“The world is a lot different from a year ago, and we have three brand new browsers and there is a lot more competition and as a result the users are getting a lot more technology…”

“… I think it is uncomfortable, because our rivals have 2-3 times the magnitude of people and resources, and they are relentless.”

The state of the browser market pretty much proves that it’s impossible for an open source project to remain a popular front-end application for too long.

A successful open source project will see one of two trends:

- Commercial entities, each with its own USP will pick, modify and integrate portions of the project into their own products. This is what’s happening with Firefox. (Chrome, according to Google, used ” components from Apple’s WebKit and Mozilla’s Firefox”). Firefox as an open source project is likely to thrive, but its best features and technology will probably find their way into more popular commercially-backed browsers [1].

- It will see widespread adoption, but on back-end IT infrastructure instead of the desktop. Linux and *BSD are examples of this. I guess this is because after a point, the marginal cost of polishing the UI is more than what developers are willing to bear, and that end users demand more. Regardless, the core functionality of such applications is on par with/often superior to commercial alternatives, so a combination of this + low price point makes them an attractive choice for back-end deployment [2].

[1] Android was a commercially-backed open source project (based on Linux kernel 2.6) from the beginning, so I guess we’ll treat it like Chrome.

[2] This isn’t a value judgement on the quality of open source products, or the viability of the open source development model itself. The past couple of decades do seem to have proved, though, that end-user open source applications are tough to build and sustain in their original form.

No longer. Not only are more mobile phones being sold now than ever before, there are more types of folks making money off it. For smartphones with an ecosystem such as iPhone, there is

- Apple, the iPhone manufacturer

- AT&T (in the U.S.) that provides cell phone connectivity

- tens of thousands of developers who sell their iPhone applications through the App Store (with Apple getting a cut). And this is not just indie developers. Amazon stands to make a huge bundle through book sales via its Kindle Reader app for iPhone [2]

- businesses that create free iPhone applications but make money off ads within their applications [3]

- record labels that offer their music for sales on the iTunes Music Store

- television networks and Hollywood studios that offer their TV shows and movies (respectively) for sale/rent, also on the iTunes Music Store

Of course, this runaway success has inspired every smartphone label to scramble to bake its own pie. Witness the plethora of application stores (Palm, Nokia, Blackberry, Windows Mobile, Android) [4], and Nokia’s attempts to sell music.

Open or closed?

The more mature a product category gets, the more players there are that stand to make money off it. That’s because the pioneer quickly realizes that for true scale, it must “open up”  the product to entities other than itself. And that’s where it seems we have from history, a clear lesson: IBM opened up the specs of its original PC, and hordes of beige box manufacturers crowded Big Blue out of its own market. Apple itself nearly destroyed all that the Macintosh stood for when it licensed the Mac to other manufacturers.

“Opening up” a successful product and creating an open ecosystem divides the pie into so many slices that the pioneer is left picking up only crumbs. Apple’s iPhone ecosystem has been “opened up” to all those players above through the iPhone OS developer API, the iTunes Music Store and the iPhone App Store, but the ecosystem itself remains tightly closed.

[1] OK, so there were (are) electronic component manufacturers on the source side and advertising agencies on the sell side. But let’s limit ourselves to those that gained directly from the mobile phone. 

[2] Also with iPhone OS 3.0, developers can now charge for features within the application (unlocking extra weapons and purchasing weaponry within games being the most commonly cited examples), so you could have a free basic application with paid features if you like. Before OS 3.0, the best that developers could do was offer separate “free” basic and “paid” full-featured apps.

[3] Take Twitterific, for instance. The free version of the application inserts ads into your tweetstream.

[4] With comical attempts to make them sound different (Palm Software Store, Nokia Ovi Store, Blackberry App World, Windows Mobile Marketplace, Android Market). 

Did Microsoft miss out on the big search opportunity that Google pounced on? Is Google losing the real-time communication game to Twitter?

Microsoft’s original mission was “a computer on every desk and in every home” [1]. Even with their almost total dominance of the PC industry, that mission remains far from accomplished.

