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  • Wall Street ignites major global rally; futures point to more gains [View news story]
    There has been a steady stream of ticker-tape parades recently on Business Channels, Market Blogs and Business News articles of Pundits who’ve all explained why the sell-off happened. Mostly they’ve consisted of bears who haven’t been able to growl much lately like, Peter Schiff who now get to take their woefully premature victory lap. We’ve also seen a deluge of chartists who have gotten their “fifteen-minutes” telling us how much more horrible things are going to get. Nonetheless, the only thing either group has been able to succeed at is confusing existing and potential market participants using politics disguised as market wisdom and cherry-picked chart trend lines served up as apocalyptic visions. Somewhere in the back of the classroom there is the truth; sitting at a desk, waving its hand and going “ooh… ooh” like Horshack; begging to answer the question of “What the heck just happened”.

    For almost two years we’ve seen the size of “margin” in the markets in the U.S. grow to gargantuan levels. Nowhere was this more of a problem in the U.S. than with Apple, easily the most overly owned stock that trades in the U.S. For a few weeks prior to the collapse, Apple began to make a series of lower highs and lower lows, and so did the broad U.S. market. Each dip lower triggered margin selling as owners of too much margin debt began selling things to raise cash necessary for margin requirements and pay owed fees. This was being done in an orderly fashion, but the market was clearly trending lower as this margin liquidation worked itself out.

    However, things don’t stay ideal for long, China decided to devalue its currency, in the 2nd largest economy, while simultaneously hosting the world’s largest “equity on margin” markets. By lowering the value of their currency while their hands were not busy manipulating the market allowed their markets to do what markets should do, self-correct. The currency move decreased the value of the cash, and the equities based in the currency and caused margin liquidations that were already being orderly executed (like our own) to go into hyper drive. The rapid sell-off in China trigger a lesser (yet equally troubling) sell-off in the U.S. that trigger our markets into a chaotic margin call frenzy.

    So, why the big U.S. bounce? If you could not own the stocks you wanted to own at the price you wanted to own them, someone else’s loss is now your gain. The shopping list that U.S. investors have been sitting on for a long time is out and being filled with a healthy portion of outperformers, a hand full of outliers (risk) and one or two poster-children (pure spec).

    I’m not making any market calls, I’m just saying that there have been many people on television, blogs, news articles and other mediums that have been screaming that there is a “margin” problem that is coming to a crescendo; but few were listening then and most are still oblivious now. The U.S market has an abundance of buyers and a healthy head-count of short-sellers that is not a bad thing; no panic is required!
    Aug 27, 2015. 12:39 PM | 5 Likes Like |Link to Comment
  • Tesla Motors higher after massive Morgan Stanley PT boost [View news story]
    Apple could grow the market for Tesla, and there is the possibility of a synergistic technology based relationship between the two companies:

    Apple’s Self Driving Car Project Confirmed http://bit.ly/1Jmc8Vo via @theinquisitr
    Aug 17, 2015. 08:47 AM | Likes Like |Link to Comment
  • Tesla's $500M Financing: We Were Right Again [View article]
    Moral Victory:

    There are two types…

    1) Mortal Kombat was a game where you were allowed a “Flawless Victory” and if quick enough on the controls, a “Fatality”! The “Flawless Victory” meant you defeated your opponent without sustaining any personal injury. The “Fatality” was gratuitous violence that you laughed at, a guilty pleasure allowing you to indulge yourself post victory.

    For Tesla bears, this would look like a short position that made massive returns with little (if any) downside (Flawless Victory). However, you’d also have the opportunity to take jabs at the opposing team with completely hollow, self-indulging “I told you so” moments like…

    “I told you they would trim guidance”

    “I told you they would raise capital”

    2) Broken Clock Syndrome, often associated with economists, politicians and pundits allows general purpose predictability to masquerade as enlightened foresight. Since the motionless clock face and hands will be correct at some point, each cued point triggers the celebratory victory lap of “we told you so”.
    For Tesla bears, this would look like a short position where profits where minuscule (or nonexistent) and risk was unsustainably high. Therefore the only relief afforded would be an opportunity to take jabs at the opposing team during those 2 occasions (where bears aren’t being punched in the face by their position) to say something seemingly obvious.

