Microsoft promoting Hewlett Packard - Why?

Why has Microsoft made a 60 minute advertisemnt showing someone buying a Hewlett Packard Notebook?

Windows Laptop Hunters $1000 - Lauren "Not cool enough to be a Mac"

If I was CEO of one HP's competitors, say Dell, Lenovo, Asus, etc., I'd be screaming down the phone to Microsoft's CEO, Steve Ballmer.

On the surface, the ad appears to be a clever retort to Apple's "I'm a Mac" ads, but digging a little deeper reveals a lot of murky issues:

• Lauren will have to live with Vista;


• Lauren could save even more money if she didn't have to pony up for a Vista licence. If she wanted to install Linux, or dare I say, turn her laptop into a hackintosh, that Vista licence is a double-waste;


• MacBook Pros are arguably better machines, and come with an arguably better Operating System;


• Sticker price always neglect the total cost of ownership, where Macs are generally considered to provide better long term value.

Of course, other people have already commented on these and other issues: e.g. that "the ad was staged", and that the theme of the commercial seems to be “PCs: Computers for Losers”.

Another thing this ad shows is that Microsoft willingly ignores generally accepted rules of advertising. For example, according to the panel of The Gruen Transfer, the acknowledged leader in a market should never mention lesser rivals by name in its ads. Doing so lends credibility to the the challengers. That explains why Pepsi (number two cola maker) refers to Coke (number one cola maker), and never the reverse. And Telstra (number one telco in Australia) never mentions its rivals by name, whereas Optus (the second biggest telco in Australia) deliberately compares itself to Telstra in its ads.

Windows 7 and Movie DVDs: Examples of Price Discrimination

Apparently Windows 7 (like its predecessors Vista and XP) will give users a choice of multiple versions. See "Windows 7 SKUs announced: your worst nightmare has come to pass" for information about the versions and their distinguishing features.

On the surface, this "choice" gives users the ability to pay only for the features they want. But, what it actually represents, is an example of what economists call "price discrimination". Now, this term sounds bad, but conceptually it's not necessarily a "bad thing". The point I'm trying to make is that the reason for the different versions is not so much to give consumers greater choice, but more simply to maximise the profits of the producer.

In particular, Microsoft is employing a premium pricing strategy. The cost of developing Windows 7 is essentially sunk, and so can be spread out over all the versions (refer: "Pricing Information Goods, Price Discrimination, Pricing Digital Goods"). Therefore, the cost of supplying an additional copy of "Windows 7 Starter" is essentially the same as the cost of supplying an additional copy of "Windows 7 Ultimate" (I'm assuming minimal differences is packaging and number of discs). From the Wikipedia article on price discrimination: "by providing a choice between a regular and premium product, consumers are being asked to reveal their degree of price sensitivity (or willingness to pay) for comparable products." Other examples include bewildering choice of drinks at coffee chains and the pricing of business class airline tickets.

[An aside: "Hey, your an Apple fanboy - what about the two versions of Mac OS X: Client and Server?" The comparison is not really applicable, as these variations are clearly aimed at different types of installation. The Client version actually corresponds to all six flavours of Windows 7: it is intended for an individual's workstation. The Server version is intended to drive backend (i.e. server) systems, and corresponds to the separate Windows 200x Server products.]

For a detailed explanation of how price discrimination increases profits, I suggest you consult Wikipedia or an introductory economics book (e.g. The Undercover Economist or Naked Economics). I'll try giving the gist. In a free market for a product, there is a single price that applies for all units sold. This price represents the point where demand equals supply. Suppliers will continue to sell units of the good as long as the price matches or exceeds the (marginal) cost of producing that additional unit. Now, different consumers value the benefits of the product differently, so some would actually be willing to pay more than the market price if they had to. Those who aren't willing to pay the price miss out altogether. If the seller could charge different prices according to the class of consumers (e.g. by marketing a premium version), it could increase its revenue on the same total volume of sales. This in turn increase profits.

