marty Parker: Hi, this is Marty Parker of UCStrategies, and I am on this call with a number of the brilliant peers that I get to work with here. We'd like to talk today about the new Microsoft Surface computer/tablet product that's been introduced into the market and what that might mean for enterprises and for unified communications in the enterprise.

We have a lot of great ideas amongst the group. I think I'm going to call on the group first and maybe add a few things later. First I'd like to call on Russell Bennett. Russell, I think you actually worked at Microsoft while some of these ideas were floating around. Now, as you look at what's happening in the market, what's your prospective?

Russell Bennett (00:44): Thanks, Marty. I can't claim any credit for Windows 8. That happened after I left. I certainly think that Windows 8 from what I know of it so far, which isn't a lot of detail, is an interesting attempt to provide a tablet for the mobile worker. An iPad-type tablet is for an information consumer rather than an information producer. For mobile professionals, you need a keyboard. I think the Surface and the keyboard/cover that they've got is a great innovation. It combines portability with the ability to generate content.

I see that the user experience is aligning with Windows phone and I think that's a very positive thing for both as kind of a complementary value proposition there. And it also provides the enterprise IT department with a response to the BYOD (bring your own device) movement. I'm sure a lot of IT departments are absolutely mortified by BYOD. They don't know how to stop it. Now this gives them an option saying, "look, if you really want a tablet form factor, we can give you one of these and we can control it, and then we'll both be happy."

In terms of UC, I think that Lync and Skype user experience will be tightly integrated with Windows 8 Surface, and that will be great. The open question I haven't seen any information on so far is the camera/mic speaker requirement to make Surface a UC platform. On balance, from what I know so far, it's a good compromise between affordability and functionality. The Netbooks and the Notebooks have been attempting to supplant the laptop, but the form factor wasn't quite right. The iPad-type tablet, the form factor isn't right for the information producer. I think this is a good compromise. Let's see how it works out. Thanks, Marty.

Marty Parker: Interesting prospective, Russell. Thanks for sharing that. I'm going to call next on Art Rosenberg. I know Art, you love to write about multi-modal. How multi-modal is a Surface?

Art Rosenberg (2:55): Well, I think it is multi-modal, especially if you get the camera question put to rest and so on. But, I think that Russell's point - I was going to raise it is - BYOD, we can't stop it when it comes to smartphones, but we sure as hell want to stop it when it comes to tablets. That's where the dividing line will be for an employer that says, "okay, you work for us so, if you're going to use a tablet you're going to use our tablet. As far as your smartphone, we can't stop you from doing that too much. We have other ways of enforcing things." That's what people are going to use, but really, you need both devices. The smartphone is not going to replace the desktop or the tablet that well. So, the question is, where do you draw the line and who is going to control what? And I think Russell's commentary about BYOD is right on. The information generators, providers, whatever, they're going want more than a smartphone; they're going to want tablets when they're mobile, and let's get control of that what who is going to supply those, and give us all the control we want. And it will be multi modal; that's not the point. The question is, who is in control of how it's going to be used and the information that it generates?

Marty Parker: That's good. I'm glad that you put multi modal in the right prospective there. Thank you, Art. I think it's all about the user experience, Art, as you suggested. And, Don Van Doren, I think...well, I know for a fact, you've always thought about the user experience first. When you think about this, what would you say?

Don Van Doren (4:47): I think, Marty, that is obviously going to be one of the key questions: what that user experience is and how extensive it will be. The notion that this is going to somehow thwart the BYOD idea, I think that's sort of a well, we'll have to wait and see. Because I think the reason a lot of people like their own devices isn't so much the business applications that they've got on them, but all the others. So one question is, to what degree will this particular product be open to some of those kinds of applications so that the workers will really say, "yes, this is a good substitute for the other consumer-oriented tablet devices that I've been using."

I guess the second question though that I would ask and throw out to our group is, what do we see about the recent demise of the Cius? And, you know, which was arguably another attempt to sort of corral the BYOD market by offering a corporate friendly tablet device... and why is this one going to succeed where Cius didn't? I'll toss that one back to you, Marty, and everyone else.

Marty Parker: Let me go around the horn. I'd still like to hear from Steve Leaden and Phil Edholm. And then let's come back to that in the discussion phase, Don. I think it's a great question. Steve, when you look at the Microsoft Windows 8 Surface, what do you see?

