Can Google's Chromebook Break Windows?

Summary.  Google is right: Windows is an old, creaky, virus-ridden product that deserves to be replaced by something better.  But to displace an established computing platform you need to do a lot of things right, and Google hasn't shown the focus and coordination needed to pull it off.  Unless there are dramatic changes in Google's Chromebook plans, I think they are likely to fail.
   

Google's Chromebook vision is seductive: sleek and simple net-connected notebook computers, backed by the world's biggest web company, replace the bloated, unstable Windows PCs that dominate the desks and laps of the computing world.  Google painted that picture at its IO developer conference last week, and it tantalized a lot of people:

"Google...might have just changed the industry."  -Engadget (link)

"Microsoft could lose billions in sales to Google's Chromebook."  -Beta News (link)

"Google Chromebooks will likely seduce businesses."  -Tech Republic (link)

"Chromebooks may just be the next best solution for small to medium-sized businesses looking to untether from Microsoft Office."  -PC World (link)

I wish it were true.  Windows deserves to be replaced.  It's just plain old, weighted down with decades of compromises and tweaks.  The OS steadily degrades as you use it, and the security software companies will tell you privately that it's impossible to fully protect it from hostile software.  I'm sure that with a clean start we could do better.

So I love Google's idea.  Unfortunately, the Chromebook as currently defined is woefully unready to take on Windows.  It may capture some niches and verticals, but it won't have a major effect on the industry unless Google makes major changes to it.  And some of the biggest barriers to its success are inside Google itself.

In case you're a new reader to my blog, I should give you a brief background on myself, so you'll know where I'm coming from on this issue.  I worked at Apple for a decade, where I was a front-line soldier in the Mac vs. PC war.  I was part of Apple's competitive analysis team and later managed it, and I was in charge of the main Mac vs. Windows marketing team.  Throughout that time, my co-workers and I spent a huge amount of time studying platform transitions -- how computing platforms were displaced in the past, and how could we apply those lessons to defeating "Wintel."

What we found was daunting.  Once a computing platform is established, it's not enough to make a product that's better overall.  You have to duplicate the core benefits of the current product, and be so much better in some areas that you overcome the users' natural resistance to change.  Even when Mac had a graphical interface and the PC was still stuck with DOS, we could convert only a small fraction of the PC installed base.  Users were too attached to their PC programs and all the arcane keyboard commands they had memorized to use them.  Most people moved to graphical interfaces only after Microsoft offered Windows on the PC, which allowed them to keep access to their old software while they gradually came up to speed on Windows.

So when Google brags about the advantages of Chromebooks, I'm completely unimpressed because they are more than wiped out by the enormous sacrifices in basic compatibility and productivity that most people would have to make in order to move off Windows.  The most fundamental problem is Google Docs.

There's no way to put this politely: As a replacement for Microsoft Office, Google Docs stinks.  Its word processor is adequate but limited, its spreadsheet is rudimentary, and its presentation program is so awkward and inflexible that it makes me want to throw something.  In terms of usability and features, Google Docs is about where Macintosh software was in 1987.

In fairness, there are some things Google Docs is great at.  It's fantastic for collaborative editing; using Docs plus a Skype session can be a thing of beauty for brainstorming and working through a list of action items.  But as a replacement for Office, the apps are so limited that using them is like watching a Jerry Lewis movie: you keep asking yourself, "why is this happening?"  I tried very hard to use Google Docs as the productivity software for my startup, and eventually I gave up when it became clear that it was actually destroying my productivity.

If I sound frustrated, it's because I am.  I remember back in 2005 when a startup called Upstartle created Writely, an online competitor to Microsoft Word.  The product was evolving quickly, and as I wrote at the time, I thought it had a good chance of eventually growing into a real challenger to Word (link).  Then Google bought Writely and bundled it into Docs, and I thought "that's even better, now development will really accelerate."

Instead, the evolution of the product has been snail-like.  Six years after the acquisition, the word processor component of Google Docs is improved, but still very primitive compared to Word.  The official Google Docs blog lists lots of new features the team is adding (link), but there are even more missing.  For example, only last month did they add pagination to the word processor.  Part of the problem is that the team is spending a lot of time adding features that have nothing to do with competing with Office.  I sat through a session at Google IO last week on Google Docs, and the main theme was that they are transforming Docs into an online storage system like Dropbox or Box.Net.  The team has added semi-random features like the ability to store videos, do OCR on photos, and sync between devices.  Meanwhile, their presentation module can't even do transitions between slides.

Rather than doing the unglamorous work of competing with Office, the Docs team seems to be chasing after the latest shiny new startup category.  Google says those sexy features were high-priority requests from Docs users, but if so that just shows what's wrong with Google's development process.  The people it should be trying to please are current Office users, not the unusual people who were willing to give up Office for the current mediocre version of Docs.  Get a roomful of Office users and ask them if they'd rather have OCR of photos or a printing architecture that works in most browsers.  As Mom used to say, "you can't have dessert until you finish your peas."  It looks like no one at Google is telling the Docs team to finish its peas.

The limitations of Google Docs are going to be unacceptable to most Office users.  The problem is not that most people create slides with transitions, but they don't want to be cut off from that sort of advanced feature if they ever need it.  The loss of potential future productivity is what keeps people away.

I know, I fought this battle extensively at Apple.  There's a reason why apps have long feature lists -- the feature count drives sales.

Even if a user could come to terms with the limited features of Google Docs, good luck if you need to share your work with the majority of computer users who are still on Office.  Moving documents back and forth between Office and Google Docs routinely mangles some of the features of Office documents.  Now you're not just limiting your own productivity, you are annoying your business partners and coworkers.

Since Google does not seem to be focused on fixing Docs, it's theoretically possible that some other app developer could create an online replacement for Office that really works, and offer it on Chromebooks.  But who would want to invest in that area when Google Docs is there as a competitor?  Docs is just good enough to hinder innovation, but not good enough to take out Office. 

Besides, Google did a couple of sessions at IO comparing web app development to native app development.  They all concluded that web app development was better for content-playing applications, and that for productivity apps you need native software.  And native software is exactly what Chromebooks won't run.

It makes you wonder if the app guys at Google ever talk to the Chrome guys.

So Google can say all it wants about long battery life, instant on, support costs, and invulnerability to viruses.  Those are all problems that PC users put up with because they are unwilling to give up the advantages of Office and the rest of the PC apps base (think about it, if those issues really motivated people, Macintosh would have 80% share in PCs).  I could picture an IT manager looking at the lower costs of Chrome and wanting to force users off Windows, but that will just produce a user revolt.  I know very few IT departments that are willing to take on that sort of battle.  Maybe some very cost-conscious schools and businesses might force users to switch to Chrome, but for the vast majority, as long as Office is not challenged, neither is Windows.

Ironically, if Google really wanted to replace Windows, Android would probably be a better OS for the job.  It has more momentum, and you can write native software for it.  But that's blocked by Google's own internal politics, which has assigned Android to phones and tablets and Chrome to PCs.

