The evolution of the computing value chain

The history of personal computing has come to be defined as the history of Microsoft. At least since 1981 Microsoft’s operating systems have been the consistent market share leaders, and by a very large margin. That is about to change. This year Android will be on more devices sold than Windows. iOS is also set to also overtake Windows next year. The following chart illustrates the wave of mobile platforms that has emerged, and in spite of some notable failures, is overtaking traditional computing.

Of course we should remember that PC themselves overtook entrenched predecessors like minicomputers and mainframes which themselves overtook business computing systems based on adding machines, typewriters and slide rules. This is the cycle of disruption and there is nothing new about it.

However, it always seems to take people by surprise. This is because it happens in unforeseen ways and at unpredictable rates. And so it is that we are surprised by Microsoft’s seeming abandonment of a business model that has sustained it for three decades.

Yesterday’s reveal of Surface, Microsoft’s first personal computer, was a watershed event in the evolution of value chains around computing. In a famous slide Clay Christensen illustrated (in 2004) the value chain evolution in computing from the 1960s to 2000.

As computing moved from the desktop to the pocket the industry re-integrated. First, Apple moved from Product Design into Sales & Distribution with its stores. Then it moved into service with Genius bar. Then it moved into component design with the A series chips and unique batteries. Then it moved into materials with exclusive licensing of LiquidMetal. It also began to own the equipment used in its manufacturing. This in addition owning the operating system.

Now we see Microsoft following in the same footsteps. First applications came early then stores, then service, and now product design. Google is also tracking closely behind as well with its acquisition of Motorola, the results of which have yet to be revealed.

And so we can see value chains evolving in real time before our very eyes. They have always evolved but in technology industries they evolve far more rapidly and will continue to accelerate.

Whether Microsoft or Google will be successful in their integration efforts remains to be seen. The challenges are immense as the value of the existing chains are enormous and the bonds that tie the company to them very strong. Breaking these ties will seem like value destruction and corporate antibodies will be set loose to kill the transitions. HP, RIM, Nokia and Dell are vivid examples of what happens when the response mechanisms have their way.

  • def4

    From what we know so far, Microsoft seems to want to limit distribution to their own physical and electronic stores.
    This Zune-like limitation on distribution is probably the work of the corporate antibodies.

    • nuttmedia

      Agreed. As impressed as I was with the courage it took to break from their usual formula with an integrated hardware design, I came away disappointed that they did so in a half-baked way – limited distribution (likely out of fear of exacerbating the negative reaction from partners who are instantly now their competitors), continuing to wed themselves to the Windows brand, indecisiveness on pricing and availability, and the illusion of a no-compromise system. This is another chance for them to establish a new beach head and they are blowing it by continuing to mend castles on the same plot of sand.

      But still, it is provocative-enough a move to make it interesting. Microsoft is now making their own PC’s and tablets… Just drop a few billion on Nokia or RIM and they’ll have a full tea set.

  • Pingback: Asymco: The evolution of the computing value chain()

  • I had a feeling that (almost) everyone is “missing the point” on copying Apple.
    They copy “the way Apple is doing things”: integrating hard&soft&sales&services.
    But —in my opinion— the Apple’s way is to “design insanely great products!”
    Is the Surface (it seems they run out of names, it is already a big product) an “insanely great product”? Or it is just an integration of hard&soft.
    What is going to do Google with the first Googlorola device… a great product?
    Although it is true that the paradigm is changing… is it changing in the right direction?

    (Well, it is changing in the “right” direction for Apple… they’ll never succeed!)

    • vladiim

      Apple have educated the market that design matters. I give Microsoft credit for identifying that and taking it seriously.

      Surface is incredibly elegant and is helping move both hardware and interface design forward.

      I’m also impressed with Microsoft’s purchase of Yammer to target the “Enterprise Consumer”. They were stale for a while but you can’t fault Microsoft for giving disruption a try at the moment.