The case of "Windows 7 Home Basic", which is only available in emerging markets, is an example of third degree price discrimination, where "price varies by location or by customer segment, or in the most extreme case, by individual customer".

Those familiar with region coding of movie DVDs should recognise a similarity here. According to Wikipedia: "Price discrimination is especially applicable to movies, because the marginal cost of selling one copy (or viewing) is quite small, giving the seller great flexibility in pricing. There is great disparity among the regions of the world in how much a person is willing to pay for a DVD, and region encoding allows a publisher to sell a DVD for less money in the regions where the demand is low and more where the demand is high."

Note: I haven't mentioned the more contentious issue of Microsoft's predatory pricing through OEM distribution. See "Predatory Pricing - Microsoft's Modus Operandi" for an interesting discussion.

[Adelaide's maximum temperature was only 33.0 degrees Celsius (91 degrees Fahrenheit) today. The temperature continues to fall, but the humidity is increasing.]

Jobs/Apple Speculation Frenzy

Some of the wild speculation surrounding the health of Apple CEO, Steve Jobs, has been shameful. He's a human being, and now that he's stepped aside as Apple CEO for a while, he deserves some level of privacy and respect. The speculation about Apple's future has also been rather bizarre, and I'll be discussing some of that in this rant.

The revival at Apple since Steve Jobs returned as CEO has been in large part due to his efforts, both direct and indirect. He's assembled a great team of talented people, for example: Jonathan Ive, Tim Cook and Phil Schiller. Obviously, having such an influential CEO stand aside will have an impact on Apple's day-to-day operations. But there are about 35,000 other employees who've had a hand in producing great products too.

Some may point to what happened to Apple after Jobs was ousted in 1985. There are several factors that need to be considered, however: Jobs went on to start NeXT Inc, "taking several Apple employees from the SuperMicro division with him" [Wikipedia]. Then-CEO John Sculley didn't waste time reorganising (de-Jobsing?) Apple. Other top Apple personnel also left around that time (notably chief Macintosh engineers Andy Hertzfeld and Burrell Smith). And in 1987, co-founder Steve Wozniak left Apple. Quite a brain-drain, I'd say.

The current situation is quite different. Jobs has stepped aside, but his hand-picked team remains in place. As has been noted recently, "although the co-founder has been critical to the company's resurgence, his spirit and drive have since been instilled in thousands of other Apple employees".

Perhaps a more appropriate guide is Pixar. Steve Jobs is no longer CEO of Pixar, yet WALL·E (released last year) did rather well. "It grossed $521 million worldwide, won the 2009 Best Animated Film Golden Globe Award and is nominated for six Academy Awards, including Best Animated Feature" [Wikipedia]. After the acquisition of Pixar by Disney in 2006, most of Jobs' creative team has retained control.

In stark contrast, Microsoft's situation does seem to have greatly deteriorated since founder Bill Gates left the company. The past few years have been rather underwhelming for the company: Vista, Zune, Xbox 360's "red ring of death", SPOT, Windows Mobile, Origami/UMPC, PlaysForSure (to name a few problems, failures and missteps).

[Would you believe, another hot day in Adelaide. Today's maximum temperature was 41.1 degrees Celsius (106 degrees Fahrenheit)!]

.docx Considered Stupid

Recently I received an email with a ".docx" file attached. This is the new format for Microsoft Word 2007 documents. I won't even start about how annoying it is to get Word documents attached to emails. Unfortunately it's something you have to put up with.

Being a Mac user and not having the latest and *cough* greatest word processor from Microsoft, I had to figure out how to read this document. I found out the .docx file format is actually a zipped directory tree containing xml files.

Ok, first step was to unzip the .docx file via the command line. This resulted in eleven files in a handful of directories. So far, so good.

Next step was to find which file contains the actual text of the document and not just metadata. Looking through the filenames, I found one called "document.xml" which appeared promising. So I opened it up in my trusty text editor, TextMate. Suddenly my computer began grinding to a crawl as the file was loaded. It turned out that the entire file consists of two lines: the first line containing the xml version, and the second line contained the entire xml markup for the document! No wonder TextMate struggled, since it dutifully created a 70,000+ character line for the document. Why couldn't the xml file have newlines to make it more manageable? Anyway, on to the final step...