I like the Chromebook vision, and some day I'm sure something will replace Windows.  But Google is utterly unready for the hard, unglamorous work needed to make Chromebook succeed, both in terms of its products and in terms of its internal organization.  Unless Google makes major changes, Chromebook will probably be yet another failed Google initiative that will have us asking "what happened?" a couple of years from now.

Kind of like the way we talk about Jerry Lewis.


Three steps to fix Docs

If Google truly wants to replace Windows, it needs to focus Docs on that task.  Stop the sexy but esoteric stuff like automatic translation of street signs in photos (something that most people don't really need their word processor to do), and make sure the basics like printing work properly.  Here are my top three priorities:

1.  Make it look like an application.  The user interface in Docs is primitive, an awkward mix of web page and application.  It is extremely intimidating to a normal user.  Here's the window I get when I edit a word processing document in Google Docs:

You're looking at two inches of stacked-up interface cruft, including three separate menu bars and 58 different clickable items.  Hey Google, aren't you embarrassed by this?  I didn't think anyone could make the Office ribbon toolbar look efficient, but you managed to do it.

You might be saying to yourself, "well, that's just what happens when you run an app in a browser."  That's no excuse.  If you can't make a browser-based app easy to use, you should give up the pretense that you'll ever replace Windows.

2. Take full advantage of HTML 5.  Google gave a great pitch at IO on all the wonderful new graphical features in HTML 5 and its associated technologies: groovy things like 3D transforms, text bound to a curve, animation, and huge numbers of fonts.  Very little of this graphical power has shown up in Docs.  Google should make Docs (and especially its presentation module) a showcase for the great things you can do with HTML 5.

3.  Make Docs extensible.  No matter how well Google focuses its development, it won't be able to quickly match all of the features in Office.  That's why Docs desperately needs a plug-in architecture.  One of the reasons WordPress became a leading weblog tool is because it enabled developers to easily extend it with a blizzard of widgets and add-on modules. Google should do the same with Docs.  Then rather than Google being responsible for covering all the features of Office, the development community could share the burden.  I bet that with the right plug-in architecture, and a widgets store built into Docs, Google could have a more complete office suite than Windows within 24 months.  That would make Chromebooks a truly potent competitor to Windows, and a product worthy of Google's enormous skill and ambition.

Goodbye, IBM. Seriously.

For those of us who worked at Apple in earlier days, the company's current success is sometimes surreal.  I had one of those moments today.  Back in the mid 1990s, we were struggling to get to $10 billion in revenue per year, a figure that seemed ridiculously high.  This week, Apple reported quarterly revenue of $27 billion.  Apple is almost certainly now a $100 billion a year company.

To put that in perspective, Apple is now larger than companies like Honda, Sony, Deutsche Telekom, Procter & Gamble, Vodafone -- and IBM.  Apple is very close to passing Samsung and HP, which would make it the world's largest computing company.

In 1981, when IBM entered the PC business, Apple ran a big ad in the Wall Street Journal saying "Welcome, IBM. Seriously."  At the time, everyone thought it was a very cheeky move by a tiny upstart company.  No one -- and I mean absolutely no one -- would have believed that 30 years later Apple would be looking at IBM in the rear view mirror.

The spookiest thing is that Apple may still have a lot of room to grow in both mobile phones and tablets.  There's no way the company can keep growing like this indefinitely, but it's very hard to predict exactly when it'll slow down.

Quick Takes: The RIM Tragedy, Lame Market Research, Ebooks Closer to Tipping, Flip vs. Cisco, Google as Microsoft, Nokia and the Word "Primary"

Short thoughts on recent tech news...


RIM as Greek tragedy

I wrote last fall that I was worried about RIM's financial stability (link), but I never expected the company to start inflicting damage on itself.  RIM has always come across as a calm, dependable company.  Maybe not as flashy as some other firms, but reliable and smart.  But as we approached the PlayBook launch, the company has started to look like its own worst enemy.

It's clear that the PlayBook was designed initially as a companion device for people who have BlackBerry phones, and only those people.  That's an interesting choice -- not one I would have made, but I can see RIM's logic.  But apparently RIM decided late in the game that it needed to market the tablet to a broader range of customers.  It started talking up the features those users would need, without making clear that the features would not be included in the device at launch.  Many of the things the company has been touting -- such as Android app compatibility and the ability to check e-mail messages independently of a BlackBerry -- were not available when the device shipped.  RIM has been marketing vaporware.  That guarantees disappointed reviews that focus on what the device doesn't do, rather than what it does.  Check out Walt Mossberg's write-up (link).

While this has been going on, RIM co-CEO Mike Lazaridis has been compounding the problem by creating a personal reputation as a loose cannon.  His latest escapade was ending a TV interview with BBC when they asked about security issues.  The use of the word "security" was mildly provocative, but if you've ever dealt with the British press, you know they specialize in goading people to get an interesting reaction.  The more senior your title, the more they'll poke at you, to see if you can take the heat.

The way this game works, there are several techniques you can use to deal with an aggressive question.  You can laugh at it, you can calmly point out the flaw in the question, you can answer it earnestly and patiently, and you can even pretend not to understand it (I did that once on a UK TV show and it drove the interviewer crazy because he didn't have time to rephrase the question).  But the one thing you can't do is stop the interview.  If you do that, the BBC will post a clip of you online that makes you look like a gimlet-eyed prima donna (link).

The fact that Lazaridis did this means either he's losing personal control under pressure, or not being properly briefed by his press people, or both.  Whatever the cause, it is unprofessional, and it's making RIM's challenges harder.

If you want to understand the damage being done, you can read the forward-looking obituary of RIM that Slate just ran (link).  Or check out this column by Rob Pegoraro of the Washington Post (link). Rob's a very fair-minded, professional journalist who isn't given to hyperbole.  But he called Lazaridis' actions "profoundly foolish from any sane marketing perspective...Seriously, does RIM not realize whom it’s competing with? The company is all but begging to get crushed by Apple."

I haven't written off RIM by any means.  They have a huge customer base, a great brand, and a long history of overcoming skepticism from people like me.  I hope they can do it again.  But at a minimum, RIM's management needs to recognize that they do not have the marketing skills needed to play in the world of increased smartphone competition.  They need professional help, immediately.  And I worry that the marketing problems are actually symptoms of much deeper disorder within the company.


The lamest market research study of the year

It's still early in the year, but I think someone's going to have to work pretty hard to do a lamer market research study than Harris Interactive's EquiTrends survey of mobile phone brands in the US.  Harris says the survey indicated that Motorola has the most "brand equity" of mobile phone brands in the US, followed by HTC, Sony Ericsson, Nokia, and Apple.  Harris also provided a nice chart of the results (link):



There are a couple of problems here.  The first is that the reportedly best-selling mobile phone brand in the US, Samsung, was not included in the results (link).  Oops.

