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Beyond SaaS: The Rise of the Device Independent Platform and the Portable Workspace, Part II of II

Merrill R. (Rick) Chapman, Softletter Managing Editor

Who Will Build the Portable Workspace?

There are three technology giants currently maneuvering for the strategic high ground in the platform war about to break out, Apple, Google, and Microsoft. Secondary players include Samsung, possibly a variant of Linux, or maybe an international contestant such as China’s COS (yet another Linux variant). Oracle in the past has dabbled in the OS market, but we suspect they’ll be focusing on snatching up key layers in the device independent stack, particularly anything to do with data and data interchange and the drive to “normalize the cloud,” as Roger Sippl said at Softletter’s 2012 Austin SaaS conference.

Potential wild card entrants to the conflict include the major SaaS firms such as Salesforce or Netsuite. Both companies have transcended their beginnings as SaaS application companies and have become platform providers. Both browser-based and mobile apps can be built on top of the online development frameworks these companies provide. And both are connected to Oracle, a company positioning itself to be a major provider of device independent infrastructure.

The reason companies fight for platform control is simple—dominance is very lucrative and allows a company to dictate the growth and development of an industry while skimming off the revenue cream. IBM and Microsoft have both experienced this nirvana and Apple is currently enjoying the sensation of having large wads of cash drop into its revenue maw as it luxuriates in its latest beautiful walled garden, the one built from the iPhone and iOs.

There is a downside to platform supremacy. Over time, it tends to weaken a company as it becomes obese and lazy, focused on protecting its revenue food source at all costs as new species of company enter the market and learn to graze in new technology fields. This happened to IBM and Microsoft and there is speculation that Apple is beginning to undergo the same transformation.

It is possible that the major competitors will agree on a collective effort to build a platform for device independence, but I think this unlikely. Big company CEOs all have satanic personalities and would rather rule in Hell than cooperate in Heaven. Regardless, if you’re a startup interested in playing in the portable workspace market, your strategy from the time you write your first line of code is to be acquired by one of the Great Powers.

Each of the Big Three brings particular strengths, weaknesses, and its history to the upcoming war. Let’s analyze each combatant in turn.



Apple’s potential for platform control comes from three primary factors. The first is money in the bank ($200B and counting) and yearly profits are currently running between $30 to $40B. There is no service or component of the device independent infrastructure that Apple can’t buy if needed.

The second is iOS/Mac OS’s 70% smartphone revenue market share. Android phones Apple’s by 80/20, but no one’s generating much in the way of profits from the Google OS platform.

Apple’s biggest trump card is its legendary ability to create compelling product designs. Despite years of playing catch up, Android remains an inferior user experience in the mind of the market. Hundreds of variants of the interface exist across the OS firmament. By contrast, Apple’s Continuity system, a service layer that unifies the company’s functions and synchronization across its devices, draws the Apple ecosystem closer together.

Apple’s secondary strengths are its footholds in the desktop and laptop markets and a strong browser position with Safari. Apple’s line of laptops and desktops provides it with expertise and experience in how to provide applications and manage services across different devices and form factors.  Safari helps Apple understand how to integrate browser based applications into the portable workspace.


Apple’s strategy is simple—extend its walled garden around the planet.  It has the best hardware, the most money, an incredible brand, a retail selling machine, and the best selling consumer electronic device of all time sporting the best interface. Apple can and will make the argument that if you want applications, integration, and interoperability between devices, Apple is closest to providing this computing nirvana. Why buy anything else? A de facto “device independent” environment already exists, as long as the device is one of Apple’s.


There are problems facing Apple’s bid to control the portable workspace. The first is an ancient problem that has always plagued the company and is beginning to appear again—the desire for device independence and the growth of services supporting it will exceed Apple’s ability to meet buyer demand. Apple has been here before. Once the problems afflicting the early Macintosh models were addressed, sales of the system hockey-sticked. Apple was in the happy position of being able to sell every unit it made of its GUI PCs at premium prices.

However, Apple was unable to meet the entire market demand for GUI-based computers, allowing Microsoft to address the larger market of people and businesses who wanted GUIs and mice and couldn’t buy an Apple or were unwilling to pay a premium for the experience. Over time, available and good enough drove Apple into a 4% market niche. It wasn’t until the company shifted its emphasis to consumer electronics that it was able to grow again.

