Microsoft Looks Inward for Mobile Success

Software giant is its own salvation – and worst enemyIf you think Microsoft Corp. means to succeed in the mobile industry by battling sector stalwarts such as Palm Inc. and Research In Motion Ltd. head-to-head, think again. According to one Microsoft product manager, the software giant’s way forward is more introspective than aggressive."It’s really about chasing those Exchange users," said Brian Seaton, Microsoft Canada’s business group lead, mobile and embedded devices, speaking at the firm’s analyst briefing day in October. Microsoft’s popular Exchange Server for email has attracted 150 million users, Seaton said, but just 10% of them access messages via mobile devices. The gap represents an opportunity for Microsoft. If the company can bridge the wired and wireless realms with Exchange, it could become the mobile industry’s lynchpin. Microsoft is trying to make that happen with Exchange updates. One of the latest provides "push" technology that shoots messages out to handheld computers, a la RIM’s BlackBerry system. Microsoft is also making unusual partnerships, such as the one with former operating-system rival Palm, which now uses Microsoft’s Windows Mobile 5.0 operating system in its Treo handsets. Seaton said Microsoft envisions a day when people would use one mobile device for both their personal and business lives, toggling back and forth between appropriate profiles. "Putting that pure consumer experience and the enterprise user experience on one device" is the goal, he said. He also figures future mobile devices will support speech-to-text, VoIP integration, biometric security and location-based services. It seems Microsoft wants to transform mobility into a genuine enterprise-IT responsibility. Seaton said his company figures it’s time for businesses to start sourcing their mobile devices and apps from value-added resellers and IT services firms – companies that integrate ERP and enterprise telephone systems, for instance. "That’s where we see a huge opportunity," Seaton said. Microsoft is a growing force in the communications arena. Its operating system for mobile devices is becoming popular. The company is in bed with Nortel Networks on unified communications (see the cover story), and it has partnerships with numerous communication system providers. The chasm between its Office applications and various messaging platforms seems to shrink daily. But Microsoft faces a fundamental problem: its own reputation. The company’s roots draw from the PC sector, not the communications industry. The corporation has yet to prove itself in the network realm. And given its association with such undesirable IT phenomena as the Blue Screen of Death, buffer overflows and viruses, Microsoft has plenty of work ahead. But the IT industry knows just as well that when Microsoft puts its collective efforts towards a market, it’s only a matter of time before the firm becomes a formidable competitor. Even if Microsoft’s biggest bugbear now happens to be its own repute, that could change. RIM, Palm – Nortel – watch your bottom lines. NTP Sues PalmHaving done with Research In Motion Ltd. (RIM), patent-holding company NTP Inc. sued mobile computer maker Palm Inc. in November for patent infringement. Seeking financial restitution, NTP said Palm has infringed seven patents. Palm said it would defend itself, and that NTP’s patents have little to do with Palm technology. NTP won US$612.5 million out of RIM in a settlement earlier this year after a five-year court battle. Good for MotorolaMotorola Inc. in November announced plans to acquire Good Technology Inc., a company that makes software that "pushes" email messages from servers to mobile devices. Good’s platform adds BlackBerry-esque functionality to many wireless PDAs, including those made by Palm Inc. Motorola’s acquisition made some industry observers wonder if Palm would continue to partner with Good now that Palm’s rival Motorola is the owner. Cable Phones Hurt IncumbentsCompetition is the name of the telecom game, according to market watchers at IDC Canada Ltd. Although the industry grew only 3.6% in 2005, the "explosive" growth of the cable telephony business has affected the whole sector. The incumbents – Bell Canada, MTS Allstream Inc. and Telus Corp. – are pressured by firms such as Rogers Communications Inc., but IDC figures Bell is most likely to be hurt by the cable-phone phenomenon. Bell has three cableco competitors to combat – Rogers, Vidéotron ltée and Cogeco Cable Canada Inc. – whereas the other incumbents have just one cableco competitor, explained Lawrence Surtees, IDC Canada’s principal analyst. As well, Bell has the greatest number of NAS lines – the most to lose to cable competition. Other IDC Canada findings: in the local market, wireline service is no longer the single largest