The second problem is that Harris doesn't directly measure brand equity (which is a pretty fuzzy concept anyway).  What it measures is "Familiarity, Quality, and Purchase Consideration."  Those three ratings were combined into an overall brand equity score.

So this is a made-up rating created through a mathematical formula that Harris hasn't shared with the public, as far as I can tell.  But Harris assures us that it's meaningful: "Those companies with high brand equity are able to avoid switching behaviors of those brands that lack brand equity."  (link).  So, according to Harris's research, people in the US should be switching from other phone brands to Motorola.

But in the real world, the exact opposite has been happening.  Motorola has been losing share.  The number three rated brand, Sony Ericsson, has barely any distribution in the US, so it doesn't have much share to lose.  The number four brand, Nokia, has lost most of its US share.

Harris argues that Apple's mediocre score is driven by the sophistication of the iPhone:  "There is still a large audience of consumers that aren’t interested in a smartphone running their life, and Apple doesn’t have a product to meet that need."  I think that's correct, but HTC also sells only smartphones, and it was ranked number two.

And oh by the way, what's the margin of error in Harris's survey?  I can't find it disclosed anywhere, but my guess is that it's several points plus or minus, in which case everyone except Motorola is in a statistical tie.  That wouldn't have made for a cool looking marketing chart, though.

It's been distressing to see websites pick up the Harris story and repeat it without questioning the results.  PC Magazine swallowed it whole (link), as did MocoNews (link).  A lot of other sites reprinted the Harris press release verbatim.  Even if you didn't dig into the flaws, the study ought to fail the basic sniff test of credibility -- does anyone really believe that HTC has a stronger brand in the US than Apple?

When I worked at Apple and Palm, we hated synthetic brand rating studies like this one (and the JD Power ratings, which are similar) because the results depend more on the secret formula used by the polling company than on the actual behavior of customers.  The polling companies construct these special methodologies because they can then sell long reports to the companies surveyed explaining the results, and also charge the winners for the right to quote the results in their marketing.  Check out the fine print at the bottom of the Harris press release: "The EquiTrend® study results disclosed in this release may not be used for advertising, marketing or promotional purposes without the prior written consent of Harris Interactive."  I don't know for sure that Harris charges to quote the survey, but that's the usual procedure.

The lesson for all of us is that you should never accept any market research study without looking into its background, even if it comes from a famous research company.


Ebooks: Here comes the tipping point

The continued strong sales of iPad, Kindle, and Nook in the US are bringing us steadily closer to the tipping point where it will pay an author to bypass paper publishing and sell direct to ebooks.  The latest evidence is from the Association of American Publishers, which reported that ebooks made up 27% of all book revenue in the US in January-February 2011 (link).  AAP correctly pointed out that the ebooks share was raised temporarily by people buying ebooks to read on all of the e-readers they got for Christmas.  The share will go down later in the year.

Still, at any share over about 20%, it will be more economical for an established author to self-publish through ebooks (where they can retain 70% of sales revenue) rather than working through a paper publisher (where they get at most 15% of revenue).  When we hit that point on a sustained basis, I expect that a lot of authors will move to electronic publishing quickly.

It looks like we'll hit that point sometime this year or next.


Flip aftershocks

Silicon Valley has the attention span of a toddler in a candy store, but it was interesting to see how people around here lingered on the story of Flip's demise several days after the announcement.  There were dark suggestions of ulterior motives at Cisco -- that they had bought the company to strip it of its intellectual property (link) or that they shut it down a viable company only so they could look decisive to Wall Street (link).  And that was just the stuff in the press.  I've heard even more pointed speculation from people working in Silicon Valley.

My guess is the real story is a lot more complicated and nuanced, but at this point it doesn't matter.  Killing Flip may have helped Cisco with Wall Street analysts, but the sequence of buying Flip and then shutting it down has seriously damaged the company's image in Silicon Valley as a leader and a partner.  Silicon Valley is a very forgiving place.  You can make huge strategic mistakes, and waste billions of dollars, and still you'll be forgiven as long as you did it in sincere pursuit of a reasonable business idea.  But Cisco's senior management is now viewed as either overconfident to the point of stupidity, or as the deliberate torture-murderer of a beloved consumer brand.  I've rarely seen this level of hostility toward a management team, and I don't think they will be forgiven anytime soon, if ever.

Does that have any practical impact on Cisco's business?  Not immediately; business is business.  But it will probably be a little harder for Cisco to make alliances and hire ambitious people in the future.


Google 2011 = Microsoft 2000?

It's spooky how Google is sometimes starting to remind me of Microsoft circa 2000.

The latest incident was a quote from a Google executive saying that the company wants iPhone to grow because Google makes a lot of money from it (link).  Microsoft used to say the same sort of thing about Apple, claiming that it made more when a Mac was sold rather than a Windows PC (link).  (The idea was that many Microsoft apps were bundled with Windows at low cost, whereas Mac customers bought Microsoft apps at retail.)
   
In both cases, the statements may be technically true, but what they really point out is that the company has deep internal conflicts between its various business units.  Yes, part of Microsoft wanted to make Macintosh successful, but another part of Microsoft wanted to kill Macintosh.  Microsoft as a whole wanted to do both at the same time, which created internal confusion.  Add in antitrust lawsuits by governments and Wall Street pressure for quarterly growth, and Microsoft quickly became distracted, inwardly focused, and slow-moving.

Parts of Google, I'm sure, think iPhone is great and want it to grow.  But I guarantee that the Android team is trying to kill iPhone (and Nokia, and HP/Palm).  Google has its own set of government distractions, plus a big old lawsuit from Oracle, plus legal action by Microsoft and Apple against Android licensees. 

There are huge differences between Google and Microsoft, of course.  Google is not under the same sort of Wall Street pressure that was applied to Microsoft, and Google's founders have not lost interest in running the company. 

But it's disturbing to see how quickly some of Microsoft's symptoms are showing up at Google.


Hey Nokia, how do you define "primary"?

Microsoft and Nokia said they have finalized the contract for their alliance.  There were a couple of interesting tidbits in the announcement:

--Both companies said they completed the negotiations sooner than they expected.  Usually that sort of statement is hype, but for an agreement of this size, it actually was a pretty fast turnaround.

--They went out of their way to say that Nokia will be paying royalties for Windows Phone similar to what other companies pay.  That's important legally and for regulators, so companies like Samsung can't complain that Microsoft is giving discriminatory pricing.  At the same time, the announcement also made it clear that Microsoft will be passing a ton of money to Nokia for various services and IP, which Nokia wanted on the record to help with its investors.  I think the net effect will be that Nokia gets a free Windows Phone license for a long time.  That will not please Samsung, HTC, and the other Windows Phone licensees, because it puts them as a price disadvantage.

--The companies are apparently cross-licensing a lot of patents.  I wonder if this will help Nokia with its IP warfare against Apple.