My plan was to write a regexp search-and-replace to strip out all the xml markup so I could read the content of the document. But then I discovered that the markup is peppered with <w:proofErr w:type="spellStart"/> tags around almost every single word! I should mention that the contents of the document were in a foreign language, hence all the spelling "errors". For some bizarre reason, Microsoft Word marks up spelling mistakes in docx files, not just on-screen. Why? Shouldn't it be left to the individual application (and platform) loading the document to decide whether or not words are misspelled? I can accept all the other hassles with the docx format: zipped xml files and incredibly long lines, but the encoding of spelling errors is crazy stuff.

After all that I gave up trying cleaning up the xml to read the file. Luckily, I found a web site that offers free conversion of docx files: zamzar.com.

PS: It turns out that Word documents created using MS Office 2007 do not conform with their own OOXML standard!:

OOXML and Office 2007 Conformance: a Smoke Test

Why I Hate Windows (Feb '05 Edition)

Almost everyone who knows me is aware that I'm a "Mac-head", and that I hate Windows. The purpose of this rant is to highlight some of the things that I most hate about using the latest version of Windows (XP), and thus help me release some frustration. I also hold out the (very slim) hope that someone at Microsoft is listening.

In a perfect world I would be able to use an Apple Macintosh for any computer-related work. But, alas, this is a far-from-perfect world, over the years working as an IT contractors means I have to suffer the nightmare of using Windows.

Here's a list of my current major peeves about Windows XP:

• Stale directory listings
• Mapping drives using letters
• Limited Drag-and-Drop support
• Epileptic fit-inducing colour scheme
• Hyperactive taskbar and general environment
• Extreme modality
• Start to Stop

It's by no means an exhaustive list, but I don't have all day to write them all down (and I doubt you don't want to have to read through all of them). I'll focus on a selection of my peeves then explain my pain.

Stale directory listings
Why is it necessary to press F5 to get a directory listing updated? Surely the system should know that a file has been added or updated in a directory. Also the system should know if a window is open displaying the contents of that directory. So why should I need to do anything to get the directory listing updated? For many years now the various versions of Mac OS have automatically refreshed the directory listing after changes to the contents.

Mapping drives using letters
Back in the days of yore (actually, the Eighties) I owned an Atari 800XL. To save files I had a tape drive, which used standard audio cassettes. Later I could afford to buy a floppy disk drive. To reference the tape drive, I had to use the letter "C" and a colon ("C:"), while the floppy drive was referenced as "D:". All perfectly reasonable, in 1985.
At the same time, PCs were called "IBM compatibles", and ran Microsoft's DOS. Windows 1.0 was released around that time. These PCs also referred to storage devices, be it a floppy drive or hard disk, by single-letter drive designations. Apple Macs were bit of an exception. They allowed volume names to be whatever you wanted them to be, say "Macintosh HD", "Backup Drive" or even "Dave". In those days I guess it wasn't really a big deal, because networks were very rare. Everyone in an office would have the same small set of drives and associated drive mappings as everyone else.
These days almost every office is networked. Resources can be shared over the network quite easily. To do this in Windows you to map a network resource to a drive letter. Unfortunately not everyone maps the same resources to the same drive. I tend to prefer using mnemonic mappings to help me remember what's what. For example, I usually map my home directory on the network file server to drive "H:". For common resources available to all users, I might choose another letter, trying to use a letter that reminds me of the resource. The problem occurs when other people choose different letters for the same resource, so they say "the file is on Y drive", which is meaningless unless I have the same resource mapped to "Y:" as they do. Contrast this to a Macintosh, where network volumes have actual names, such as "Company Stuff" or "Web Server". No confusion there. So why does Windows still use drive-mappings in 2005, just like my old Atari 800XL did in 1985?

