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Microsoft Faces Stiff Mobile Challenge


Microsoft had a heck of week last week, didn’t it? It actually felt like it got its groove back with HoloLens, its holographic virtual reality glasses, which I have to say looked way cool. It also got our attention with the Windows 10 mobile strategy, and it showed off the desktop version of Cortana, something Siri can’t do.

In spite of its good, dare I say, great week, I have to wonder if Microsoft can make any headway in mobile. As of now, its tablet and phone marketshare numbers are simply abysmal. Microsoft is so far back in the marketshare pack, it’s going to take a huge leap to move the needle enough to matter.

That’s not to say that the company doesn’t have a mobile strategy. Satya Nadella has gotten well-deserved credit for refocusing the company, and creating a much more positive image. A united screen across mobile and desktop with Windows 10 could be attractive to consumers and developers alike, both of which have yet to warm to Windows mobile. But will it be enough to lift Microsoft from its current marketshare doldrums?

Microsoft bought Nokia last year in an effort to take control of the Windows mobile platform, and is finally creating a single-platform view across mobile and desktop. That’s great, as far as it goes, but people still aren’t buying Windows phones or even enough Surface tablets –and unless that turns around, it is going to have a very difficult go of it.

Let’s Look At The Mobile Phone Numbers

The company is betting that Windows 10 is going to be its mobile salvation and finally drive people to buy these devices, but we’ve heard that before and it hasn’t happened.

In fact, the company’s global marketshare for mobile devices is falling.

Consider looking at Kantar WordPanel mobile marketshare statistics. It’s a great resource, but it won’t make Microsoft or Windows fans happy. As of November, Windows’ phone marketshare in the US was sitting at a measly 3 percent. That’s after years of pushing the platform, and getting great product placement in movies movies and TV shows. What’s more, the number is actually down from 5 percent at the beginning of 2014.

I can hear fans of the platform sputtering: “But what about Europe?” What about it? Consider these November Kantar numbers:

  • England was sitting at just 7 percent, down from a high of 12 percent in August, 2013.
  • France? It had 9.8 percent, down from a high of 12.5 percent in October, 2013.
  • Even Italy, a Microsoft stronghold, was 12.7 percent, down from a high of 17.1 percent in December, 2013.

The trend is down all around and it doesn’t bode well for the company’s mobile initiatives. I know Microsoft will argue that once Windows 10 hits the streets and people see how well it integrates across mobile and desktop, this is all going to change, but it’s hard to see these numbers turning around enough to make a significant difference. You could in fact, argue that at this point, the market has hardened and Microsoft is going to have a tough time pushing through iOS/Android supremacy.

In case you’re wondering in today’s quarterly earnings report, Microsoft reported selling 10.5M Lumias. That’s up from 9.3M last quarter, and while up is better than down, it’s an incremental increase at best.

Surface Pro 3 To The Rescue?

Putting Windows Phone aside, we’re left with the Surface Pro 3, a tablet-laptop hybrid that Microsoft loves to point to as a big win, and it’s done well, no doubt. By most reports, it can and should feel good about it. Yet in spite of impressive 67 percent growth in 2014, the company marketshare remains miniscule.

The Surface generated a healthy $1.1B in revenue in today’s report, up from $908M the previous quarter, but it still has miles to go before it catches iPad in second place, never mind Android in first.

That’s why Microsoft’s Windows 10 show was so important to the company. It gave them another opportunity to get sustained attention and it didn’t waste it. In fact, Microsoft actually wowed us a little bit, but don’t be fooled by a few minutes of HoloLens. As cool as it was, it’s never going to generate the kind of lift iPhone gives Apple or Android has given Google and by extension Samsung.

Don’t get me wrong, I was dazzled by HoloLens too. I get it, but I also understand that to truly compete in the next decade it’s going to take more than a holographic face computer.

The Harsh Mobile Reality

Microsoft appears to have done what it needed to do, perhaps something it should have done long ago. It created a single view from phone to tablet to desktop. Unifying the operating system was an important step, but it’s going to take some monstrous gains in mobile marketshare, especially for phones, for it to matter.