--In an interview with AllThingsD (link), Microsoft and Google Nokia said Windows Phone was Nokia's "primary smartphone operating system." That leaves open the door for Nokia to play with other smartphone operating systems, and it leaves completely unanswered the question of tablets.  I'm sure the Symbian/Meego fans will be all over that as a ray of hope for their platforms, but to me it just leaves some prudent wiggle room for Nokia in the future.  I'd love to know how the agreement defines the words "smartphone" and "primary" -- or if it even has definitions for them.

(Note: Edited on April 22 to fix an embarrassing typo.)

The Real Lesson of Cisco's Billion-Dollar Flip Debacle

Cisco announced that it's closing down the Flip camera business and revisiting its other consumer products.  With a purchase cost for Pure Digital (maker of Flip) of over $600 million, and now restructuring charges of $300 million (link), the total cost of Cisco's failed consumer experiment is probably north of a billion dollars, making it one of the larger business debacles in Silicon Valley in the last few years.

Most online analysis of the announcement doesn't really explain what happened.  The consensus is that Flip was doomed by competition with smartphones, but that says more about the mindset of the tech media than it does about Cisco's actual decisions.  I think the reality is that Cisco just doesn't know how to manage a consumer business.

There are important lessons in that for all tech companies.

Here are some samples from today's online commentary:

Gizmodo (link):  "The Flip Camera Is Finally Dead—Your Smartphone’s Got Blood on Its Hands."

Engadget (link):  "Cisco CEO John Chambers says the brand is being dispatched as the company refocuses, done in by the proliferation of high-definition sensors into smartphones and PMPs and the like."

ReadWriteWeb (link): "Single-purpose gadgetry has no place in today's smartphone-obsessed world."

ArsTechnica (link):  "Flip can't be faring well against the growing number of smartphones with built-in HD cameras. The quality of your typical smartphone video camera is comparable to the Flip, and people have their phones on them all the time."

Computerworld (link):  "More and more people are using their smartphones to take lower-quality video...the market for low-cost small video cameras that produce quick-and-easy videos is dead."

There's an old saying that when all you have is a hammer, every problem looks like a nail.  We need a similar proverb for news analysis -- when you're obsessed with smartphones, every market change looks like it was caused by them.

But did smartphones alone kill Pure Digital?  Two years ago, it was the most promising consumer hardware startup in Silicon Valley.  It had excellent products and a rabid customer base.  Two years later, it's completely dead.  That's a lot to blame on phones.  Plus, Cisco appears to be moving away from driving consumer markets in general.  The Umi videoconferencing system is being refocused on business, and Cisco CEO John Chambers said, "our consumer efforts will focus on how we help our enterprise and service provider customers optimize and expand their offerings for consumers, and help ensure the network's ability to deliver on those offerings."  In other words, we'll be working through partners rather than creating demand on our own (link).

Smartphones didn't cause all of that.  But they did play a supporting role in the drama.  They commoditized Flip's original features, putting the onus on Cisco to give it new features and innovations.  As Rachel King at ZDNet pointed out (link), Cisco failed to respond:

"The technology of Flip never really evolved since then, making it a very stale gadget. Sure, even once Cisco picked up Flip, new models continued to come out each year. Yet Cisco dropped the ball by never pushing further with Flip. It never moved beyond 720p HD video quality, and it never got HDMI connectivity."

Presenting a stationary target is enough to doom any consumer electronics product.  For example, what would have happened if Apple had stopped evolving the iPhone after version 1?  You'd have no app store, no 3G.  Today we'd be talking about iPhone as a cute idea that was fated to be crushed by commodity competition from Android. 

Just the way we're talking about Flip.

The important question is why Cisco failed to rise to the challenge.  Why didn't it innovate faster?  I don't know, because I wasn't there, but I'm sure the transition to Cisco ownership didn't help.  It was not a simple acquisition.  Cisco didn't just buy Pure Digital and keep it intact, it merged the company into its existing consumer business unit, which was populated by consumer people Cisco had picked up from various Valley companies in the previous few years.   Some of the key Flip managers were given new roles reaching beyond cameras, and there must have been intense politics as the various players jockeyed for influence.

Then there was the matter of Cisco's culture.  I had a great meeting at Pure Digital several years ago, prior to the merger.  They were housed above a department store in San Francisco, in a weird funky space with lots of consumer atmosphere.  The office was surrounded by restaurants and shops.

In contrast, visiting Cisco is like visiting a factory.  Every building on their massive campus looks the same, with an abstract fountain out front, the walls painted in muted tans and other muddy colors.  The buildings are surrounded by an ocean of cars.  The lobbies are lined with plaques of the company's patents, and the corridors inside have blown-up photographs of Cisco microprocessors.  In the stairwells you'll usually see a couple of crates of networking equipment, shoved under the stairs.  And all of the cubicles look the same.



The Cisco campus.



A typical Cisco building.

Cisco is an outstanding company, and an excellent place to work.  But it screams respectable enterprise hardware supplier.  To someone from a funky consumer company, going there would feel like having your heart ripped out and replaced with a brick.

Then there were the business practices to contend with.  As an enterprise company, Cisco is used to long product development cycles, direct sales, and high margins to support all of its infrastructure.  A consumer business thrives on fast product cycles, sales through retailers, and low margins used to drive volume.  Almost nothing in Cisco's existing business practices maps well to a consumer company.  But it's not clear that Cisco understood any of that.

The transition to Cisco management happened at a terrible time for Flip.  Just when the company's best people should have been focused obsessively on their next generation of camera goodness, their management was given new responsibilities, and Cisco started "helping out" with ideas like using Flip cameras for videoconferencing -- something that had nothing to do with Flip's original customers and mission.

If Pure Digital had remained independent, would it have innovated quickly enough?  Maybe not; it's very hard for a young company to think beyond the product that made it successful.  But merging with Cisco, and going through all of the associated disruptions, probably made the task almost impossible.

I'm sure that as the Flip team members get their layoff notices, we'll start to hear a lot more inside scoop.  But in the meantime, this announcement by Cisco looks like a classic case of an enterprise company that thought it knew how to make consumer products, and turned out to be utterly wrong.

That's not an unusual story.  It's almost impossible for any enterprise company to be successful in consumer, just as successful consumer companies usually fail in enterprise.  The habits and business practices that make them a winner in one market doom them in the other.

The lesson in all of this: If you're at an enterprise company that wants to enter the consumer market, or vice-versa, you need to wall off the new business completely from your existing company.  Different management, different financial model, different HR and legal.

You might ask, if the businesses need to be separated so thoroughly, why even try to mix them?  Which is the real point.

The other lesson of the Flip failure is that we should all be very skeptical when a big enterprise company says it's going consumer.  Hey Intel, do you really think you can design phones? (link)  Have you already forgotten Intel Play? (link)

I'll give the final word to Harry McCracken (link):  "You can be one of the most successful maker of enterprise technology products the world has ever known, but that doesn’t mean your instincts will carry over to the consumer market. They’re really different, and few companies have ever been successful in both."