    “I told you they would trim guidance” (they should tell us what they see)

    “I told you they would raise capital” (like every other growth company)

    Return on Investment:

    There are two types…

    1) I made money

    2) I lost money

    • If you broke even after fees, perhaps that’s a moral victory

    If you’re a bear on Tesla, you’ve got the perfect storm brewing for you at the moment. If you believed low oil prices would kill the bull, you’ve got-em. If you believed market contagions would kill the appetite for risk assets, you’ve got headlines a-plenty. If you believed trimmed estimates and model X production issues would weigh heavily on the stock, you have been rewarded. If you knew Tesla would have to raise capital and dilute shareholders then you can whoop-off with glee this morning.

    However, early shorts wanted the stock bellows $180… rebuffed; they capitulated and regrouped to hope the stock would get back below $225. That dream died and now the stock has failed to even breach $230 on the perfect storm of bearish news.

    There is no “Flawless Victory” for the bears.
    They must therefore settle for an occasional “Fatality” of gratuitous celebration each time they pass a wrecked Tesla on the side of the road as they rubber-neck and risk their own safety in the process. There are easier stocks to be short on. Tesla has too much support for bear-growling to work. You’re not going to “growl” this stock down.

    If you’re making money shorting Tesla then that is awesome, that is why we do this after all. If you’re on the sidelines, don’t be baited in (bull or bear), Know what you want to own and why you want to own it, “I told you so” should not be taken as advisement.
    Aug 13, 2015. 11:57 AM | 4 Likes Like |Link to Comment
  • How Twitter Could Fit Into Google's Plans [View article]
    Previous post:

    Between the time
    when the BSoD drank your Word file,
    and the rise of the workshops of Adobe,
    there was an age undreamed of.
    And onto this, Google,
    destined to wear the jeweled crown
    of MS-killer upon a troubled brow.
    It is I, their chronicler,
    who alone can tell thee of their saga.
    Let me tell you of the days of mis- adventure!

    Most hard core Apple fans grew up hating Microsoft (not all), perhaps they even had a good reason to hate MS. Therefore when Google showed up and presented itself as Microsoft’s Grim Reaper, the company (Google) found instant support. Most of today’s fake tech journos will at least feign “like” for Google if for no other reason than to display the appearance of non-bias, you can’t always talk about Apple or people will get suspicious. Google however, couldn’t just play “Pumpkinhead” for Apple fans and kill their enemy for them; Google has gone after Apple as well; they are a business after all.

    Interestingly enough, now that the fanatics have fewer touchstones to use as sources of ire (Gates and Jobs) that leaves just Nadella and Cook to do business that makes dollars which of course makes sense. Both companies have a great deal to benefit from a weaker Google, and they are getting their wish.

    Antitrust:
    What hurt MS as a business more than anything else was fighting the government for over a decade! Yep, I said it… more than failures in mobile or any awkward OS; or any half-assed acquisition. How ironic (serendipidy for some) is it that the company celebrated for supposedly sounding the death knell for Microsoft is now walking in the same cement shoes.

    “Is Google About To Be Dethroned? Social, Search And Legal Threats Collide”:
    http://onforb.es/1RYbKjX

    Google Plus:
    Time wasted trying to play hit man on MS should have been better allocated defending Google’s own territory!

    “The Latest in Long Line of Social Flops”:
    http://bit.ly/1ORD7X3

    “”Google is mistaken in thinking that social is just about making the best product. As we found in our extensive Google+ vs. Facebook shootout, Google+ is better than Facebook in most ways. But Facebook is where the people are, and as our reviewer Yaara pointed out, “if you truly want to stay updated and have an audience, you will understandably stick to Facebook.”

    All of this points to one thing: Google has no idea how to make it in the world of social media. And history bears witness through some of Google’s greatest social flops.””

    Google Docs:
    If Google was the Grimm Reaper for Microsoft, then Google Docs was its death dealing instrument of choice, however, celebration was premature…

    “Google announces new Drive plugin for Microsoft Office – FierceCIO”: http://bit.ly/1ORD7X4

    “”Following the Google announcement, more than one tech publication expressed some surprise at the move on Google's part. TechCrunch called it an admission on Google's part that Microsoft Office is still the default business productivity suite. Venture Beat had a similar message, noting that the firm was acknowledging that many business users prefer Office to Google Docs.””

