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5by5 | The Critical Path #43: We'll take it from here

Horace and Dan look at Microsoft’s Surface through disruption colored lenses. First, the ongoing evolution of the computing value chain and how it foretold us of Surface. Second, how the economics of Microsoft’s businesses makes Surface compelling. We also begin a new segment tentatively called “Reader Questions”. This time it’s education: is it disruptable? If so how can we tell and where will it lead us?

via 5by5 | The Critical Path #43: We’ll take it from here.

  • graphex

    A quick way to convert Celsius to Fahrenheit for the temperatures we typically encounter, is to double and add 30.

    • http://twitter.com/asymco Horace Dediu

      I had forgotten this.

      • actualbanker

        It’s no trouble to serve our former colonies by doing their maths for them. They stuggle with the basics sometimes.

      • Roarshack

        What country are you from that colonized Finland? :)

    • Ian Ollmann

      If you actually want the right answer, then the conversion is double C, subtract C/10, add 32.

      • Roarshack

        The right answer isn’t always the best one. Although sometimes it is.

      • Roarshack

        The right answer isn’t always the best one. Although sometimes it is.

  • Mike Wren

    Horace, you mentioned in the podcast that Steve Ballmer said that the Surface will be a big market for Microsoft and therefore the corporate antibodies against disruption and for the modular OEM status quo didn’t win as they almost always do. But how do you reconcile that with the Surface only being sold in Microsoft’s 20 stores and online? That supports the opinion that this is just Microsoft’s version of Google’s Nexus meant to motivate the OEMs.

    I’m rooting for your Microsoft as courageous internal disrupter theory being true because it gives us more data points besides Apple ones and adds to the excitement.

    • http://twitter.com/asymco Horace Dediu

      It might be that the limited distribution is a sign that they are pulling punches. That they are not sure how this will work and don’t want to destroy too much value in the short term. It might also mean that they will start small and grow distribution over time. The theory would suggest that they will more than likely kill the effort though a thousand cuts. Let’s not forget that Courier, Kin and Zune failed at various stages.

  • Mage

    In the discussion of education in the podcast you referred to students as the customer of the educational institution, which from the stand point of who pays is reasonable and very mainstream thinking. I saw this attitude first hand as an adjunct instructor at a local community college. The logical conclusion of this is that teachers must get higher through puts, that is an increasing percentage of the class must pass with acceptable grades. An approach that produces several distortions in the student-instructor relationship.

    My contention is that students are the product of an educational institution. The educational institutions customers are the businesses that hire the students or the subsequent educational institutions that accept the students for further instruction.

    • http://www.facebook.com/ted.tschopp Ted Tschopp

      I would argue directly against this approach as it makes the student the object in the noun/verb/noun construction. “Institution {teach | certify | mold | shape} Student is a lot more demeaning to the student than “Student learns {Subject}”.

      Another way of saying it, what is the job to be done by an educational institution? Is it teaching or learning? If I go to an educational institution to teach then I have one focus. If I go to an educational institution to allow them to certify me that’s another focus. However, I think what the future holds is that I go to an educational institution to learn. With this focus we have a large disruption in the industry as that’s not what educational institutions do these days. Many people at schools these days believe their role at the institution is either to be certified (graduate) or to teach. The job to be done by an educational institution should be to uncover the truth about reality (learning) by applying the techniques of communication, mentoring, and research.

  • Dave Brandt

    I’m still quite convinced that Microsoft is on the wrong side of the “disruption” tipping point. Their dominance has been disrupted; they know it and are trying to fight it off, but in a maladaptive way. Yes, making their own devices is an historic change for the company, but I interpret this week’s announcement as further evidence of the turmoil within Microsoft.

    On one hand, part of Microsoft has done the financial analysis that you’ve reported. They can see that the growth potential is in a market segment that they haven’t even entered. This part of Microsoft knows that it desperately needs to get into the tablet game.

    The other part of Microsoft is the “antibodies” part (to use your term). What’s sad about the Surface announcement is that the tension between the two is still raging. After all, the signature feature of Windows 8 is that it carries the legacy Windows OS inside it!

    This is their conception of “no compromise.” Even though they are prepeared to make their own tablets, they aren’t psychologically prepared to develop an OS that is unambiguously for and about tablets. Ballmer again reaffirmed his “Windows everywhere” message.

    One might have hoped that the CEO’s role is to protect the internal disruptors from the antibodies, but we didn’t hear that at all. He actually believes that Microsoft needs to promote the Windows brand on every OS they sell.