    • Apple disrupts different markets and creates new markets. That’s its true value. Design is a means for getting there that is not a function of price and therefore drives higher margin. A lot of that has to do with simplicity and ease of use. Apple’s success is similar to Ford’s with the Model T a century ago.

    • raycote

      Just as a thought experiment it is interesting to ponder what Apple could/would do if they were in charge of all MicroSoft’s assets at this point ?

      • Tatil_S

        Shut it down and return the money to shareholders? 🙂

  • This is making out to be a really exciting time. In fact, I think that we are going beyond value chains into whole ecosystems that are increasingly vertically integrated; all driven by Apple:

    – Value Chains: Apple is making a lot of money through very profitable, high volume integrate value chains. The iPad has shown that this is almost impossible to replicate, and they are doing it again with the next generation of laptops (The Airs).

    – Ecosystems: You need to buy into a particular ecosystem going forward otherwise you will come up against a lot of friction. Microsoft needs to offer this ecosystem underpinned by cloud services to remain competitive.

    Apple doesn’t just create insanely great products; they are also innovating in supply chains and ecosystems which is where they are really being competitive.

    More of our thoughts around the implications of Surface, including why Microsoft will make their own laptop, are here:

    • Mike Wren

      The tablet industry is moving towards the integrated approach — Apple, Amazon, Microsoft and Barnes & Noble (Nook). And rumored to be coming soon is Google, made by Asustek. (Why not Motorola?) That leaves Samsung, Acer and the other Android vendors. Maybe they will fork Android like Amazon did. Or maybe they will use the open source Linux-based OS Tizen that Samsung is pushing. And then there is HP, Dell and Lenovo and all the other PC vendors with Windows 8. Some vendors will diversify with multiple operating systems — Android, Windows 8 and Tizen. It’s the spaghetti model — whatever sticks to the wall.

      Yes, it is an exiting time — for us and other tech fans. But there is such a thing as too much excitement if it means confusion for the consumer. For instance, should they get a Windows 8 tablet on Intel or ARM? Maybe the default choice will be Apple, just like the default choice was IBM in the mainframe days. The saying was, “Nobody ever got fired for buying IBM.” So it seems this confusion will work to Apple’s advantage.

      • I agree with much of what you say. I think that Samsung will have to fork Android – and TODAY they have the critical mass to be able to support that. Tizen is just a distraction, it has no ecosystem, it’s a non-starter.

        Basically you are choosing an Eco-system: Apple, Microsoft, Google or Samsung. There will be niche applications for the rest, but basically that’s the choice. There are two companies that stand out there for having a good solid offering, and one that’s leading the charge and innovating to a maximum.

        As for Microsoft’s choice to have two tablets, it is interesting and very confusing. They need to be clear about the use-cases for each one. It’s clear that Microsoft thinks the future is one device to be used as a tablet and a desktop depending on the mode you’re in. They’re sticking with the desktop. This means they need to support desktop apps on their tablet, which means they need Intel!

        Apple is working on moving almost everyone to tablets, and making OS X as similar as possible to iOS. Different approach, one seems simpler to me and simpler tends to win out in the long run. We’ll see!

      • raycote

        Yes I agree!

        MicroSoft would do better to have a clear and prominent software switch, maybe even hardware switch, that toggles from the mobile Metro-8 look into pain old Windows-7. That unnecessarily clear and prominent switch is just a marketing opportunity for them to highlight, to shout out loudly to the world, look you get two complete devices for the price of one.

        Look you get the industrial strength Windows-7 you know so well and our new mobile touch Metro-8 platform that conveniently cloud dances its way into all that deeply rooted legacy backend you already own! And for employees that only need a mobile interface into modern touch based Apps they will still get access to all your cloud based legacy backend with our less expensive touch base Metro-8 only device!

        Then, as is Apple, slowly morph the look of Windows-7 to overlay with the new mobile touch based Metro-8 look. Then later at some key marketing based transition point make another big marketing splash when they are ready to relabel into the new Windows-Metro full integration monicker.

