Mobile Solutions CI

Microsoft earnings slump and layoffs deep dive: What it means to mobile

At its earnings call last Thursday and internal company meetings last Friday Microsoft announced revenue declines and the first-ever layoffs of around 5,000. Microsoft employees interviewed following the internal announcements spoke of more layoffs to come, estimating that over the next 18 months two or three times the announced head count would be reduced.

Microsoft will be launching Windows Mobile 6.5 at MWC and will emphasize the integration of services such as Mesh and Zune to the mobile operating system. Mesh will be the key competitive move as it provides backup/restore to devices, PC file acces, and content sharing.

The trouble with Mesh is that it is basically a PC-centric extension of Windows, rather than a mobile content service. Mesh has substantial memory requirements on both the PC and mobile device. The WM and services combination is processor intensive and will require the most current and advanced hardware platforms. Compared with iPhone services, Blackberry services, or Nokia's Ovi it is not a designed-for-mobile experience.

However, expect Microsoft to use Mesh to focus its efforts on creating license renewal strategies rather than expand alternate revenue streams. As advertising dollars plunge and Microsoft still struggles to integrate its acquired ad services into its properties, it must rely upon server/cal licensing. For consumer offers this means an acceleration of bundling Mesh and Microsoft Live services into Windows Mobile (WM) 6.5 and WM7 to give value to WM licenses.

The existing cuts affected the business unit which houses the Zune team as well as consumer-oriented mobile services (Entertainment and Devices). Microsoft's 10Q financial filing revealed a sharp dropoff in Zune hardware sales. The business unit overall managed to see a 3% increase in revenue due to Xbox holiday sales after aggressive price cuts, but the mobile and music services are flat to declining. WM did claim 5M licenses shipped over the previous quarter, exceeding iPhone sales, although over a much broader and deeper distribution channel.

The employee cuts in consumer mobile services have focused on content-production groups, mostly in gaming. The Zune team remains fully staffed and focused on layering Zune as a service component of WM. There are several blogs and news sources which are inaccurately portraying the layoffs as affecting mobile teams. The WM team saw an increase in developers assigned to it following the cuts and a re-org. These moves point to an acceleration of the "software plus services" model for mobile offerings as Microsoft rushes to add sync-based services based on Microsoft Mesh.

 

Microsoft earnings release

The layoffs mark the third major re-org within Microsoft mobile business units in the last 12 months. As an example of the impact this is having on Microsoft, see the following interview where Microsoft's Director of Mobile Music UK is unable to explain the value of his new service and also is not aware of how it affects device upgrade cycles. Ouch.

T-Mobile USA launches "G1" Android phone

T-Mobile announced the first Google Android phone today at a press conference in New York, calling it the "G1". The announcement stressed the integration of Google services onto the HTC touchscreen device, particularly search.

The two elements of Android which will draw the most attention as being directly competitive to Apple's ecosystem are the integration of a music store and an application store.

Watching the video it looks like it has some features which are ahead of Apple and RIM but the overall integration and service experience may lag.

T-Mobile announcement and information:

Details:

Amazon has provided a music store and purchasing capability. There is an Amazon MP3 icon which lets you surf the site's music store and do one-click ordering. Its default music player has options to search for related material on services such as Google or YouTube while a song is playing--a step beyond what Apple's "Genius" feature can do.

The device OS also has an "Android Market", an application store comparable to iPhone's Appstore. There are three high-level differences between Apple's App Store and Android's Android Market. Android will only feature free applications, Android has no approval process, and the Android Market will have no website or desktop element.

The G1 also features push email for Gmail; pull email for other POP3 and IMAP. No native support for Exchange.

Google products bundled on phone:
- Google Search
- Google Maps
- Gmail
- Google Calendar
- Google Talk
- YouTube

Pricing: US$179 for the device with a 2-year plan required of voice ($29-99) + data ($25-35/mo) (therefore minimum of $65/mo w/only 300 voice minutes and 400 messages, unlimited data)

Availability: October 22 in the US, November for UK, Western Europe to follow early 2009

Visto adds social networking, photo share

Visto is announcing a new version at CTIA which includes email, social networking, SMS, IM and photo sharing.