Google’s mission is “to organize the world’s information and make it universally accessible and useful”. That’s a mouthful. But it’s also nowhere near completion.

Both companies – one over 3 decades old, the other over a decade old – have still only plucked the low-hanging fruit. Urban homes and corporations have computers, but there are still billions of potential Microsoft consumers – who might be well served with a mobile “computer”, for instance. For Google, even with its mind-boggling data center infrastructure and web-crawling, the task is just begun. Books. Space. History. Energy and resource consumption. And more. And that’s just the “organize” bit. Converting all that data to information so that it is “accessible and useful” is another thing altogether.

Companies like these are larger than the “next big thing”. Their own “thing” is so incredibly significant, so humbling. That’s why it’s unfortunate when such an organization changes its very mission to something that can mean absolutely anything (and therefore also nothing): Microsoft’s mission is now “to help people and businesses throughout the world realize their full potential” [2].

Google isn’t about to kill Microsoft. Not if Microsoft directs all its resources towards what it set out to do. Likewise for Google; Twitter isn’t out to organize everything known to man. So ignore those predictions of doom.

[1] According to Wikipedia the exact words were “to get a workstation running our software onto every desk and eventually in every home”

[2] Although I didn’t find any evidence to suggest Microsoft changed its mission in response to any other company or threat

So far [Microsoft] has been on the losing side of the equation, ceding market share to its upstart rivals, all of whom are touting ease of use, simplicity, security and speed. Microsoft’s browser chief, Mike Nash, thinks the new IE 8.0 has got all that and more.

So true, except that none of it matters to Microsoft. If it cared about  “simplicity, security and speed”, it’d install Firefox + extensions with every copy of Windows.

It’s become pretty clear that the only way you can make money off a browser is by driving traffic from it to a search engine results page with advertisements. That’s how Mozilla makes over 80% of its revenue – driving traffic to Google from its search box and its default home page.

Earning revenue from ads on Microsoft Live Search pages through IE traffic is the only imperative driving IE development. And its getting costlier by the day to keep up with the competition.

But it won’t help.

Microsoft says Windows 7 is netbook-friendly (and it might well be), but that’s irrelevant. The issue is higher margins. If Microsoft prices Windows 7 like Vista, it’s going to raise the total price of netbooks. That is unacceptable. After all, the USP of the netbook is Cheap.

Now, I think the company’s realized the underlying problem: Mobile and Desktop are moving towards each other.

The company is more likely to make higher margins on its Mobile Operating System than on its Desktop Operating System. High-priced smartphones are becoming increasingly popular and also more sophisticated. On the other hand, PCs are getting smaller and lighter – and cheaper.

Most commentators have already identified Mobile and the Cloud as the defining markets for the immediate future and they’re probably right. Microsoft has plays (albeit relatively weak ones) in both these in the form of Windows Mobile and Windows Live.

I think we’re going to see a shift in investment toward these two markets, and away from the PC market. At the minimum, expect a quick rollout of Office Live soon (either free or monetized) and Windows Mobile 6.5.

Noble enough, canny enough, bold enough. Except that no one’s talked about the gamble that’s implicit in the move.

Let me explain.

Suppose Google enhances its web applications using Chrome’s new capabilities – which it will. Gmail, Google Docs, Google Reader – now run almost as well as desktop applications. But only on Chrome. Now, these applications are more dependent than ever on the browser. In other words, Google is encouraging users to install a thin layer (of Chrome) on top of Windows to run their web apps. Perhaps Firefox will follow Chrome’s lead. That means 20% of the user base will be able to run the next generation of Google web applications.

But there is the remaining 80%. For that 80% of users, Internet Explorer is the receptacle through which they interact with the web. If Microsoft chooses to not play nice, Gmail, Google Docs, Reader will “break” on IE – that is, not render/function properly.

The average Joe’s reaction is to blame the “website”, not the browser. Example: The other day, the Yahoo! India mail website “broke” on Internet Explorer. My sister’s reaction was “Well, looks like Yahoo! mail’s not working properly, let me try Gmail”. Not “let me see if it works on Firefox”. Or my personal experience in cyber cafes in India: If the site doesn’t render correctly, “We’ll try after some time”. Not “Hey cybercafeowner, do you have Firefox on this box?”