Right on.

The Five Most Colossal Tech Industry Failures You've Never Heard Of

The tech industry is famous for forgetting its own history.  We're so focused on what's next that we often forget what came before.  Sometimes that's useful, because we're not held back by old assumptions.  But sometimes it's harmful, when we repeat over and over and over and over the mistakes that have already been made by previous generations of innovators.

In the spirit of preventing those repeated failures, I spent time researching some of the biggest, but most forgotten, failures in technology history.  I was shocked by how much we've forgotten -- and by how much we can learn from our own past.


5. Atari Suitmaster 5200

Video console manufacturer Atari was notorious for its boom and bust growth in the 1980s.  The company's best-known failure was probably the game cartridge ET the Extraterrestrial, which Atari over-ordered massively in anticipation of hot Christmas sales that never materialized.  Legend says that truckloads of ET cartridges were secretly crushed and buried in a New Mexico landfill.

What's much less well known is that Atari was also involved in the creation of an early motion-controller for home videogames, a predecessor of Microsoft's Kinect.  Since video detection technology was not sufficiently advanced at the time, the Suitmaster motion controller consisted of a bodysuit with 38 relays sewn into the lining at the joints, plus 20 mercury switches for sensing changes in position.  The suit was to be bundled with the home cartridge version of Krull, a videogame based on the science fiction movie of the same name.

A massive copromotion was arranged with the producers of Krull, and Atari made a huge advance purchase of Suitmaster bodysuits and cartridges.  Unfortunately, development was rushed, and late testing revealed two difficulties.  The first was that the suit's electromechanical components consumed about 200 watts of power, much of which was dissipated as heat.  That may not sound like much, but imagine jamming two incandescent light bulbs under your armpits and you'll get the picture.  There were also allegedly several unfortunate incidents involving mercury leaks from broken switches, but the resulting lawsuits were settled out of court and the records were sealed, so the reports cannot be verified.

The Christmas promotion was canceled, but Atari didn't give up on the Suitmaster immediately.  The next year, it was repurposed as a coin-op game accessory, allowing the user to control a game of Dig Dug through gestures.  Sadly, Atari's rushed development caught up with it again.  Due to a programming error in the port to Dig Dug, under certain obscure circumstances when Dig Dug got flamed by a Fygar the suit would electrocute the player.  (The bug was discovered by an arcade operator trying out the game after hours, in what is now memorialized in coin-op gaming circles as The Paramus Incident).  That was the last straw for Atari's corporate parent, Warner Communications.  To limit its potential liability if a Suitmaster were to fall into public hands, Warner arranged to have the entire inventory chopped up and mixed into concrete poured into a sub-basement of the Sears Tower in Chicago, which was then undergoing renovation.   A small bronze plaque in the third sub-basement of the Sears Tower is the Suitmaster's only memorial:


 

4. eSocialSite.com

Before Facebook, before MySpace, even before Friendster, the most successful social networking site on the web was eSocial.  Largely forgotten today, eSocial thrived in the late 1990s as usage of web browsers took off on PCs.  By 1998, it had reached more than 50 million users worldwide, an unheard-of success at the time.  Its Series A fundraising in 1999 raised more than $132 million from a consortium of VCs led by Sequoia Capital.  Many people still cite eSocial's Super Bowl ad in January 2000, which featured a singing yak puppet, as a classic of the dot-com bubble era.  When the company went IPO in February 2000, its stock price made it the 23rd most valuable company in North America.

Unfortunately, just two months later, it was revealed that 99.999974% of eSocial's registered users were fake people simulated algorithmically by a rogue eSocial programmer.  The other 13 were middle school students from Connecticut who were technically too young to sign up for the service.  eSocial was sued for allowing underage users, which delayed critical service upgrades for several months.  By the time the litigation was resolved, Friendster had seized the initiative, and eSocial was quickly forgotten.

eSocial found a second life overseas, though, and today it is still the leading social site in several former Soviet republics in Central Asia.  The founders of eSocial have long since left the company, and today are active in Wikidoctor.org, a promising new site that enables people to crowdsource the diagnosis of diseases and other chronic health problems.
   

3. The cardboard aeroplane

It's an unfortunate fact that wartime is a great stimulator of innovation.  Desperation leads countries to try all sorts of crazy ideas.  The successful ones become famous, while the failures are usually forgotten.   For example, you don't hear much today about Britain's World War II plan to turn icebergs into aircraft carriers (link).

Even more obscure was the effort to create an aircraft from cardboard.  One of the greatest bottlenecks in aircraft construction during the war was the shortage of aluminum feedstock.  Britain could not expand aluminum production quickly enough to meet its needs, so it attempted to substitute the output from the Empire's massive Canadian paper mills.  The idea of a cardboard airplane sounds crazy at first, but cardboard can be incredibly rigid in some directions (as you've found if you've ever tried to smash a box for recycling).  Through the proper use of corrugation in multiple directions, the British found that they could create a material with the same tensile characteristics as aluminum, with only slightly greater weight.

Early flight tests of the cardboard aircraft were not encouraging, as the first two test planes broke up suddenly in mid-flight.  Subsequent investigation revealed that water was infiltrating the corrugations, and then freezing when the plane reached altitude.  The expansion of the ice caused the cardboard to delaminate, resulting in failure of the airframe.

But the engineers persevered, sealing the cardboard with paraffin wax to waterproof it.  These new models successfully completed flight tests in the UK, and were demonstrated for Winston Churchill in 1943, who endorsed them enthusiastically. 

The new aircraft were deployed to North Africa, where another unfortunate problem appeared: the paraffin melted in the desert heat, causing the planes to wilt on the tarmac.  Needless to say, this limited their effectiveness.  The British engineers persevered, eventually creating a new waterproofing scheme utilizing used cooking oil.  This not only waterproofed the planes, but also made them smell like fish & chips, a definite plus to homesick British airmen.  Unfortunately, wartime supplies of cooking oil in Britain were limited, and by the time alternate supplies could be imported from the America South, the war was nearly over.

The cardboard airplane disappeared into history, but its spirit lives on (link).


2. The microwave hairdryer

The 1950s and 1960s were the golden age of innovation in electronics.  Companies like HP, Varian, and Raytheon created amazing new devices, often adapted from wartime technologies.  One example was the microwave oven, which was derived from radar.

But microwaves were once used for a lot more than cooking food.  My dad worked in the electronics industry at the time, and he often told me stories about the remarkable new product ideas he worked on.  One was the microwave hairdryer.

Today we're frightened of microwaves because they're "radiation," and that's assumed to be bad.  But in the 1960s people understood that microwaves had nothing to do with nuclear radiation.  They were just another tool that you could use to get things done, like arsenic or high voltage electronics.  Engineers at my dad's employer (which he asked me not to name) were looking for new ways to use microwaves to solve everyday problems.  Someone noted the number of hours women spent under rigid-hood hairdryers, used to finish the elaborate hairdos that were prevalent in the 1960s, and realized that a microwave hairdrying helmet could do the same job in just 45 seconds -- creating a massive increase in national productivity.

