Wi-Fi Use Climbs

Right now there are 1.3 million public Wi-Fi spots around the world, but Informa reckons that’s going to jump to 5.8 million by 2015 with tablets and smartphones driving the deployments. This is not surprising to find, as Android over takes the iPhone and iPad. Since purchasing my own Android phone I can say I am setting at my desktop 30% less.

Those figures don’t include the 4.5 million “community” hotspots – privately owned but publically shared – the 5.8 million hotspots up and running in 2015 will be available to anyone who wants to pay, but most will be run by mobile network operators who want to offload as much of their data traffic as possible.

Informa, which compiled the data for the Wireless Broadband Alliance, spoke to 259 network operators around the world, and discovered that tablet computers already account for a tenth of hotspot connections, while smartphones account for 36 per cent and laptops less than half (6 per cent are unaccounted for).

Network operators are very happy to offload traffic onto Wi-Fi, so China Mobile is planning to deploy more than a million hotspots in the next few years, and Japan’s KDDI has announced plans for another 100,000 within the next six months. In the UK things get a bit weird thanks to our regulatory environment, but we too are heading in that direction.

The Wireless Broadband Alliance is pushing its single-sign-on standard to make it easier for devices to authenticate themselves, so users can roam onto Wi-Fi connections without having to ask, though if they’re switching regulatory environments that might come as a shock.

Getting seamless roaming means adding the capability to handsets and access-point hardware, which is what the Alliance hopes will be promoted by this report.

Download (PDF, 227.39KB)

Android/Linux Innovation

Microsoft is a marketing company, they buy and stifle innovation. A business that harasses customers will soon lose customers. Microsoft has repeatedly violated this rule by suppressing competition. The result is a huge body of customers/consumers who are ready to bolt at the first sign of an alternative. Witness the avalanche of consumers who have chosen Android/Linux smart phones instead of stupid phones with Microsoft’s stuff on board.

They attempt to stifle innovation and if unsuccessful, they resort to patent extortion via *bogus* patent fees. According to Microsoft, Google’s Android OS is infringing on many of its patents and hence those manufacturers who use Android for their devices owe royalties to Microsoft. But the intriguing fact is that, instead of suing Google itself for infringing on its patents, Microsoft is finding it easy to sue or threaten smaller firms which don’t have the financial muscle to fight a legal battle with the Redmond troll giant.

It’s just wrong. They too old and useless to make a decent product itself, can hold innovators for ransom. What justice is there in a legal system that can allow this to happen. What is truly ironic is that Microsoft now makes FAR more money from Android than they do from Windows Phone, and it’s a business in which they don’t actually have to produce or sell anything. FOSS challenged Microsoft when they said that Linux violates 235 of their patients. When FOSS asked them to show us which ones, Microsoft backed down and instead attacked the OEM’s.

Larry Page commented on that when he discusses Google impressive growth,

 “Rather than seeing, for example, Microsoft compete in the marketplace with their own smartphones, they’ve really continued resorting to legal measures to hassle their own customers, right? So it seems kind of odd. And we haven’t seen the details of those total agreements, and I suspect that our partners are making good deals for themselves there.”

Android/Linux is on most smart phones these days and Phoney “7″ is on 5%, the opposite situation we see in the retail shelves of personal computers. The difference is consumers have a choice in smart phones. They soon will have the same choice in all personal computers because the suppliers who are making money using Android/Linux are not beholden to Microsoft cash cow and can make personal computers of all kinds to compete with Microsoft’s legacy stuff that’s too bulky, hot, noisy and unreliable. Folks who love Android/Linux on smart phones know there are better ways to compute. That knowledge is spreading quickly. This Christmas we will see Android/Linux taking up lots of space on smart thingies and notebooks and desktops in retail shops.

I can think of one awesome piece of kit, the ASUS Transformer, with detachable keyboard and mouse.

Android disrupts market

In 2011, Android/Linux smart phones displaced Apple, Nokia and RIM smart phones in the market but they did more than overtake. They pulled away.

Look at the numbers. IDC reports that in 3Q 2011, 118 million smart phones were produced. Apple, Nokia and RIM accounted for only 45.7 million of them. Samsung and HTC accounted for 36.3 million with 175% annual growth rate. The former market leaders were not only overtaken but left in the dust. They could not outperform dozens of newcomers using FLOSS swarming over every region and every niche in the market.

