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Vector 9: Ben Thompson on Microsoft's mobile dilemma

Ben Thompson of stratēchery joins Rene to talk about Microsoft in a post-Ballmer mobile market, the IBM analogy, whether they need to be more like Apple, and why Google and Samsung were so damn smart. Also: Nokia sale!

Note: This was originally supposed to be next week's episode of Vector, but due to Microsoft buying Nokia, we decided to fast-track. (It's especially interesting given Thompson, until recently, worked at Microsoft on the Windows 8 apps team, and previously interned at Apple on the Apple University project.)

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Rene Ritchie has been covering the personal technology industry for almost a decade. Editorial Director at Mobile Nations, analyst at iMore, video and podcast host, you can follow him @reneritchie on Snapchat, Instagram, or Twitter.

48 Comments
  • Why is an iFan (Rene Ritchie) the arbiter of anything MSFT? Seems counter-intuitive...
  • I made it through about 2 minutes, don't care to hear anymore from either of those guys.
  • I've been using Windows since it first shipped, DOS before that, worked on Microsoft in IT, I rocked an HP Jornada and a Treo Pro, I have 6 Windows 7 boxes at home, have both an Xbox and Xbox 360. WTF are you? :)
  • Wow.
    I really respect your opinion now.
  • Hello Rene,
    As a person who speaks and writes in public, I believe that it's wrong to have such lack of manners in public. What kind of standard and quality are we holding up to for journalism? We need to do better than the trolls.
    Just a few weeks ago, there was a teacher having to publicly apologize just for saying the exact same word "WTF" in Hong Kong.
    Calm down and take a back seat. Commenters are nuts. We all know that. Don't feed the trolls.
  • It was a joke, hence the smily. If I was being rude, I would have been rude. Anyone using terms like "fanboy" disqualifies themselves from serious debate. It's the worst kind of dismissive trolling. I expect better from the WPC communty, so I poke fun. I love HK. Thompson is actually based in Taiwan right now.
  • ...all of the above plus I upgraded all of my Windows 7 boxes to Windows 8... INCLUDING my MSI Wind U100...Thats WTF I am :)
  • Ummm, because he does more than just iMore? Vector 4 with Brian Klug was amazing, but that's because Brian breaks down mobile stuff to an almost clinical level. Vector 8 was quite excellent as well.
  • You know what I love about bloggers, they actually think they are experts and think they know what they are talking about!
  • THIS! And they can so quite a lot of damage too.
  • Did you mean *sew?
  • No, I meant *do* (typo)
  • I understand the tribal mentality on internet comments, but I'd encourage you to listen anyway. Agree or disagree, Thompson worked on Windows 8 at Microsoft until recently and now is enjoying a lot of acclaim for his analysis of the mobile industry. He's brutal, but he's passionate and straight forward, and it was gracious of him to join us to discuss the issue.
  • I will take a look on it. Or better listen it.
    There is no fanboyism to me.
  • Thats all well and good, but none of that makes him "right". And he's not only passing himself off as "right", but he's being presented as "right". So what will he be called when his opinion is proven wrong?
     
  • There's a saying that I know Thompson subscribes to: "Strong opinions loosely held". He's changed his opinions on his website, and been very obvious about it. He's presenting an opinion here. Maybe right, maybe wrong, but the best way to handle it is discussing it. That used to be something we could do: argue with passion but not prejudice. Have great discussions of different points of view but with mutual respect. It's not personal. No one here should be fighting for or against Microsoft or any other tech company. They should all be fighting for us.
  • I agree. But why is it that everyone comes off as so anti MS? again, to each his own, but there seems to be far too many people just itching to be able to point out the next great Microsoft failure. And that's just a huge waste of time IMO.
  • As do commenters I noticed! *cough* Quit shitting all over the guy for giving his opinion without giving an opinion of your own. Break down your criticisms, explain why you disagree. Don't just say "lol bloggers r dumb".
  • +1
  • Rene Ritchie I wanna your opinion, about Microsoft is willing to also buy Blackberry, according to Bloomberg report today. What could really change it?
  • It's not about "tribalism", "fanboi'ism" or any other "ism" but as usual it's VERY difficult to get an honest story/opinion from a dscussion between a couple of people who clearly have interests in other areas. And NO I'm not saying you have to like/love MS products to speak on them, but as usual, the people who speak on anything microsoft related can't leave their preferrences in their pockets.