Unfortunately, the microwave hairdryer ran into a series of technical problems.  The first was that the microwaves caused metal bobby pins and hair clips to arc, which frightened customers and gave their hair an unattractive burned smell.  That was solved by substituting plastic clips.  The second problem was that the microwave frequency that couples best with wet hair is very close to the frequency that couples best with blood plasma.  This required some precise adjustments to the three-foot-long Klystron tubes that powered the hairdryers.  If they were jostled there was a very slight risk of causing the client's blood to boil (although this never actually happened in practice).

The technical problems were eventually resolved, but the death knell to the microwave hairdryer was something no engineer could fix: a sudden change in hairstyles in the late 1960s.  The move toward long straight hair, frequently unwashed among younger people, caused a collapse in the hairdryer market, from which it has never recovered. 

There was an abortive attempt to create a microwave blow dryer in the 1970s, but it was pulled from the market when it caused LED watches to burst into flame.


1. Apple Gravenstein

During the Dark Years when Steve Jobs was away, a rudderless and confused Apple Computer churned out a long series of failed initiatives.  Their names echo faintly in tech industry history:  CyberDog, Taligent, Kaleida, OpenDoc, HyperCard, Pippin, eWorld, emate, A/UX, the 20th Anniversary Macintosh, Macintosh Portable, QuickTake, the G4 Cube (oh, wait, Steve did that one), Newton, and so on.

But the most catastrophic failure was the one Apple worked hardest to hush up, the project called Gravenstein.  Simply put, Gravenstein was Apple's secret project to produce an electric automobile.

In the late 1980s, Apple was growing like a weed, but the driver of its growth was the Macintosh product line initiated under Steve Jobs.  John Sculley and the rest of Apple's senior management team were concerned with securing their historical legacy by doing something completely different.  Sculley, noting the chaos caused in the world economy by the oil embargo of the 1970s, chose to focus on the creation of an all-electric car.  Michael Spindler, ironically nicknamed "Diesel," was chosen to manage the production of the vehicle.  Bob Brunner drove the overall design, but Jean-Louis Gassee was asked to do the interior, on account of he's French and has good taste.

Apple used its Cray supercomputer to craft a unique teardrop aerodynamic shape for the car.  Apple purchased all the needed parts, and planned to begin production in its Fremont, California factory.  To prepare the market for the car, Sculley started working automobile references into Apple's advertising.  The most famous of these was the "Helocar" advertisement (link).   If you watch the ad closely, you can see actual diagrams of the Gravenstein's design and aerodynamic shape, although of course the first version of the car was not intended to fly.

Unfortunately, the public response to the Helocar ad was so overwhelmingly negative that it frightened Apple's Board of Directors.  Sculley was ordered to scrap the Gravenstein project, and all documents related to it were shredded and then burned.  Although Gravenstein never came to market, its legacy affected Apple's products for decades to come.  The Macintosh Portable, for example, used bulky lead-acid batteries that were originally intended to power Gravenstein.  And many years later, Jonathan Ive reused the Helocar's aerodynamic shape in the design of the original iMac.




Those are my five top little-known tech failures of all time.  What are yours?  There are many other candidates.  Honorable mentions should include Leonardo da Vinci's steam-powered snail killer, Thomas Alva Edison's notorious electric bunion trimmer, spitr.com, and of course Microsoft Bob.

You can draw many lessons from these failures, but to me the most important lesson of all is that you can't trust blog posts written on this particular date.

Posted April 1, 2011

Quick Takes: Nokia's culture, RIM's interface, and living in the paradigm of engineers

This post is an experiment.  I sometimes run across information that I think is worth sharing, but that doesn't fit into my usual publishing tools.  Generally it'll be something too complicated to tweet, but too simple for one of my usual long blog posts.  I've decided to try compiling those tidbits into an occasional post, which I call "Quick Takes."

Please let me know if you find this useful.

This time I want to talk about the aftermath of the Nokia-Microsoft deal, Android on BlackBerry, wireless insecurity, and WikiLeaks as a model for the future of human society.


More aftershocks from the Nokia-Microsoft deal

In the flood of commentary about Nokia's deal with Microsoft, I ran across three items with interesting perspectives on the deal.  They helped me understand how much work Nokia still needs to do.  If you're interested in the deal, or just in organizational change, I think they're worth checking out...

The engineering-driven culture.  Adam Greenfield, a former Nokia employee, discussed Nokia's culture and explained how it produces wonderful mobile phone devices but poor user experiences (link).  The key sentence:

The value-engineering mindset that’s so crucial to profitability as a commodity trader is fatal as a purveyor of experiences.

When I've written in the past that Nokia needs to learn how to do real product management, this is what I was trying to say.

This is how it feels to have an alliance dumped on you.  Meanwhile, if you want to get a sense of how corporate alliances get built, check out Engadget's interview with Aaron Woodman of Microsoft (link).  Aaron is a Microsoft spokesman and a key player in the Windows Phone team, so you might expect him to know chapter and verse about the plans for the alliance with Nokia.  But he doesn't, and you can feel his discomfort as Engadget tries to pin him down on some details:

Q:  There will be no preferential treatment given to Nokia in terms of the level of customization that they can apply to their devices. Is that correct, or no?
A: So it's an interesting question -- you say, like, preferential treatment, so say more about that. Is that like oh, they can modify...

The reality is that a big corporate alliance is created from the top down.  Senior management negotiates the broad outlines, and then announces the deal (because it's material to both companies and has to be announced to prevent insider trading).  Then the mid-level employees have to painstakingly work out what the agreement actually means.  I believe that's happening as you read this, and that process will probably continue for some months.  Meanwhile, Aaron can't answer most of Engadget's questions because the answers don't yet exist.  I give him a lot of credit for not trying to make up something to make himself sound better.

Anyway, if you see some vagueness from Microsoft and Nokia in the next few months, don't be alarmed.  It's how these things are done.

When is an installed base not an installed base?  I've been delighted to watch the rise of Horace Dediu, a former Nokia employee who has built himself a huge online following through very cogent analysis of Apple, and now the overall mobile market.  Although I usually find myself agreeing with everything he says, I thought he was a bit off base in some recent commentary about Nokia (link).

Dediu plotted the installed base of every mobile platform, and pointed out that Symbian has a far larger installed base than any other mobile platform.  He said Nokia has decided to throw away that installed base:

The disposal of such a large installed base must count among the largest divestitures in technology history and, when coupled with the adoption of the least-tested alternative as a replacement, elevates platform risk-taking to a new level. It may seem bold, but there is a fine line between courage and recklessness.

