Analyst Opinion – This November has certainly a big month for technology and shifting trends. One of the most interesting news bits was a quiet change from Windows to Apple boxes in some of the largest and most powerful technology companies. Then we had the Intel launch of Core I7 and the launch of AMD's Shanghai platform, both of which exceeded expectations. I exited last week receiving a smoking triple-card Nvidia-based system running Core I7 and while I missed the flash drives I was blown away by all of the performance. But is technology really all about performance?
It is clear to me, and the Apple move really got me thinking along these lines, that people are starting to make decisions based on other criteria than pure performance and that the overall user experience is becoming a bigger differentiator. There are reasons for what is suddenly driving Apple into big companies and it is affecting the battle between AMD, Intel and Nvidia as well.
Apple's enterprise move
Last week, I was visiting one of the most powerful companies in technology - one that is typically thought of as a Microsoft partner. I noticed a lot of Apple computers and even the guy briefing me had a MacBook Air. Since this was a traditional Windows shop, I paid a bit more attention on what was going on at that site.
Apparently, the buying authority for employee devices and supplies has become decentralized and has been moved to the managers who own the related profit and loss. The idea behind this is that these managers are closer to the problems and can better assess how to most effectively spend their limited budgets.
This is a heavy laptop shop and, like most, is still on a 2-year rotation and buys laptops with full services at a cost of about $3600, excluding the software or central services from the company's IT organization. Because a few people wanted to use Apple machines, an internal peer-to-peer support organization was set up and, initially, anyone who wanted an Apple had to get special permission and generally buy it themselves.
Upon review, the costs associated with these Apple users turned out to be vastly less than those associated with Windows machines for obvious reasons, including the fact that the employee, not the company, bought them. But, when managers looked at the departmental cost, a $1800 MacBook Air saved $1800 over a $3600 Windows machine, because the annual service cost can be avoided.
As a result, employees at this company can now select, once their Windows box is up for replacement, an Apple machine and speculation is that most will elect to do that. That means they save the company tons of money and those employees are usually very happy with their computer. Many apparently elect to use their own money to buy an even better laptop from Apple.
There are a couple of issues. The Apple solution isn't as secure as the Windows solution and the calendaring is terrible, largely because Exchange just doesn't work that well with Office for Mac at this time. I'll bet that may force a move away from Exchange, if that isn't fixed before the company moves. This isn't really about Vista vs. Mac; this is about the ecosystem that has come up around the Mac and the fact that many firms now live off of web applications and not desktop applications these days. From the selection of the product (looks like most want the MacBook Air) to the way they chose the platform it was all about the experience and not the performance. This is a lesson I am taking into the next section.
The hottest computing platform in the market at the moment is the netbook. This class of product sells for an aggressive price and trades performance for size generally running the Intel Atom processor. The economic conditions are forcing buyers to consider the Netbook as an alternative to the notebook and even the OEMs like it, because it carries both a low price and a relatively high margin. This is a solid shift from performance into something that is more experiential. The signature offering is the Vivienne Tam Netbook that HP is bringing to market: It is all about style and while it has good performance for its class, buyers won't be buying it for that.
AMD has been moving to three variants for their focus going forward. One for gamers, one for entertainment and one for business. The company intends to increasingly provide the software to enhance the experience in each of these environments. One of the most interesting is a single button gaming mode which turns off all of the stuff you don't need - which improved the gaming performance and reduces the possibility of a crash. On the multi-media side, AMD has been working on improving the user interface into media advancing significantly the ease in which users can find and navigate various media types.
Nvidia focuses on Stereoscopic 3D, which could revolutionize gaming, do impressive things to movies and might open up the 3D web. The nice thing about Nvidia's approach is that game developers generally don't have to do much work and even though you have to wear glasses, they are both light and do not look overly dorky. I got a chance to play with these recently and the experience is actually rather impressive.
But, in all cases, those vendors who have been known for fighting over the same things are moving the battle into who can improve the user experience more. In some cases, their efforts, which are vastly different, will enhance each other and in others they will be mutually exclusive. But we should enjoy the result.
Wrapping up: It's the user experience, stupid
It is interesting that, over all the years of one vendor beating up another on performance, it has taken Apple's success to bring back what originally helped found the entire market. User experience is the primary battlefield and everything else is a distant second. This focus by vendors - OEMs are going down similar paths - should result in well-differentiated experiences that real people can choose between and an overall improvement in our satisfaction with PC-based products.