Microsoft is a 39-year-old company. Google is about to turn
16.
Both of those ages are major milestones for humans. It turns
out they’re pretty interesting for giant tech companies as well.
Microsoft and Google are locked in a struggle for the future
of computing. Both companies want to put their flagship operating system on
every screen you own and allow developers to write apps that scale from
handheld devices all the way to full-size desktop monitors.
This was Microsoft’s vision, as expressed in its 2013
Windows Everywhere ad:
And this is Google’s Android Everywhere vision, as shown off
at the recent Google I/O conference:
Look familiar?
If you’re a developer or device maker with a stake in mobile
technology, and specifically the next billion devices, this isn't just a
friendly wager. Do you bet on the older, experienced competitor? Or do you put
your money on the young, aggressive rival?
The numbers are clearly in Google’s favour. Earlier this
year, Gartner forecast that more than 1 billion Android devices will
be sold in 2014, roughly three times as many as the total number of devices
running Windows (360 million) or iOS/OS X (a combined total of 344 million).
But maybe Google is aiming at the wrong target.
Windows 8 in Business
Microsoft has painted bold design strokes with Windows 8,
but the business impact remains hotly debated. TechRepublic have the
enterprise and SMB perspectives on Windows 8 covered from virtually every
angle.
Microsoft quietly dropped the Windows Everywhere mantra last
year and, under the leadership of new CEO Satya Nadella, has been pursuing a
“mobile first, cloud first” strategy that focuses on getting its services onto
as many platforms as possible, including Android.
The most recent evidence is a one-two punch: First was a
report from own Mary Jo Foley that Microsoft will deliver Office
for Android ahead of its touch-first version of Office for Windows. That was
followed in close order by the news that Microsoft will ship a second
Nokia-branded, Android-powered phone, the X2.
That’s certainly not what Microsoft would have done in its
youth. But 39-year-old Microsoft doesn't behave with the same reckless abandon
as when it was a teenager. The cutthroat Microsoft of the mid-1990s, the one
that perfected the "Embrace, extend, and extinguish" template, has
been supplanted by a more mature competitor. (A few billions of dollars and
Euros in antitrust fines, along with a decade living under a consent decree,
also helped with the transformation.)
The Office team in particular has learned how to
enthusiastically embrace alternative platforms. The goal for Office is to
become aggressively ecumenical, running on as many platforms as possible.
Office on the Mac, for example, is a significant business. The new Office
apps on iPad are excellent and appear to have sold a fair number of
$99-per-year Office 365 subscriptions.
If Microsoft's goal is to make it possible for you to run
Office on as many devices as possible, then building a first-class Android app
is mandatory, even if the unintended side-effect is strengthening Google’s
hardware position temporarily.
That certainly means delivering Office for Android through
the Google Play store, using the same subscriber-only model Microsoft used for
its iPad apps. Whether Google will embrace Office as enthusiastically as Apple
did is an open question, but it’s a safe bet that Office for Android will be
insanely popular.
But the real game is in the Android Open Source Project, the
Android code that Google gives away. An army of small Chinese manufacturers are
building handsets based on AOSP. As of the end of last year, BI Intelligence
reported that 25 percent of all global smartphone shipments were
running a forked version of Android, minus Google services.
Amazon’s Kindle Fire is based on AOSP and is similarly
Google-free. AOSP is also at the core of those Nokia-branded, Android-powered
phones now being sold by Microsoft.
And that’s where things start to get interesting.
If Office becomes the anchor for Microsoft's Android app
store, a non-Google version of Android becomes much more attractive for device
makers and an easy hedge for developers, who can port their apps to MS-Android
with only trivial effort.
Handset makers who are currently shipping Google-certified
Android devices could choose to replace that OS with MS-Android instead. For
device makers that have signed a patent licensing agreement with Microsoft, the
carrot could be a complete waiver of those per-unit licensing fees as long as
Office and other core Microsoft services replace their Google counterparts on
each device shipped.
I made the argument earlier this year but it bears repeating
here: Android isn't the enemy, Google is.
If you think Microsoft cares most about the royalty it
charges a device maker for the OS license, you’re several years behind. Of
course the company would be happy to collect that one-time OS royalty from a
device maker, but they’re equally eager, if not more so, to have the buyer of
that device paying for international Skype calls, for an Office 365
subscription, and maybe even for an Xbox Live Gold account. Over the life of a
phone, the revenue from those services can easily be an order of magnitude
greater than that OS royalty.
Microsoft wants its services, along with those of its
partner and soon-to-be-subsidiary Nokia, to be front and center on a mobile
device. It’s easy to do that with Windows Phone and Windows 8.1 mobile devices,
where Microsoft controls the platform. It’s much more difficult to replace
Google services on new Google-certified Android phones, where those services
are set as defaults, as a condition of acceptance into the Google Play
ecosystem.
The Evolution of Enterprise Software
Enterprise software represents the glue that ties together
teams and business processes, especially in global organizations. See how
enterprise software is simplifying, webifying, mobilizing, and getting a lot
more social.
No, this doesn’t mean Microsoft is going to abandon Windows
on mobile devices. When the touch-first version of Office for Windows ships, I
expect it to be significantly more powerful and feature-packed than its iOS or
Android cousins. That’s the advantage you get when you own the whole operating
system and can tap into that OS at a low level in a way that ordinary,
sandboxed apps can’t.
That also explains why Office for iOS and, soon, Android are
coming ahead of the Windows version.
Meanwhile, Google’s strategy with its services is to build
them for Android first, and for iOS because it can’t afford to ignore the
800-pound Apple gorilla. But it has so far steadfastly ignored Windows 8.x,
forcing Windows users to use its services through the Chrome browser or not at
all.
That’s exactly what Microsoft would have done under Bill
Gates’ leadership in the company’s early years. But Microsoft is counting on
old age and treachery to overcome Google’s youth and skill.