If all of those Symbian users understood that Symbian was their OS, had purchased applications for it, and felt that Symbian added value to their devices, then Nokia would indeed be taking a huge risk.  But virtually the only people who were even aware of Symbian were the people reading and writing blogs about the mobile industry.

Try this -- go look at a typical Nokia Symbian phone.  What is the brand you see on it?  Start the software, launch some apps.  Do you see the word "Symbian" displayed prominently?

Have you ever seen an ad for Symbian?  A billboard perhaps, or a big glossy ad on the back cover of the Economist?

Maybe a teensy little text ad inside the Economist?  Anything?

Indeed not.  Because Nokia didn't want the name Symbian to be prominent.  Heck, it didn't even let Symbian create its own user interface, let alone advertise its brand.  Nokia made Symbian into anonymous plumbing, because Nokia wanted Nokia to be the brand that users bought.  And considering how things worked out, that was something the company did right.

When I was at Palm and we surveyed mobile phone users, we asked Symbian users what OS was on their phones.  Most of them had no idea.  Among the minority who said they knew what their OS was, more of them thought it was Windows than knew it was Symbian.

Let me say that again, more Symbian users thought they were using Windows than knew they were using Symbian.  I guarantee that hasn't changed in the years since we did our surveys.

So, if Nokia executes its marketing properly, it should be able to flip most Symbian users to Windows Phone easily.  Just grin, tell them it's the cool new Nokia smartphone, and move on.  In that vein, the riskiest thing Nokia has done in the past couple of weeks is play up its deal with Microsoft.  It would have been better to play it down, so Nokia customers wouldn't get a message of disruption.

But I doubt most of them are listening anyway.

If there's anything reckless in the Nokia-Microsoft deal, it's the huge number of things that both companies need to execute very well in order to make it work.  But I think there's nothing reckless about the basic idea of ditching Symbian.


Android apps on BlackBerry?

There have been persistent rumors that RIM is trying to get software that will let its PlayBook tablet run Android apps (link).  Now there's some evidence that they may be looking to do the same on BlackBerry phones as well (link).  This seems like a reasonable thing to do, but I'm astounded that they're only working on it now.  The time to plan the app platform for your tablet is when you're creating the software for it, about a year before it ships.  It's not the sort of thing you dink around with a couple of months before shipment.  And you especially don't tell the public about it right before the hardware launches -- all that does is undercut any chance you had of getting native app development on your platform.


Wireless isn't secure (duh)

This isn't news if you've been paying attention.  For years the security companies have been telling us that wireless networks (especially wifi) can easily be snooped.  I'm not sure why the wireless insecurity story has never gotten much traction outside the beltway.  Maybe we weren't using enough web apps to care, or maybe no one listens to the security companies because they're presumed to be alarmists who just want to charge you $49.95 a year for something that'll make your computer run slow.

Anyway, it seems to me that the story is now popping up all over the place.  In December the Wall Street Journal ran a series on the information collected by mobile apps (link), this week The New York Times ran a story on the third party tools available to hack wifi hotspots (link), and a professor at Rice University posted on the types of data his class could sniff from his Android phone (link).  A surprising find -- two apps unrelated to location services were broadcasting his GPS location.

Why is this significant?  The mobile operators plan to offload traffic to wifi to reduce network congestion.  If those networks turn out to be insecure, the operators might be blamed for security breaches that result.  Or if more wifi networks are restricted due to security fears, the operators might find it harder to do that offloading in the first place.  Bottom line -- it is risky to depend on someone else's infrastructure as part of your core product.


WikiLeaks: Human society as designed by an open source engineer

O'Reilly ran a fascinating review of Inside WikiLeaks, a new book describing how WikiLeaks operates (link).  It reminded me of some thoughts I had after I heard a talk by Ward Cunningham, one of the creators of the wiki (link).

Most of the social structures in the world today were designed by two groups of people, religious leaders and lawyers.  The religious leaders gave us governments based on moral codes and hierarchies; the lawyers gave us governments based on laws, property, and checks and balances.  In both cases, the people creating the system built into it their own worldviews, their own assumptions about human nature.  The assumptions were so fundamental that I think they didn't even realize they were using them; they just baked them into the system.

Wikipedia, WikiLeaks, and movements like them are profoundly new because they attempt to structure society around the social assumptions of a third group of people: engineers.  And not just any engineers, but open source engineers.  That culture believes in the rationality of human beings and the existence of absolute truth.  It assumes that if the same information were available to everyone we'd be able to settle all disputes through logical discourse.  And it is intensely hostile to authority structures, because by definition they're assumed to get in the way of free discussion.

WikiLeaks is an attempt by that culture to restructure society.  I know that sounds crazy, but here's a quote from the book:

In the world we dreamed of, there would be no more bosses or hierarchies, and no one could achieve power by withholding from the others the knowledge needed to act as an equal player.

If you want to see this idea taken to its logical extreme, check out the short story "The Ungoverned" by science fiction author Vernor Vinge (it's online here).  I'm not saying that's the world we're headed for, but I think we'd all be foolish to assume that WikiLeaks will be the last attempt at open source social engineering.

I think it's actually just the beginning.

The Info Pad Creeps Closer

It's hard to believe that it's been four years since I first wrote about the idea of an info pad.  I thought for sure we'd have one by now, but to my immense frustration it's still not here.  We're gradually getting closer, though, so I think this would be a good time to revisit the idea.

As I explained in my original post on the subject (link), the info pad is a small tablet computer designed not for consuming content but for managing the information needs of a knowledge worker.  It's a business tool, not an entertainment device.  It has a stylus, so you can take notes and sketch on it, but it also acts as an extended memory, letting you access your old files, messages, contacts, and other important documents.

Mike Rohde drew a picture that captured the idea well (link):



For people who work with huge amounts of information, the info pad is a Holy Grail device.  It's the extended memory that captures what you're doing during the day, and lets you easily recall anything you need to know, whenever you need it. 

We studied the info pad idea when I worked at Palm.  There was a big audience for it, very distinct from the people who buy mobile devices for entertainment or communication.   Unfortunately, Palm got into financial trouble before we could do anything about it.  Since then I've tried twice to pull together a startup to build one.  The result was always the same: many people loved the idea (I can't tell you how many venture capitalists wanted to be beta testers).  But no one wanted to fund it, because hardware startups are viewed as incredibly high risk in Silicon Valley.  I was told to go to the big hardware companies and convince them to build it, but when I tried they were all focused on copying each other rather than creating anything new.

So I settled back and waited, figuring someone would eventually build it.  And I waited.  And waited. 

I'm still waiting today.


Signs of hope

Lately we've started to see some devices that raise my hopes.  The info pad isn't here yet, but I wonder if we're starting to see the first hints of it on the horizon.

The first is the Boogie Board, a tablet device that's literally a replacement for a dry-erase board.  It has a touch-sensitive monochrome screen, so you can write on it with a stylus, finger, or any other object.  Like a dry-erase board, you can't save pages or do much of anything else with them.  So it's not even close to an info pad.  But it currently sells for just $40 on Amazon, showing that basic tablet technologies can get to extremely low prices (link). 




