What does Linkedin really mean to Microsoft?

Microsoft has stirred up a swirling buzz of discussion around the Linkedin acquisition for $26.2 billion. There are a number of angles that have been considered in the gazillion news stories floating around. Here’s a few of those threads:

  • Linkedin is a Salesforce counter by Satya Nadella — It has been argued by Steve Nellis and others that Linkedin’s efforts at developing and selling the tools in the company’s Sales Solutions unit have not gone very far, but the data in Linkedin’s network — when coupled with Microsoft’s own Salesforce competitor — Dynamics — could become a real player. Note that Nadella’s rumored efforts to acquire Salesforce stalled because of a too-high price tag (10X revenues), while Linkedin was much more affordable (7X revenues). Plus, with Linkedin in there are other angles to play.
  • Linkedin is a professional social network, and could counter Facebook for Business — Facebook has not yet released its business variant, Facebook for Business, but it’s supposed to roll out this year. Nadella might be trying to get there first by offering a fusion of Linkedin’s current mix of blogging, social networking, and recruitment use cases with Office 365 productivity options. Linking together the professional graph (Linkedin) with the work graph (Office 365)– as Nadella talked about in a call with the NY Times — and getting a premium on the integration of the two is probably a smart move so long as the seams can be made low friction. There is a devil in these details, but this is one of the most powerful visions for the merger.
  • Linkedin alone was a company with real problems — Linkedin stock got hammered earlier this year after lowered sales estimates. This would be bad in itself but doubly bad for Linkedin, since many of its best and brightest are compensated in part by stock grants, so when the stock falls, so does compensation. As a result, Linkedin was facing a mass exodus unless they could right the boat. This is one of the reasons Microsoft got the terms that it did. And now, people will be compensated in the more standard Microsoft way (as will the accounting for these expenses, which were clouded by non-GAAP practices).
  • Microsoft sees Linkedin as a way to deflect Slack — Personally, I don’t buy this conflation of threats to Microsoft. Yes, Slack is making huge inroads in work technology — specifically as the defining product in the exploding work chat space — but just because is has some of the features of a ‘social network’ (in that people are logged in for long periods of time each day, message each other, can coordinate outside of company boundaries) that doesn’t mean Slack and Linkedin are in some way head-to-head competitors. Yes, Slack is a competitor to Microsoft’s productivity/work technology products — most specifically Yammer, but also the core functionality slowly growing in Office 365 — but that doesn’t mean that Linkedin is intended as a Slack killer. Although Microsoft should be working on that, as well. I just don’t expect it will come from the Linkedin side of things.

After all the dust settles I expect that we’ll see a reoriented Linkedin, with a greater focus on CRM technologies and networking, and also a much enlarged focus on people operations (HR) technologies and networking, an area that Microsoft has functionally no offerings. This will take the form of enlarged platforms, and an ecology of partners building on Microsoft/Linkedin capabilities, as well as other, subsequent acquisitions. And Linkedin will immediately find its operational core — and culture — pulled toward CRM and HR by the Microsoft sales operation.
I also don’t believe that Jeff Weiner will be at Microsoft for longer than his required tenure, two years or whatever it is, and Kara Swisher agrees. More likely he will find new worlds to conquer, and Satya will find someone in Microsoft or Linkedin who will better execute what will rapidly become an integration strategy, rather than a trailblazing one.

Microsoft embraces Python, Linux in new big data tools

Continuing its quest to make Microsoft Azure comfy for the non-Windows world, Microsoft just launched a preview of its Hadoop-based cloud tool (HDInsight) that runs on Linux. It’s also making its Azure ML machine learning service widely available now with new support for Python as well as the already-planned support for the popular R language. Microsoft bought Revolution Analytics, the company behind a commercial version of R, last month.

Azure HDInsight is thus “Microsoft’s first fully Linux-based service for big data,” Joseph Sirosh, Microsoft’s corporate VP of machine learning, said in an interview. Microsoft says 20 percent of all VMs running on Azure run Linux.

Asked if he sees any open-source oriented developers still wary of using Microsoft’s cloud, Sirosh said the perception of Microsoft as a Windows-only company is fading. “There is a new breed of developers [who want] to leverage features … whether they are Linux- or Windows-based is becoming less important,” he said. With cloud services, “you really don’t have to know a lot about deep inner details to use these services.”

Azure ML’s embrace of Python also shows just how popular that language has become and that [company]Microsoft[/company] Azure is building on its promise of language agnosticism. “Python has become the number one language of choice for developers. We can now claim to be the most comprehensive analytics service — no other product lets you integrate SQL, R and Python into one project,” Sirosh said.

Microsoft CEO Satya Nadella.

Microsoft CEO Satya Nadella

Microsoft is also making Storm, the open-source stream analytics tool, available for HDInsight with support for both .NET and Java. The company already offered Azure Stream Analytics and will continue to sell, support and upgrade that as well. Storm is another option, Sirosh said.

In the massive public cloud infrastructure arena, Microsoft must contend with [company]Amazon[/company] Web Services and [company]Google[/company] Cloud Platform, both of which are targeting developers with fancy analytics and other services. I agree with Sirosh that Microsoft has done a good job of embracing open-source frameworks and languages in Azure. But the perception, especially among young startups, of Microsoft as a Windows-and-Office-first monolith dies hard.

