What Failing Newspapers Tell us About Microsoft's Pending Flop, Vista

In the past 20 years newspaper publishers used a handful of tools to boost circulation:

• Low-priced subscriptions or giveaway copies
• Contests, bingos, etc.
• Newspaper redesign

The redesign trend really picked up in the 1980s as USA Today proved that a light, bright and fast read with a lot of graphics met customers' needs. And it worked for a lot of newspapers.

    But now the redesign tool seems to be failing. Newspaper designer Mark Friesen shows a clear picture of trends for several newspapers that have recently been redesigned.

Friesen doesn't actually draw any conclusion from this.  But there may be an important pattern here that applies well beyond the media industry. In fact, Microsoft and the entire PC industry may be staring such a signal in the face over the next three months as Microsoft launches its new operating system Vista as well as a deluge of upgraded software such as Microsoft Office.

When a proven management method fails, it may be a signal that the market is over-shot. Typically in such cases, suppliers continue to innovate and improve on things that no longer matter to customers.

Clearly this is occuring in newspapers and we may draw a similar conclusion, tentatively, about PC operating systems, hardware upgrades and new software applications. Just as the periodic newspaper redesign of the 1980s paid off, operating system upgrades created the market boom for companies like Microsoft, Dell, HP etc. 

This raises a question: Is that boom over? 

Overshooting customer needs is a core element of disruptive innovation because an overshot customer base will include a segment that will likely accept a so-called inferior product if it meets some other important needs, typically for:

• Greater convenience
• Simplicity
• Accessibility
• Lower cost
• Greater flexibility

So while there is little doubt that Microsoft Vista is better (more secure, easier to use, lower power consumption on laptops), the real question is, has it has surpassed the needs of most users?  And the disruptive question is whether a new entrant operating system or application is now good enough?

Classic warning signs of disruption:

• Customers only care about price
• New products flop
• Marginal new entrants take share
• Tried and true management methods start to fail
• Growth gap emerges
• Management needs a miracle

Given that many people stopped upgrading Microsoft Office around 1994 and the last major rev of Internet Explorer was five years ago, I think the boom ended around 2001 but the industry has not fully taken notice. Of course, Windows Vista will ship as the default option on almost all PCs, so customers won't have a lot of choice about the product's adoption.

This is not the case for MS Office or hardware upgrades; That's where the market reality will show itself first.

**Other Views**

Microsoft's windows boss Jim Allchin says Vista is so secure, it doesn't need additional antivirus software, a point of controversy with some.

CEO Guide to the Benefits of Disruption (pdf) and other tools for managing disruption at The Disruption Group's site.

Some PC users seem to want new PCs but without the operating system.

Mixed reviews for IE7 compared to FireFox with some early users complaining about step backwards in terms of flexibility and customization.

CNET reports on the details of Microsoft's ship-process for Vista

Comments

[Conficio]

Software is somewhat different than hardware or any other product, as is fashion different from food, etc.

Software's main difference/problem is complexity and feature creep. A new car does not get (much) more complex to use than its predecessor. And if it does most often software is to blame.

On one hand it is relatively cheap to add new features and functions to software. On the other hand it makes it increasingly complex to use.

A major obstacle to feature rich software is to teach people how to use it. all users currently complain "I can't find anything in the documentation" and "The documentation seems to be written in a foreign language".

We at conficio (shameless plug here) try to do something about this issue. See our net Plan-B for OpenOffice.org
http://openoffice.screencast-tutorials.com/index
(just reached public beta status) for an example what we mean.

Kaj

[fmk]

all products - cars to candy, media to menswear - have definable product cycles, which require the basic product to be altered in some way in order to boost flagging sales. but most of those markets are highly competive. is the software os market highly competitive?

software also differs somewhat in that it works in tandem with another industry: hardware. the hardware manufacturers have difficulty getting users to buy new kit without software to run on it. software manufacturers are naturaly averse to issuing product that doesn't have the hardware to support it. ms has the advantage of size in this area, and so has capitalised on the relationship between the two industries, with each major release of an os upgrade having a positive impact on hardware upgrades, enabling the applications to become even more feature rich. it's a sort of virtuous circle for the two industries.