    Although its true that Apple has success in building their own products, there are many other critical pieces of the formula that are absent from Microsoft. And Apple has 30 years of experience. In mobile, some of the highlights include:

    * the unique industrial designs (Ive),

    * the mobile OS, spun off from its NextStep ancestor so that Apple now has two unix-based variants, Cocoa and Cocoa Touch (Forstall),

    * operations and manufacturing (Cook),

    * retail and online stores (Johnson, et al), the API and app review process,

    * Steve to direct the entire operation.

    They’re “firing on all cylinders” as Steve said. All of the components have come together. It took years. Where does Microsoft stand on each of these components?

    Microsoft has taken the step of bringing some of the manufactuing in-house but that hardly solves the problem. They have a hell of a lot of work to do to catch up. It isn’t that they need a Tim Cook; they need to execute all aspects of the mobile business.

    I thought the article 7 by Michael Mace, “Fear and Loathing and Windows 8″, http://mobileopportunity.blogspot.com/2012/05/fear-and-loathing-and-windows-8.html was the best review of Windows 8 that I’ve seen. I wrote a blog post of my own that uses the metaphor of schizophrenia instead of antibodies (http://www.secondcellar.com/node/6). It’s a similar theme: there’s an internal struggle within Microsoft for control. Right now, Ballmer is CEO so they’re pushing “Windows everywhere” for all its worth. They’re trying try to enter the tablet market while carrying that load of baggage with them.

    • Mike Wren

      “What’s sad about the Surface announcement is that the tension between the two is still raging. After all, the signature feature of Windows 8 is that it carries the legacy Windows OS inside it!”

      The disruptive technology force is Metro with Windows RT on ARM. The opposing status quo, backwards compatible technology force is the desktop with Windows 8 Pro on Intel. The disruptive, integrated business model force is the Surface made by Microsoft. The opposing status quo, modular business model force is OEM produced tablets. It’s not the Apple way — “focus”. It’s the Microsoft way — “no compromise”. Microsoft is taking an experimental way to do strategy. It won’t decide. It will let the market decide. It has the resources (or at least Ballmer thinks it does).

      Diverse methods from assorted companies will give Horace and Asymco participants the wide cross section of data needed to push disruption theory forward. There may be more than one way to successfully disrupt.

      Microsoft made a stepped transition from DOS to Windows and kept backwards compatibility. Even Apple had Rosetta and the Carbon API.

      • JBWales

        Can’t help feeling that the concept of a Tablet that becomes a Laptop, as with the Surface running Windows 8 Pro and with a clip on Keyboard, is the wrong direction. Maybe a more effective device would be a Laptop which, when you flip the keyboard to the back, instantly becomes a Tablet running a Tablet OS. An AirPad! Would run Mac OSX as a Laptop and iOS as a Tablet.

  • Anthony Daniele

    Hi Horace,

    Your comments on using the show as an educational tool intrigued me.

    I do a weekly radio show (which is podcast) on solutions to climate change. The format (which I inherited) is one 30 minute interview with a researcher or entrepreneur in clean tech. While the show has an audience, I’ve struggled with the idea of how to turn a weekly show into an educational tool that has a longer shelf life than one week.

    I elected not to support your book project because I didn’t see it as effective in meeting this objective. Your show is full of so many great ideas, but I don’t see how a transcript will be a valuable resource for someone who wants a shortcut to the best insights.

    Something I’ve tried doing is what I call a “recap” show, where I select bits from previous shows on a common theme, then talk around it with my co-host. Unlike your show, most of my content comes from my guests, so this approach has been good for me to tell a story and communicate a bigger idea than whatever narrow field our guest is involved with. The reaction’s been good so far, and I hope to do it more.

    P.S. After listening to you, I find myself using the word “disruption” with my guests. It’s infectious!

    • http://www.asymco.com Horace Dediu

      While you don’t see the transcription of the spoken word into the written word as improving its educational potential, I think having oral histories in written form helps with recall. It did at least for The Odyssey and Iliad.

      • Narod

        I have she

        I have serious questions about the disruptive ability of online education. I i ask you to honestly answer two questions: 1. You are about to hire a new employee. Your two best candidates have no work experience. They are exactly equal, except one has an Ivy league degree. The other a certificate from Phoenix. Who will you hire? So, what premium is that degree worth? $40,000 times 4?
        2. In 10 (12?) years your son no longer wants to be a car mechanic and has gotten into Harvard. Would you tell him to reject his acceptance because Khan Academy is “good enough”?

      • http://www.asymco.com Horace Dediu

        You are alluding to brand value. Today the brand value of an Ivy League education is still high. However, brand value is not permanent. I’m not convinced that the brand value of the Ivy league will survive intact unless they innovate. The innovation they need may not be consistent with their current priorities.