I’ll be sure to ask Sirosh more about how Microsoft Azure can win over startups as well as big business accounts when we’re on stage next month at Structure Data.

This story was updated at 10:05 a.m. PST to reflect Microsoft’s assertion that 20 percent of all VMs on Azure run Linux

Live blog: Microsoft previews Windows 10 in Redmond

Microsoft’s consumer-focused Windows 10 reveal kicks off at company headquarters in Redmond, Washington today and we’re live from the event to see what the next version of Windows has in store.

We’re expecting Microsoft to share new details about how the desktop version of Windows 10 works, but the bigger questions facing Microsoft surround its mobile strategy and the next version of Windows for tablets and smartphones. Will Microsoft merge its Windows Stores for mobile and the desktop into a single cross-platform app store? Microsoft is also to announce new improvements and features for Cortana, its voice-activated assistant, as well as possibly a new browser codenamed “Spartan.”

Windows 10 also marks Microsoft’s first major Windows release since CEO Satya Nadella took over last year. He’ll be speaking today, so make sure to tune in starting at 9:00am PT.

Here’s what’s been announced so far:

What does Microsoft have planned for Wednesday’s Windows 10 event?

Microsoft will unveil the first major Windows update under new CEO Satya Nadella on Wednesday. Obviously, it’s a big day for the Redmond-based giant as well as for any Windows user who wants to know what to expect from her PC in the future.

Microsoft’s stock is at a near 15-year high. Nadella has refocused the company on services and made many of Microsoft’s key properties — including Office — truly cross-platform. The PC industry has also had a few good quarters recently, with sales slowing less than expected.

But although Windows is most closely associated with the PC, Microsoft’s biggest challenge is in the mobile space. Last year, Microsoft bought Nokia for over $7 billion hoping to ride closer integration of hardware and software to a bigger share of the mobile market, but Windows Phone still lags far behind both Android and iOS in terms of the number of devices in consumer hands. Microsoft will look to Windows 10 to turn that around.

Here’s everything we think we know Microsoft has up its sleeve. I’ll be live-blogging the event along with Kevin Tofel on Gigaom at 9AM PT on Wednesday.

A Windows 10 preview for consumers

Leaked-Windows-10-Build-9901-Screenshots-467421-3

[company]Microsoft[/company] is expected to launch the Windows 10 Consumer Preview at its event. The Consumer Preview is a beta version that’s not quite ready for mass consumption, but when it’s distributed it should be good enough for interested parties to taste the new Windows 10.

Thanks to a few leaked Technical Previews, which are intended for Microsoft “experts,” we have an idea what to expect from the latest Microsoft desktop operating system.

First, there’s going to be a big emphasis on Cortana, Microsoft’s voice assistant, which has continued to improve since its launch in 2014. It started out on Windows Phone, but it’s almost certain that Microsoft wants to bring the Google Now and Apple Siri hybrid to the desktop.

Microsoft may also be planning to introduce a new Xbox app, which would function as a gateway to the entire Xbox ecosystem.=That means that gamers could see and configure their achievements, friend lists, and activity feeds from their desktop computer. The big question is how the Xbox app will handle games: Will you be able to download games on the Xbox app that you can play on your laptop?

Another possible big feature is called Continuum, which allows users to pick up what they were doing as they switch between PC, tablet, and phone, specifically geared for 2-in-1 devices. It sounds similar to Apple’s Handoff feature or Nextbit’s projects on Android phones (which use the cloud). But we’ll have to wait to see what kind of backend Microsoft is using to provide the feature.

Of course, long-time Windows users are loyal to the Start menu. And, according to leaked screenshots, “Start” is making a comeback of sorts.

A version of Windows for smartphones, tablets, and mobile devices in general

Most attention at the Windows event will probably be on Microsoft’s mobile platform, which is expected to be a new version of Windows without a desktop interface that combines Windows RT and Windows Phone and works on both Intel and ARM processors.

Unlike Windows 10 for the desktop, Microsoft hasn’t released a preview for its upcoming mobile operating system yet. Rumor has it that Spartan will include both a light and dark theme, and will integrate more fully with Xbox and Windows on the desktop.

Which version of Windows will small tablets run? To this point, Windows Phone hasn’t been installed on a Wi-Fi only tablet. Will Microsoft encourage device makers to use the new mobile operating system on inexpensive tablets, or will some of them continue to run full Windows like a few tablets that came out last year?

Microsoft has been experimenting with changing the way it licenses Windows, especially to other businesses. In December, Microsoft COO Kevin Turner said that Microsoft needed to “monetize” Windows differently. Windows 10 could mark a key shift in Microsoft’s decades-old business model.

Some hardware makers who wanted to try out Windows Phone or Windows RT on devices under 8-inches haven’t had to pay the licensing fees recently. With subscriptions to services like Office 365 hopefully growing under Nadella’s watch, it’s not hard to imagine heavily-subsidized hardware largely paid for through subscriptions, especially for enterprise customers.