In other words, if IE decides not to implement Chrome’s under-the-hood architectural innovations, it will end up discrediting Google’s own web applications, not IE or Microsoft. The average user is happy with his/her webmail (or other such apps). He/she won’t shift to a new browser, he’ll demand that the “email” work “as before”, or he’ll/she’ll switch to a new “email”.

No prizes for guessing that MS is hoping the new “email” is going to be Windows Live Mail.

I was playing around with a colleague’s HTC Touch Cruise the other day. The Touch runs Windows Mobile 6.1, and, in summary, is a full-featured smartphone with decent multimedia capabilities. That’s not what this post about though.

It’s about two clear observations I made – that we’re stuck in the late 90s when it comes to mobile touch-based input devices, and that UI designers still use the desktop paradigm when designing for mobile touch screens. While Windows Mobile is what triggered this post, with PalmOS, and UIQ too.

Poke, poke

Turns out that it’s a huge pain navigating the WinMobile interface on the 2.8″ touchscreen with your fingers. The buttons are tiny, the menu options are awkward, and it’s next to impossible to grab and drag a scrollbar. I gave up.  It’s clear – the best way to navigate a Windows Mobile is using the accompanying stylus. 

But a stylus is a hopelessly outdated tool. Along with the physical QWERTY keyboard for desktops/laptops, the stylus is a tool for mobiles that stubbornly refuses to die. Perhaps it’s easier – and commercially attractive – for touchscreen phone manufacturers to add applications and features than to rework a familiar, though suboptimal interface.

iPhone/iPod Touch have changed that. iPhone may not pack the sheer number of applications the HTC Touch Cruise does, but its interface is revolutionary. It lost the stylus. In fact, with multitouch – flicking, pinching, dragging with multiple fingertips – your hand is more effective than a stylus. You may not agree with iPhone the device (I don’t) – but you have to admit iPhone’s set the benchmark for all touchscreen interfaces.

Honey, I shrunk the desktop

Windows Mobile 6.1 has a task bar, a system tray, a Start button and a drop-down Start Menu. With nested menus. On that tiny 240×320 pixel screen.  

After spending a while with the device, I realized that Windows Mobile is essentially a shrunk-down version of the desktop Windows interface. The widgets are smaller, but the paradigm is the same. The result is a cluttered interface and a frustrating navigation experience.

Someone’s psyched the WinMobile team into believing that their biggest strength is that their mobile interface looks just like their desktop interface. That may have been true when mobile applications were very simple, but it doesn’t hold true any longer. It’s hurting usability and innovation.

There have been several calls for this, and I’m going to say it here again – the WinMobile team will do themselves and their legions of developers and enterprise customers a world of good if they rethink their interface. 
 

Note: I think Samsung and LG also have very good touchscreen interfaces. But this is merely an observation from Google Image Search results. Haven’t tried them out first-hand, so no comparisons.

Visibility: Xobni is a sidebar for Microsoft Outlook 2003 and 2007. With tens of millions of people using Outlook at work and, indeed, spending all day in it, Xobni is constantly in its users’ view. Contrast that with applications like Facebook, which live in a tab in your browser and will be out of view most of the time. (Serendipitiously, widescreen monitors are more popular than ever before, so a sidebar works well).

Ready-to-go: Unlike Facebook, xobni doesn’t need a first-time user to enter profile information, build a network over time by inviting friends, or accumulating wall posts or scraps. Xobni uses as fodder the tons and tons of information that’s already accumulated over the years in your inbox. That means once it’s done indexing, Xobni gets you up and running right away – discovering your network instead of you building it.

Intent-based: Xobni understands how you ‘do’ email. Users don’t view email as a chronological list of tasks at all – they either want to look at email as boxes of tasks (or projects or events), or as a collection of people whom they talk with. Xobni does the latter, and very well. So it’s a cinch looking up attachments from a contact, or the time of day you typically communicate with someone, or schedule time with someone.