    …and finally…

    Chromebooks:
    I won’t even use my own hyperbole here, this excerpt says it all…

    “Acer's Cloudbooks are Chromebooks with Windows 10”: http://bit.ly/1ORDa5h#
    via @verge

    “”Of course, since these Cloudbooks run Windows 10, they're basically just regular laptops with low storage space. Unlike a Chromebook, they won't stop you installing Steam or other Windows apps as long as you can make them fit. But it's intriguing to see Acer, one of the premier Chromebook manufacturers, use similar language to position and market its Windows machines. Google's cloud-first Chromebook approach may be resonating with consumers at the low end of the market.””

    Journalistic Bias:
    Just because Microsoft and Apple have taken the advice of Elsa and “Let it Go” that doesn’t mean the fanatics have. Let’s write ALL DAY about MSs Mobile ambitions being forestalled by Android, or Office being dethroned by Google Docs, an let us not forget how Chrome OS has undermined Windows. Meanwhile, let’s NOT talk about Google, missing social and the rise of Facebook or Google missing a Netflix-like opportunity with YouTube or a cloud dominant position like Amazon all so they could get ad revenue, yep that’s going to last!

    Duel of the Fates:
    Google is up against a fate that was first envisioned for Microsoft as dreamed up by Apple fanatics. Now Apple is all too happy to take Android OS defectors back while inviting MS to play in its iStuff sandbox. All while a new... young... fresh... generation of Google hating, tech-savvy, tech-social, mobile, cloud-first, youth all dream of a world where Facebook, Snapchat and Instagram all run Google over in an Uber driven HERE navigated Tesla! “Revenge of the Social” on the king of the Search!
    Aug 7, 2015. 07:37 AM | 1 Like Like |Link to Comment
  • Google Not Searching For Growth [View instapost]
    Between the time
    when the BSoD drank your Word file,
    and the rise of the workshops of Adobe,
    there was an age undreamed of.
    And onto this, Google,
    destined to wear the jeweled crown
    of MS-killer upon a troubled brow.
    It is I, their chronicler,
    who alone can tell thee of their saga.
    Let me tell you of the days of mis- adventure!

    Most hard core Apple fans grew up hating Microsoft (not all), perhaps they even had a good reason to hate MS. Therefore when Google showed up and presented itself as Microsoft’s Grim Reaper, the company (Google) found instant support. Most of today’s fake tech journos will at least feign “like” for Google if for no other reason than to display the appearance of non-bias, you can’t always talk about Apple or people will get suspicious. Google however, couldn’t just play “Pumpkinhead” for Apple fans and kill their enemy for them; Google has gone after Apple as well; they are a business after all.

    Interestingly enough, now that the fanatics have fewer touchstones to use as sources of ire (Gates and Jobs) that leaves just Nadella and Cook to do business that makes dollars which of course makes sense. Both companies have a great deal to benefit from a weaker Google, and they are getting their wish.

    Antitrust:
    What hurt MS as a business more than anything else was fighting the government for over a decade! Yep, I said it… more than failures in mobile or any awkward OS; or any half-assed acquisition. How ironic (serendipidy for some) is it that the company celebrated for supposedly sounding the death knell for Microsoft is now walking in the same cement shoes.

    “Is Google About To Be Dethroned? Social, Search And Legal Threats Collide”:
    http://onforb.es/1RYbKjX


    Google Plus:
    Time wasted trying to play hit man on MS should have been better allocated defending Google’s own territory!

    “The Latest in Long Line of Social Flops”:
    http://bit.ly/1ORD7X3

    “”Google is mistaken in thinking that social is just about making the best product. As we found in our extensive Google+ vs. Facebook shootout, Google+ is better than Facebook in most ways. But Facebook is where the people are, and as our reviewer Yaara pointed out, “if you truly want to stay updated and have an audience, you will understandably stick to Facebook.”

    All of this points to one thing: Google has no idea how to make it in the world of social media. And history bears witness through some of Google’s greatest social flops.””