" Featuring an innovative "living address book," VISTO Mobile 6 offers end users expanded push mobile email and mobile social networking capabilities. This living address book combines favorite contacts from multiple sources, including social networks, into a seamless user interface. VISTO Mobile 6 utilizes VISTO's patented push and synchronization technology to keep users constantly up to date in real time on their messaging and social networking activities.

In addition, VISTO Mobile 6 provides end users the ability to filter updates from their list of contacts; meaning each user has the control to see only the updates they truly care about. This eliminates the clutter of unnecessary updates and requests."

Visto will target both small business, SOHO, and consumers with this offer. For operators Visto will emphasize the ability to federate many solutions through one client application and control data costs through Visto's NOC and data compression capabilities. There are no announced operator customers yet.

Visto's product positioning:
"VISTO Easy Setup(TM): End-to-end self provisioning with pre-installed clients, enabling mobile email users to set up their service from their device in a matter of seconds

VISTO worklife.freedom(TM): -- access email from the most popular portal email providers and social networking sites including Yahoo!, AOL, Google Gmail, Hotmail, Facebook, MySpace, Flickr and Photobucket

VISTO ConstantSync(TM): instantly pushes data right to the phone so the end user is always up-to-date - alerts, emails, status messages - everything is always current. -- get notification of new pictures, posts, and other important events from social networking and photo sharing sites from your favorite contacts pushed to your phone -- share photos from your phone to multiple photo sharing sites. Support for multiple services: send and receive messages from work and personal email and social networking accounts, each with its own inbox, with full attachment handling"

RIM announces Sametime client integration

At Lotusphere this week RIM announced increased integration of Lotus Sametime into the BES server platform, including integration of a Sametime client to the Blackberry.

Is this the first sign of Ascendant's platform extending PBX integration to BES, or more a sign of last year's announcement that Sametime and BES would share development resources? It's an important step to extending RIM's reach beyond email and encouraging use of BB as a desktop phone replacement. This counter's Microsoft's similar capabilities for Exchange 2007, which has yet to be as deeply integrated into WM5.

Key features include:

• Lotus Sametime client software for BlackBerry handsets
• "Convert to Call" Allows users engaged in an IM group chat to instantly convert their text-based discussion into a multi-party conference call (initiated and managed through the enterprise PBX or a conference server by the BES).  "Convert to Call" works through the BlackBerry Enterprise Server to seamlessly collect the presence information of each user from Lotus Sametime, then invokes the enterprise PBX or conference server to initiate outbound calls to each user, pulling them together into a voice conference
• "Click to map" launches Blackberry Maps from within sametime and shows buddy positions on the map
• Design templates for Notes discussion databases to optimize for Blackberries

Full press release

No MSN integration for Sametime?

Sametime to interoperate with AIM, GoogleTalk, Yahoo IM--but not Live Messenger.

The standards competition between major players in IM and messaging will continue to drive the need for middleware.

"Lotus Sametime jibes with AOL, Google, and Yahoo IM" at CBR Online.

Sybase completes Mobile 365 acquisition--will it work?

Sybase recently announced it had completed its acquisition of Mobile 365, renaming it Sybase 365.

Last week I spoke to one of Mobile 365’s sales executives for additional background. As part of the deal he and much of the Mobile 365 sales team were let go because their roles were viewed as redundant to current Sybase roles. His view is that the Sybase will lose traction in the operator channel because the enterprise sales team that replaced the Mobile 365 operator sales team lacks required experience and will have to rebuild relationships with operator partners. 

However, this buy adds IM to Sybase’s messaging portfolio and provides access to the operator channel relationships that Sybase lacked. It also adds key go-to-market components which Sybase might capitalize on.