        MicroSoft is now finally doing some serious innovation and risk taking but due to confusing product positioning tactics by their inept marketing vision, may as the old cliche goes, “be able to snatch failure form the jaws of success”.

  • Pingback: Tuesday links: difficult comparisons | Abnormal Returns()

  • r.d

    what is funny is that Surface Pro version has 208 ppi on 10.6 inch display.
    Wonder if Apple will bring retina display to Air in January.

    Microsoft has to compete with ipad 4 yet there spec is aimed at ipad 2.

    • I wondered about that too. What’s missing from this product announcement is any understanding of the quality of the user interaction and the whole user experience.

  • Joe_Winfield_IL

    You have to give Microsoft credit for some novel design concepts. The kickstand will be really nice if it is sturdy enough to last the life of a tablet. The thicker keyboard cover with some tactile feedback sounds nice if it works well. For the few times a pen would come in handy, their tech to prevent palm smudges is a great idea. Also, the company is clearly showing some courage by launching a direct salvo at its core customers. I’m not really sure what recourse the OEMs have but to whine and stomp their feet. Between Microsoft and Google, the licensed model seems to be on life support. Maybe Linux finally gets a big marketing boost, but more likely the little bit of remaining profits in the PC-building business will evaporate.

    To me, there are two intriguing pieces to this ongoing story:

    1) Corporate buyers are Microsoft’s bread and butter, but do they want Windows 8 tablets?

    It would seem that the most important market for Microsoft to address is corporate users. These users are the largest piece of Windows’ installed base, and are the most loyal due in large part to the thousands of legacy applications that aren’t web compatible, let alone ready for small mobile screens. These apps are tied to the Wintel x86 architecture, and in a way are the company’s strongest competitive asset. But as time passes, these apps gradually get replaced or converted to more modern replacements – the advantage is eroding. Microsoft knows they need to get with the times and dramatically improve in the massive mobile computing space. Windows Phone was too late to be the primary licensed competitor to iOS, and doesn’t offer anything important that Android can’t match. Further, WP7 doesn’t offer any meaningful compatibility with Windows.

    With Surface, they are trying to merge the consumer look and feel of a mobile OS with the back end of a graying corporate desktop OS. But who are they trying to sell? Corporate buyers are notoriously slow to adopt new versions of Windows. They seem to all eventually make the move, but the process can be painful in a large organization. With Windows8, the friction will be intense. Users don’t want their replacement PC to feel any different than the old one, just faster (I personally still hate the UI changes from Office 2007). So will they buy a tablet that doesn’t look and feel like their main PC? Will they want this different-looking tablet to BE their main PC? Do corporate buyers see any value at all in the RT version of Windows? Will they buy a piece of hardware from a company with almost no hardware experience, running a brand new OS that hasn’t yet gone through patching? I suspect that among corporate buyers, Surface will be off to a slow start for these and other reasons. If users are going to have to make compromises from their familiar PC experience, the iPad has proven to make for a pretty painless transition. It’s in its third model year, running software on version 5.x (soon to be 6).

    2) How does Microsoft want to position the Surface family of devices? How on earth should Microsoft price these?

    Are they hoping to steal consumer sales from would be iPad buyers? If so, the RT version needs to be cheap. Not $499, not $449, but significantly cheaper than the entry level iPad. More onboard storage and better connectivity aren’t of much value to the price conscious shopper, as many Android device makers have learned. There is no existing Windows tablet market, so the company won’t be peeing in its own pool. They need to grab the public’s attention, and price will be a tool to make it happen. I’m guessing $299 for the base model.

    For the pro version running the expensive Intel chipset, things get much more complicated. I have already addressed why I think the corporate market is not clamoring for a pro device with these capabilities, but what about consumers? Microsoft has to be very careful to walk the tightrope between cheap enough for customers and too cheap for frenemy OEMs. If they price these too low, the Dells and Acers of the world will go nuts. If they go too high, they simply won’t sell in any material volume. And if they don’t sell in big volume, what was the point?