The reality is if it can’t attain significant marketshare, it can’t attract developers. It’s really not going to matter how easy it is to develop across desktop and mobile if the developer class isn’t paying attention. It’s also important to remember that the Windows 10 story is going to appeal to companies more than consumers, and the phone choice today for the most part is in the hands of consumers. Most companies aren’t buying employees phones anymore, and most consumers aren’t paying attention to Windows phones.

That means it would take a consumer sea change to make significant gains, and that doesn’t seem likely in its current market state, no matter how well integrated Windows 10 is across devices.

Featured Image: Courtesy of Microsoft

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Winter Is Coming For Wearables


Editor’s note: Kitty Ireland is a product strategy consultant interested in how technology changes the human condition and is a founding member of the team that built the lifelogging app, Saga.

Remember wearables? Those wristbands and glasses that were going to take over our lives? This time last year, many of us had high hopes that 2014 was (finally) going to be the year of the wearable.

Whoops. The wearables revolution didn’t come to pass in 2014, and it’s not going to happen in 2015, either. Why? Because we gave up. While more wearable products were launched in 2014 than ever before, most are sitting in a junk drawer somewhere. More than half of us who purchased a wearable activity tracker have since abandoned it.

No one showed up. Analysts expected 90 million wearables to be shipped in 2014, but the reality is looking to be more like 52 million, even after holiday sales. And this year doesn’t look any better: TECHnalysis Research predicts sales of 40 million units next year.

Smartwatches showed up. Gartner says that in 2015, more than half of the people shopping for a wearable device will opt for a smartwatch rather than an activity tracker.

And most importantly, the tech didn’t change our lives. Despite the glut of wearables seen at CES in January 2014, there are now only a few widely recognized products in the category.

Yes, early adopters, I can hear your feathers ruffling. While there may be some growth in the category over the next five years, I’m here to argue that the heady days of wearables as the “next big thing” are over for the foreseeable future.

What we’ve learned from 2014 is that today’s simple wearable gadgets aren’t enough. They’re not a complete solution. They do well enough for a very specific set of early adopters and fitness buffs, but they aren’t worth the investment for regular people.

Go quantify yourself

Go to any quantified self (QS) conference, and you’ll see wearables everywhere. I’ve met lots of Google Glass-wearing folks festooned with wristbands, body cameras and tracking devices of all shapes and sizes.

For quantified selfers, wearables are one of the keys to a better, happier and fitter life. In the QS movement, wearables are regarded as just one way to achieve “self-knowledge through numbers.” They’re also an easy and semi-convenient way to track personal data related to your habits, weight, fitness and mood.

Unfortunately for the rest of us, wearables don’t magically make you thinner — or happier. Once you have the data, you still have to act on it. An app or a device won’t do the the hard work for you.

That’s not good news for mainstream audiences who (for the most part) want some kind of immediate and tangible return. Most wearables don’t give much back beyond a bunch of data. Even when they tell you something potentially insightful, it’s still hard to figure out what to do, and even harder to find the motivation to do it.

Today, wearables and the Quantified Self face the same barrier to adoption: access to tools that will help us make sense of all of this data.

Gary Wolf, co-founder of the Quantified Self, believes better days lie ahead. “It is still not very easy to use our data to address unique personal questions. I think there is a role for intermediate, exploratory ‘platforms’ for meaning, filling a middle ground between totally processed and totally home cooked.”

Hardware is hard

While it’s true that wearables haven’t done themselves any favors in the hardware department (they’re clunky, still have to be charged regularly, and sometimes cause you to break out), it’s also clear that they haven’t found a workable value proposition outside of fitness tracking.

The real challenge with wearables isn’t the hardware, though. It’s the return we as end users get for slapping something on our wrists.

Astro Teller of GoogleX has been thinking about this challenge a lot. At Vanity Fair’s New Establishment Summit, he said, “Wearables are tough. They’ll eventually be a part our lives, but there’s this mantra that there’s no point wearing something on your body. There’s no point in having it on your body unless you can give people something you really couldn’t get otherwise. It has to be qualitatively better for it to be worn.”

Today’s wearables require an investment that many aren’t ready to make. We hope this won’t always be the case, but finding killer use cases (other than step counting or fitness tracking) has proven elusive.

