Yeah but isn’t that more affected by the fact that people are still moving from XP to Windows 7 and it’s a little bit early to say …
Adam: That’s the argument that I make. The argument I make is this issue of not upgrading goes all the way back to XP. You have 40% of users still using XP. There are 40% of users who didn’t go to Vista and didn’t go to Windows 7. And now you have Windows 8.

Now the question becomes why didn’t they do that? How could they have not upgraded? Why do you have 40% of your base that’s using this very aged software?

So let’s reach in to some of the academic writings and my favorite is a guy named Clayton Christensen who wrote “The Innovator’s Dilemma” and a lot of other books since then as well. He’s a mentor of mine. He’s an innovation guru right, and one of the things he points out is that companies that have a solution will tend to keep trying to improve that solution until they overshoot user needs.

Onuora: OK.
Adam: And then what happens is that they’re now coming out with new revisions and new upgrades but the users of their products are sitting there saying “I don’t really know if I need that product. I don’t really know that I want that upgrade.”

Onuora: OK.
Adam: And in those markets what happens is user base d doesn’t upgrade and then what you see is some sort of an alternative will come along that meets needs in a new way. And then people start buying the new thing. I’m not just sitting here talking about computers, we saw this happen, for example, in xerography where people were running printing presses.

They kept coming up with better printing presses and then what happens is Xerox comes out with a Xerox machine and then all different kinds of Xerox machines come out and then over the course of a decade we pretty much quit having printing presses in the basements of companies and everything was replaced with a Xerox machine.

You see so xerography and the technology replaces the old technology and the printing press is out. Sure there are plenty of printing presses out there today, you didn’t get rid of all of them but you got rid of enough of them that you put out of business all of the printing press manufacturers and most of the printing plate manufacturers and you get down to 3 or 4 companies in the whole world that are making that equipment.

That’s just an example that’s outside of tech. Now come back to tech when you’ve got an installed base, like a PC installed base and that base has been getting larger over about 6 years.

Onuora: OK.
Adam: And we start saying OK people are not upgrading. What you’re looking at is a classic problem of the user out there isn’t saying “I want to upgrade” and Microsoft saying “I’m giving you an upgrade and you should do the upgrade” and then in fact you can read lots of articles of people saying “I would never leave XP if you didn’t force me to leave XP because I’m perfectly happy with what I have here”.

Now those people are saying ‘I’m happy with a PC at this level and don’t want a bigger faster PC. I don’t need a bigger faster operating system. I don’t need bigger faster Office tools, I don’t really need that. I’m really happy and content with what I have…”

Onuora: Sure.
Adam: So now comes something new like the tablets and smartphones and people say “Oh wow I like this, it gives me more mobility, it lets me do a lot of stuff in a way that’s different and I find it to be quite a bit handier than my PC.

I like the size, the format, the build, the look, the interface, I like not having data on the device in case I lose it” – those are some of the reasons they say they like it. Then they start buying them and they starting buying them in huge quantities.

This is the classic market shift, the textbook example of a market that is shifting. The user isn’t saying “Hey my PC is crap”. They don’t’ say that. What they say is “I got a PC and I’m using the PC but I’ve noticed that this month I don’t use my PC nearly as much as I used it 6 months ago and I didn’t know that 6 months ago or a year ago I would never have walked around the halls or gone to a meeting without my laptop but now I find I never carry my laptop.

You know I only boot my laptop up every 2-3 days and now I do most of my work on this other thing”.

Onuora: Well, I mean there’s no dispute that consumers are gravitating towards tablets and mobile devices, that’s not even up for dispute. I guess what’s a little bit more murky to me is the rate at which that’s happening in the corporate world.

In the Enterprise which is Microsoft’s stronghold, they are taking steps to combat that trend. They’re coming out with the Surface, they’re coming out with a bunch of mobile devices as well, Windows Storm 8, the Ecosystem, so it’s not exactly as if Microsoft is doing nothing.
Adam: I absolutely agree it’s not as if Microsoft is doing nothing. So now we get into the issue of leadership and management because…

Onuora: OK.
Adam: What a really adaptive, clever leadership would do is say “Hey you know what – we’re gonna keep these PCs running as long as we can but we’re going to realize that market doesn’t have a lot of growth left in it”.

Onuora: OK.
Adam: “What we gotta do is keep those users running as long as we can as long as possible for us but we have to be ready to be part of the cannibalization of our own environment. We have to be ready to make these changes and we need to get a product out there”. And you know that Microsoft had the first tablet right?

Onuora: Sure, sure.
Adam: Then in 2010 Ballmer stepped up and wanted to get a tablet out this year but didn’t get it out until 2012. What you see is a company that was very, very late to market.

Onuora: That’s correct.
Adam: Yeah, by being so late to market they allowed the competition to build its very own large installed base. Now installed base tends to build on installed base. Once Microsoft started to whip Apple’s butt (going back two decades ago), you saw that the installed base of Microsoft users kept growing as people switched from one platform to the other.

So you now have an installed base of Android, Kindle, iOS, iPad users and that begets more buyers because people look around and most people don’t say “Oh I’m going to do a spec analysis to compare products” that’s not what they say. They say “Hey this is what most people are using” and they use it and they like it and once they use it and like it they don’t like to change.

To come along and say OK I’ve got a product that I think is better and we’ll say that product is Surface and you hand it to them and they say “Well you know it might be better but I’m very happy with what I have. I like it and how it works and I don’t like the idea of having to go use this other interface and another shape”. You say it’s better and they say “I don’t know why you say it’s better” and that’s actually how people do behave.