Cool: Xobni’s done a terrific job of being viewed as something cool to transform drab old Outlook into. That’s why so many early adopters have turned passionate evangelists.

Do you use Outlook at work? Have you given Xobni a spin? What else (apart from specific features) do you think makes Xobni popular?

In fact, one of the tenets of the “new Web”, or Web 2.0, as it’s more popularly known, is that value is moving up the software stack, and that applications are now commodities; the real value lies in services that are offered via those applications. For instance, I’m writing this document on Writely, a sort of Wordpad-for-the-Web. Mind you, it isn’t an application in the traditional sense of the term, as much as it’s a service. In any case, the important thing here is that it doesn’t matter what browser application I’m using to access this document on Writely. I’m using Firefox, but I might as well have been using Internet Explorer. Or Opera. Or Safari. Or… well, you get the idea. The browser does not matter any more. It is a commodity. A lot of application “services” today run on the same principle. All of Google’s offerings: Search. Local. Maps. Gmail. Orkut. Blogger. Writely itself. Take a look at the hottest tech startups today. Flickr. del.icio.us. 37signals. YouTube. Digg. Bloglines. Spot the pattern? How you access the application services does not matter.

The browser is just the way we access the Internet today. What will matter is how we will access the Internet tomorrow. I’ve said this in the past, and I’ll say it again here. Google Desktop (GD) is the application to watch out for. The future will belong to what are known as Internet-connected widgets, or as MS calls them, Internet-connected components (ICC) . These will be used on desktops, mobile devices, and any other appliances that will be connected to the Web in the future. And GD is one application that uses these ICCs already. Almost every single plugin connects to the Internet to gather the data it needs. Or take a look at Konfabulator, deemed valuable enough to be bought by Yahoo!. These widgets are the future of how information and content on the Internet is going to be created and accessed. Taking it to the next level, imagine these widgets on your smartphone. Or in your TV/TiVo. Or in your car. That is the opportunity for ICCs.

So does MS need Internet Explorer?
The area we’ve talked about above is where MS’s future opportunities are. Ray Ozzie and his team have to find a business model to monetize this opportunity. That’ll require his deep technical insight. It’ll also require immense technical talent from within MS to build a programming model around the new Web. And here’s where I’m going to step in and make this assertion.

Microsoft should stop developing Internet Explorer.

Instead, it ought to concentrate on building the Internet into the very heart of the next Windows, whether it’s the successor to Windows Vista (for the desktop), or Windows Mobile (for mobile devices). Firefox is doing a better job than IE in every respect. It’s the better browser by far. Only Opera can come close to being as good. IE isn’t MS’s competitive advantage in the least, in many respects, it’s a liability. A wise move would be to cease development on the browser – any development on IE would be simply playing catch-up to Firefox and Opera. It makes no sense to compete in such a market when you’re better off building up tomorrow’s market. Microsoft needs to jump to (in the words of Guy Kawasaki) “the next curve”. Or in the words of John Sculley, “change the rules of the game”, as he did at the helm of Pepsi.

I sense that Windows Live is another mistake that the company’s making. Not the idea of web-enabled services – that’s fine by me. But the fact that Windows Live works best on IE and has problems with Firefox, Opera, Safari means that we’re going down the same path again – trying to “lock-in” users to their browser, when it doesn’t make sense – does the value lie in Windows Live application services, or does it lie in Internet Explorer? There’s no rationale in their policy right now, and it looks as if it’s degenerating into an ego issue – stop the spread of Firefox at any cost. If Ray Ozzie is to be believed through his “The Internet Services disruption ” memo, MS is now a services company, only with multiple product offerings. (As an aside, this model is precisely what Gates had alluded to in his book “Business @ The Speed Of Thought” more than half a decade ago. Talk about visionary!) So why is it competing in a senseless, hopelessly commoditized market which isn’t even a revenue source, where all it gets is bad publicity, and where its product offering is way behind competitors from a feature and ease-of-use point of view?

If Microsoft has the courage to back up its vision with action, it ought to include a copy of Firefox with Windows Vista, as the default browser. But the home page ought to be Windows Live. Hmm – now that’s a move that makes sense!