    • FalKirk

      What a nice read. Well done. Very well done.

      • Joe_Winfield_IL

        Thanks for the kind words Falkirk. I was all over the place yesterday spewing my thoughts on the Surface; I’m hoping to provoke feedback from those who disagree with me on the likelihood of success. Like most readers here, I have a significant long position in AAPL, and I have an (admittedly overzealous) opinion that the company will continue to grow aggressively for the next several years despite all efforts of competitors or exogenous events in the macro economy.

        With that said, it’s not often that a competitor announces a product as intriguing as the Surface. Microsoft is trying to back up its oft repeated belief that tablets are just PCs, and I sincerely can’t get a read on how the consuming public will receive these devices. If these are any kind of commercial flop, I believe that iPad will have a clear runway to near permanent success. But if they succeed (and I’m not sure what at what volume threshold we could define “succeed”), iPad and MacBook Air will have their first real competitors. Besides market share, Microsoft could put a serious dent in Apple’s operating margins.

        I’m hoping to spur a debate, but it looks like most of the internet communities I frequent are willing to write off Surface before its launch. But if Microsoft succeeds in redefining consumer expectations of what tablets should do, Apple will lose a lot of influence very quickly. I don’t expect this to happen, but I think it merits serious discussion.

      • FalKirk

        “… it looks like most of the internet communities I frequent are willing to write off Surface before its launch.”-Joe

        I’m not writing off the Surface. My theory is that we’re like scientists. We form a hypothesis but the only way to test our hypotheses is to put the product up for sale. Then the market decides.

        “Microsoft is trying to back up its oft repeated belief that tablets are just PCs, and I sincerely can’t get a read on how the consuming public will receive these devices.”
        I think it’s a giant “meh” right now but nothing really matters until the devices go on sale. Then the level of public awareness and excitement at that time will be crucial.
        “If these are any kind of commercial flop, I believe that iPad will have a clear runway to near permanent success.”-Joe
        Agreed. And I’ll add a bit more to that thought, below.
        “But if they succeed (and I’m not sure what at what volume threshold we could define “succeed”), iPad and MacBook Air will have their first real competitors. Besides market share, Microsoft could put a serious dent in Apple’s operating margins.”-Joe
        I’m not so sure. I’ve been reading innumerable articles on the subject and they’re starting to convince me that even if the Surface is successful that its victims may be Android tablets and Windows notebooks instead of Apple’s devices.
        Not at all sure about that. I’m going to have to give it some thought.
        Again, thank for your continued commentary. I always enjoy it (even if I don’t always agree with it)! 🙂

      • Joe_Winfield_IL

        I think the RT model is DOA if it isn’t very inexpensive. I’m much more concerned about the Pro models taking mindshare. If Microsoft can convince enough people that tablets need to have a keyboard and run Windows apps (a GIANT if), Apple will struggle to put the genie back in the bottle. This isn’t analogous to the RIMM/Android assaults on iOS for its incompatibility with Flash; I’m talking about a “job to be done” discussion which is much more powerful. Only time will tell.

      • FalKirk

        I go the other way. I think the Windows 8 tablet will prove to be an expensive kludge. The desktop part will not work as well on the Surface as it would on a notebook and people will begin to wonder why they have both a tablet and a desktop OS on their tablet when they primarily only use one of them.

        Theres no way to know for sure. Only time (and sales) will tell the story.

      • Joe_Winfield_IL

        It’s really interesting because I think it is binary. My gut says the Surface will be a huge disappointment to users, but I’m not confident about it at all.

      • FalKirk

        There are (at least) two things going on here. The first is whether Microsoft can execute. That’s an unknown. Recently, they’ve been executing brilliantly, but if there are production delays, low battery life, bad hardware experiences, etc, it’s over. There’s no way to know any of that until the devices actually ship.