    Google Docs:
    If Google was the Grimm Reaper for Microsoft, then Google Docs was its death dealing instrument of choice, however, celebration was premature…

    “Google announces new Drive plugin for Microsoft Office – FierceCIO”: http://bit.ly/1ORD7X4

    “”Following the Google announcement, more than one tech publication expressed some surprise at the move on Google's part. TechCrunch called it an admission on Google's part that Microsoft Office is still the default business productivity suite. Venture Beat had a similar message, noting that the firm was acknowledging that many business users prefer Office to Google Docs.””

    …and finally…

    Chromebooks:

    I won’t even use my own hyperbole here, this excerpt says it all…

    “Acer's Cloudbooks are Chromebooks with Windows 10”: http://bit.ly/1ORDa5h#
    via @verge

    “”Of course, since these Cloudbooks run Windows 10, they're basically just regular laptops with low storage space. Unlike a Chromebook, they won't stop you installing Steam or other Windows apps as long as you can make them fit. But it's intriguing to see Acer, one of the premier Chromebook manufacturers, use similar language to position and market its Windows machines. Google's cloud-first Chromebook approach may be resonating with consumers at the low end of the market.””

    Journalistic Bias:
    Just because Microsoft and Apple have taken the advice of Elsa and “Let it Go” that doesn’t mean the fanatics have. Let’s write ALL DAY about MSs Mobile ambitions being forestalled by Android, or Office being dethroned by Google Docs, an let us not forget how Chrome OS has undermined Windows. Meanwhile, let’s NOT talk about Google, missing social and the rise of Facebook or Google missing a Netflix-like opportunity with YouTube or a cloud dominant position like Amazon all so they could get ad revenue, yep that’s going to last!

    Duel of the Fates:
    Yep, Google is up against a fate that was first envisioned for Microsoft as dreamed up by Apple fanatics. Now Apple is all too happy to take Android OS defectors back into the fold while inviting MS to play in its iStuff sandbox. All while a new young fresh generation of Google hating tech-savvy, tech-social, mobile, cloud-first youth all dream of a world where Facebook, Snapchat and Instagram all run Google over in an Uber driven HERE navigated Tesla! “Revenge of the Social” on the king of the Search!
    Aug 5, 2015. 06:33 PM | Likes Like |Link to Comment
  • Nokia sells HERE maps unit for $3.07B [View news story]
    "Nokia CEO: ALU acquisition will make it 'very strong' in North America"
    http://bit.ly/1SLEOeQ

    ""Nokia's (NYSE:NOK) deal to acquire Alcatel-Lucent (NYSE: ALU) will give it a stronger position in wireless but also make it "very strong" in North America, said Nokia CEO Rajeev Suri during a fireside chat at the GSMA's Mobile World Congress Shanghai.

    "When you look at the deal, you rarely get this much complementary synergy," he said, according to Mobile World Live.

    He also said the Alcatel-Lucent deal will give Nokia fixed and IP router assets that it doesn't currently have and make it an end-to-end provider. Only about 29 percent of operators in the world today are pure-play, he said with a nod to the convergence going on in the sector.

    In acquiring Alcatel-Lucent, Nokia will be getting the expertise of the iconic Bell Labs, which also has been working on 5G technologies. Analysts have speculated that the deal is driven in large part by the company's desire to become a 5G powerhouse.""

    *******************
    "Sprint to add 'tens of thousands' of small cells, bring 800 MHz and 2.5 GHz LTE to 'nearly all' macro sites" http://bit.ly/1SLEMnf

    ""Sprint expects to spend $5 billion on capital expenditures in its fiscal 2015 year and then maintain that level of capex spending for two years after that, for a total of $15 billion over three years.

