Napoleon, ruler of France from 1803 to 1815, rose to power by conquering most of Europe, creating an imperial monarchy and fashioning a set of laws that for the most part still stands in force today. He formed alliances and partnerships with dozens of countries and established France as the empire of the era. And then he made the mistake of invading Russia in 1812. With supply lines stretched and his forces weakened, Napoleon suffered a humiliating
Like Napoleon’s obsession with the resources of Russia, Google continues to fall in love with the potential riches of the consumer market. They’ve been investing millions in their YouTube channels. They recently expanded Google+ to take on FaceBook and announced a new version of their Google Hangouts services where users can broadcast their videos to unlimited viewers. The other week they unveiled a re-design of their ads to allow for even more eyeballs. At their last conference, they showed off a special pair of Internet friendly glasses.
But the Napoleonic moment is the latest announcement of the Nexus 7. It’s a $200 tablet aimed directly at Apple’s iPad and Amazon’s Kindle Fire. I can understand the temptation. It’s a big market. With a lot of potential. But there’s too much risk. If Napoleon had just settled down and focused on exploiting his core client countries he would likely have ruled for many more decades. If Google were to focus on just the business market, they could do the same.
But instead they’re reaching, perhaps over-reaching, for consumer riches. They want to sell to customers like my wife.
My wife, a dedicated Amazon customer and a huge reader, bought a Kindle Fire about six months ago and found it unsatisfactory. Why? The screen was difficult to read in the sunlight, an Internet connection was required to buy more books and she found herself re-charging the device every day. With her original Kindle, she could read and buy books from anywhere and only needed to recharge the thing once a month on average. Plus, she’s not a big video watcher, or a traveler. And she uses her phone (a Droid, by the way) for all of her messaging. So after six months what does she do?
She tosses the Fire and went back to her original Kindle. This is what Google is about to face. Will she buy another tablet? Sure. Once those problems are addressed, which I’m sure they will be. But will she care if it’s a Nexus, iPad, Kindle or a Nook? No she won’t. Because they’re consumer toys. And, like all consumer toys, copycat manufacturers from the Far East will make replicas as good as the originals and sell them en masse for a fraction of the price. Does anyone doubt that a typical tablet will cost fifty bucks within a few years? Will anyone care who makes it, as long as it accesses the web and has a cool touch screen? Google will come out with new consumer features, Amazon will counter and the copy-catters will beat them both.
And if Google isn’t careful, and invests too much in the consumer market, their Waterloo could come at the hands of none other than Microsoft.
That’s because Microsoft is soon coming out with their own tablet, the Surface. To be sure, Microsoft has made and broken many promises to me over the course of my lifetime, so there’s no guarantee they’re going to execute here. But if they play their cards right, the Surface should differentiate itself in one important way: it will be a consumer AND a business device.
Sure, the Surface will have the nifty touch screen and cool web features. Microsoft is a company that’s succeeded at being lousy innovators, great copiers and even better marketers. So I have no doubt they’ll do the same with this device too. You’ll be able to read books on it and watch movies and eventually, I’m sure, connect it to your TV. But more importantly it will be designed as a new tool for businesses, particularly small businesses like mine, to use.
It will have a built in keyboard. And that will always be a critical component for a business tool. Swiping and touching are good. Talking to a machine is nice. But business people frequently do what I’m doing right now: sitting in front of a computer and typing. We write reports, create memos, send long emails, analyze with spreadsheets and futz (yes...futz) with our databases. We will not be able to do this with a touch screen Nexus, iPad or Fire. Yes, we can connect an accessorized keyboard to it. But we’d prefer not to – it’s an extra piece of hardware and we’re looking to simplify and be more productive and not create complications.
It will be tightly integrated with Microsoft Office. This is enormous. There are hundreds of millions of Office users throughout the world. And despite all the hype and the landslide of excellent cloud based Office competitors like Google Apps, most of my 600 clients are quite happy with Office. Giving me a device with all of my favorite Microsoft applications built in, supported and ready to use makes it easy for me to do business.
But that’s not the secret weapon. The secret weapon is Microsoft’s channel. Hundreds of thousands of partners throughout the world. These people are as dangerous as the Cossacks who pecked away at France’s supply lines. They are happy to scorch the earth if it means a hundred more chargeable hours. And they are used to operating in conditions worse than any Russian winter (yes, I’m talking about creating applications in Microsoft’s development environment). These are cold-hearted, weather-beaten, bug-experienced soldiers of the programming world who are hungry for the next opportunity. And they will be developing applications for the Surface. Not apps. Not games. Business applications.
Because Microsoft will allow them to turn these devices into data gatherers for their clients. They will develop custom applications for roofers to enter in job specifications in the field and service technicians to create workorders with large, tobacco stained fingers. They will create easier ways to count stock, scan products and ring up an order. They will build applications for checking on raw material levels, calculating machine runs and logging in man-hours. And here’s the main thing: the data collected will then integrate with all the enterprise level, back office applications that Google doesn’t have: accounting, customer relationship management, Office, Exchange and SQL. Angry Birds may be fun. But it’s data integration that businesses will require.
Developing a true business oriented tablet may not be sexy. It may not look cool. You won’t sell hundreds of millions of units. You won’t get a ton of media attention. But you will earn yourself a built in audience who are less fickle, more loyal and more likely to continuously spend money with your developers and partners then someone like my wife.
Like Napoleon, Google does not have an army suitable for these conditions. Like Napoleon, I bet they will not realize the returns they hope to realize by invading the consumer market with their tablet. They would be much more profitable focusing on the smaller, loyal and more long term business market instead. This won’t be a fall on the epic scale of Napoleon. But I do predict a retreat in the next few years.
Besides Forbes, Gene Marks writes weekly for The New York Times and Inc.com.