• IM: Sybase 365 claims to be the global leader in mobile interoperability messaging (SMS, MMS, and IM)
• Operator channel: 700 mobile operators, content providers, media companies and large enterprises; major customers include Cingular, O2, Telcel, Telefonica, T-Mobile, Verizon Wireless and Vodafone
• Application delivery: Distribution channel and infrastructure for delivering marketing campaigns, interactive services and premium content to consumers for major brands (Citibank, Yahoo!, MSN and AOL) including live event contests, broadcasts and mobile alerts
• Software as Service infrastructure: Sybase 365 will provide a service-based model for Sybase to deliver AvantGo (mobile content and services) and mFolio Web content mobilization server, and data analytics
  
• View the Sybase press release here: http://www.sybase.com/detail?id=1047934

WebEx Launches AIM Pro Business Edition

Microsoft is trying to first establish LCS’s IM as a meeting and applications enablement feature bundled into their server, and then build on that footprint to include software as service models. This article shows how Webex is going straight for the bigger play by leveraging AOLs installed base and again tying it to meeting enablement features.

An example of the larger battle between SaaS and packaged solutions.

http://www.cbronline.com/article_news.asp?guid=4D18A8E0-14FD-4F54-AF19-29CE573A6354

MSFT and Nortel announce UC alliance

Microsoft and Nortel announced a four-year Unified Communications (UC) alliance to combine R&D, licensing, and channel resources to develop and sell communications solutions based on presence, messaging, and voice. Nortel will locate some product teams on Microsoft’s Redmond campus. The announcement is a marketing gesture with no specific roadmap or milestones.

This is an empty PR statement that fulfilled its purpose when it was broadly picked up and Nortel's shares got a much-needed bump. Back in the dot-com era companies would purchase this kind of placement with stronger players by trading customer traffic, advertising placement, or other "soft" assets in order to get a timely rise in stock value.

However, the potential for Microsoft to create channel and partner programs to deliver and support these solutions is a real competitive threat to Cisco and other players. In the long term Microsoft’s Unified Communications platform may benefit from this alliance as it seeks to displace analog voice solutions.

Press announcement at:
http://www.innovativecommunicationsalliance.com/

Microsoft Q&A on alliance:
http://www.microsoft.com/presspass/features/2006/jul06/07-18UCGNortel.mspx

BES 4.1 IM Features (Part 2 of 4)

This is the second of four posts reviewing the latest version of RIM's server, BES 4.1, and this post covers Instant Messaging (IM). The rollout of BES 4.1 prominently featured IM as one of the key new capabilities and reasons to upgrade.

BES 4.1 includes integration of several Enterprise IM platforms: Sametime, Microsoft Live Communications Server 2005, and Novell GroupWise® Messenger. Sametime and LCS dominate enterprise IM, although consumer IM adopted by employees still represents far greater usage. 

The BES 4.1 IM client lets you move from your desktop (or web browser) for chat and presence to your Blackberry while maintaining contact lists. Chat sessions don't transfer history; messages are redirected to a new login (either desktop to mobile or mobile to desktop) when presence is moved to a new location. A few months after BES 4.1 rollout there are still known issues with this on the RIM support site which list problems with this transfer. It isn't unusual for this step to fail, with IM messages going to your desktop while you send from your device.

You can conference throught the BES IM; it supports two-way chat or multi-way chat from the Blackberry.

In summary, extending IM to your BES clients is not seamless, particularly for larger enterprises. A code install on the IM server is required to allow communication (Collaboration Services) from BES to IM Server. More critically, IM must have a single BES to Single IM server relationship. This means that in large enterprises with multiple BES for load balancing, but only a single IM Server, all IM users will have to be on the same BES. This setup is not uncommon so it's a real limitation.

RIM needed to bring unified messaging features to the Blackberry and this introduction of IM is an important step in that direction. It isn't without its hiccups but most enterprises will find the convenience of IM worth the pain--particularly if the option is employees using Yahoo! , AOL , or other consumer IM without any tracking or control.