History seems to be repeating itself with Android. While the first Android units were clearly inferior to iPhones, the price/performance gap is narrowing. New Android models, most of which are appearing from China and the Far East, offer comparable hardware at significantly lower prices than the iPhone. Android is becoming more functional and the interface smoother. Eight of every 10 smartphones made is based on Android.

But the more fundamental problem is that the portable workspace devalues devices. It’s the virtual space that will soon become the focus of user attention and investment. Beautiful devices will increasingly become fashion and status statements. Their ability to provide value-added services will decrease, though not disappear.

Apple could deal with this dilemma by making the momentous decision to OEM its smartphone technology on a selected or general basis, allowing it’s entire ecosystem to grow beyond its own expansion capabilities. Apple attempted this strategy once before, with the Mac OS under Gil Amelio. The initiative was a dismal failure, but the timing was terrible. By the time Apple was ready to license the Mac OS, it was a niche product. The same is not true of iOS, a dominant force.

The odds of Apple doing this are about zero. The desire to license their core technology is almost absent from Apple’s DNA. And they can make an excellent argument their current strategy has worked wonders.

Another problem facing Apple is the company lacks the infrastructure and service layers Microsoft, Amazon, Google, Oracle, et al possess. But $200B enables the company to fill a great many holes as needed.

One final speed bump in Apple’s path to dominating the portable workspace is the positioning conflict that now exists between Mac OS and iOS. The company must now maintain two operating systems with similar names and overlapping functionality, a classic positioning conflict. However, Apple seems aware of this problem and its recent behavior indicates the company is moving towards a merger of the two products. Apple has experience in this area, with its very successful transition from it’s older OS technology to System 10 in 2001.



In many respects, Google is by far the best-positioned company to take advantage of the shift to device independence and the portable workspace. The company’s entire portfolio of applications and services is built around the Cloud and device independence. While most of the industry’s attention is focused on the struggle between Android and iOS, Google’s Chrome OS (Chromium OS is Google’s open source version of Chrome and exists to confuse everyone) is a web-based OS that’s rapidly becoming a millennial and K-12 favorite via the company’s Chrome Book hardware platform.

Google Docs is another powerful part of the company’s strategy. While Microsoft’s Office franchise remains the corporate standard for business applications, increasing numbers of graduates from college and high school have never touched Excel, Word, PowerPoint, et al, entering the workplace with no allegiance to Redmond.

Google is also a major provider of device independent infrastructure and service layers, unlike Apple, and is steadily growing out its portfolio. AlphaGo, the computer program that just whipped the world’s best human Go player, is built on an AI backend service layer built by DeepMind, purchased by Google in 2014. Waze is another recent example of Google building out its services, willing to invest in a product that’s superior to its successful Google Maps.

The company also doesn’t lack for revenue. While Google doesn’t possess as much cash in the bank as Apple, the company’s lock on web search provides it with a solid financial foundation and the company can buy what it doesn’t have.

Finally, Google has pulled off one of the most remarkable feats ever seen in computing: displacing Microsoft as the browser leader. It boggles the mind to think that IE, which once had 90%+ marketshare! is being supplanted by Chrome. Microsoft’s disastrous IE 11 or else strategy has permanently wounded the one-time browser heavyweight and Edge has failed to prevent wholesale defections to Chrome, leaving Microsoft an also-ran in a technology it once owned.


Google’s strategy is fairly straight forward. It will continue to build out its cloud systems and acquire applications and services to support Android and Chrome. Most of the parts necessary to create the portable workspace are already in place. Chrome and Android apps can run on desktops, laptops, Chrome books, and 80% of the smartphones being sold. Google provides a satisfactory desktop suite that can run offline when needed. The Chrome browser ensures Google will remain a prime portal to all SaaS applications.


Google’s chief problem is focus. Its core business is web-based advertising and its Android operations only generate about $3B in search revenue; by contrast, iOS search generates $9B. The company’s “throw it against the wall and see if it sticks” philosophy leads to many breakthroughs (Android, Google Docs, Waze)  and as many dead ends (Google Lively, Health, Flip and so on. The jury’s still out on Glass). Softletter doubts if anyone at the company has been given central responsibility to coordinate Google’s various phone, application, and OS initiatives into a coherent whole.