Jim Gemmell of trôv suggests wearable companies target people chronic health conditions — or those looking to avoid one. “It will become rarer and rarer for someone with a common ailment like diabetes, asthma, or heart disease to avoid health logging as the devices and apps improve.”

He may be right. Susannah Fox and Maeve Duncan famously showed that with one or more chronic conditions track more personal data than anyone else. Insurance companies and healthcare providers recognize this, and may be the ones to ferry even the late majority into the future.

For those without chronic conditions, wearables still a hard sell, especially with competition from free apps in the market that replicate much of the functionality.

Our computers, our selves

But despite the gloomy forecast, I’m still excited about wearables. I just have given up on seeing mass adoption of the current products.

I know our bodies will become our computer interfaces. I know that wearing body cams like the Narrative Clip will become commonplace (and not just for police officers). We will never see people like Chris Dancy walking down Main Street, USA, but all of us will covertly collect the same amount of information, if not more.

That’s why I’m afraid winter is coming for wearables.

Today, artificial intelligence startups are poised to eat the world. But you don’t have to be a historian to remember the “AI Winters” of the past, where enthusiasm and hype for technology so far outpaced performance that most casual observers lost interest. It’s hard not to draw parallels to the wearable space, given the level of hype we saw in at the end of 2013 — and the level of disappointment many of us felt at the end of 2014.

Yes, someday, there will be a thaw. The tech will get better. Personal data trackers will become ubiquitous. We’ll see a new generation of tools that will help us access, aggregate, and even make sense of our personal data.

We might have to live through some chilly days to get there, though.

Featured Image: tarmofoto/Shutterstock

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Have An Old Dropcam? It’ll Stop Working Soon, But They’ll Give You A New One For Free


Do you have an old Dropcam? One of those boxy-lookin’ ones from when they first launched the company back in 2009?

Bad news: it’s about to stop working.

Good news: Dropcam will give you a newer one for free to make up for it.

On a support page published over the weekend, Dropcam notes that their oldest models — the Original Dropcam and Dropcam Echo — will stop working as of April 15th, 2015.

Why? The company doesn’t say much to that point, except that those cameras no longer provide “an experience that meets [their] standards”. In less nice words: the original Dropcam has a weak 320×240 resolution and no audio recording, and they don’t want to support it anymore.

So you get a new Dropcam HD (pictured up top) for free. Launched in 2012, the HD isn’t exactly Dropcam’s top-of-the-line model — that’d be the 2013 Dropcam Pro — but it’s considerably beefier than the 2009 Dropcam it’ll replace. Considering that Dropcam was charging $150 for the Dropcam HD up until a few days ago, it’s a pretty solid deal.

For reference, the models they’re replacing:

(Curiously, isn’t currently selling the Dropcam HD — just the Pro. A Dropcam rep tells us that the Dropcam HD is “now sold out” except for the inventory set aside for the replacement program; we’re looking into what that means for the HD moving forward.)

Update: Dropcam tells me that they’ll no longer be selling the Dropcam HD (the model they’re giving out for free, here) moving forward, though they’ll continue to support it.

Interested owners of the oldschool Dropcams can find replacement program details here.

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Facebook Censors Blasphemous Pages To Comply With Turkey’s Demand, But Won’t Publish It


When Google and Twitter receive legal threats from countries to censor controversial content or have their services shut down locally, they often publish them on for transparency. But today when Facebook followed Turkey’s legal order to block Pages that defamed the Prophet Muhammad from Turkish users, it kept the demand private.

Rather than get banned, Mark Zuckerberg has said it’s Facebook’s duty to comply with censorship so it can keep operating and at least give some citizens a voice.

Since the Edward Snowden revelations, there’s been an increasing push for transparency in how tech companies work with governments. Most tech giants now publish transparency reports, but are widely barred from breaking out or being specific about how many requests they receive from the NSA.

But when some receive censorship ultimatums from abroad or DMCA copyright takedown notices in the US, they make them public. Google and Twitter both have large archives of notices they’ve shared on Chilling Effects. But Facebook abstains from this transparency practice.

Instead, the company has been beefing up its transparency reports with an interactive map the shows what types of content have been blocked in different countries like Turkey. These are only published every six months, though.