Steve Leaden (6:18): I have a couple of perspectives on this, Marty. Number one, I think really the entire market on the business side of the market, the defacto software manufacturer out there is Microsoft. It's not Apple; it's Microsoft. So, since they're really introducing on Surface a Windows Version 8.0 along with the laptop and desktop version of 8.0 to be released shortly, I think that puts them in potentially a very strong position for adoption by the corporate community much more so than the consumer-based side of the market.

They also have; obviously, they've cornered the market on Exchange and email and all that - as well as SharePoint and other kinds of venues. Therefore, if they tailor this tablet as a portable version of what they've been used to all these years on the laptop, I think it could be potentially a very strong play here. Of course we have to look at what are the apps going to be like. Are they going to entertain the consumer side like Apple has? Will the manufacturers on the voice over IP side and the UC side adapt to a tablet from Microsoft as they have so strongly at Enterprise Connect this year with the iPad, for example?

Of course, you know what we've learned in the past, Microsoft takes at least three versions of any new product before they get it right. They've proven that through Xbox as a consumer-based product. So let's see what happens. They've failed in the past with Zune and other products. But I think if they get this right and if they marry and tailor it right across the board as a common OS I think they have a very strong play.

Marty Parker: Very interesting perspectives, especially the three-release model. That will be interesting to see. Phil, what's your prospective on what's happening, why they did it, what it is, and what its strengths and weaknesses might be?

Phil Edholm (8:13): Yeah, I think something that's very obvious is that Microsoft has realized that the PC being the singular center of the universe of devices, is going away. I mean, the world we lived in 10 years ago where you had a PC, which was your intelligent compute device, you had a mobile phone, which was really little more than a phone, has changed. If you look at the industry what you see is the reality is that the tablet industry - that middle device - kind of the three-device model that says I've got a device that's pocketable, that I can put in my pocket, limited to about a four-inch screen...because if I get any larger I can't put it in my pocket... I've got a desktop device that's 25 inches. You kind of come to the middle - it's that 9 to 11-inch device.

For years there was that attempt to make that 9- to 11-inch device out of the desktop. I think what people have realized is that the right model to get to that 9-11 inch device is to come at it from the handheld device and grow it up and give it a bigger screen. Because the user interface experience in that kind of device is actually closer to that pocketable device. That's really what Apple did. They started with the iPhone, they grew up the tablet. Android started essentially as a smartphone. Apple, obviously when they did the deal with Nokia and now with Windows Mobile 8, they're really focused on having that answer that moves up.

The question that's very interesting is, is this really an attempt to become a hardware vendor or is it rather an attempt to drive the PC side of the industry, the PC manufacturers - the Dell's, the Toshiba's, the Sony's, the people who have not been part of the smartphone market - that have grown up to tablets as in Samsung, to really show them how you can make this transition and win in that middle space.

Then, the question becomes, what happens, assuming that Microsoft does establish a reasonable beachhead here? I think very interesting questions have been raised about do IT departments look at this as their tablet device? What's the issue with BYOD? I think it brings up, though, a couple of very interesting bigger questions that we probably need to, as an industry, begin to grapple with.

The first question is, are devices rapidly changing from being a device with capabilities to a device where the capabilities are common? And, will we in three or four years, not really care whether it's an Android device or an IOS device or a Windows Mobile device because they all basically do the same thing? So, devices are going to be purchased for other reasons. And if that's the case, then the BYOD marketplace will change pretty radically. Corporations need to be ready to deal with those devices, not as intelligent devices, but as intelligent presentation layers.

I think that to me, this is the beginning of really the next stage of evolution, which says the enterprise IT department is going to look at a device and say, "I don't want to have things on that device. I want to just use that device and its capabilities to display and give information to people. Therefore, I don't have to control the device." I think that's the message that I would take back - one of the messages to the organizations is BYOD is going to be less about control and more about management to ensure all you give a device is information that is displayed.

The second question that comes out of this I think is going to be a very interesting question. Microsoft, I think, was in the throes of grappling with, but I think this will really accelerate that, which is the discussion of what is the desktop? The reality is that for a lot of people the desktop has taken two forms. For almost everybody it's either a hard desktop but that tended to be more information workers, or for a knowledge worker it was a laptop that when you went to your desktop you connected it to a large display. When you left your desktop you took the laptop with you.

If in fact what Microsoft is really doing and assuming Apple follows suit, is creating a device that when you leave your desktop it's very effective away from the desk, away from the office. Then the question is, what do you have in the office? If you don't have a need to carry a laptop away any longer, you really don't need a laptop in the office. In fact, in the three-device model, that desktop environment really is fixed. The minute it becomes fixed, all of the sudden VDI becomes interesting.