That’s what we should be seeing in the market for PCs generally but competition is stifled by lock-in of OEMs, retailers and businesses. It’s about time that changed. In Q2, the world shipped 91 million notebook/desktop PCs. Change will come but it’s too slow for me. While FLOSS is taking over the mobile space, it will penetrate the monopoly more slowly, one purchase or installation at a time. In Q2 50 million PCs shipped with “7″. A lot of the rest shipped with GNU/Linux or FreeDOS or no OS. I expect a few retailers will experiment with Android/Linux on ARMed PCs, then GNU/Linux on ARMed PCs and finally GNU/Linux on x86/amd64 PCs. It will take a few more years but it will happen. Microsoft’s entry into ARM with “8″ and Microsoft’s current advertising campaign for “7″ shows Microsoft sees it coming. The stalling of PC sales while smart thingies take off shows the market is on the edge of change.

I predict that Microsoft will not be able to grasp/hang on to the fast-moving train that is the mobile ecosystem. One of these days it will come crashing down.

When someone asks about what phone they should get, I always tell them to get an Android as it is the most open device on the market and has plenty of options.

Software updates: Adobe

Adobe is a vendor that often plays catch-up with security exploits; issuing emergency patches issued to fix zero-day vulnerabilities. But Adobe, like Microsoft, also has a regular Patch Tuesday update cycle. This regularly scheduled update is a way to give users and enterprises a predictable and stable timetable for Adobe updates.

For August’s Patch Tuesday, Adobe has issued update advisories covering to fix a slew of critical security flaws in its products, including FlashShockwave Player and Adobe AIR.

The Flash update corrects at least 13 critical vulnerabilities present in versions 10.3.181.36 and earlier for WindowsMacLinux and Solaris machines (the bugs exist in Flashversions 10.3.185.25 and earlier for Android devices). Windows, Mac, Linux and Solaris users should upgrade to version 10.3.183.5, and Android users should update to v. 10.3.186.2. According to Adobe, they are not aware of any exploits “in the wild” for the issues addressed in the update. Digging into the vulnerabilities, the vast majority are for memory and five buffer overflows, four memory corruption and three integer overflow issues. There is also a single cross-site information disclosure issue that is fixed that could have potentially led to arbitrary code execution.

To find out which version of Flash you have, visit this page. Windows users who browse the Web with anything other than Internet Explorer will need to apply the Flash update twice, once using IE and again with the other browser (Google Chromeusers should already have the latest version of Flash). To avoid using Adobe’s annoying Download Manager, IE users can grab the latest update directly from this link; the direct link for non-IE browsers is here.

Windows users can furthermore use the Flash Player Settings Manager that is part of the Windows Control Panel to check for updates. Here it is furthermore possible to check the Flash Player version that is installed on the system. The path is Control Panel > Flash Player (32-bit) > Advanced. Users with a 64-bit version of Flash Player installed need to change the 32-bit to 64-bit in the path.

The same flaws exist in Adobe AIR for Windows, Mac and Android. Using an application that requires Adobe AIR (Tweetdeck or Pandora, for example) should prompt you to update to the latest version, AIR 2.7.1. If you don’t see a prompt to update the program, the latest version of AIR is available here.

Adobe also shipped an update to its Shockwave Player that fixes at least seven critical vulnerabilities in the media player program. Adobe is urging users of Adobe Shockwave Player 11.6.0.626 and earlier  update to Adobe Shockwave Player 11.6.1.629.

I should note that you may not have or want Shockwave installed. I haven’t had it on my Firefox installation for some time now and don’t seem to have missed it. I’m sure it has its uses, but to me Shockwave is just another Adobe program that requires constant care and feeding. What’s more, it demands two separate installation procedures for IE and non-IE browsers.

To test whether you have Shockwave installed, visit this page; if you see an animation, it’s time to update. If you see a prompt to install Shockwave, there is no need to install it. Mozilla Firefox users without Shockwave Player installed may still see “Shockwave Flash” listed in the “Plugins” directory of the browser; this merely indicates that the user has Adobe’s Flash Player installed.