        The second question is strategic: Is Microsoft following the right strategy? Apple clearly has a whole different take than Microsoft does. There are complementary and parallel strategies but I get the feeling that Microsoft’s and Apple’s strategies are diametrically opposed. One has to be right and one has to be wrong. They can’t both be right, nor can they co-exist.

        Unlike the execution I discussed above, this question is already answerd. Problem is, we’re not smart enough to see it. It will become plain to most of us only after the fact.

        So far, Apple’s strategy has been brilliant (Steve Jobs) and brilliantly executed (Tim Cook). I don’t see that changing with regard to tablets. I think Apple got it right and Microsoft is going to pay the price. However, I’m willing to keep thinking on it and have my mind changed.

    • kankerot

      What is with this mad rush mobile mobile mobile = value. Look at the work most of the people in a corporate environment do and it will be seated. Why do they need a mobile computer? What they need is a machine that maximises their productivity. This will be a large screen computer.
      Corporate users will still be buying Desktops, notebooks in droves. The rest of your main point is waffle as you are talking about something that doesnt apply.
      Ipad 2 16gb is $399. Ipad 3 16gb is $499. Ipad 3 32gb is $599.
      There is no way MS needs to sell the Surface at $299 – it would be selling at a loss. The base 32gb Surface would be retailing between $449 – $499 – about $100-$150 cheaper than the Ipad 3 32gb.

      • Joe_Winfield_IL

        @Kankerot, thanks for the reply. A couple of thoughts:

        – I don’t think it’s relevant to compare prices at a given capacity. The ASP of iPad is in the low $600’s, which indicates a strong bias among buyers toward the cheapest available option. Microsoft is choosing 32gb for its entry model, but I suspect most consumers will compare it with the iPad entry model, not the 32gb one. There are plenty of other differences between the two tablets that additional flash storage will likely just be a slight positive in favor of Microsoft. With this in mind, I would suggest that Microsoft needs to compete with both the $399 iPad2 and the $499 new iPad.

        – Microsoft has shown a willingness to lose money on products it deems important. The Xbox lost money for nine years before its first profit. The online services division still bleeds cash every quarter, but Microsoft is unwilling to cede search and cloud services to Google and Amazon. The company hands Nokia hundreds of millions each quarter, even as WP7 has been a nonstarter and the Lumia line of phones has not gained significant share. My point is that if Microsoft thinks they need to be in the consumer tablet space, and they think $299 will get the job done, it isn’t crazy to suggest that they will eat a small loss on each device.

        – I agree that Microsoft will sell a lot of desktops and notebooks with Windows 8. I just think the upgrade cycle may be a bit slow because of the radical UI change. I focused my rambling comment on mobile because this article is all about the Surface announcement. Surely you agree that Microsoft sees mobile as an important battleground if they are choosing this particular segment to own the whole widget.

      • kankerot

        A few points –
        “but I suspect most consumers will compare it with the iPad entry model” – Why?
        So consumers are smart enough to work out that 16gb costs $100 but then dumb enough to discount this and compare a 32gb model surface with a 16gb ipad. No consistecy.
        $299 is madness all that does is set into consumers minds this is a low end device.
        The calculation that MS needs to make is simple. For every loss of Windows licence to the Ipad will they make the equivalent amount on selling a tablet. Ergo if they sell say 340m windows licences next year at the same price but 10% is via “Surface” then they are happy.

        Corporates will not be upgrding to Win 8 anytime soon they usually are a generation behind for good reason.

        Mobile is important but its only part of the battleground – it’s intelligence everywhere – its moved off the desktop into your pocket, into your hands and into your living room. No one has yet tied it all together and to be honest I am unsure whether I want anyone to own the whole system as it just will bring lock in.

      • Joe_Winfield_IL

        “So consumers are smart enough to work out that 16gb costs $100 but then dumb enough to discount this and compare a 32gb model surface with a 16gb ipad. No consistecy.”

