Archive for March 2014
There have been esimates that when Microsoft releases Office for the iPad, likely later this month, it could end up bringing in billions of additional dollars to Microsoft’s coffers. Is that hype and overkill, it will it really add that much to Microsoft’s bottom line?
It’s widely expected that on March 27, Microsoft CEO Satya Nadella will announce Office for the iPad. If that’s true, that will finally put an end to the “will-they-won’t-they” speculation that has swirled around the fate of the suite for years.
How much additional revenue will Microsoft bring in when it releases the suite? Morgan Stanley analyst Adam Holt says that Microsoft could get $2.5 billion in new Office revenue by releasing Office for the iPad. And Gerry Purdy, principal of MobileTrax, offers even bigger numbers. He believe that Microsoft could gain an additional $1.25 billion in revenue in the first year Microsoft releases Office for the iPad and Android tablets, and $6 billion in annual revenue by 2017.
I think both numbers are wildly inflated. Take a look at Purdy’s reasoning,which is based on Microsoft releasing Office for both Android and the iPad.
He assumes that 25% of iOS and Android tablet users would buy Office and that Microsoft would net $50 per copy sold. He believes that Microsoft will sell Office for the tablets as standalones, rather than include it as part of a subscription to Office 365.
Purdy is likely wrong on both counts. It’s hard to imagine a quarter of all iPad and tablet users buying Office, especially because there are so many free or very low-cost alternatives, including the free Google Docs and Google’s Quickoffice. I’m sure that the percentage of people willing to pay for Office is far, far under 25 percent.
In addition, it’s quite likely that Office will be sold as part of an Office 365 subscription, not as a standalone piece of software. Microsoft has made clear that subscription-based Office is the future, and standalone Office is the past. As just one piece of evidence, Microsoft recently announced a cheaper Office 365 subscription, called Office 365 Personal, that appears to be aimed at those with iPads. It will cost $6.99 a month, or $69.99 for a year for one PC or Mac and one tablet compared to $9.99 per month or $99.99 per year for five devices for the normal subscription version of Office. That means that only some part of additional Office revenue shoud be attributed to the iPad, not all of it.
But that doesn’t really matter. Releasing Office for the iPad is not only about additional revenue. It’s also being done to protect existing revenue and market share. Microsoft needs to fend off Google Docs, which is free and works on all platforms. Releasing Office for the iPad is an important way to do that.
That will be even more important in future years. Rumors are that a 12-inch iPad may eventually come down the pike. If true, that would put it at the screen size of a laptop, and make it more likely that iPad owners will want a productivity suite. If Microsoft wants to keep its hold on the office productivity market, Office needs to be available for the iPad, and at some point, Android tablets as well.
Every business starts from the question: ”Which direction to take, how to choose the right niche…”. Most start-ups choose software development as the direction to start with because of quite low launching costs, easiness to start the business, high popularity of IT and the well-known postulate “software will eat the world”. But when choosing IT sphere it is quite important to understand this market and find new perspective areas in it. As investors and business angels are much more eager to invest not in what is popular today, but what will be the future of tomorrow.
In my article I would like to draw your attention to some trends that seem promising in my opinion
The Internet of things
The Internet of Things is likely to have a staggering impact on our daily life and become an inherent part of such areas as electricity, transportation, industrial control, retail, utilities management, healthcare, petroleum etc. For example, GE predicts that the oil and gas industry will be able to save more than $90 billion a year thanks to the reduced operating costs and fuel consumption that smart components will deliver. The health care sector may save more than $63 billion because of improved resource usage and modern equipment.
Also the Industrial Internet will make transport more economical, and safer too. Jumbo jets, loaded with sensors that record every detail of their flights, will help engineers to design safer aero-planes and know which parts need to be replaced. On the road, fleets of trucks and even ordinary drivers will be able to tap into the web, monitoring traffic in real time, with automated programs suggesting alternative routes in case of accidents/traffic congestion.
