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Christmas wishes for Microsoft, Apple and HP

Column What Santa should bring these three tech firms
Fri Dec 06 2013, 15:00
V3 and The INQUIRER editor Madeline Bennett

WITH CHRISTMAS FAST APPROACHING and as 2013 draws to a close, it has got me thinking about my wish list for the technology industry in 2014.

There have been some major events impacting the enterprise IT world this year - the PRISM NSA spying scandal, Twitter floating, Dell going private, Microsoft buying Nokia's devices business to list a few, and going into the new year there are some interesting challenges facing the big players if they want to remain relevant. These are the three that I find the most intriguing and will be paying the closest attention to the outcome.

The main objective for the software giant for 2014 is to select the right chief executive to replace CEO Steve Ballmer, the larger than life character who has led the firm during its steady decline over the past 13 years. When Ballmer announced his plans to retire, the betting was all on Nokia chief and ex-Microsoft executive Stephen Elop to take the reins. Facebook COO Sheryl Sandberg, former Microsoft Windows 8 executive Steve Sinofsky and current VP of devices Julie Larson-Green were also seen as strong contenders.

However, as the search has progressed, a smaller number of firm favourites have emerged. Elop is still in there, along with Kevin Turner, Microsoft COO and former CIO at Wal-Mart, Microsoft's EVP for Cloud and Enterprise Satya Nadella and Tony Bates, the company's EVP responsible for Business Development, Strategy and Evangelism. The only outsider on this rumoured shortlist is Ford CEO Alan Mulally. I can't imagine many in the technology industry are overexcited about any of these potential appointments.

The Microsoft candidates are all solid, safe choices, unlikely to make any bold moves with the firm, especially as they'll have the shadows of Gates and Ballmer hanging over them. And while Ford's Mulally would certainly bring some outside business acumen to the Redmond firm, he's not a tech innovator and at 68 is far removed from the current generations so immersed in technology - and so the creativity would be left to the current Microsoft executives, leaving the CEO to balance the books.

I'd rather see Microsoft making a bold move by going back to the Gates era, and bringing in someone with tech credibility. Meg Whitman might be looking for an exit route from HP, and Eric Schmidt is available.

Or look at some of the up and coming tech startups, and take a bet. Microsoft acquired Yammer in 2012, a $1.2bn deal spearheaded by Yammer chief executive and former Paypal COO David Sacks, who's still at the firm and could easily move up the ranks, offering an internal candidate with social expertise and strong tech credibility.

Microsoft's challenge for the future is how it can compete with its far younger rivals like Google and Amazon, which are making inroads in the business market, having already won the consumer battle. Appointing a seasoned CEO like Mulally or a long-term Microsoft man like Elop is not the answer.

Going into 2014, top of my Apple wish list is a brand new product. The Cupertino giant will no doubt have another successful year in terms of profit and revenue. The issue is innovation. Apple has spent 2013 releasing the same products in slightly different versions. The iPad Air is a gorgeous tablet, but it's really just a slightly smaller and lighter version of all the other iPads before it. Same with the iPhone 5S, the Macbook Air 2013, and so on.

Apple is sitting on a huge pile of cash, and needs to release a big bundle of this for R&D next year into brand new products, ideally a budget smartphone. There's plenty of money left in the mobile market across the developing world and China, but Apple will gain none of this with its pricey iPhone 5C and iPhone 5S.

And just a side note - the new headquarters does not equal innovation, and Apple shouldn't get distracted by the development of its new spaceship in Cupertino. This is not innovation that will attract new customers, it's a building.

As one of the oldest IT firms, I'd like to see HP turn around its business in 2014 and find a stable position as an enterprise IT provider. Its recent financial results have shown signs of improvement, with sales from the Enterprise Group rising by two percent year on year for the fourth quarter compared to a nine percent decline in the third quarter. However, the firm is still suffering from its declining PC business, and perhaps 2014 is the year for HP to make a brave decision to cut the rope, rather than continue to let its personal systems group offset any gains made by its enterprise side.

It's unlikely that a behemoth like HP could pull off a management buyout similar to that achieved by Michael Dell, allowing Dell to regroup and refocus its business on the enterprise market behind closed doors. But under Meg Whitman, HP has an assured leader, who clearly isn't afraid to play the role of Scrooge. She just needs to work out how to offload the PC business or extract the most value out of it, while having the least impact on HP's enterprise side. A visit from the Christmas fairy is certainly in order. µ

 

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