Microsoft Puzzling Announcements

Microsoft has been on a roll and is back at the top of the tech industry by doing exactly what Satya Nadella said he’d do when he took the reins from Steve Ballmer. But now, Microsoft is engaging in a number of risky processor (ARM) and partner (Android) transitions. Why?

Last week, on October 2nd, Microsoft made some puzzling product announcements wrapped in contorted explanations. The company’s news page provides an overview of the new products, some shipping now or in the very near future, others with a hazier “2020 Holidays” ship date.

Near-term products look like a good evolution of the respected lines of 2-in-1 Surface tablet/laptops and the more conventional but always well-executed Surface laptops such as the new Surface Pro 7. Since 2012, Chief Product Officer Panos Panay has guided the Surface devices to the very top of the industry, shedding a less-than-flattering light on Apple’s once de rigueur but more recently stumbling Macintosh product line. (By coincidence, when drafting this column on a plane from CDG to SFO, my MacBook keyboard stubbornly refused to output the 8 in x86 below…)

Moving on, the insistent Windows On Arm surfaced again in the form of the Surface Pro X, a thinner, lighter, always LTE-connected Windows laptop with a significantly longer battery life (up to 13 hours). So far so good…but the Surface Pro X comes with a price: Existing x86 Windows apps won’t work.

The Surface Pro X isn’t a ‘new and improved’ product introduced in a time-honored Good-Better-Best succession. Instead, it’s a half-sibling to the Surface Pro 7, born of a different mother(board). The ARM-based SQ1 chip that drives the machine requires a translated operating system — and translated apps. No doubt, Microsoft will provide the gamut of basic Office apps for the new device, but adapting the rich world of third-party x86 Windows apps that made “classic” PCs so popular is another matter.

The bottom line is that Microsoft has “forked” their product line. An ARM-based Windows device forces Microsoft and its partners to develop, maintain, and deal with the subtle incompatibilities that will arise in this parallel world. True, Microsoft provides evolved tools to ease these tasks, but life in such parallel universes is never as simple as the markitecture pablum claims it will be.

Why fork Windows and its applications on Microsoft’s flagship Surface line? Does the company expect sizable short-term benefits, a measurable revenue increase, from such a decision? Or is it a preemptive move in case other ARM-based devices, from Google or Apple, become too-powerful PC alternatives?

There is much more: the Duo and Neo devices.

Starting with the Duo highlights, we have two display modules connected by a clean, solid-looking hinge, as opposed to a more fragile foldable display. The CPU is a Qualcomm Snapdragon ARM-based chip that runs a version of Android; the device sports a stylus option and makes phone calls:

(Surface Duo intro video here)

In keeping with a late 2020 ship date, many details are still hazy. From here, it looks more like a small Moleskine notebook than a phone, and we have little information about the camera (or cameras) the Duo will offer.

As for apps, the Duo will run “Android-optimized” Windows apps…another fork. And what about apps that need to be adapted from the Android world to fit the dual screen arrangement? That’s still another fork, a complicated one with interesting challenges, to say nothing of the terms of the undisclosed Android license with or without Google Mobile Services (I assume they will run on the Duo).

We then move to the Neo devices. Once again, it’s a two-screen hinged device, each screen measuring 9” diagonally. With interesting tricks such as using the bottom module as a screen keyboard and a Magic Bar, the Neo is functionally richer than the MacBook Pro with Touch bar or with a magnetic keyboard and stylus add-on:

(Surface Neo intro video here)

The CPU will be a “heterogeneous” Intel chip designed for such form factors, and will run a special dual-screen Windows 10X that will require specially adapted apps to make good use of the two display units…all sounding like another fork for Microsoft and its developers.

Again, why such travails, such risky compatibility gambles?

Here we have to pause for a moment to admire what Satya Nadella has accomplished since he took Microsoft’s reins following Steve Ballmer’s departure. By focusing on the Cloud, where most mobile Microsoft applications now live and offer very substantial collaboration benefits, well-managed storage, and easy subscription arrangements, Nadella and his team have once again taken Microsoft to the top of the market capitalization mountain, more than $1.020T (as in trillion) at the last reading. This is no flash in the pan; by all appearances, it looks stable and it’s not running out of steam.

So what does Nadella see beyond the horizon that would explain the technically and organizationally challenging forks? Why complicate Microsoft’s orderly transition to a cloud-based world of productivity and creativity for its business customers?

Unfortunately, Microsoft’s CEO doesn’t help our understanding when, in a Wired interview, he says things like [as always, edits and emphasis mine]:

The operating system is no longer the most important layer for us […] What is most important for us is the app model and the experience. How people are going to write apps for Duo and Neo will have a lot more to do with each other than just writing a Windows app or an Android app, because it’s going to be about the Microsoft graph.”

The first sentence is puzzling, a neither here nor there statement. One could argue that Office and related software has been and continues to be the most important layer for Microsoft: The company has always made more money from Office licenses than from Widows billings to PC OEMs and customers combined. True, if there’s no Windows then there’s no Office, but in that sense Windows is just an enabler, something used indirectly.

Considering the forks just discussed, what will bite Microsoft in the reputation and income statement? The operating system, or complications during the delicate transition to new devices? By switching to ARM processors and to Android, Microsoft will have to use a long ladle to dine with Google.

Lastly, what’s with the “Microsoft graph”? Nadella is probably (and legitimately) referring to the ecosystem of products and services Microsoft customers enjoy: cloud apps, storage, collaboration services, Teams, LinkedIn… This is precisely what returned Microsoft to the top. But why parrot Zuckerberg, why borrow Facebook’s Graph expression that helped tarnish the company’s reputation as it messed up social and political worlds? Could you imagine Tim Cook discussing the mutually reinforcing properties of the Apple ecosystem components and proudly referring to it as the “Apple Graph”?

Microsoft’s efforts deserve better than to an attempt to appropriate Facebook’s tainted vocabulary.

One is left to wonder: What does Nadella see beyond 2020? Google becoming a dangerous hardware and cloud-collaboration competitor? Is Microsoft trying to implement a 21st century version of its old Embrace and Extend maneuver — on Google’s devices and collaboration software this time?

All Rights Reserved for Jean-Louis Gassée

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