Of course, all of these benefits mean plenty of business opportunities for those who are brave enough to make the first step. Profits will grow exponentially as the Internet of Things itself matures. Today, there’s around 1.3 billion connected devices in the world, but by 2020 this could well exceed 12.5 billion devices. Similarly, the M2M (machine-2-machine) industry is said to be worth around $121 billion a year today. By 2020, that value will grow to almost $950 billion, according to the Carbon War Room. Don’t lose your chance!
Computer Science health
This sphere suit startups that plan to develop software to diagnose and treat diseases (i’m not taking about Biotech, but about Information Technology). As a rule it is a noninvasive methodology. The technology will help to avoid costly and dangerous procedures: instead of an operation it will be enough to use a specialized device Different kinds of fitness applications have already filled the market. Apps that evaluate sleep state and help to wake up at the most opportune moment, that evaluate quality, caloric value and allergenicity of food are not a rarity anymore. More and more people keep track of their daily activity: number of steps made, calories burned, heart rate etc by using bracelets and kardiosensors. But the real revolution will produce a system that will combine sensor data and sensor condition of the body with genetic information. The Apps will give an opportunity to influence the physical state, recommending an appropriate lifestyle and a specific diet, supplements and medicines.
In 2012 and 2013 we saw significant data breaches across multiple industries and governments impacting millions of users. For instance, according to a recent study conducted by Ponemon Institute, nearly 1.5 million Americans have been victims of medical identity theft. Individuals whose medical information has been stolen often deal with erroneous medical expenses, insurance issues and incorrect data on medical records that can lead to fatal medical errors. And data security issues compromise more than patient privacy and personal data.
Is this an uncertain future we will have to live with? Can we accept degraded privacy and security and billions of dollars in lost revenue, damage, reduction in brand value and remediation costs?
Such issues will become the concern of more and more enterprise leaders. Thus, Data Security could be the biggest challenge for startups.
“Green Energy” field
We live in the world of limited subsoil resources. We may experience and in fact we do already experience their shortage. The time of “users” is close to the end and the era of “creators” is coming instead. The “creators” are sure, that the potential of the “Green Energy” is huge… and they are right. Every fifth kWh is got from renewable energy sources in the developed countries. Let’s see what is happening in the world:
Elon Musk, the creator of PayPal, has opened a company that produces electric cars Tesla. For three years they have produced quite expansive super-cars and rectified technologies …btw the technologies are still being improved ( hope you understand what I’m driving at…). Also the super-cars require refueling …with the help of solar batteries, which are quite widespread in the USA and Western Europe. By the way it is predicted that America, South Canada and most of Europe will be covered with solar stations by the end of 2015 year (another niche 😉 ) and the solar batteries will be used not only for the refueling).
What I’m driving at …want to say that there will be need in different applications (including mobile apps as well) for its ordering, managing etc.
In conclusion I would like to wish you to find your niche and not be afraid of putting your ideas out and trying them. Good luck and thanks for the reading 🙂
Fear of surrendering control is probably the main factor holding many IT directors back from realizing the benefits of outsourcing IT services. But if you can find an IT services supplier who will work with you in a genuine partnership, understanding the specific needs of your business, it soon becomes clear that this fear is misplaced. It is perfectly possible to retain your strategic power while outsourcing the fundamental and mundane elements of your IT service and support. By opening the door to outsourcing some niche services or even your entire application or database management infrastructure, you can generate a host of business benefits.
The top 10 benefits of outsourcing
- Reduced service and support costs within a managed and predictable budget
- Better quality of service, fewer IT failures and less downtime thanks to well-defined service level agreements
- Access to the latest applications without high up-front license costs
- Access to accredited engineers, skills and technical expertise without having to train your own staff
- Reduced risk of employees leaving and taking their knowledge with them
- Round-the-clock access to a help desk primed to resolve problems remotely and rapidly
- Compliance with the latest regulations
- Guaranteed data security at remote, hosted data centers
- Real accountability via contracted commitments from a third party supplier partner that wants to keep your business rather than reliance on an in-house group that is hard to pin down
- Remove high IT staff costs from your balance sheet and shift to an opex budget
For some time, there have been signs that IT directors in smaller enterprises are increasingly receptive to these benefits and are even embracing them with greater agility than their global counterparts. A survey from Computer Economics suggested that 27% of businesses now outsource applications management, while 21% outsource database management.