        I’m not making a statement about consumers’ collective intelligence at all. I’m just saying that all else being equal, users will choose the least expensive option available. For iPad, that’s the 16GB model. For surface, it’s 32GB. The $100 price bump for 16 more GB on iPad is a completely arbitrary pricing strategy that Apple has used, nothing more. Storage capacity is one item on a very long checklist of decision criteria, and one that Microsoft will win. I suspect Apple will win in battery life, 3rd party accessory support, app ecosystem, etc. Microsoft will win with those who value pen input, those who value a built in stand, etc.

        Maybe I’m dead wrong on $299 – it’s just a wild ass guess. But Microsoft’s decision is even simpler than you are describing it. Do they want to sell millions of Surface RT tablets or not? If it’s just a Nexus-like reference design without big sales goals, they can price it as high as they want. If they do want one under every tree this Christmas, $499 and up won’t get the job done. It has none of the legacy software or powerful hardware advantages of the Pro model, so it will be viewed by consumers the same as any other tablet not named iPad. The only such tablet to have had any success was the Kindle Fire, and price and distribution were the primary levers that Amazon pulled to sell the devices in big voume.

      • twilightmoon

        Kindle Fire never sold in big volume. That’s a myth propagated by the convenient fact that Amazon never released Fire sales figures, and further evidence that after a modest bump for holiday sales it collapsed post December. It doesn’t help that the Fire is tied into a distribution model that is decidedly US only, while the iPad is sold world wide with world wide content and app availability.

    • raycote

      I don’t get how the Surface-Pro model is a laptop replacement. It is more like an over priced power hungry tablet that can also double as a portable-desktop-unit but only if you can scout out a conveniently large enough flat surface area on which to erect it.

      It is not a laptop or jet-passenger-tray friendly device. Surface-Pro needs a serious pro size landing strip on which to erect it and that makes a more traditional laptop much more convenient.

      This does however make the Surface-Pro model a great choice for consumers who want the mobility and convenience of a tablet that can also double as a good enough home desktop replacement. Many people are reaching the point where they realize they don’t need or utilize the industrial fire power of todays desktops.

      Their is also some segment, maybe a sizeable segment of the corporate users for whom a light-weight-desktop/tablet combo is just the right fit that also comes with significant savings to the corporation?

      That is the marketing focus MicroSoft should be subliminally spinning for the Surface-Pro model. Too loudly and they will definitely have and OEM riot on their hands?

  • neutrino23

    Setting the exact specs for the moment, the MS offering is curious. Are they doing this because they have a passion for the product niche? Did they choose this configuration because this is the best they can imagine? Is this simply a reaction to them losing share? Is this a compromise among established interests within the company? This is fascinating. These decisions they are making now will ripple down through the years and affect the direction and success or failure of this product line. People focus on the screen resolution or processor speed. Deciding what business you are in at least as important.

    Apple thinks their mission is to bring great technology to consumers. Dell was established to manufacture the least expensive PC clones possible. RIM is a purveyor of secure, portable email. Look where those ideas have led them.

  • verec

    And if Microsoft was strongly eyeing Apple …

    … Not so much for the quality of their products, as for the size of their market cap, thinking to themselves: gee, we’ve gone the software route and licensing hurdles only to have the Dell and HP and other make the hardware profits, all with the compatibility hassles we have had to go through for 30+ years???? Apple got it right. From now on we will own the whole shebang. Hence “Surface”. I wouldn’t be that surprised to hear that “Windows 9” would NOT be licensed from then on….

  • Apart from the changes in the players’ role in the value chain, there are also changes in the value chain structure. When the computers started to get networked and the Internet emerged new layers appeared in the value chained and companies like Cisco became dominant in that domain. We have also seen the rise and fall of AOL.