A step up from Boogie Board is NoteSlate (link).  It's a tablet note-taker that works a lot like a piece of paper.  Like Boogie Board, it has a monochrome screen (no grays) and you write on it with a stylus.  Unlike Boogie Board, you'll supposedly be able to save pages, and share them with others via wifi.  The online illustrations of the NoteSlate prototype look nice, although text on its monochrome screen looks a bit blocky (I'd be a lot happier with smaller pixels and grayscale, so you could do some subtle anti-aliasing of lines).



This closeup shows the graininess of the writing in the mockup device.  The right software, and a better screen, can fix those jaggies.

The price will supposedly be $99, although that model may not include wifi.  It's hard to tell exactly what NoteSlate will do because it's not shipping yet, the developer is located in the Czech Republic, and the company's website is written in broken English.  Here's a sample:

Sorry if we were not able to response sooner all the great emails. When we have been preparing year ago all this, about bit weird NoteSlate device, we hoped this kind of exciting story becomes real, real product. We are going to make this thing real, also thanks to you, to produce open-source NoteSlate device and create unique NotesLate handwritten network. For 99$.

You don't have to speak good English to create a great product.  But the fact that the company can't afford to get an English native speaker to edit its website implies that it has very few resources.  That will make it hard to finish the product, let alone get it into retail distribution.  I'm amazed that such a small, early-stage company has managed to get so much press coverage.  Some websites even speculate that the product may be a hoax (link).  I was able to find an interview in Czech with the product's designer, Martin Hasek, and he gives some more details on the plans.  You can read Google's translation here.

NoteSlate has been nominated for an Index award, a design competition based in Denmark.  The online nomination gives more details on the product (link).  Reading between the lines, it looks like Martin is a designer who cooked up the NoteSlate idea.  He's apparently working with Albumteam, a Czech company that sells an electronic photo viewing tablet (link).  And there was a hint that the manufacturing might be done by another Czech company, Jablotron (link).  At this point I'm struggling to interpret auto-translated Czech blog posts, which is not a great way to get information, but that tells you how difficult it is to find hard details on NoteSlate.  (If anyone reads Czech and can give a better translation, please post a comment.)

The bottom line, I think, is that NoteSlate may be real, or may be caught in limbo.  When I was trying to get the info pad idea funded, I toyed with the idea of announcing it, getting people excited, and then using the excitement to get someone to fund it.  That felt too much like a pyramid scheme to me, but it's a possible approach.


High hopes for the Flyer.  There are several other upcoming tablet devices that bear watching, including the mySpark education tablet (link), and the Kno dual-screen device (link).  It's very hard to tell if any of these will actually ship.  But the device that has me the most excited is one that I know exists: the HTC Flyer, a new Android-based tablet computer previewed earlier this month.  The Flyer is a seven-inch Android tablet, very similar in looks to the tablets coming from Samsung and Motorola.  But there's one crucial difference: the Flyer comes with a stylus.

That sounds like a simple change, but actually it's a profound difference.  The iPad and most Android tablets can't tell the difference between a stylus and a finger.  If you try to write on them with a stylus, the screen will also sense the places where your hand touches the screen, and you'll end up with multitouch confusion.  HTC has paid extra for a touch sensor that can distinguish between the stylus and your hand.  Touch it with the stylus and you'll get ink on screen; touch it with your fingers and you can swipe, pinch, or do anything else you'd expect from a touch tablet.

HTC has also added a note-taking application to the tablet, so you can write on the screen during a meeting and save your notes to Evernote.  You can also record sound during a meeting, in a process that reminds me of the LiveScribe pen.

None of this is completely new -- Microsoft has been pushing Tablet PC systems for note-taking for the better part of a decade.  But they were extremely expensive, complex, heavy, and had very short battery life.  If you want an example, check out Asus' new $999 tablet PC, the EP121 (link).  In contrast, the Flyer looks to be the first product that marries the good ergonomics and usability of an Android tablet with reasonable note-taking.

What's missing.  Unfortunately, the Flyer has several very significant drawbacks.  The first and most significant is its price.  There have been several reports that the Flyer will see for about 700 euros in Europe, which is about $950 in the US (link).  That's an outrageous price.  When we studied the info pad idea in the US and Europe, the top price most people were willing to pay was about $499, and the demand sweet spot was $299.  At $950, the Flyer is going to be compared to full-function notebook computers, and it won't come off well in those comparisons.  Next to a notebook, it has very little memory, no keyboard, and few apps.  The price makes it an interesting curiosity for technophiles, not a mainstream product.

Maybe HTC is hoping for a big mobile operator subsidy that will make the Flyer more affordable.  Or maybe it's planning to strip out some features.  The announced version of the Flyer has a 3G cellular radio built into it, which increases its cost.  HTC says a WiFi version will come out later.  That might cut as much as $100 from the parts cost, which could translate to a couple of hundred dollars retail.  But still that would leave the device at $750, which is vastly too expensive.

I am also worried about the marketing of the Flyer.  HTC is positioning it as an ideal device for gaming, browsing, productivity, communication, and just about anything else except making espresso (link).  The message reminds me a lot of the old Palm LifeDrive (link), and we know how that worked out (link).

It's very easy for tech companies to fall into this sort of kitchen sink marketing, because they don't want to give up any possible customers.  But the messages tend to cancel each other out -- if the device is great for gaming and music, it sounds inappropriate for business productivity, and vice versa.  This also leads to bad design decisions.  If you build in graphics acceleration, 3D, HDMI video, dual cameras, and a stylus, the device gets too expensive for any single use.


Would your boss reimburse you for buying this?

It doesn't help that HTC has a clear case of iPad envy.  Their website even echoes some of Apple's iPad language:

Apple:  "A magical and revolutionary product."
HTC:  "HTC Flyer's magic pen transforms anything...Work or play, it's magic for the whole family."

The trouble is that Apple's already cornered the market on people who want a magical tablet experience.  HTC needs to play counterpoint to that, not imitate it.


Where the heck is Baby Bear when we need him?

I feel like Goldilocks.  Papa Bear (Tablet PC and Flyer) is too expensive and too loaded with features.  Mama Bear (Boogie Board and NoteSlate) is too limited.  What I want -- what's required to kick off the info pad revolution -- is a product in the middle on both price and features, optimized just for managing information.  At its current price, the Flyer is destined to sell very poorly.  When that happens, I hope HTC won't cancel the product.  Instead, it should strip out the 3G and the entertainment features, focusing it into a business tool that could sell for less than the magic $499 price point.  If Flyer doesn't survive, maybe NoteSlate or one of the other note-taking tablets will make it to market. I can always hope.

Once we get the right hardware, all we'd need would be the right software to make the info pad a reality.

We don't have the info pad yet, but we're getting closer. I am cautiously hopeful that I won't have to write this post again in another four years.