There are other problems as well. Like Apple, Google is currently managing two operating systems, Android and Chrome, with overlapping functionality, appearance, and markets. One of them has to go. The company’s UI designs are far from leading edge, as anyone who uses Gmail already knows. And Google’s relationship with hardware is often problematic, as its foray into building phones during its brief ownership of Motorola demonstrated.



Of the top three contenders, Microsoft is the company that most needs to invest in device independence and the portable workspace and probably the most aware of it. The company has several major strengths, but is facing several severe problems.

Among the factors in its favor is Microsoft retains control of the PC desktop market via Windows and while sales revenue from its ubiquitous OS are shrinking rapidly (10% and dropping), other components of the desktop still represent a very lucrative market and the company remains a major power in NOSs.  Microsoft Office for many businesses is still the essential product and various open source initiatives to displace it have for the most part failed. The company also has a strong position in enterprise DBMS technology with SQL Server, CRM with Dynamics, gaming with its console business, development tools with Visual Development Studio and Sitepoint, etc.

Microsoft has also made a major investment in building out a powerful Cloud-based infrastructure via Azure. The company is pushing its relevant applications onto the Cloud and supporting open source development on its platforms in ways unthinkable a few years ago. It’s also pushing its Universal Windows Platform (UWP), a “write once, run anywhere” development framework that enables an application written to it to adapt to different devices, displays, and input methods.

The description for why you would develop using UWP is interesting. The first reason Microsoft lists is:

  • You target device families, not an OS.

Later on, the requirements say:

  • There’s a common API surface across device families.

The Universal Windows Platform (UWP) core APIs are the same for all Windows device families. If your app uses only the core APIs, it will run on any Windows 10 device.

It’s a revealing bit of corporate schizophrenia. Which is it? Are you targeting devices or an OS? And UWP applications don’t seem destined to run on many smartphones.


Microsoft’s strategy is application-centric. The company is currently focusing on porting its applications, particularly its desktop suite, to all OSs, a sharp turn from the strategy pursued by Bill Gates and Steve Ballmer. The belief is that by providing cross platform development tools and services, Microsoft benefits regardless of the OS.

The company is also leveraging its investment in infrastructure. It’s free and Office 365 SaaS applications are robust, more powerful than Google Docs, and integrate well with the company’s huge legacy base of on-premise applications. It’s online development tools are extensive and provide extensive back-end and infrastructure construction abilities. And it’s worth remembering that beginning with the first steel ball Microsoft Mouse, the company has always kept its hand in hardware design and production, as the HoloLens, Surface, and Xbox One demonstrates.

Microsoft has also spent a great deal of time and good will retooling its monumental flop, Windows 8, into Windows 10, a dual interface system that seems to be succeeding in not annoying huge percentages of the market. Windows 10 works well on desktops, laptops, and “tablets,” IOW, small form factor convertibles with detachable keyboards. But Windows 10 is not a smartphone OS.


Microsoft’s primary problem is that it’s cut off from the future. Since 1995 and the demise of OS/2, Redmond has been able to dictate standards to the market. The collapse of Windows Phone (or Mobile, or whatever) has ended over two decades of Microsoft hegemony. The firm has just announced that in 2016, it won’t be focusing on the smartphone market.  If you own a Lumia, time to start window shopping for that new iPhone or Android unit. The Windows RT debacle emphasizes the point. Windows will control the desktop for the time being, but this is a shrinking market. And once portable workspace standards are established, Windows will become an increasingly less important component in the environment.

Microsoft faces a stark choice. Build the portable workspace, or at least provide a credible framework for its construction, or cede control of UI and desktop technology standards it’s set for over 20 years. There is no device path it can take to tomorrow. The alternative is to become simply an infrastructure and applications company and take your marching orders from Apple, Google, or even perhaps Salesforce. You can make good money, stay in business. and after 40 years in business, finally become IBM.

(Our next article on the device independence movement will discuss service layer business and market development.)


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