 

Google Chrome at 20%

Google Chrome’s rise in popularity has been remarkably fast and it has just hit a new milestone. More than 20% of all browser usage has hit 20 percent market share, according to StatCounter. Net Applications has Chrome cracking 13 percent. Either way, Chrome is growing fast versus IE and Firefox.

Chrome rose from only 2.8% in June 2009 to 20.7% worldwide in June 2011, while Microsoft’s Internet Explorer fell from 59% to 44% in the same time frame. Firefox dropped only slightly in the past two years, from 30% to 28%.

Most Internet researchers agree that Google’s Chrome Web browser is steadily gaining market share at the expense of established rivals, Microsoft Internet Explorer and Mozilla Firefox.

Two top browser researcher disagree on just how much market share Chrome has worldwide. StatCounter said Google claimed 20.7 percent browser share for June, up from 2.8 percent a year ago. Net Applications claimed Chrome actually corralled 13.1 percent, up from 12.5 percent through May.

More broadly, StatCounter said Firefox is next in line to be passed by Chrome at 28.3 percent, with IE at 43.6 percent. On the (much) lower end of the scale, Safari is at 5 percent, with Opera claiming 1.7 percent through the month. Net Applications meanwhile has IE at 53.7 percent, Firefox at 21.7 percent, Safari at 7.5 percent and Opera at the same 1.7 percent. While there is a wide differential between both firms’ figures, it’s clear Chrome is gaining share and momentum.

From Google Chrome officials own lips at Google I/O in May, Chrome had racked up more than 160 million users, up from 120 million in December. If that trend holds true, Chrome should crack the 200 million mark in October. Looking at some numbers based on StatCounter’s stats and guessed Chrome could pass Firefox this November and IE by June 2012. Assuming Chrome’s ascent continues at its average growth rate over the past six months (consider that it took Chrome only two years to hit 10 percent share) Chrome could even hit 50 percent share by November 2012.

Chrome first hit 10% in August 2010 and was still at 19% in May before surpassing 20% in June. If Chrome’s numbers seem a bit high that’s because StatCounter’s method of tracking highlights Google’s strength: attracting power users. Net Applications, another usage tracker, shows Chrome rising fast as well, up to more than 13% usage compared to Microsoft’s 54% and Firefox’s 22%.

“It is a superb achievement by Google to go from under 3% two years ago to over 20% today,” StatCounter CEO Aodhan Cullen said in a press release. “While Google has been highly effective in getting Chrome downloaded the real test is actual browser usage which our stats measure.”

But the groups count differently. While Net Applications tracks a browser’s total number of users, StatCounter measures the total number of website clicks. That means a Chrome user who surfs the Web more often than an Internet Explorer user has more weight in the StatCounter ranking. The discrepancy between the two groups’ findings suggests that users who spend the most time online have switched from Internet Explorer to Chrome or Firefox. There are many reasons for Chrome’s upswing and accelerated release cycles, which means Google is putting snazzy new features that other browsers lack in front of users faster. Case in point: the Chrome Speech capabilities to enable voice search on the desktop.

Chrome advertising and marketing for the browser and Chrome Operating System have also been playing their parts in the growth. Google last year began advertising Chrome on ESPN.com, the New York Times and other high-profile Websites for a year. In May, Google began pushing Chrome as the center of users life experiences, planting a marketing seed for Chrome OS notebooks.

The first Samsung Series 5 Chromebook launched June 15, while it’s unclear how many Series 5 Samsung sold through Amazon.com and Best Buy online. Google made Series 5 Chromebooks vailable for flights as well now. Virgin America is maintaining its reputation as the darling airline of the tech sector, and today it announced a new partnership with Google that will give travelers the option to test Google’s Chromebooks in their flight beginning tomorrow.

The promotion will last until September 30, and passengers will be able to check out a Chromebook at their departure gate and use it freely with Gogo in-flight Internet on their whole flight. In addition to the currently available Chrome apps, Virgin America has co-developed a special Chrome app with Google that includes discussion boards about Virgin America’s trip destinations, city guides based upon data from UrbanDaddy, and information about packing and travel planning. The app will be available in the Chrome Web Store later this month.