    Now because I'm not considered and "expert" in this genre (seems like all you need is a website and time to type to be consider one) but you really need to STOP looking at apple as the standard bearer. I know that sounds insane, but it honestly needs to stop. Apple has become wildly successful in mobile, but their recipe is not THE ONLY recipe. The snob attitude of "my app isn't available" is, and will be proven completely wrong.
    So the constant comparisons to what MS is not doing right according the the apple model is way off.
    I won't go into why the whole "app ecosystem" BS is dead wrong, beause it's pretty obvious.
  • Well said Sean
  • In the MMO gaming space its like trying to replicate the Blizzard WoW success model or use them as a standard. Simple fact is that people (corporations are people) can complete without copying each other - it just requires more work and their own "moment". Consider Apple pre-iPhone or MySpace pre-Facebook-opens-floodgates, etc. Question really is whether or not MS has the wherewithal to pull it all off - they certainly have the impetus and resources.
  • One point was partially made in the interview/discussion.
    The success of the Xbox was brought up. But it SEEMED as if it was spoken off in a sense of, "well MS got lucky... that won't happen again". But I often use the Xbox as a reminder to people who are so quick to doubt Windows Phone. Xbox was doubted left and right... it couldn't compete... MS had no idea what they were doing, etc, etc, and so on. There were so many reason why it couldn't survive, damn the idea of it ever becoming a leader. Hell, it couldn't even sell in Japan.
    But look where it's at now. That was not an accident. Somewhere along the way they knew what they were doing. I believe they will do the same with WP. Maybe not using the same formula, but if they commit to it, they will succeed at it. PS.
    I'm a Playstation "fanboi" if anything.
  • My thoughts about this blogger. His perception failed a lot to explain the rise of Windows Phone in many markets. The recent polls about how the users love Nokia design and windows phone way. The blogger also doesn't show any information, any graphic, any data to us follow his thoughts. I respect his opinion, because is a blog. But the truth, I saw better blogs than this one. Really poor blog.
  • At the end of the day, its just one guys opinion. That does not equal fact.
  • I didn't know that trolls are allowed officialy on the Wpcentral. Because I can't describe this blogger with other word than Troll. No Data, No graphics, nothing to emphasis his thoughts. Nothing.
  • Bloggers that need trolling demonstrated how poor is their mind, how lacks their true perception. Surprised me alot this interview here on Wpcentral. I guess you could dig better guy to interview Rene.
  • Thanks for the great interview and it really highlighted quite a few things.  The only thing I truly disagree with is the notion that there cant be more then 2 eco-systems out there.  I thing mobile can support 3, and would be better off.  Compatition breed innovation.  For a long time there was only 1 smartphone OS, and that was WM.  It was stale for years, even after others jumped in.  iOS has gotten rather stale due to there massive market share, but recently with iOS 7 started making changes.  Maybe because of Windows Phone considering that many of those recent changes in iOS are very similar to WP?  Without compatition, innovation goes dry.
  • Also Google clearly purchased Motorola for there patent portfolio.  Google was loosing its pants in court from patent lawsuits since it has no real amunition to fire back with.  Now they have an extensive patent portfolio that they can withold if someone say Apple or MS were to go after them again.  Its like the cold war all over again.  Everyone stockpiles nukes in hopes of never having to use them, but without them, you just get rolled over.
  • I suppose any fanboy here of Microsoft could write some trolling posts (no data, only thoughts) about Apple after Jobs, and maybe Rubino interview him and post on iMore.
  • Maybe it because English is not my native tongue but I heard two guys talking about business models and I seem to agree with them. I'm still to heard about 50 mins of the podcast but so far it is good, so I might change my mind later.
  • Ok, in a second note I think that they should try WP once more, because the gap in apps is tiny on WP8. Whenever people says that there is a lack of apps in WP I don't really understand what they mean since most of the important ones are there and the ones missing are not unique or without equal. About Nokia being stupid when threw away all its strengths (Industrial design, durability, etc.); I disagree with that because those stuffs are still there and are pretty obvious in WPs. Also the company is switching to a services company like Microsoft is doing it with Xbox One; like Dell is trying to do it; the same say that IBM did several years ago. Services are the future (for earnings) and not products; even utilities company are renting the solar panels as a service for some customers. Google who is posed a company doing great only cares about services and in my opinion, Motorola is not a big part in their plans.