According to Information Week, as this level of outsourcing gains credibility the benefits quickly accumulate in terms of greater flexibility (particularly for companies that are growing rapidly); access to cost-effective expertise, techniques and programs; access to third-party resources such as the help desk, which liberates IT staff to focus on more productive business-focused activities; and the wider savings achieved by not having to invest in infrastructure and licenses.
Take email services as one example: Gartner estimates that outsourcing just this one application could save businesses with fewer than 300 employees a significant amount because an outsourcing partner has the dedicated infrastructure to manage it at a much lower cost.
Five reasons to outsource
Here are five good reasons why you should think about outsourcing your IT services:
1. You could save significant staff costs.
Not just on the recruitment and hiring front. Skilled people with strong application-based credentials don’t come cheap and have long-term costs. Why spend time and money training somebody to support a core business application, only to see them poached by another employer and taking their expensively-acquired skills with them? Or send them to costly training to keep their skills current? And why not liberate your in-house IT staff to focus on projects that add value to the business rather than spending their precious time on firefighting duty?
2. An outsourced call center/help desk frees your resources.
Providing round-the-clock support for your users in-house is expensive. Depending on the size of your business, you might need a dedicated facility that is operated by key IT support staff and is a significant cost center in terms of facilities management overheads. Even in a smaller IT operation, somebody—it might even be you—has to be on call outside office hours to provide IT support for an increasingly mobile workforce. Thanks to greater economies of scale, a dynamic IT services partner should provide a superior help desk at a greatly reduced cost.
3. You can save money all around – with the right outsourcing strategy and partner.
A good IT services partner will work with you to identify the pressure points that make sense for you to outsource. These can vary tremendously from one business to another. Toolbox.com points out that cost savings vary with the number of employees who need support and to what degree, the number of devices involved, the types of applications that you use, the ratio of employees using office space to remote workers, and even your geographic location when it comes to the price of on-site support. These are complex calculations that deserve patient analysis.
4. Your business will be more flexible in its use and consumption of IT services.
Infrastructure is expensive. Why invest in servers, complex networks and other hardware just to deliver vital but everyday applications to your users when you can have those applications managed and distributed as a service direct to the desktop without the expense of hardware maintenance? Because your applications are being managed and hosted by a third party, they can be scaled up or down to meet fluctuating demand, and your costs will be more tightly controlled as a result.
5. Peace of mind.
Why let worries about more complex issues such as data security or disaster recovery keep you awake at night when they can be managed and supported by a third party who has all the necessary expertise and infrastructure to meet your security and business continuity requirements? Yes, they are important, but by choosing the right partner to provide relevant support services, you are prioritizing them rather than allowing them to become distractions that need constant attention from your in-house IT team.
Negotiation is the key to getting your relationship with your IT services supplier off to the best start and making sure you realize the business benefits that you expect. And it starts long before the contract is signed. It should be more profitable if you decide what you want from your contract before you choose your supplier.
Select an IT service partner who demonstrates they understand your business and clearly articulates the value they can bring to your operations. By combining and matching your goals with an IT service partner who has the vision to match them and deliver the latest service desk technologies to provide you with complete service performance visibility, including measurable indications of performance quality, you’ll soon become part of the rising tide of SMEs that are living proof of the benefits of outsourcing.
- Outsourcing IT services does not mean all or nothing.
- You can deliver genuine benefits to your business by outsourcing IT services if you negotiate service levels that are customized to your company.
- Fear of surrendering control is the main factor holding many IT directors back from outsourcing IT services—but you can keep control if you select the right partner.
Feel free to share your thoughts.