    Claure said in May that he thinks Sprint will have the No.1 network in the U.S, in the next 18-24 months. On the call, he said "our network is going to be able to have parity or superiority over the next two years." He said Sprint's initial densification efforts have shown that it can significantly improve coverage, speeds and capacity and that "if we densify our network and leverage our spectrum, we have the capacity to be No. 1.""
    Aug 5, 2015. 12:09 AM | 3 Likes Like |Link to Comment
  • Nokia unveils the Ozo virtual reality camera [View news story]
    No, the proceeds will fund a second ball, they must drop two if they are to be respected, Ozo needs a twin. ;-)
    Aug 3, 2015. 07:29 AM | 1 Like Like |Link to Comment
  • Nokia unveils the Ozo virtual reality camera [View news story]
    German auto makers agree deal to buy Nokia HERE: sources http://yhoo.it/1SytsuG via @YahooNews
    Aug 2, 2015. 10:06 PM | Likes Like |Link to Comment
  • Tesla Motors delivers new battery option and updates on models [View news story]
    Check out: Analysts say Tesla could sell 19 million EVs http://aol.it/1HNaKaw via @therealautoblog
    Jul 24, 2015. 03:07 AM | Likes Like |Link to Comment
  • Apple: The Stark Contrast Between iPad And Surface Sales [View article]
    "Microsoft's Cityman and Talkman flagship Lumia phones and what you need to know" http://phon.es/1fydv
    Jul 23, 2015. 03:24 PM | 1 Like Like |Link to Comment
  • GoPro +5.7%, Ambarella +5.9% a day before GoPro's earnings [View news story]
    "GoPro up on Toyota deal, content licensing portal" http://bit.ly/1eccPlG #IBDBlogs via @IBDinvestors $GPRO $TM $AMBA
    Jul 20, 2015. 02:39 PM | 3 Likes Like |Link to Comment
  • Tesla Motors delivers new battery option and updates on models [View news story]
    "Tesla just did something really big - Tesla has rocked the world of high-performance automobiles with the..." http://bit.ly/1CLI03k

    Breaking news, what Elon Musk just said about Tesla... http://bit.ly/1CLI0jA
    Jul 20, 2015. 02:27 PM | 1 Like Like |Link to Comment
  • A Leaner Microsoft Equals A Better Microsoft [View article]
    You're welcome Steve!

    Most of the flack will come from those who would hate anyone, even Steve Jobs if he came back and ran Microsoft.

    Why?

    Because it's Microsoft!

    Here is something I posted from Oct. 16th 2013
    http://bit.ly/1UZrguR

    Microsoft sentiment:

    Microsoft has a sentiment problem that is proving difficult to erase. It exists in two main forms…

    1st form: Lord Voldemort
    People hate it when Microsoft does anything, it doesn’t matter what it is; it is immediately met with ire and a negative sentiment. This can be seen in tech magazines and e-zines, it is prevalent in blogs and market coverage media and especially in consumer tech circles. However, if something Microsoft does (that was predicted to fail) does not fail, it becomes “Lord Voldemort” and nobody is ever allowed to speak of it again.

    Examples: 1st form: Lord Voldemort

    Xbox (and now Surface Pro)

    2nd form: “Why? Because it’s Microsoft!”
    When you can come out with a piece of technology or a change in business strategy or the announcement of an acquisition and have it immediately labeled a failure in the making because of past endeavors you probably work for Microsoft. Microsoft has had a few bad acquisitions and startups, so from here on out, every acquisition and new endeavor will fail; why you ask? Because it’s Microsoft!

    Examples: 2nd form: “Why? Because it’s Microsoft!”

    Microsoft Dynamics CRM
    Office 365
    Azure
    Insert anything Microsoft does next here “”

    My reply will draw negative sentiment…

    Why? Because it’s Microsoft!

    I enjoy that however, it does not bother me, it’s what makes a market and if the majority agreed with you it would not be a contrarian trade, after all; I could be wrong…we are talking about Microsoft! :-)
    Jul 14, 2015. 02:56 PM | 2 Likes Like |Link to Comment
  • Microsoft: Nadella Continues To Lead With Distinction [View article]
    Microsoft- “If no OEM stands up to build Windows devices we’ll build them”

    ZDNet
    http://zd.net/1O46Ewe

    MJF: That's a great jumping-off point to one of the things I want to talk about. After last week a lot of people I'm talking to -- partners and customers -- are really worried about your prospects in mobile. You just said not to conflate the technology with what you're going to do next. So, does Microsoft cutting back on the number of Windows Phones you make mean you are getting out of the mobile market?

    NADELLA: Not at all. Quite frankly I think it's sort of about the lens through which you view what's happening. I view the mobile opportunity, even today in its broadest sense, and in the future, as being richer.

    First, I want to be able to be present on every mobile endpoint. That's a very explicit core goal. It's not (just) the notion of having our application endpoints, Skype, Outlook, Wunderlist, Sunrise, on every one of the two billion devices. We want to have Microsoft experiences, because to me that's a platform play. It's not like, oh, they're just application endpoints. Guess what is behind those applications? It's One Cloud. It's Office 365, either for the consumer or for the enterprise. There's MSA (Microsoft Account) in there.

