Can companies excel at hardware, software and content, asks Niall Kitson?
It may be the goal of every tech brand to create ecosystems (or ‘walled gardens’ if you want some sinister jargon) but evidence from four stories last week indicates that any attempt to be all things to all users is doomed.
Exhibits A and B come from Samsung: first, the decision to close its "hub" music smartphone app and second, the announcement that it is working on a virtual reality headset to be paired with its Galaxy line of premium smartphones and tablets.
Exhibit C comes from Sony, where CEO Kazuo Hirai admitted the company had reached a "make or break" point where massive losses from its electronics business have not been alleviated by selling off assets, exiting the PC and e-reader markets, and spinning out its TV business as Sony Visual Products.
As an aside, Hirai is also toying with wearable tech, especially the use of smartglasses as gaming peripherals - a whole other catastrophe in wait, albeit a less risky one thanks to the PlayStation 4 outselling the Xbox One.
This brings us to Exhibit D: Microsoft’s latest attempt to crack the tablet market. In an earnest presentation, Microsoft's vice president for surface computing, Panos Panay, showed how the Surface Pro 3 should be not just be considered your next tablet, but your next PC as well.
Positioned as a productivity tool and content consumption device, Panay dismissed criticism of the Surface Pro as an expensive ‘tablet that thinks it’s a PC’, by introducing an impressive 12” supertablet with all the same virtues and flaws as its predecessor.
Each of the above provide examples of brands contorting their way into shapes outside what would be regarded as their core competencies.
In the case of Samsung, the retreat from content is barely noticeable. One of the reasons Galaxy smartphones and tablets sell is that they are competent (occasionally superior) alternatives to the iPhone without the tug of Apple’s cultish fanbase. Where iTunes won user buy-in thanks to a sluggish music industry that didn’t see the appeal of digital formats, Samsung could never hope to emulate its success beyond a courtesy ‘me too’ alternative. Ducking out of content is a smart move that will free up resources to make better handsets than the lacklustre Galaxy S5.
As for entering the VR space by turning immersive headsets into smartphone peripherals, much as everyone likes the idea of augmented reality and Google Glass, this can only end badly.
Sony’s problems stem from an attempt to emulate the competition and stagnating in markets it had dominated. Sony had a solid position in e-readers, a PC division that shouldn’t have languished and a TV brand that at one time was a gold standard. In the last five years these spaces have been carved up by Amazon, Samsung, HP and Lenovo.
What links the Samsung and Sony cases - adventures in wearable tech aside - is the lack of a figurehead to sell their view of the market instead of making their product ranges easy to navigate. A paradox of any brand ecosystem is that it needs a figurehead to communicate its values. Apple’s message was clearly communicated by Steve Jobs to the extent that competitors had to define themselves as ‘not Apple’. Microsoft did it with the ‘I’m a PC’ campaign (and is doing so again with the anti-Google ‘Scroogled’) and Samsung did it by aping Apple’s TV ad style before reverting back to a more product-centric approach.
Sony’s position, however, is more complex than Samsung’s as it has been a player in content for years, giving it the benefit of aggressive product placement in its feature films. This backfired with this summer’s blockbuster The Amazing Spiderman 2 where Vaio laptops featured prominently.
If Sony and Samsung's attempts at fostering ecosystems are down by poor messaging or recognisable leadership, Microsoft has the opposite problem: strong messaging and inconsistent products.
Steve Ballmer’s attempt to redefine Microsoft as a devices and services company produced a number of failed products (the Zune and Kin, for starters) before the Surface RT and Surface Pro landed, the former being a $900m bomb. With Ballmer gone, current CEO Satya Nadella tried to turn a dud tablet strategy around with the Surface Pro 3. With Nadella as a figurehead and his "cloud first, mobile first" paradigm, we can see that even if Microsoft can’t innovate it knows where it needs to be.
With the Surface RT all but forgotten and an 8” Surface dropped at the last second, the Surface Pro 3 has a clear run with its "only machine you need" marketing. The investment in using Core processors, new screen technology and lighter materials makes the Surface Pro 3 the most exciting tablet we’ve seen but its specs create an issue of pricing. Starting at €819, the Pro 3 bypasses the tablet market (where the iPad Air starts at €489) to compete with ultrabook PCs and the Macbook Air (which start at €929) or, rather, it competes with the combined price of an ultrabook and a tablet.
Had the Surface Pro 3 been an all-new product this message would be fine, but this is the third shot Redmond has had at making the Surface Pro a compelling proposition. Despite the first two iterations being as impressive for their time, reframing it as the new face of the "all in one PC" isn’t going to work not because of the Pro 3 itself but because of a lack of peripherals (an area Microsoft is otherwise strong in) doesn’t give it that flexibility to be all those things to all people.
When demonstrating improvements in the Surface Pro 3’s stability as a laptop replacement, Panay still looked awkward with revised type cover and angled kickstand. Even worse, the Pro 3 looked ugly when put in a keyboard dock and despite an endorsement from Adobe, unless you’re seeing Photoshop live at work on a high definition monitor, its graphics capability is a moot point. Without a compelling range of complimentary hardware, the Pro 3 is a versatile 12” tablet at a PC price point.
As a satisfied user of a Surface Pro, I’m frustrated by the lack of peripherals and consider it one of the main things holding it back, especially in building upon the user experience. In trying to look innovative Microsoft has released a product that requires a leap for the casual user. A "best of both worlds" message is fine so long as those worlds are recognisable in the first place - floppy keypads, small screens and kickstands will not convert shoppers looking for a general purpose laptop or home PC.
The Dell XPS 10 showed that tablet/laptop hybrids could be done well and had it come with a full version of Windows 8 instead of RT it would be the device the Surface Pro needs to be.
Microsoft has the PC market sewn up with Windows but its cache doesn’t spread beyond software. Despite succeeding where Sony and Samsung struggle, by putting its faith in an expensive product that tries to mould user expectations to suit its product, Microsoft’s tablet strategy will fail.
Samsung, Sony and Microsoft have plenty of good products but overreach is leading to costly product failures and diluted brand value. Ecosystems are created by solid products and customer loyalty, solidified by a set of creative ‘values’ and a cult of personality. Sometimes it’s not worth the effort.
Niall Kitson is editor of TechCentral.ie