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By Tom Groenfeldt
In May 2003, Nicholas Carr horrified the world of technology, from CIOs to vendors, with a Harvard Business Review article proclaiming “IT Doesn’t Matter.” He argued that once a technology, like electricity or railroads, moves beyond the introductory stage, it becomes more of a utility than a competitive advantage. Cloud computing, anyone?
At the time he wrote, PC makers were still pushing their machines as “screaming fast” and resolutely neglected such boring details as offering consumers a way to move their existing information -- much less applications -- from an existing computer to a new purchase.
The old adage was that as soon as Andy Grove (Intel) put more power into processors, Bill Gates (Microsoft) released fatter software to eat up the new hardware capability. For a long time this went along swimmingly; Intel set up a regular program of processor releases, Microsoft sent out upgrades which became more or less mandatory as it cut off support for older operating systems (an extended period for XP when Vista turned out to be such a disaster) and eventually both individual consumers and firms had to upgrade, if only to exchange documents with outsiders without running through conversion programs. Microsoft said that most people used about 5 percent of the features in Word and kept adding more. It all seemed to work, and it was very profitable.
And much of it was unnecessary as the stunning popularity of the netbook proved. Buyers showed they were happy with a small computer that could do just enough, and if it didn’t run the latest Microsoft operating system they just might get by with some form of Linux and OpenOffice.
I thought of this when I read a CIO saying that his firm was beginning to think of netbooks like smartphones -- they cost about the same and if one broke they threw it away; no longer were upgrades going to be a major corporate decision because they were so cheap.
While Intel and Microsoft have struggled to find profitability in stripped down netbook chips and software, competitors see an opportunity to bypass both of them.
In an interview with ZDNet, the chairman of Asus said his company was exploring multiple choices in chips and operating systems for its smartbooks
Jonney Shih, Asus’ chairman, said in an interview Jan. 13 that the manufacturer was still not sure how many people would sacrifice the application compatibility advantages of Windows and Intel for a lower-cost subnotebook running a Linux-based OS on an ARM chipset. He also said Asus was working on a tablet or slate device.
“With the current Wintel-based Eee PC, the advantage is you still enjoy the [application] compatibility,” Shih said. “The smartbook is usually based on ARM -- then you will have some advantage in the cost. This will further push the original direction of the netbook."
Now comes word that China is developing its own computer chips, the Loongson or Dragon Chip, according to Wired. An early design was used for a cheap netbook; the next goal is a chip that can power a supercomputer.
“To encourage adoption of the processor, the Institute of Computer Technology is adapting everything from Java to OpenOffice for the Loongson chip and releasing it all under a free software license,” said Wired.
This changing attitude isn’t limited to technology -- car makers are finding that a growing number of hip young people aren’t terribly interested in cars and would prefer the simplicity of life without one, especially in urban areas. American car makers, led by Ford CEO Alan Mulally, are focused on making money from good small cars rather than selling them at a loss and making it up through profits on trucks.
Indeed, the most exciting new car in the world is not something from BMW or Toyota but the Tata Nano, a barely four-passenger car that will sell for less than $2,000 in India. Consultants, never slow to catch a fad, have even developed a name for this approach, pioneered in India, for fast and cheap solutions – jugaad, according to BusinessWeek.
“Recession-slammed corporations no longer have money to burn on research and development. Likewise, U.S. consumers are trading down to good-enough products and services,” says the magazine.
Listening to customers is the first step, although as Henry Ford remarked, if he has listened to customers he would have produced a faster horse and buggy. The next step is an imaginative leap to understand what users want. Finally, the challenge today is to deliver a solution which is simple, value-priced, and not over-engineered.
It’s not something technologists have been great at in the past.
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