Some claim that Facebook is wrong to comply with censorship, and that it should accept bans. Facebook’s growth and advertising objectives are often cited as supposed reasons it complies.

However, Mark Zuckerberg recently commented on the censorship issue in a public QA saying one more country doesn’t add much extra ad money or growth. Instead, he defended his position, saying (paraphrased):

I can’t think of many examples in history when a company not shutting down in the face of a law and getting banned helped change that law. But continuing to operate can help the country in other ways, such as allowing people to connect with loved ones, learn, and find jobs. So I think overwhelmingly our responsibility is to continue operating.

Zuckerberg’s perspective is open to debate. Complying with censorship implicitly encourages it, but a fundamental communication utility for millions getting shut down also silences forms of expression. Facebook declined to comment on this specific issue.

Regardless, it seems obvious that Facebook could maintain its current position while also being more transparent and publishing the demands it receives in a timely fashion. That could go a long way to convincing people it only censors when legally obligated to, and is doing all it can to fight back without cutting off citizens from their social network.

Featured Image: ADEM ALTAN/AP

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Surface And Lumia Clock Record Numbers For Microsoft During Holiday Season


In its most recent quarter, Microsoft sold 10.5 million Lumia handsets, and the Surface line generated $1.1 billion in revenue. Both figures are all-time highs.

Microsoft did break out total phone revenue — $2.3 billion, down from $2.6 billion in the sequentially preceding quarter — but that figure includes the sale of tens of millions of dumbphones, so it’s slightly polluted.

Measuring v. Measuring

When it comes to Windows Phone and Surface, what we care about is volume for the first, and revenue for the second. It comes down to a matter of scale: Lumia handsets are pretty much the only variety of Windows Phone that sells at the moment; Surface volume compared to the PC market is minute, but it could be a decent business for Microsoft — the higher its revenue, likely, the closer it can reach the break even point.

In short, Microsoft cares more about building mobile market share — every Lumia device it sells brings a user either into its services and software orbit, or binds a user more tightly into its ecosystem — than short-term revenue from phones.

The opposite is true for Surface, which was never designed to either be the core nexus point for the Tablets+Windows equation — that was always going to rest with devices built by third parties that ship with the company’s software. So, for Surface, showing growing revenue is the key metric. Microsoft does not break out Surface unit volume, unsurprisingly, but happily it reports the more important of that figure, the project’s top line.

Modest Sequential Growth

In short, the two product lines put up record numbers that were up on a sequential and year-over-year basis. But how strong were the gains?

Surface grew its revenue by $200 million or so during the quarter, on a sequential basis, and 1.2 million more Lumia handsets when measured in the same way. So, Surface revenue was up just over 20 percent when compared to the company’s preceding fiscal third quarter, while Lumia volume grew a slighter 13 percent.

It appears that the company notched record highs, but not scorching growth. This is doubly true when you take into account the fact that the last quarter included the holiday sales season,  without which it isn’t hard to estimate that the company could have ended up seeing device volumes and revenue fall.

The Microsoft earnings call kicks off in just a few minutes. I’ll update this post if the company sheds any more light on its device performance.

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Dropbox Acquires Pixelapse, A Startup Building Collaboration Tools For Designers


Pixelapse, a startup incubated by Y Combinator and StartX, has been acquired by cloud storage company Dropbox. The news was announced on the Pixelapse blog, and Dropbox has confirmed it.

Pixelapse offers version control and other collaboration tools for designers. Back in 2013, we compared it to both GitHub and, yep, Dropbox. (It’s also been adding integrations with Dropbox.)

The company says that Pixelapse will continue to operate as a standalone product “for the next year,” but it sounds like the eventual goal is to migrate customers over to Dropbox.

The founders write:

We started Pixelapse with the mission of building the definitive version control and collaboration platform for creatives. Since then, we’ve been fortunate to become a part of the daily workflow of tens of thousands of freelance designers and creative teams. The prospect of developing products at Dropbox that expand this vision to millions of users is tremendously exciting.

Our new development efforts will be focused on bringing the same kinds of collaboration and workflow experiences that you’re used to in Pixelapse over to the core Dropbox product.

The financial terms of the acquisition were not disclosed.

Featured Image: Pixelapse

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