So, I think one of the things that this will become a real precursor to, and I would definitely look at it if I was an organization is, if I had this kind of tablet or the evolutionary tablets I'm sure will follow from Apple and the Android venders in this space to create a much more business focused tablet, business capability tablet from a hardware prospective, if I have that tablet and my employees have that tablet, can I eliminate the laptop and take their desktop to VDI?

I think that becomes a very interesting model from an IT perspective because all of the sudden now I'm controlling... going back to what we talked about earlier and BYOD, I'm actually controlling all my devices to be dataless. Regardless of whether you're on the desktop, you're on the tablet, or you're on the handheld, you're living in a predominantly dataless environment. Now email is the one place where that really doesn't exist yet, but I can very well see that coming fairly quickly.

So, as long as you have communications, you have all the applications. But the devices are dataless, which reduces a lot of the issues that IQ organizations have about BYOD devices. I think in a lot of ways it's a lot of portents of the future.

Marty Parker (14:07): Those are really great points, Phil. I think the virtual desktop-the VDI question-is certainly going to play big in here. Yes, I agree with you that there is this difference between building a PC downwards or building a mobile device upwards also creates an interesting intersection. My comments on this - just to put my two cents in here - in the first place, I don't buy that the PC's going away. If you define my PC as a set of software applications and information, that's how I define my PC. The form factor has changed enormously. Four times my desktop form factor has changed in the last 15 years, and it will change four more times in the next 15.

But, the PC, that is, the software that is a personal computer, is still there. My Blackberry had trouble yesterday. It took four minutes to reboot. You know it's still a PC. My iPhone... my iPad... I have iPads as well. I have a Dell PC, an iPad and a Blackberry. Guess what: they're all PC's. They're all software with databases and information and operating systems in them. So, I think there is a battle of how to do that most efficiently and how to package it so that it's most application friendly and so forth.

I think Microsoft with the Surface is really trying to make sure something happens for Windows 8 that perhaps their partners now that the user devices have become so low margin, only Apple seems to be able to get really high margin out of those devices so far, and I'm not sure how much longer that will last for Apple. But I think Microsoft wanted to be sure the right device was out there so they built one themselves.

I would expect them to take whatever they've learned here and license it out to their traditional partners - Dell, Samsung, Asus, and so forth, HP. I would certainly expect that just like they did with the Roundtable. It was a proof point of how to run a better conference table desktop. They got that one handed over to Polycom.

Maybe it's the case that if you're really trying to reach consumers you need to have some kind of anchor proof point that you can manage like the Kindle or the Nook or the Android. The software makers got into the device market. I can read books now more easily on my PC. I can ready Kindle and Nook books on my PC or my iPad. The boundary of where the information goes can't be device dependent, and I don't think Microsoft will try that with the Surface either. So, I see the Surface as a proof point, but that brings us back... I'll say one more thing about it, which is: Microsoft may have found out the right thing about the form factor. Maybe they trumped Steve Job's vision because I don't see any business users... I haven't seen a business user of an iPad. I see most of the people I am meeting in business now are using iPads, but I don't see any of them that aren't using it without that little appliance that folds down and you prop the iPad into it and it's a keyboard. It looks a lot like my laptop. It looks a lot like a Surface, but they didn't buy the keyboard from Apple. So, you know, what's that future going to look like? Perhaps Microsoft got that one right.

Back to Don's point, maybe just to close on that point, we'll open for more comments, but to get to that point, do you think that this is going to go away like the Cius? Or, is it going to go away like the Roundtable? Or, will Microsoft stay in this business for the long-term? That's really your question, right Don?

Don Van Doren (17:55): Yes Marty, that is. Well, and also the other angle of that is with the issue about to the extent that this is positioned as an IT-friendly tablet device, which I think you know arguably was one of the ideas behind Cius that didn't take off or didn't work. Why won't the same problem happen to Microsoft? What are the differences?

Marty Parker (18:22): Maybe Microsoft doesn't care. Maybe it's truly sample code.

Don Van Doren: True. Exactly. That reinforces the point several others have made too.

Marty Parker: What would you say, Russell? Is this sample code, or are they trying to make a business out of this - the Surface specifically, I mean?

Russell Bennett (18:44): Sample code in what sense? I don't quite understand.

