Microsoft missed out on the Internet of Things: Are you ready?

Microsoft was so successful in software that they missed perhaps the biggest shift, a shift still happening, since the Internet itself. Many other companies are going to miss the shift to the Internet of Things, but they don’t have to.

Microsoft as an also-ran

Once upon a time, young Bill Gates and Paul Allen, inspired by a Popular Electronics story, set change in motion that made Microsoft a massive company touching every corner of the globe (if a globe has corners…). But that innovation that kicked off change hasn’t shown up in more recent times. Elise Ackerman wrote today in Forbes:

Today, the wheel of technology has turned. Microsoft’s monopoly position in computer operating systems is being chipped away by Apple, Google and others. Its continued dominance of business productivity applications is uncertain. In areas like Internet search, social networking and smartphone software, Microsoft holds the humbling position of an also-ran.

If you think Windows 8 will change things, read on.

Internet of Things

There can be no better explanation of where Microsoft missed their date with the future than their absence from a leadership position in the Internet of Things. Way back in 2009, Kevin Ashton wrote a piece for RFID Journal that, while focused on RFID, was really a much broader statement about moving from an Internet of thoughts to an Internet of ‘things’. He summed up as follows:

We’re physical, and so is our environment. Our economy, society and survival aren’t based on ideas or information—they’re based on things. You can’t eat bits, burn them to stay warm or put them in your gas tank. Ideas and information are important, but things matter much more. Yet today’s information technology is so dependent on data originated by people that our computers know more about ideas than things.

If we had computers that knew everything there was to know about things—using data they gathered without any help from us—we would be able to track and count everything, and greatly reduce waste, loss and cost. We would know when things needed replacing, repairing or recalling, and whether they were fresh or past their best.

We need to empower computers with their own means of gathering information, so they can see, hear and smell the world for themselves, in all its random glory.

That’s a very long quote but very important. Ashton was predicting the need for technology to manage the physical world far more than it does today. That means so much more than operating systems (mostly commoditized), hardware (very commoditized) and databases (highly commoditized).

What Microsoft missed

This is what Microsoft missed in a nutshell:  Microsoft missed their moment to build the data connectors, sorters, filters, analytics, event processing, rules, and workflow that makes the Internet of Things a manageable and lucrative reality. They had the means and could have taken the turn ten or more years ago.

Instead, a combination of startups and technology platform players are positioned to dominate the Internet of Things landscape. Between point solutions mostly created by tiny startups and the platform players that follow or buy up those startups, the technology needs of this new paradigm will be met.

Ackerman makes a good point that it won’t happen overnight and that the Internet of Things needs to be constructed just as the Internet was. But watch carefully where investment goes in the coming twelve months and you’ll get a good idea of how that’s happening now.


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Categories: Disruption, Innovation, Internet of Things, Tech Strategy

Author:Chris Taylor

Reimagining the way work is done through big data, analytics, and event processing. There's no end to what we can change and improve. I wear myself out...

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14 Comments on “Microsoft missed out on the Internet of Things: Are you ready?”

  1. November 6, 2012 at 7:22 am #

    Microsoft may have missed the “Internet of Things”. But if you listed the things that Microsoft missed, you’d have a very long list of “coulda’s” and “shoulda’s” – search, smartphones, and social are probably the big ones.

    If the focus is on Microsoft, what could they do now? Is their acquisition of Yammer, combined with SharePoint, going to put them in a strong position in social collaboration inside organizations?

    If the focus is on the “Internet of Things”, RFID and NFC and other technologies have been offering promise for at least a decade. What’s the evidence that something has changed and adoption will be taking off?

    • November 6, 2012 at 7:33 am #

      From my outsider’s view, I would say that Microsoft needs to move beyond SQLServer and into caching apps. They need to use SharePoint as a true collaboration tool, meaning not document-based, but data-based.

      If Microsoft were to just maintain Windows 8 and put their resources behind a platform for sensing and responding to the environment, they could turn things around.

  2. November 6, 2012 at 9:32 am #

    Microsoft desperately wants another big win like DOS, Windows and Office. Connect might be as close as they’ve come. People are still finding new uses for that technology and MS Labs is cooking up some new interface technologies that will knock your socks off.

    I would agree that the world has definitely gotten bigger around Microsoft and they find themselves playing in an environment that they cannot dominate or even control. Hopefully, they are learning to cope. They have learned that Apple, Google and Amazon have all been successful in creating computing ecosystems. They now have their own. Let’s see if they can sell it this late in the game.

    November 6, 2012 at 10:48 am #

    Indeed Microsoft lacks an ecosystem of devices. They do have some gems, such as Kinect, which can capture non intrusively data about people. They may play a role, but not as important as they’ve had in the past.

    • November 6, 2012 at 10:51 am #

      Thanks for the comment. I agree. They had a chance to be the de facto infrastructure play by having the database software, the OS and the productivity tools. They stayed too close to the ‘front end’.

  4. November 11, 2012 at 8:39 am #

    The problem with Microsoft isn’t just that they got stuck with legacy code (from DOS) as we’ve all heard before, it’s that they didn’t solve the big problems with the software industry. Here is just a few of the problems with software from what could be a long list of things that they have not addressed:

    1) Coding is too hard
    2) Coding takes too long
    3) Software has way too many defects
    4) Software is too rigid to scale easily or be responsive to individual needs
    5) Parallelism/Multi-core means coding is harder, not easier
    6) Focus on the cloud can cause us to miss what’s right under our noses (the explosion of personal devices) and what it’ll take to leverage them all.

    I’ll put my vision for how to change things in a future guest blog. Chris, thanks for the invitation to guest blog.

  5. November 26, 2012 at 9:17 am #

    Great post. We just discovered your blog by following your comment from GigaOm. Will definitely be reading more!


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