Rob Enderle: 2008's Apple, Dell, Google, HP, Lenovo, Sony, Microsoft and Linux
Forward: by Wolfgang Gruener and Rick C. Hodgin
Regular readers of TG Daily will know that Rob Enderle is a frequent contributor to our coverage of the technology industry. You may not always agree with his opinions as we learn from week to week when we are following our readers' comments to Rob's articles. Even we at TG Daily sometimes question points he makes and we occasionally get into heated discussions. But we are very well aware of his background and experience and realize that he is one most knowledgeable general analysts in Silicon Valley today and we learned over the years that there's always a good reason why he has certain opinion.
Often, he does not support the most popular opinion at a time, but his opinion is derived from spending a lot of time with key initiatives in Silicon Valley, which allows him to provide a very different view on current events -- different from what the popular opinion often tries to make us believe. And yes, Rob makes mistakes, as we all do. In these cases, he feels the impact quite painfully, as he sometimes is criticized harshly for the opinion he voices. But some may actually be surprised to learn about Rob's common sense nature and eagerness to learn and analyze the potential impact of a technology trend down to the last detail.
With that being said, TG Daily is very excited to introduce to some, and announce to other's, analyst Rob Enderle and his take on what the landscapes will look like in 2008 for several major technology companies. When you post comments, please bear in mind that Rob is people too. :) Thank you.
Analysis: 2008's Apple, Dell, Google, HP, Lenovo, Sony, Microsoft and Linux
by Rob Enderle
Looking ahead to 2008 we are in for one amazing ride. We start off the year with CES and a massive battle between Apple and the Consumer Electronics (CE) vendors, which Apple surprisingly easily won in 2007 and probably won't in 2008. Dell and HP are on a roll with both pushing hard on design and starting to step up with Apple level marketing. Microsoft created a product that is my choice for product of the year in 2007, and I explain why below. Google's gPhone platform, which showed a lot of promise, is getting horrid initial reviews and that doesn't bode well for that company. Linux seems to be drifting down in interest as it exited 2007 with Red Hat in trouble and more defined by internal conflict than great products. So let's get to it.
Apple: Running with Scissors
A decade ago Microsoft was just starting to be called the "evil empire" and as we ended the year Apple seemed to be on that same track. Putting a near rabid fan site, Think Secret, out of business for being part of a leak for a product that never actually shipped (and probably wouldn't have done well had it shipped) was bad. Worse was going after Dan Lyons, author of the wildly popular Fake Steve Jobs parody site, personally with letters that seemed to threaten his family both during the Christmas holidays is old school Steve Jobs and, up until now, Steve's real personality has been more of an insider secret. For those of you who have never read one of the Jobs' unauthorized biographies the guy seems to like to fire people for fun and they even have a word for it at Apple, it's called being "Steved".
Personally I've always thought that Apple's greatest asset was its incredibly loyal customers, folks that stuck with the company even when Steve Jobs himself didn't. One of the most influential folks in that group are journalists who, defined by folks like the Wall Street Journal's Walt Mossberg, who seem too often be over the top in their passion for the company may have issues with the way Apple is going after one of their own. Even with Think Secret, while there are a few that seem side with Apple, most seem to be thinking of Apple differently now (pun intended) and that doesn't appear to be a good thing for the company. At the end of the year Apple's new OS, Leopard, had picked up the nickname Leoptard, which clearly wasn't a good sign either.
While there is a lot of speculation about Apple's soon to be announced laptops, their 3G (thanks AT&T) iPhone, and other product refreshes right now even it is being eclipsed by discussions suggesting Apple may have shot itself in the foot badly in December and while not fatal, it's going to hurt a lot in the new year. In any case we start 2008 with my wondering whether Apple is rotten at the core.
Dell and HP: Using Old School Apple Marketing and Design Magic
Where you are seeing a lot of Apple magic is in HP and Dell right now. In 2007 HP came out with advertising campaigns around their PCs that rivaled Apple and with a set of great looking products which were also very nicely priced vaulted into first place in the PC market. They had the industry defining BlackBird desktop, the first touch screen all-in-one with the TouchSmart and bought out what was the best Microsoft PC like collaborative product of the year the MediaSmart Home Server.
Dell wasn't sleeping however and got into Best Buy along with a lot of other retailers with their own refreshed lines. Standing out were the Dell One and its marketing campaign, arguably the best looking all-in-one product on the market, and the World of Warcraft laptop which seemed to capture the hearts (if not wallets) of the folks happily addicted to that game. The M1330 laptop was actually designed to make Apple laptops look old and, to my eye, it actually does that.