About the Author

Onuora Amobi is the Founder and VP of Digital Marketing at Learn About The Web Inc. Onuora has more than a decade of information security, project management and management consulting experience. He has specialized in the management and deployment of large scale ERP client/server systems.

In addition to being a former Microsoft MVP and the founder and editor of EyeOnWindows.com, he is the CEO of a Pasadena based online marketing education startup - Learn About The Web Inc. (www.learnabouttheweb.com) and The Redmond Cloud (https://www.theredmondcloud.com).

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10 Comments
  1. I have to agree, brilliantly thought through and MS might just do it but like Adam, I’d argue they will have done it the hard way. I have a Surface RT Tablet, the more Tablet friendly version and I find myself turning to my Nexus 7 and iPad for ease of use, they are just not awkward. Add to this that Google has a great set of tools in Doc’s, Spreadsheets, Google+ & Email mean I can have a really good, cost effective, anywhere usage which further threatens Microsoft sales of Windows & Office… Imagine you are an SME starting from scratch, would you use these tools or the new ones available on tablets and any device… Ok Lunch over back to work…

    • Your description outlines the opportunity MS has to win market share; Google does a few things well and Apples does a few things well but they don’t do them all well. If MS can figure out the ease of use thing and seamless integration, they will do what the others have not. Google continues to ignore what real business users need. You can’t use Google Docs to prepare a professional document and Apple isn’t even trying. MS just needs to improve ease of use and pull their products together so people can use one platform. I’ve been using Apple, Google and MS for years and recently dropped Apply because the Surface and Windows 8 phone fit my needs with seamless integration. I’m frustrated learning Windows 8 RT and that is the arrogance of MS thinking it is okay to make consumers completely relearn how to use their OS. It is a better browser IF it is compatible with websites, reliable and faster.

  2. I don’t see why defending your customer base by adding innovating technology is a bad part of your strategy. A seamless integration of business systems makes it harder to move to other systems. At the same time innovative technology competes with others taking market share. A two pronged approach seems smart. The problem is that Microsoft has been arrogant for years and thinking they don’t have to compete. Microsoft has put about several lack luster products thinking the market would just accept them since they are from Microsoft. Consumers are not blind minions following Microsoft. If Microsoft can be humble and realize they must product great products and services seamless integrated and encourage development they will gain market share. Apply and Google have captured market share because their products are easy and just work. Microsoft puts out IE 9 and 10 and it has constant performance and integration issues. Every time a user has to close IE because it crashes or freezes Microsoft loses stock with users. I have a Surface and a Windows 8 phone and both are excellent choices. If Microsoft can get more apps they will be going head to head with iPad and others plus have the advantage of Office product integration.

  3. george_szubinski / January 28, 2013 at 5:41 am /Reply

    and I disagree with Coatsey.
    Having owned a Surface RT and sold it patiently waiting for my Surface Pro… I found my ipad Nexus grossly inferior and couldnt wait to get onto my Surface. I have been in IT a very long time and seen too many people like this guy pumping up his background and his mentors… only to still be there in 10 years when his predictions have failed….

    nope…. I cannot see it happening…

    as for great set of google tools… Coatsey… perhaps but not for the heavy duty stuff I do… and my corporate customers need…. you see there is the difference … the toys are for kids to consume… but business is totally different…

  4. Forget about it. Microsoft ppl are smart. They are different, they deal with technology and those kind of people can adapt very fast if they want to. Besides I have had convertibles for about 5 years now (Vista, 7 and 8). Well yeah, Vista convertibles were clunky heavy and ultra-expensive, but they were awesome. Windows 7 convertibles were also nice, with the addition of multitouch and capacitive screens (vista’s ones were resistive). But the device was still somehow heavy and was more of a laptop than a convertible that could be used as a real tablet. And now I’ve got a Windows 8 convertible (Sony Vaio Duo 11 256GB SSD i7) and I can tell everybody it is just SO MUCH F&*&*ING better than whatever other tablet / convertible / whatever ever made. And Windows 8 is just a complete pleasure to use!! Absolutely nothing can beat up this beast!!

  5. Very interesting. I was really sure I would disagree with what he said, but instead found myself agreeing in large part. MS has a big job ahead of itself for exactly the reasons he states. MS is reacting defensively instead of proactively attacking a new market. I think people intrinsically see that and make decisions base on confidence displays by the manufactures.

    That said. People do have a problem, which enterprises are the first to recognize. “How do I get all I need to do done on a tablet?” The solution to this must be either on the front end or the back end, or a combination. MS has the complete answer to this already on the front end with Windows 8. It is just not conveying that message to them well. Apple has absolutely no answer to this, as iPad is at least 3 generations away from that and shows no signs they understand the problem. iPads are only viable to consumers that have computers to fall back on when necessary. Their hope then lies in a third party building a backend solution. Google is a lot closer if they combine Android with Google Chrome OS. However his comments really sinks in to me that Windows RT is exactly the type of venture that MS needs to avoid. This is the exact sign that MS is hedging its complete solution bet. This shows that MS is not confident in its convergence strategy. People are picking this up and unless MS changes its message, it will be in trouble.

    So where does that leave Windows Phone? I am sorry to admit this, as I am really wanting Windows Phone to be a viable platform. The current endevor seems bound to fail. It has been playing catch-up and will continue to appear this way even thought technically they have caught up. They actually need to go beyond. MS has always been about taking some idea and making it better. That works when they are ahead, but they are not in the phone and tablet arenas. It is time that MS implements disruptive technology or they will never break into this market.

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