Chrome’s rise has been most pronounced in South America where it is the second-most used browser ahead of Firefox and behind Internet Explorer. In the United States, “Chrome has risen to 16% behind market leader IE on 46.5% and Firefox on 24.7%,” StatCounter said. StatCounter measures 15 billion page views per month, including 4 billion from the United States across a network of more than three million websites. Data from Net Applications, which tracks unique visitors to 40,000 websites, show that IE usage dropped from 60.5% in August 2010 to 53.7% in June 2011, while Chrome rose from 7.5% to 13.1% in the same period.

Net Applications also tracks usage of mobile devices, and has found that more than 5% of all Web browsing is now occurring from smart-phones and tablets. The trend toward mobile browsing is even more pronounced in the U.S., where 8.2% of all browsing takes place on mobile devices. Of that, 2.9% of U.S. Web browsing comes on the iPhone, 2.6% on Android devices, and 2.1% on the iPad with BlackBerry next at 0.57%.

That means Apple’s iOS accounts for 5% of U.S. Web browsing, making it the most popular mobile platform.

 

Linux growth climbs and quickens it’s pace

Linux continues it’s ascent to increased visiblity and market dominance.  While looking at Wikipedia analytics, which has a nice entry on Linux adoption by the way, one will find a slight uptick in Linux users and a slight decrease by Windows users.

Linux
  • February 2011 – 2.47%
  • February 2010 – 1.65%
  • Change = +.82% Rate of growth = +50%
Windows
  • February 2011 – 81.96%
  • February 2010 – 86.95%
  • Change = -5% Rate of growth = -5.7%

 

Here are the links.

http://stats.wikimedia.org/archive/squid_reports/2010-02/SquidReportOperatingSystems.htm

http://stats.wikimedia.org/archive/squid_reports/2010-02/SquidReportOperatingSystems.htm

Playing with the numbers, and extrapolating. Let’s see what 50% CAGR does:
  • 2011 1.50%
  • 2012 2.25%
  • 2013 3.38%
  • 2014 5.06%
  • 2015 7.59%
  • 2016 11.39%
  • 2017 17.09%
  • 2018 25.63%
  • 2019 38.44%
  • 2020 57.67%
  • 2021 86.50%

Interesting…and this is with Windows 7 being out on the market.. That’s with a lock on retail shelves for desktops and notebooks in many places. That’s with Wikipedia being much more popular in North America and Europe where M$ is popular. That’s with a lock on business… Much of the recent growth of Linux has been Android/Linux which is mostly on smart phones but, unless you believe that users of smart phones have pressing needs to visit Wikipedia when they are mobile, something else is happening here.

We are starting to see Android on tablets and notebooks, Android is based on a modified Linux kernel and just today Intel’s CEO confirms that they are porting Android 3.0 to x86. http://www.techspot.com/news/43407-intel-ceo-were-porting-android-30-to-x86.html

In August 2010 Jeffrey Hammond, the principal analyst at Forrester Research pronounced: “Linux has crossed the chasm to mainstream adoption.” His declaration was based on the huge number of enterprises that had moved to Linux during the late-2000s recession. In a company survey completed in the third quarter of 2009, 48% of companies surveyed reported using an open source operating system. http://itmanagement.earthweb.com/osrc/article.php/3898206/LinuxCon-Analysts-Linux-Is-Winning.htm

Era of Windows gone, HP pushes WebOS to market

HP’s recent press conference with Linux on center stage, revealed the details of its mobile device strategy. HP announced two new WebOS phones and more importantly an impressive new tablet that is a clear contender against the iPad. While I don’t for one second underestimate Apple, that was not the most interesting part of the event.

The most interesting part of the event came near the end when HP announced that it is going to ship WebOS not only in phones, tablets and printers, but in PC’s as well. In doing so, the worlds largest PC supplier is indicating that they are going to ship PC’s without Windows. For Microsoft – who was nowhere at this event – that has got to hurt. Perhaps this really IS the year of the Linux desktop.

Considering HP is the world’s biggest PC maker, this could have serious reverberations. HP exec Todd Bradley said, “Do the math on two PCs per second. You easily exceed 100 million devices with WebOS deployed annually. That’s the start of something pretty big.”