    So to me it's very important to think of our operating system more broadly than some old definition of an operating system. So we want to be in every device, not only have our application endpoints on every device. I want the identity management. It's not MSA alone, it's Azure Active Directory. It is managing those devices, securing those devices in terms of data protection. These are all core capabilities that we have.

    Then on top of that, to me, one of the great structural pieces is we don't have with Windows is this problem of Mac OS/iOS. I'm not in some quest to say let me try and replicate Mac OS and iOS or iOS and Mac OS. We don't have the Chrome versus Android. We are Windows, from Raspberry Pi to HoloLens. And when you saw the demo of HoloLens today, to me it's part of my mobility strategy. When the person was using Autodesk and Maya on the desktop and just moved to a 3D model and interacted, they weren't using their phone.

    If anything, one big mistake we made in our past was to think of the PC as the hub for everything for all time to come. And today, of course, the high volume device is the six-inch phone. I acknowledge that. But to think that that's what the future is for all time to come would be to make the same mistake we made in the past without even having the share position of the past. So that would be madness.

    Therefore, we have to be on the hunt for what's the next bend in the curve. That's what, quite frankly, anyone has to do to be relevant in the future. In our case, we are doing that. We're doing that with our innovation in Windows. We're doing that with features like Continuum. Even the phone, I just don't want to build another phone, a copycat phone operating system, even.

    So when I think about our Windows Phone, I want it to stand for something like Continuum. When I say, wow, that's an interesting approach where you can have a phone and that same phone, because of our universal platform with Continuum, and can, in fact, be a desktop. That is not something any other phone operating system or device can do. And that's what I want our devices and device innovation to stand for.
    Jul 14, 2015. 01:03 PM | 3 Likes Like |Link to Comment
  • Microsoft cutting up to 7,800 jobs, taking $7.6B charge on Nokia deal [View news story]
    Microsoft- “If no OEM stands up to build Windows devices we’ll build them”

    ZDNet
    http://zd.net/1O46Ewe

    ""I asked Nadella about his plans for continuing to compete in the phone/mobile markets; his expectations for Microsoft's HoloLens augmented-reality technology; and his partnership plans, in particular with regards to Microsoft's long-time nemesis, Google.

    I've edited this transcript for clarity and length.

    MJF: You just got off the stage. What do you hope partners take away from your keynote this morning?

    SATYA NADELLA: I really mean this when I say I want us to be a very mission-driven company in the choices we make and the things that we do and how we do it, because the lesson learned for me has been to not conflate or mistake a particular goal with a particular technology and your mission.

    When I joined the company in '92 it was about the PC in every home and on every desk. Guess what: We achieved that. And a company has to outlast any given technology paradigm and any ambitious goal. And so for me this going back to what is it that drove Bill (Gates) to build even the BASIC compiler or the interpreter to what we did in terms of inventing productivity or democratizing client-server computing.

    That's where I come back to this notion of empowerment. When I even think about the three broad ecosystems out there in the world, we are the only ones who both (consumer and business). Because of what we do in our economic model, we are fundamentally focused on saying it's about our customer's product. IT can be a student writing a term paper or a big enterprise driving their own differentiation of productivity. Both of them are the things that we as an ecosystem care about. And that's what grounds me on what choices we make, what markets we participate in, how we do it.

    In this world we have these three big ambitions (reinvention of productivity and business processes; building the intelligent cloud; more personal computing). Of course they're grounded in real product today, But it's also beyond what we're delivering today, beyond the brand names of today. Where are we going? That's where the morning's keynotes were all about and that's what I'm focused on.

    MJF: That's a great jumping-off point to one of the things I want to talk about. After last week a lot of people I'm talking to -- partners and customers -- are really worried about your prospects in mobile. You just said not to conflate the technology with what you're going to do next. So, does Microsoft cutting back on the number of Windows Phones you make mean you are getting out of the mobile market?

    NADELLA: Not at all. Quite frankly I think it's sort of about the lens through which you view what's happening. I view the mobile opportunity, even today in its broadest sense, and in the future, as being richer.