sub-sector, thanks to wireless and VoIP growth; nearly 750,000 Canadians signed up for non-ILEC VoIP by May 2006; long-distance remained the worst-performing market. Cable Broadband Rules CanadaWhereas DSL subscribers outnumber cable subscribers in 28 of the 30 OECD countries, cable rules in Canada and the US, where cable subscribers outnumber DSL subscribers, according to the Organisation for Economic Co-operation and Development’s broadband statistics up to June 2006. The OECD also said Canada leads G7 countries in terms of penetration by population, but we’re ninth in the list of all countries – behind Denmark (first place), Korea (4th) and Norway (7th). The OECD said the US has the most broadband subscribers (57 million), and Japan leads in fibre-to-the-premises (FTTP) rollouts with 6.3 million subscribers. BC IT Groups CollaborateThe British Columbia Technology Industry Association (BCTIA) and the British Columbia Regional Sciences and Technology Network (BCRSTN) are partnering "to encourage innovation, promote commercialization of research, and support entrepreneurs and emerging technology companies," reads a news release. BCTIA president Rob Cruickshank says, "Our unified efforts will ensure a stronger voice on issues that are important to the industry as a whole across BC." Vonage In with Seniors CommunityCourtyard Developments Inc. has chosen Vonage Canada to provide telephony services for Hyde Park, a retirement community in the Village of Richmond, near Ottawa. Hyde Park will feature 300 bungalows, apartments and suites, all equipped with Vonage phone service offering fixed-rate unlimited calling plans. "We selected Vonage to provide Internet phone service because of its simplicity and flat-rate calling plans, which helps provide a means of budget control-ideal for seniors," Steve Hyde, president of Courtyard Developments, said in a news release. Avaya-Juniper Router Links Voice, DataConsummating a deal they entered last year, Avaya Inc. and Juniper Networks Inc. unveiled a line of combined router/ IP voice gateways in Juniper’s J4350 and J6350 routers. Designed for branch offices with up to 100 stations, the boxes come with Avaya’s IG550 IP voice gateway and interface modules built in. The devices support two analog stations and two analog trunks, and the units can be connected to Hewlett-Packard Co.’s OpenView management software. Rogers Confirms FMC PlansSpeaking of his company’s banner Q3 2006 results, CEO Ted Rogers said Rogers Communications Inc. is developing a service that would let residential customers link their in-house, wireline service with mobile handsets. It’s a late-2007, 2008 program, Rogers said. This functionality stems from fixed-mobile convergence (FMC), an over-arching concept to connect disparate networks – Wi-Fi, cell and wireline. In its third quarter Rogers experienced a 33% year-over-year increase in operating profit, which hit $784 million. Last month Rogers also announced that its High-Speed Downlink Packet Access (HSDPA) network was ready to go in southern Ontario. HSDPA provides a theoretical data rate of 10 Mbps, but network implementations vary. Wireless Handoffs a DreamA handful of network equipment makers may well have demonstrated mobile handsets that can jump from Wi-Fi to cell networks without dropping calls, but that doesn’t mean the technology will be available soon. Writing about the myths of dual-mode phones in Business Communications Review in October, Peter Brockmann, president of Ottawa’s FirstHand Technologies Inc., pointed out that such macro handoffs are a long way away. "The technology and standards...are immature, devices aren’t ready and operators aren’t interested." Brockmann also said dual-mode functionality has nothing to do with offsetting mobile airtime charges and everything to do with greater wireless coverage – Wi-Fi can provide coverage where cell networks peter out. FirstHand is a mobile VoIP software development firm. Convergence or Tooth Fairy?Convergence is a myth, said Gary Audin, president of telecom consultancy Delphi Inc., speaking at the Enterprise Networks conference in October. Despite marketing from the likes of Avaya Inc., Cisco Systems Inc. and other network gear vendors that this is the age of convergence – applications and networks, voice and data all coming together – it’s not true. In Audin’s estimation, "converged" voice-data networks are nothing more than data networks with voice interloping on top, and although some companies say they’re merging formerly disparate IT operations to act as one, IT management silos remain intact. Convergence is "harder than we thought," Audin said. He predicted a booming market on eBay for used TDM telephone equipment as businesses scramble to maintain their aging but serviceable PBXs. Pocket-Sized IP-PBXIP-PBX maker 4S newcom has unveiled an IP-PBX that boots off an Apple Computer Inc. iPod portable media player. The German firm says the phone system, dubbed blue4s, is so compact that it can reside on an iPod while still leaving enough room for the media player to store hours of music. The phone platform boots from the iPod to an Apple Mac Mini – a compact PC – and supports 250 users and 30 parallel calls. 