Limited Drag-and-Drop support
One of the great things about visual systems is the ability to grab a file or some text and use drag-and-drop to move it somewhere else. For example, one can grab a file in "My Documents" and move it to "My Music". Similarly in Word one can grab a paragraph and move it somewhere else in the document. Unfortunately, Windows doesn't provide as complete and consistent drag-and-drop support as Mac OS X. On my Mac, I can drag the text of a URL from a dialog box and drop it onto the browser's icon in the dock (taskbar) and the browser will load that page. Sure, sometimes this is not Microsoft's fault, but rather it's the fault of the developers of the applications themselves. But if Microsoft led by example and made Windows as drag-and-drop aware as Mac OS X, then things could only improve.

Epileptic fit-inducing colour scheme
Many non-Mac people criticise Mac OS X for being mere "eye-candy". Sure, it has lot's of nice colours and fancy effects, but anyone who has seen Windows XP with it's default settings would have to admit that the Mac is tasteful in comparison. The XP colour scheme looks like it was designed by kindergarten children. Actually, I'm being unfair on kindergarten children (and their teachers). Windows apologists say you can switch to Windows 2000-style look, which I have done, but why does the XP have to look so "busy" out of the box?

Hyperactive taskbar and general environment
The Windows taskbar can be a hectic place. I can understand that when a new application starts up a slot appears in the task bar. And I can appreciate how XP can consolidate windows by application. In fact I would prefer it if it did that by default, not only once the taskbar has become "full". My main issue with the taskbar is how much jumping around there is. It makes me jittery when I see so much activity at the bottom of the screen. It can be very distracting. Also, why can't I rearrange the items in the taskbar, whereas I'm allowed to rearrange the items in the quick launch section?
But the taskbar is a sea of tranquility when compared to the general XP environment. If you have an open window and change the selected file, the left toolbar gets updated to show you what actions you can do with that file. That may be nice for a novice user, but I find it distracting if all I want to do is move the file somewhere else. Why does XP have to try to second-guess what I want to do with the file? Also, whenever something happens XP displays little popup windows to alert (i.e. distract) me. Okay, these windows often dismiss themselves after a delay, but too late - I've been distracted by something which is slightly more than meaningless. To complete this section here's one of my personal favourite popus: when XP has finished booting it informs me that it failed to connect to the network. The popup neglects to reaassure me that it will continue trying, and once it does establish a network connection it doesn't even bother letting me know! Why does Windows have to be so selectively chatty?

Extreme modality
Changing control settings in Windows usually involves an ever-increasing procession through a series of dialog boxes. It's easy to get lost and try clicking on the Cancel button of a dialog box which is behind the one that's at the top of the stack. It doesn't help when your calendar program (im)politely informs you that you have a meeting in 15 minutes and takes over part of the screen. And if you make the mistake of clicking on another application's window you could find it difficult getting back to that dialog box stack that you were trying to work your way out of in the first place. User interface gurus have cautioned against using such modal interfaces, but Microsoft is not listening.

Start to Stop
One of my favourite Windows anomalies is the "Shutdown" item in the Start menu. This epitomises the upside-down world that is Windows. I think I'll stop here.

The horror, the horror.

[Update]
Revenge of XP? It appears that the feeling of hatred is mutial. When I returned to work this week, my PC failed to boot up correctly. Windows complained that a critical file (I think it was the registry) was corrupt. I don't know if it was related to the fact that the computer's memory had been upgraded (why should that cause a problem?) but I had to get someone from tech support to fix it.

[Update 2]
Mary Stamper has written an essay which criticises Windows from a software developer's point of view:
   From GUI-Avoider to OS X
Her conclusion:
"I’m sure that everyone has heard the old saying, “Mac for Productivity, Unix for Development, and Windows for Solitaire”. My experience has shown me that at least for my needs, the Mac is not only for productivity, but for development as well. Windows? Well, some things never change."

I've also commented to people that Windows PCs are just souped-up Xboxes that can run Excel.