  • That doesn't matter apparently as you need a reason to beat up on the OS. Look at Cnet for inspiration. They constantly come up with revolutionary new excuses to down any new phone with WP (from camera has a pink overtone to the body is too thick on the edges, they're all gems).
  • Same from my friends with Android and IOS; they demand perfection from WP but they overlook IOS and Android flaws.
  • At this point, it seems to me that Microsoft is more Apple than Apple is.
  • Minus the horde of mindless fruit gurgling fanbois
  • Wait, OS doesn't matter but they're quick to share their dismal experience with Symbian? The fact is that Nokia and MS are working together to attack an underserved area is the smartphone business, the low end. The 520 is selling in truckloads and it is not a premium device. Yet this blogger claims that MS continues to get it wrong by focusing on premium products. The low end will drive volume, developer interest will pick up, and the high end will strengthen with a more competitive ecosystem offering. I just see too many holes in these assertions. I do agree that WP should be free. However good luck convincing shareholders this is a good idea.
  • The biggest challenge for Microsoft has been a mind share one. They were late to the game (3 years behind Apple, 2 behind Google) and stepped into an already established market with players with huge followings. That's incredibly hard to break into (as others are finding out). Looking at their recent track record, it is hard to say that Microsoft's strategy is misplaced. It isn't. Just the market is way too hard. Had it been anyone else, they'd be belly up by now. Sure, they aren't perfect but that's hardly an excuse to beat up on them. How hard is it, for example, for Apple to gain any market share in the PC world? All these years of them claiming that they are ahead in the PC innovation game and all they have to show for that is a modest gain in the US market and a tiny sliver in the global market. That's the richest tech company you are talking about. The comments about premium devices are misplaced too. Nokia/Microsoft have the quality to compete with big names like the iPhone and Galaxy(s) so why shouldn't they? Name a phone that out innovates the Lumia 1020 currently. Heck, name me a flagship phone that doesn't out innovate the iPhone currently. They're making great gains in the low end market but to only focus there and not make any headway onto the massively profitable high end market is foolish. Also, Ritchie, please, just because you have used Microsoft products before doesn't mean you are the best guy to be "analyzing" them on a site like WPcentral. No offense to you, but you are the main guy at iMore and the bias in your views is pretty obvious. That's why people here are giving you flak and not because you are an Apple fanboy.
  • Name a phone that out innovates the Lumia 1020 currently. Heck, name me a flagship phone that doesn't out innovate the iPhone currently. They're making great gains in the low end market but to only focus there and not make any headway onto the massively profitable high end market is foolish.
    What did M$ do for this to happen, I am sure it is nothing, Nokia did all the work. What Ben is trying that M$ is soo deep into Enterprise ( 3 years refresh mentality) that they are finding it really difficult to get the to the 1 year refresh mentallity that is current in the mobile industry. Trust me I work in and industry that caters to Enterprise, we are finding it very difficult to get into the mobility space.
    Having used M$ products does not matter at all. I have used DOS from version 3.2 till windows 7. I have been using Linux for 2 years as a desktop now. I just have a virtual machine of winxp just incase, I find myself using it less and less as the days go by. Surprisingly, I use Nokia Lumia (I do not want to say Windows phone) as my mobile phone because it is unique in terms of hardware and meets my needs. I intend to keep it. I don't say the M$ has done a bad job with Windows Phone but they are very slow to meet the customers needs. They still think there is an enterprise setup out there, they are not quick to realize that BYOD is happening and it is here to stay.
  • At around the 33 or 34 minute mark Ben Thompson explains that Nokia's strengths were industrial design and ubiquity within the supply channels. He then is incredulous that Nokia failed to maintain this advantage by going down a road where they differentiated themselves instead through adoption of WP as an OS instead of competing on their core strengths.
    That leaves one wondering, does he not realize that the market dynamics changed post 2007 when iphone and eventually Android revolutionized the mobile space? Seems like trying to maintain a competitve advantage among a world of smartphones using a pre-smartphone strategy would have been by far and away the more disasterous strategy.   