For investors and developers alike, this is your canary in the coal mine in case you haven’t been paying attention lately. There are very few things in computing that are not made with Linux these days. Linux is the underpinning technology for nearly every sector of the market in every form of computing and everyone uses it daily without even knowing it. Have you used Google for a web search recently? Purchase anything from Amazon or Ebay? All three use Linux exclusively for business operations, system stability and millions of dollars saved. Lost revenue to Microsoft.

The odds are slim that it actually affects Microsoft, but it just shows how little confidence Microsoft’s traditional partners have in Microsoft these days. Dell is working with Google on Android phones and tablets. And now HP is building its own software.

HP is among a number of leading companies who understand that when consumers expect sophisticated devices and innovation is happening super fast, they can’t go it alone. HP could not have untethered itself from Microsoft and created the devices it revealed today or come to market this fast, if it had started from scratch. And, WebOS would not be what it is today without all of the technologies that is provided with Linux and the myriad of projects that make up a typical Linux platform. All the work that goes into these Linux-based mobile devices helps other solutions succeed.

By using Linux to capture what analysts predict will be a $30B market for tablets by 2012, HP is further validating Linux as the foundation from which next-generation mobile devices will run. Companies are choosing Linux because it supports more architectures and more devices than any other OS and is freely available and is able to be custom-branded. No other OS on the market can deliver on all of this.

HP’s decision to build its next-generation of devices on Linux and WebOS is good for HP, good for other Linux-based OSes, and good for the platform. The more companies who are building on Linux, the stronger the platform becomes. We’re looking forward to bringing HP and other community stakeholders together on future Linux and WebOS innovations.

In dealing with the next generation of software and operating system development,  don’t get left behind!

  • Change Happens
    • They Keep Moving The Cheese
  • Anticipate Change
    • Get Ready For The Cheese To Move
  • Monitor Change
    • Smell The Cheese Often So You Know When It Is Getting Old
  • Adapt To Change Quickly
    • The Quicker You Let Go Of Old Cheese, The Sooner You Can Enjoy New Cheese
  • Change
    • Move With The Cheese
  • Enjoy Change!
    • Savor The Adventure And Enjoy The Taste Of New Cheese!
  • Be Ready To Change Quickly And Enjoy It Again
    • They Keep Moving The Cheese.

Trend Micro Clueless on Linux and Android

Summary: The latest statements regarding iOS versus Android, rely on misinformation and ignorance.

The struggling insecurity firm known as Trend Micro has resorted to patent harassment in addition to other dubious activities and according to several reports [123456] like this one, “Trend Micro attacks Open Source”:

Insecurity expert Steve Chang, who is the chairman of Trend Micro, has just declared himself the sworn enemy of the Open Sauce movement by saying that Android is less secure than the iPhone because it is Open Sauce.

Chang claims that because Android was open sauce a hacker could understand the underlying architecture and source code and work out new ways to do it over.

Steve Chang said that you had to give credit to Apple, because they are very careful about it. It’s impossible for certain types of viruses to operate on the iPhone.

A rebuttal has been posted, which states that “the open-source-is-less-secure myth was dispelled more than a decade ago. Take a look at Linux, Apache, Firefox, or Chrome — four huge open-source projects, and all many times more secure than their closed-source brethren (Windows, IIS, Internet Explorer). Open source projects are more secure than closed-source projects due to peer and code review, and vested interest! Trend Micro fails to appreciate that while maybe a handful of people have seen the iOS source, thousands have eyeballed Android’s innards to look for bugs. Don’t forget that Android is also based on Linux, which must be one of the most rigorously tested pieces of software ever made.

“Later in the interview, Chang even goes on to mention the iOS sandbox “that isolates the platform”… which Android also has! This comes a week after Trend Micro released a mobile security app for Android.

Anyway, Chang’s ultimate point is that as smartphones become more intrinsic to our everyday life, their security becomes an ever-growing concern. Smartphones need to be treated as real computers, and locked down in the same way; either by the platform, or with third-party software. There will come a point, in the next few years, when smartphone OSes receive even more attention from malware authors. So, in other words, he is promoting security by obscurity.