    First, I want to be able to be present on every mobile endpoint. That's a very explicit core goal. It's not (just) the notion of having our application endpoints, Skype, Outlook, Wunderlist, Sunrise, on every one of the two billion devices. We want to have Microsoft experiences, because to me that's a platform play. It's not like, oh, they're just application endpoints. Guess what is behind those applications? It's One Cloud. It's Office 365, either for the consumer or for the enterprise. There's MSA (Microsoft Account) in there.

    So to me it's very important to think of our operating system more broadly than some old definition of an operating system. So we want to be in every device, not only have our application endpoints on every device. I want the identity management. It's not MSA alone, it's Azure Active Directory. It is managing those devices, securing those devices in terms of data protection. These are all core capabilities that we have.

    Then on top of that, to me, one of the great structural pieces is we don't have with Windows is this problem of Mac OS/iOS. I'm not in some quest to say let me try and replicate Mac OS and iOS or iOS and Mac OS. We don't have the Chrome versus Android. We are Windows, from Raspberry Pi to HoloLens. And when you saw the demo of HoloLens today, to me it's part of my mobility strategy. When the person was using Autodesk and Maya on the desktop and just moved to a 3D model and interacted, they weren't using their phone.

    If anything, one big mistake we made in our past was to think of the PC as the hub for everything for all time to come. And today, of course, the high volume device is the six-inch phone. I acknowledge that. But to think that that's what the future is for all time to come would be to make the same mistake we made in the past without even having the share position of the past. So that would be madness.

    Therefore, we have to be on the hunt for what's the next bend in the curve. That's what, quite frankly, anyone has to do to be relevant in the future. In our case, we are doing that. We're doing that with our innovation in Windows. We're doing that with features like Continuum. Even the phone, I just don't want to build another phone, a copycat phone operating system, even.

    So when I think about our Windows Phone, I want it to stand for something like Continuum. When I say, wow, that's an interesting approach where you can have a phone and that same phone, because of our universal platform with Continuum, and can, in fact, be a desktop. That is not something any other phone operating system or device can do. And that's what I want our devices and device innovation to stand for.

    More Windows 10

    Last week's announcement was not about any change to our vision and strategy, but for sure it was a change to our operating approach. The way we're going to go about it. I'm not going to launch a phone a day. I'm going to focus on a few phones that actually grab share that, in fact, showcase our uniqueness. When you have three percent share of that (phone market), but you also have a billion desktops, you have Xbox, you have innovation in HoloLens; you have Band. It's a graph. It's not any one node. It is the entirety of the device family. And I want to be able to think about our strategy, our innovation, and progress as one.

    If anything, the thing that I'm signaling most to the investors, to the employees is let's stop this thing about trying to atomically dissect any one. They will all have a temporal current position and a future ambition. But it is one thing that we need to move on.

    MJF: It sounds like you're saying that right now when people talk about "Windows mobile," (lowercase m), they only think it's the phone operating system. But you are saying it's much more than that. You're saying Windows mobile, going forward, is bigger?

    NADELLA: That's why whenever I talk about Windows 10, I talk about mobility broadly across all of those devices. For sure there is a form factor today which is the below six or seven inches, which is powered by a very specific operating system instance of Windows 10, which is Windows Mobile. But what do you call that (device) when you use Continuum and then you're using applications on a big screen with a mouse and keyboard? It's Windows 10.

    That's why I like to think about Windows 10 as not being bound to any one form factor. What is Alex (Kipman) doing with a HoloLens? It was a Windows 10 UAP (Universal App Platform). I think is what we need to do a better job of communicating.

    In my case I have a Band. I have my phone. I have my Surface. I have my Surface Hub and I'll have a HoloLens. And that to me is all Windows 10. And I'll seamlessly move between all of these. I want the notifications to flow between all of these. I want my data and apps to flow between all of these things.

    MJF: I saw (COO) Kevin Turner's mail about the moves you made last week, and he made a Surface analogy. He said now what we're doing with phone is more like what you're doing with Surface. Your phones are going to be more of like showcase devices for what Windows mobile can look like on a phone.

    NADELLA: Correct. There's a little bit of a distinction because, in some sense, in the world of PCs, we are trying to create new categories like Surface did. Now every OEM has a two-in-one, which I celebrate, which is great. Surface Hub -- I'm sure next year there will be many OEMs with Surface Hub like devices. We will do HoloLens, and then, since the holographic computing platform is right there in Windows, there will be people who will build holographic computers beyond HoloLens. So I want all of that to happen.