    What better proof that Internet services companies are part of the computing value chain than their desire to build their own computing devices. Amazon has started with ebook readers and is moving up the computer ladder. Google has been already discussed in detail on this forum. And Facebook is flirting with the idea, if we were to believe the rumours.

    There are new dimensions in the value chain and I find Horace’ observation that Apple is part of a modular value chain wrt services to be very profound (from Critical Path #42). There has been a lot of discussion about Google and Samsung disrupting Apple with a modular approach in mobile computing, but very little discussion about Apple, Facebook and Twitter disrupting Google with a modular approach in services.

  • Invert your stack and it resembles the OSI 7 layer model. Wintel was a vertically complete ecosystem approach to data processing that was horizontally scaled. That’s how MSFT succeeded and subsequently stagnated.

    Apple took this model and started disrupting first content (output), then communications (processing), and now creation (input). It is important to distinguish between vertical integration and vertical completeness as they have fundamentally different business models and addressable markets.

    While Apple was doing this, everyone was contemplating their own industry/segment navels. Now people are waking up and seeing how they can disrupt other industries and areas of the economy.

    For MSFT/NOK to be successful they need to go after the communications stack and disrupt the service providers. Bandwidth is 20-150x more expensive than it should be as service providers disconnected from moore’s and metcalfe’s laws 10 years ago. MSFT derives less than 10% of its revenues from the service provider segment, unlike Apple who is now intricately tied to them.

    As regards NOK, look at the fate of all the other vendors tied to the failed, monopolistic vertically integrated service provider model. NOK has no choice but to try to be a disruptive force as well. The two together can pull it off.

  • jhsp

    What is with this mad rush mobile mobile mobile = value. Look at the work most of the people in a corporate environment do and it will be seated.

    Ah, but why are people in a corporate environment seated? At first, because to write effectively you need a flat, sloping surface to rest ledgers on, and somewhere to put pen, ink, and correspondence.

    Make the desk flat, and it can hold a typewriter. And make it bigger, and it can hold a telephone. Then stay at your desk all day so people can reach you on the phone. Why are we still using desks when we hardly ever write by hand, don’t need fixed line phones, and don’t use typewriters?

    In early 18thC Britain – and as late as 19thC Austria, business was conducted from cafes, which provided all you needed – a place you could be found, that had seating, food, warmth. Bills could be signed, and messengers sent with letters and notes. Meetings could be held with partners and tradesmen in a way that wasn’t socially acceptable in private houses.

    The personal desk is not a requirement for business. The office of the future will likely resemble a university, with the focus on meeting rooms and facilities, and library-like work spaces rather than personal desks and spaces.

    • At some consulting companies, you can go to different offices and they will set up your desk per your preference

  • Charlie Alfred

    I confess that I scanned the comments quickly, and did not see this one. Apologies if it has already been mentioned.

    I’m not certain that “# of units sold” is the right metric for the computing value chain. It is strongly biased in favor of personal devices, like smart phones and tablets. Having said this, I do realize that this is precisely the Innovator’s Dilemma point. How the lower-cost competitor provides a disruption to larger established ones.

    But how much value would these personal devices have if there was no infrastructure of internet routers or web servers. Texting and cell service would not be there. Web browsing, and all the web-based apps like Facebook and Twitter would not be there. These smart phones would be left with Angry Birds, Tetris, and other local game apps. What % of the value is available now?

    Consider how many concurrent users are handled by a typical Amazon or Netflix servers. This illustrates that in the modern world, value is delivered via a multi-endpoint channel. If the Oracle or HP server that powers a web site is multiplied by the number of concurrent users it supports (same for Cisco routers), then I suspect that the chart above looks very different.

    Icebergs are pretty, but 9/10 of them are below the water’s surface

  • Pingback: Top clicks this week on Abnormal Returns | Abnormal Returns()

  • Pingback: Aktuelles 29. Juni 2012()

  • Pingback: Horace Dediu 谈论 iPhone 的影响 : 非媒体()