So, in other words, he is promoting security by obscurity. That must be the reason why Windows is so secure and while Linux is crawling with virii, right?

Ultimately, I’d dare predicting that users will ultimately end up choosing the platform that has more apps, due to development being much freer and easier and also one that provide you the safest means to navigate the Web.

Here is a comparison of ESET antivirus and a host of other competitors, notice where TrendMicro resides.

“In-the-Wild” viruses are real viruses that have been reported to the Wildlist Organization by at least two independent reporters. When it comes to In-the-Wild virus detection, no one even comes close to ESET as the following chart illustrates. ESET NOD32 has never missed an In-the-Wild virus.

Virus Bulletin tests, May 1998 through December 2010 – www.virusbtn.com

Prediction Google Chrome OS notebooks will be introduced at under $100 in mid-2011

Google in December unveiled a beta version of its Chrome OS notebook, dubbed Cr-48. Google plans to release two, Intel-based Chrome OS notebooks from Acer and Samsung in mid-2011, with Verizon Wireless providing cellular connectivity. No pricing information was released for the upcoming Acer and Samsung devices; Google said its partners will hold their own launch events in the future with more details. Google has announced that it has partnered with Verizon Wireless to provide 3G wide area network (WAN) coverage on every Chrome OS device. Each device will receive 100MB of data for free each month for two years. The Cr-48 has a 1.6 GHz Atom – 64-bit instruction set and hyperthreading but no virtualization bits. Rumors are that the production units will be true dual-core, not hyperthreaded. A machine like that can run a lot more than a browser!

My prediction on pricing will be under $100 and probably about $50.

The reason is that Google can come in below the price of the Amazon Kindle and under the price of many netbooks and most Android tablet PCs.

I think Google will subsidize its hardware partners because it is a thin browser that looks in Google search and advertising. If they can make $10 per month, then a $50 subsidy makes sense.

Google will be able to do the locking of search and browser because it is a dedicated device for that purpose and not like Microsoft Internet Explorer was a locking after the fact to a monopoly OS.

You will be buying a locked in situation and you will know that from the get-go to devices that start with no market share.

Why is there Google Android devices and Google Chrome devices

There are two because they serve different purposes. Google Android is a thicker and more flexible and more open software which is to compete with Apple iPhone and Tablets by using many hardware and software partners.

Google Chrome can go thinner, more closed, better security, less to hack but able to deliver to Google search and advertising domination. Chrome can also require more leverage of the Google cloud solutions (Gmail, Google Docs etc…)

Google can then subsidize based on estimate of the per seat revenue they expect each month or year from another person just playing with Google’s stack.

I think Google will not go totally free right away because there will be need to ramp up production and to not have it perceived a free and disposable.

Cheap Google Chrome OS notebooks could also eventually compete for the $10-20 netbooks for the developing world.

Microsoft is a dying consumer brand

Microsoft is the perfect example of death caused by bureaucracy of large top down organizations….lack of focus, and lack of creativity.

This is what happens when a company thinks it is beyond adhering to open standards and interoperability. If a company thinks it can take them, adjust them and now make them proprietary and still be loved ..it can’t. Surrounding yourself with a wall only succeeds in isolating yourself, not inviting others to join you.

Consumers have turned their backs on Microsoft. A company that once symbolized the future is now living in the past.

Microsoft dominates DESKTOP OS market share. I doubt if it dominates OS market share, considering Android, Symbian, iOS, OSX, Palm, Linux …..

I’ve said this before, but it fits here. Microsoft is a WINDOWS company (with exceptions), it is NOT a technology company. Almost everything they do is for WINDOWS, and WINDOWS is their primary focus. Apple and Google have let Microsoft have the WINDOWS market. They are after other markets, and why they are killing Microsoft in the process.

I’m reminded of an old story, from the late 1800s. The story is about a Railroad Magnate who saw his business as being “railroading”. That was his focus. The problem was, that view was myopic and very short sighted. IF he had a broader viewpoint, saying instead he was in the “transportation” business, he would have able to incorporate automobiles/trucks and aircraft when those came onto the scene.