    If no OEM stands up to build Windows devices we'll build them. There will be Lumia devices. So I'm not afraid of saying, okay, it's all about the OEMs, or it's all about the ecosystem. It's about Windows. It is about the overall health of Windows and being grounded in any given day's reality, but having ambition of where the market is going versus being bound by current definitions.

    MJF: Does that Surface analogy break down, though? Microsoft built Surface but there were still many other OEMs building successful Windows devices. But with Windows Phones phones, that's not the case, right?

    NADELLA: We will do everything we have to do to make sure we're making progress on phones. We have them. Even today Terry (Myerson, the head of Windows and Devices) reinforced, again, yes, we will have premium Lumias coming this year.

    If there are a lot of OEMs, we'll have one strategy. If there are no OEMs, we'll have one strategy. We are committed to having the phones in these three segments. And I think the operational details will become clear to people as they see it. I want people to evaluate us on the phones that we produce, but not the inside baseball -- what are we doing to produce -- because that should not be relevant to our broad consumers. It may be relevant to people like you who are critiquing us. That's okay. But what matters to me is what customers care.

    MJF: I'm curious if you see last week's decisions around Windows Phone affecting your universal app strategy. Some believe that if Microsoft makes fewer Lumias -- and Microsoft is making more than 95 percent of all the Windows Phones in the market -- doesn't that kill, or at least weaken, your universal apps play, which is key to Windows 10? Why as a developer do I now want to build an app that runs on Windows Phone if there's going to be even fewer Windows Phones?

    NADELLA: Universal Windows apps are going to be written because you want to have those apps used on the desktop. The reason why anybody would want to write universal apps is not because of our three percent share in phones. It's because a billion consumers are going to have a Start Menu, which is going to have your app. You start the journey there and take them to multiple places. Their app can go to the phone. They can go to HoloLens. They can go to Xbox. You talk to somebody like Airbnb. It might be more attractive, given our three percent share on phone, for them to actually build something for the desktop and for the Xbox.

    And by the way, when we hook them on that, we have a phone app. This strategy is path dependent, which is a term I use that means where you start is not where you end up. And therein lies a lot of the nuance. The fundamental truth for developers is they will build if there are users. And in our case the truth is we have users on desktop.

    Why then make all these changes to the Start Menu with Windows 10? It's not because I just want to bring back the old. It's because that's the best way to improve the liquidity our store. Windows 8 was great except that nobody discovered the store. In Windows 10, the store is right there and done in a tasteful way.

    I want that to translate into success for our developers. That's what's going to get them to write to the phone. If anything, the free upgrade for Windows 10 is meant to improve our phone position. That is the reason why I made that decision. If somebody wants to know whether I'm committed to Windows Phone, they should think about what I just did with the free upgrade to Windows, rather than -- hey, I making four more phone models of value smart phones.

    MJF: How does making Windows 10 free show that you're committed to Windows Phone? I'm not quite following that.

    NADELLA: Because all of this comes down to how are you going to get developers to come to Windows. If you come to Windows, you are going to be on the phone, too. Even if you want to come to Windows because of HoloLens, you want to come to it because of Xbox, you want to come to the desktop, all those get you to the phone. It's not about let's do head-on competition. That will never work. You have to have a differentiated point of view.

    MJF: I have a HoloLens question. I've heard that when you first saw HoloLens -- back when it was Project Fortaleza -- you said we need to expand this beyond just gaming. Where do you think the initial demand for HoloLens is going to be? Is it going to be more in gaming, or is it going to be more in business and research?

    NADELLA: For sure in the first version, it's going to be more about developers and enterprise scenarios

    I did buy Minecraft to create a new genre of gaming for mixed reality. We bought Minecraft for many reasons: because it's the number one PC app; it's the number one console app; it's the number one paid mobile app on iOS and Android. I wanted a hit game even for the new medium of mixed reality. And we will have that. Gaming will always be a scenario and there will be other entertainment broadly. But, with the V.1 of HoloLens, I want us to push a lot more of the enterprise usage.""
    Jul 14, 2015. 01:00 PM | 3 Likes Like |Link to Comment
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