Marty Parker: In the sense that they are proving to the market...they're putting out the Microsoft view of what the new device should look like in terms of portability, thinness, flexibility, keyboard - making a statement to the market. Are they making a statement to the market or are they trying to start a new billion dollar business?

Russell Bennett: I think the statement to the market point has already been made, that they're potentially trying to show the hardware venders what's possible to do. And, linking about to the Cius point about why didn't that work and why will the Surface work, I think the Cius was a fine idea. We discussed it a couple weeks ago. It was poorly executed. A good idea that's well executed - and it remains to be seen if this one is - is always a good thing. I think Microsoft has always allowed the hardware venders to make money by shipping their software on the vender's hardware. I think they probably want to stick to that model.

The problem we've seen is the iPad has been so enormously successful because Apple controlled end-to-end implementation. So Microsoft is saying to the hardware venders, you know, this is what you should do if you're going to compete with iPad on Microsoft software. So, your point is well made. Basically they're setting a bar. It remains to be seen whether they'll try and stick with shipping this product into the long-term or if they'll let successful hardware venders take up the running.

Marty Parker (20:28): Great, very interesting prospective. Any last comments gentlemen before we wrap it up here?

Art Rosenberg (20:36): Marty, I just wanted to second the motion by Phil about the direction of the devices, the endpoint devices to being dataless. The Cloud perspective is one that's going to make that happen slowly but surely. The device is going to be used for access with appropriate software in it, but really nothing of importance. So that's going to be maintained elsewhere and it won't be on premise necessarily; it will be somewhere in the Cloud and all kinds of information will be accessible.

The other thing of course is that the applications that we used to do at the desktop - you know it had a big screen, a keyboard, and so on - now we have things called mobile apps, but they may be not quite necessarily that mobile, but the point is they will be adaptive. The applications will be broken down into the pieces that the individual end users need and want. They will have control to access to that. So, the content, if you will, is going to be much more flexible. It will be device independent, hopefully. And all of that will come together in some effective way and cost-effective way.

Marty Parker: Any other comments?

Don Van Doren (21:51): Marty, let me just say one more thing. You know, nobody has brought up Office 365. I think that one of the interestin g ideas might be the way that this kind of a device, to the extent that it is more portable, etc., working within an O365 environment might be an interesting strategy, too, for Microsoft to be thinking about, especially as we get to what the earlier definition of post-PC market is all about. So, there might be some interesting synergies there as well.

Marty Parker: Phil Edholm, your comments?

Phil Edholm (22:31): I want to elaborate a bit on what Don just said. I think this is a very important part that we need to understand that's happening. Assuming that Microsoft integrates Surface very closely into Lync/Skype/Office 365, their - let's call it for lack of a better word - Cloud community. What you're actually seeing developing is three cloud communities in the industry. There's obviously the Apple Cloud community around FaceTime, the other applications, Apple's I-Cloud, there's a whole series of things that says if you use Apple and I use Apple, there are a set of things we can do together that you can't do with other devices.

Assuming that Microsoft follows the same path in Surface, and obviously Google is doing similar things in Circle, and some of the things they're doing. They really are merging these three cloud communities. I think the really interesting question is going to be: which ones of those from an IT prospective are most business friendly? Because one of the big advantages that Microsoft has shown in Lync is the federation between Lync users and the ability that if you use Lync and someone you are doing business with uses Lync, you can actually fairly easily set up federation for your employees to manage that. So, that's actually one of the advantages. I think it's going to be very interesting to watch over the next six months how Microsoft integrates the Surface experience in with that Lync, Office 365, potentially extended into Skype, and how those come together. I think you're going to have some very interesting choices to make about the communities that the devices that your users have, bring with them, and how you integrate them from a business prospective. Thanks.

Marty Parker: I agree with those points. They were very well made. Thank you. Any other key points, folks?

Steve Leaden (24:24): Just to finish it out, you know the Surface they claim that will come with a USB port that's very business relevant. That's one thing the iPad consistently lacks. If Microsoft gets the Cloud experience right, which again they've done up until this point in other venues, the security aspect - I think we will have to watch that. But, I think they're ahead in that particular space. I know there are concerns in the iPhone world and in the iPad world areas that are business related being backed up into the iCloud with no form factor relative to the security about business.

So, I think really in the end with some of these elements here, I think if it's targeted right it could be the business tablet that the business community has been seeking. We'll see.

Marty Parker: Great. Well, thank you all gentlemen for your inputs and your commentary. I encourage people who are listening, please post about this. There's a post section below this podcast transcription and we would love to hear what you have to say. Thank you very much.