Both of these companies exit 2007 stronger than they entered it and in 2008 expecting to push the trends they started last year. Expect refreshes and full lines for their all-in-one offerings as they move to eclipse Apple's position in this unique segment (I think 2008 will be the year of the all-in-one). Laptops are going to get a lot thinner and a lot more attractive as both companies push their designers to outdo the other.
Dell quietly bought the company which make the Sansa Connect possible and that suggests an MP3 player from them targeting the iPod's biggest weakness (the fact it can't do subscription music).
Lenovo: Going after Consumers
Lenovo owns the old IBM PC Company and what has historically been the best built Laptop Line in the business segment the ThinkPad. 2008 is the year they go after the consumer market and in China, the fastest growing technology market, they are the top vendor. They are expected to hit this segment with a rush and given their initial size and capability they should be able to make a big dent if they can hold quality up to ThinkPad standards and do solid design work themselves.
They have people who have been watching this market very closely and helping the company define a market entry strategy that will work and not repeat some of the mistakes which have been made by other firms in earlier years. Expect sharp edgy designs for desktops and laptops which provide a lot of value at aggressive price points as Lenovo moves to take their place on the world market.
Sony: Putting 2007 Behind Them
2007 was not a happy year for Sony as they were locked in the stupid and self destructive Blu-Ray vs. HD-DVD battle (no winner yet just losers). PS3 tanked at the beginning of the year but strengthened as the year proceeded though, at the end, sales seemed to be more from folks who couldn't buy Wiis than folks actually chasing the PS3. Sony TVs struggled for much of the year and while they ended reasonably well, given the quality of the Sony products they should have and could have done better. Sony PCs which actually provide the closest thing to an Apple like offering are still under appreciated and wrapped with too much Crapware.
However the executive changes they have made give me hope that 2008 will be a better year for them. I see Sony making critical hard choices that they need to make to turn the company around and their new MP3 player line is actually competitive for once; which is a small indication that they may figuring things out.
Microsoft: Vastly Improved
We started 2007 with Windows Vista in the tank, though it actually sold surprisingly well considering. SP1, which a number of us are testing, seems to address most of the problems and this should help that company (and all of their partners a lot) in 2008. They brought out with HP the MediaSmart Home Server which has to be the most Apple like product ever created in its category and my vote for product of the year wasn't the iPhone it was Microsoft Sync.
The product fixes the really lousy job Apple did with the iPod in cars (and works with iPods) and it is marketed so well that it apparently is helping sell Ford automobiles (I actually considered buying one because of this). Well marketed and easy to use if the MediaSmart Server and Sync define Microsoft's future it will be vastly brighter.
In addition they left the year not defined by their battles with Linux and Open Source, but defined by their alliances with Open Source companies. Linux champion Novell was stronger because of one of these. In short, Microsoft's products and behavior improved dramatically in 2007 and that sets them up for what could be a vastly better 2008.
Google and Linux: In Search of Progress
Linux which has always had a problem stepping out from just being the place where folks who don't like Microsoft go to congregate was increasingly defined by infighting in 2007. We started the year and ended it with no break through new offerings based on the platform, with the hardware vendors complaining about what it did to their margins, and with these same folks saying most PCs that shipped with it actually ran pirated Windows.
We had great hopes in 2007 about the gPhone from Google but I'm now beginning to hear rumbles that Google's effort isn't very good. A lot hinges on this effort and if they go down the typical path of needing to remake mistakes already made by others the gPhone will be a huge disappointment. In 2007 folks who bet against Google lost, in 2008 that could change.
2007 The Year of Battles
2008 The Year of Amazing Partnership Efforts
As I look at all of this and I think 2008 will not be defined by competition as much as it will be collaboration. Apple's problems aren't so much from what competitors will do to them but what they'll do to themselves and I wonder if Steve Jobs isn't being set up to be "retired". The problems with Google and Linux appear to be sourced inside and the expected successes from HP, Dell, and Lenovo will mostly have to do with their various abilities to execute. Just because these companies are positioned to do great things doesn't necessarily mean they will.
In the end I look at Microsoft Sync as the example of a product that has been wonderfully executed and think that 2008 could actually be about partnerships, both within companies and without, and this interestingly enough speaks so emerging strengths from some (Microsoft, HP) and historic weaknesses from others (Apple/Sony).
As we wrap up next year I expect it will be the battles that define the losers but the partnerships that define the winners. If true, that has to be a very good thing.