4S newcom was seeking a Canadian distributor when we interviewed the firm in November. Cisco Patents EverythingThe US Patent and Trademark Office (PTO) has granted Cisco Systems Inc. a wide-ranging patent covering "a method for providing integrated voice, video, and data...over a single network infrastructure." The patent, number 7075919 issued in July, mentions television, telephone services and a "common communications protocol" to tie it all together. So broad, the patent seems to cover many iterations of network convergence, including VoIP and IPTV, both of which use a common communications protocol: IP. In other Cisco news, the company announced in October that it would acquire Orative Corp., which has an application to extend Cisco’s UC functions out to mobile devices. Orative’s Enterprise Software connects to Cisco’s CallManager IP-PBX, the MeetingPlace collaboration platform and Unity voice mail system, such that mobile phone users can access voice mail details, corporate directories, and call-screening functions as if the users were at their desks. Cisco said it would pay US$31 million for Orative. The company expects to close the deal by Q2 2007. Cisco also recently released TelePresence 3000, a high-definition video conferencing system. And as if to test its own offerings, the firm is attempting to decrease travel costs and increase time spent with customers by 20%. According to Nitin Kawale, senior VP, enterprise and public sector operations at Cisco Canada, the network vendor will have to rely on its own products to get the job done. Video conferencing, document-sharing systems and presence applications will likely play a part in the endeavour. McAfee Scoops OnigmaHaving acquired a handful of IT security software providers this year, McAfee Inc. now says it has a comprehensive technology-protection program that lets enterprises reconcile regulatory requirements and data management, although the company’s prospects might be flagging. In October McAfee bought Onigma Ltd. and integrated that firm’s data-loss prevention software into its portfolio. In June McAfee acquired Preventsys and its security-risk management system; in April McAfee took over SiteAdvisor and its Web-surfing monitoring technology. McAfee says its wares now encompass antivirus, intrusion prevention, anti-spyware, security policy enforcement and network access control. Meanwhile Microsoft Corp.’s new security-minded Vista operating system has some wondering if third-party security vendors such as McAfee will be necessary. MTS Expands Wi-Fi FootprintMTS Allstream Inc. has added 60 new hotspots to its provincial Wi-Fi network, bringing its total number of hotspots to more than 300. Additional coffee shops, truck stops and shopping malls in Winnipeg, Headingley, Brandon, Virden and Morris are now offering Wi-Fi services. According to consumer markets president Kelvin Shepherd, more locations will be added in 2007. Unlimited service is priced at $20 per month, 30 hours per month is $10, and an hour costs $1.50. Nortel Scores NHL InstallThe Bell Centre, home to the NHL’s Montreal Canadiens, will soon be equipped with Nortel Networks wireless gear, such that the arena’s food and beverage service outlets will be able to accept all forms of electronic payment using Wi-Fi point-of-sale cards, and ticket scanners will go wireless to speed up the ticket validation process. The network will extend to the press gallery as well, enabling media members to exchange, upload and update files. ‘Net Neutrality PerspectiveWonder why the big telcos in the US are against any sort of ‘Net neutrality rules? The following figures help to explain why (all figures in US dollars). Verizon has spent $4 billion on its fibre-to-the-home service and plans to spend another $18 billion by 2010 just to get the service, dubbed FiOS, past three million homes in nine states, the carrier claims. It costs the company $873 to lay fibre to each home, and an additional $933 to connect the wires to each home. About 15% of homes will subscribe to the service, making the per-home cost of network deployment $6,253 per customer. Even if costs drop to $1,350 and 40% of homes in the territory subscribe to Verizon’s FiOS service, costs per customer would be $2,400. It would take two years to recover the costs if customers sourced all of their voice, video and data services from the carrier.

Microsoft Looks Inward for Mobile Success

News | December 1, 2006

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