Sunday, March 7, 2010

I’m not the only one

I posted some thoughts yesterday about the ramifications of the demise of Essential Business Server for the SMB and particularly Small Business Server market. I was reading through Susan Bradley’s blog and was interested to see that she raised many of the same concerns in a recent blog post including:

 

“Make no mistake the chatter is less about a concern over the future of "M" and more over the future of "S"”

 

and

 

“What's the future hold?  I'm not going to lie to you and say that Response Point, Office Accounting, MPAN program and now this, doesn't put a slight bit of chill up my spine.”

 

When people of Susan’s stature start voicing these concerns you really need to be paying attention I believe. Again, this not about the product or the market segment, I truly believe that it is bigger than this. If you still have doubts have a look at this article:

 

’Cloudy days ahead from Microsoft’

 

as the subheading says here:

 

“MICROSOFT has switched its cloud computing marketing from half-hearted to full bore.”

 

This means that the focus has shifted (rightly or wrongly) from infrastructure to cloud. This is where Microsoft is throwing its resources. Maybe Microsoft’s solution is half baked but that doesn’t stop them allocating their resources there. History shows us that Microsoft tends to start slow and awkwardly in many markets but eventually, usually through sheer brute force, they take a dominate stake. I see no reason why the same won’t occur here.

 

Now you can quote me that this time it is different because of Google and guess what I totally agree with you. Why? Because it again reinforces my point that this online stuff, for better or worse, is not going away. The reality is that it is the traditional in house stuff that is.

 

You shouldn’t need to ‘read the tea leaves’ as Susan says in her post, to see that markets generally go where the dollars flow and Microsoft is currently tipping its bucket into the cloud. To reap the benefits you’ll have to probably follow their lead because in the end it is their products that people sell and support.

 

Technically, maybe the cloud stuff isn’t quite there but guess what that doesn’t matter because it is not the greatest driver here. Because the IT industry is being commoditized here major decisions are now based on cost. The cry is no longer ‘I want the best technology’ it has become ‘I want the cheapest technology’ because to the customer, most technology now looks identical whether it is delivered in house or from the cloud. Therefore in a world where there are few differences between products price becomes the differentiator and the cheaper one always wins. It would certainly seem that this is what we are seeing now.