  • Ok, he answered that later by stating that Nokia should have gone Android which would allow them to focus on hardware as opposed to software. Interesting point.
  • Simple. I only listen to Dan Rubino. If Dan doesn't say it, then it's not true.
  • I disagree with some of this analysis.  Despite his assertion that most analysis in the industry is too shallow, he makes the exact same mistake in his analysis of WP8.  The way he tells it Apple Iphones and Android devices offer equal experiences and there is little or nothing left for a third system to offer.  Plainly this is not the case, one need only look as far as the consumer satisfaction survey results to see that there is something SERIOUSLY wrong with Android in this regard relative to the alternatives.  I see it every day from customers frustrated by phones that lag, glitch, die unexpectedly, and are generally unreliable.  If I had a dollar for every customer I have personally seen shit-can a first, second, even third gen android device in favor of an iphone and even blackberries, I would never have to deal with customers again.  It is even worse with the low end Androids that argue quite convincingly to customers the merits of alternatives like the iphone. 
    The iphone side is not much better as Apple is a polarizing company among consumers, and so long as a company can offer a comparible experience there will be a market for their products.  They have also fallen behind in the mind share as people see the newer phones as offering no value over older less expensive models.  Samsung's ad people have been brutal and effective in this regard. 
     
    Another area that he seemingly dismisses is Microsoft's leverage in gaming.  The Xbox is a force to be reconned with, and if leveraged properly (Would be nice to see some of that happening soon) Microsoft has a very good in with younger users.  Due to the integration through out Win8 this has the possibility of boosting interest in tablets as well as phones.  It strikes me as rich that he will acknowledge Microsft's strategy and presence in gaming but not what that leverage will get them when applied through out the rest of the ecosystem. 
  • Also disagree that iPhone and Android devices giving the same experience as WP.
    After nearly a year with Lumia 920 I doubt very much that I'll ever buy an iPhone or an Android phone again. Have tried some of them frequently and it's just not IT.
    Something's just not right...
    With further development on WP I have high hopes for an even better experience in the future :)
  • What I understand from this is that M$ is just trying to do what Apple did with iphone. That will not work for M$ in the current frame of the company? If we look at this from an Enterprise perspective, it would be a good move from M$ to buy blackberry, the services side integrate it "exclusively" to windows phone and target the enterprise market. This would act like a game changer. How effective is Windows phone management from a Microsoft's Enterprise perspective, what the heck WP doesn't even have VPN support, M$ folks are saying that GDR3 may have it. This is where the story does not look complete. I guess that M$ should have bought blackberry first and then bought Nokia? To me it looks like Nokia got Fed up with the very very slow M$ and said thats it we are going Android now and that is why the deal, and looks like Nokia got Punished for threatening M$ :)
    I seem to agree with Ben
  • Listened through it, erked sometimes.
    Read this...
    http://stratechery.com/2013/the-deal-that-makes-no-sense/
    Probably the last time I visit that blog, and he doesnt care. WinWin.
  • I've said this from the beginning, that Microsoft really couldn't have done anything different than they did, as an objective.  The problem is that they keep making bad choices in the tactical execution toward the goal.
    I disagree with Thompson's assertion that Elop should have had Nokia adopt Android to preserve shareholder value.  I have absolutely no doubt that Nokia would have died with Android.  Samsung dominates Android and would have wiped the floor with Nokia.  To borrow a phrase from Mr. Spock, after looking at all the options the only viable one was an act of desperation. This was their chance to take a stab in a market where nobody else was really serious--that of Windows Phone.  And, I'd argue that seed is starting to pay off.  The momentum was downward.  Nokia executed huge effort to arrest that fall and begin the slow recovery.  I DO agree that, globally, many many people bought Nokia devices purely because of the name....just as I believe most people buy iPhones and iPads because they say "Apple". 
    Nokia was HUNGRY.  This drove Elop to push hard.  Microsoft isn't hungry, for many of the reasons Thompson described.  He said he doesn't believe buying Nokia will enable Microsoft to be successful.  That may be true.  But I believe the chance to be successful lies in keeping the Lumia name going, even if they can't use the Nokia brand, and putting Elop in charge.  Of all the possible candidates, I think he can bring what he's learned from Nokia to bear on the effort to remake Microsoft into a devices & services company it claims to be.