The beginning of the end for Internet Explorer

Photo by Kevin Tofel/Gigaom

Photo by Kevin Tofel/Gigaom

In recent weeks, there’s been an increasing amount of chatter that Microsoft has been developing a new “lightweight” browser to be installed on Windows devices.

[company]Microsoft[/company] is unlikely to launch a WebKit-based browser, though — reports have Microsoft sticking with its Chakra JavaScript engine and proprietary Trident rendering engine, which are the underpinnings of Internet Explorer.

But the browser, reportedly codenamed “Spartan,” will be a major change from Microsoft’s previous browser efforts. It reportedly will have versions not only PCs, tablets and phones. It could be updated through the Windows Store and will deeply support “digital inking” — like what the stylus on the Surface Pro uses — as well as integrate Cortana. Given Microsoft’s new cross-platform approach, it wouldn’t even be a surprise to see the new Spartan browser ported to non-Windows operating systems.

What will it be called? It’s likely to adopt a new name — perhaps not Spartan — for a few reasons. First, it would allow Microsoft to shake the perception that Internet Explorer is a standards non-compliant pain in the neck, even though the browser has improved significantly from its IE6 days.

But the simplest reason for the new browser having a new name is that a version of Internet Explorer will likely continue to exist, pre-installed on Windows devices, if only for “legacy reasons.” After all, there are many enterprise clients that would like to keep their browsers consistent.

The convergence of the app stores

A new report says that Microsoft has been working on a platform which allows developers to easily configure a Windows app to run well on phones, tablets, and PCs all with different screen sizes. According to The Information, 90 percent of code may be able to be re-used when adapting a desktop Windows app to mobile.

Furthermore, these apps that run across both PCs and phones could be available from a single, unified app store. If Microsoft were to make this move, it would a strong play to attract app developers away from iOS and Android and back onto Windows.

Using its position on desktop PCs to bridge the “app gap” was one of the key reasons Microsoft allowed Windows 8 PCs to run Windows RT apps, although that didn’t work out quite as planned. Consolidating all the app stores into one could be a sea change for Microsoft’s mobile hopes and the moment that hot new app teams realize they have to develop for Windows, too.

Although Microsoft says that most of the must-have apps are available for Windows Phone, its clear that there are certainly some big-name apps and services that don’t have official versions on the Windows Store, and it’s a problem. Notable absences include: Lyft, Uber, HBO Go, Snapchat, RunKeeper, Tinder, GitHub, most Google services including Maps and Gmail, and most new and buzzy games.

Could Cortana eat Bing?

cortana

Cortana, Microsoft’s voice assistant, is likely to be a big focus at the consumer preview. Some reports have indicated that Cortana will be able to be used through a browser tab in the new Microsoft browser. Apple’s Siri can’t do that, but Google’s various voice powers can be used in Chrome.

One possible leaked screenshot shows Cortana integrated into the address bar of a Spartan tab.

But one of the most interesting possibilities headed into the Windows 10 unveiling is that the Cortana brand could end up substituting for Bing as the default search software in many places in the new Windows. It’s a similar situation to Internet Explorer — although Bing is a mature product, it’s still perceived as an also-ran to Google Search. Cortana uses cool voice capabilities and can do more than simply search the web through Bing. It can also dig through your calendar, for instance. Microsoft might have an easier time re-training Google users to do a Cortana search as opposed to a Bing search.

Cortana will also be baked into the Windows 10, not just the browser. Leaked screenshots and video from Winbeta show a pre-release version of Cortana retaining her old voice on a desktop computer with much of the same features found on Windows Phone — adding reminder, calling people with Skype, and launching apps.

https://www.youtube.com/watch?v=hA0Sk28TsP

The integration of Xbox and Windows Store

Microsoft’s third biggest property after Office and Windows is Xbox, which is notable as Microsoft’s only major product aimed almost exclusively at consumers (as opposed to Office and Windows, which are largely sold directly to other businesses.)

Microsoft has been developing a music and a video store under its Xbox brand. Merging Xbox Music and Xbox Video into the Windows Store could give Microsoft a full lineup of multimedia content more like Apple’s iTunes Store or Google Play.

The Xbox SmartGlass app could also be in line for a surprise update. Launched alongside Windows 8 in 2012, it’s been essentially a high-powered remote app for the Xbox console — albeit one that can stream live television content to mobile devices. But Microsoft has always considered SmartGlass as a software service to tap into Xbox content, so the app might have a new role as a bridge between Windows 10, the Xbox One, and devices not running Windows.

So when can I try out the new Windows?

Microsoft said in 2014 that users can expect a Windows 10 “launch wave” in mid-2015. I think it’s more likely to have its big launch in the early fall or late summer. But users will have a chance to try out the new Windows bits perhaps as soon as Wednesday.

A new app called Phone Insider published by Microsoft on the Windows Phone Store might be the way that Microsoft distributes its Windows 10 mobile preview. So far the app can only be installed by Microsoft employees.

With Windows 8, Microsoft released its desktop consumer preview to anyone interested in trying it out. Expect Redmond to do the same thing with the Windows 10 Consumer Preview.