What business is Microsoft in? It is in the WINDOWS business. THAT is their product, that is their service, that is what they do. That is their Achilles Heel, and why they are dying (Netcraft Confirms it)

Microsoft has been late to the game in crucial modern technologies like mobile, search, media, gaming and tablets. It has even fallen behind in Web browsing, a market it once ruled with an iron fist.

Outgoing Chief Software Architect Ray Ozzie called out Microsoft’s lost ground in a blog post over the weekend. It is the difference between a company that does nothing but milk its market share versus a company that innovates and moves with the market. Sales numbers can be huge and impressive, it says nothing about the long term potential of the company. Ray Ozzies departure addresses this as well.

“Our early and clear vision notwithstanding, [competitors'] execution has surpassed our own in mobile experiences, in the seamless fusion of hardware & software & services, and in social networking & myriad new forms of internet-centric social interaction,”

It’s not like Microsoft didn’t foresee the changes ahead. With a staff of almost 90,000, the company has many of the tech world’s smartest minds on its payroll, and has incubated projects in a wide range of fields that later took off. Experiments like Courier (tablets), HailStorm/Passport (digital identity), and Windows Media Center (content in the cloud) show the company was ahead of the game in many areas — but then it either failed to bring those products to market, or didn’t execute.

“In this age, the race really is to the swift. You cannot afford to be an hour late or a dollar short,” says Laura DiDio, principal analyst at ITIC. “Now the biggest question is: Can they make it in the 21st century and compete with Google and Apple?”

Some influential analysts think not. Several have downgraded Microsoft’s stock in recent weeks, as PC sales continue to slow and Microsoft struggles with its tablet strategy. The company’s stock is down more than 17% this year.

What’s wrong with Microsoft

A rundown of Microsoft’s major consumer projects finds trouble in almost all of them.

Internet Explorer’s popularity has been waning for years, and one recent study showed that for the first time in more than a decade, more people are using alternative browsers, such as Google Chrome and Mozilla Firefox The browser is becoming the single most critical piece of software on a device — potentially eclipsing the operating system — but all of the major innovations of the past few years, like tabbed browsing and add-on extensions, came from outside Microsoft.

Windows Phone 7 has promise, but Microsoft dug itself an enormous hole with the subpar Windows Mobile platform. With its market share currently sitting below 5%, developers are taking a “wait and see” approach.

Microsoft’s media platform Zune was dead on arrival.

Bing is growing, but substantially all of that growth has come at the expense of its business partner, Yahoo — not its arch rival Google.

Microsoft’s attempts to build a social network through Windows Live have failed to gain traction. It has no real answer to Facebook.

Six months after Apple’s release of the iPad, Microsoft still has virtually no presence in the tablet market. And its strategy for taking on Apple — Windows 7 on a tablet, rather than a tablet-specific operating system — is leaving potential partners cold. Lenovo’s technology director recently told PC Mag that his company won’t be building around the platform: “The challenge with Windows 7 is that it’s based on the same paradigm as 1985 — it’s really an interface that’s optimized for a mouse and keyboard.”

With Xbox, Microsoft succeeded at innovating: It created a competitive video game brand for hardcore gamers. But even Xbox was outdueled by Nintendo with the Wii, which outsold Xbox by appealing to casual gamers.

Then there’s the epicenter of the Microsoft universe: Windows. Microsoft likes to point out that its operating system is its biggest consumer brand and Windows 7 has been selling rapidly. Its new version has sold 240 million licenses in a year, making it the fastest-selling OS in Microsoft’s history.

But Windows’ momentum isn’t from consumers. In fact, consumers are a worry for the Windows division, because they have dramatically slowed their purchases of PCs in recent months.

Rather, the fast sales are coming from businesses, which significantly delayed their purchases of new Windows licenses because Windows Vista was bug-ridden mess. Then the recession hit. A years-overdue corporate PC refresh cycle is now happening all at once.

Meanwhile, Microsoft’s executive suite is in turmoil. CFO Chris Liddell, entertainment unit head Robbie Bach, device design leader J Allard and business division chief Stephen Elop have left within the past year. Ray Ozzie joined the exit parade last week.

Consumers matter

Microsoft has a lot of questions to answer, and it will have an opportunity to do so at its Professional Developers Conference in Seattle, which kicks off Thursday.

But PDC, which used to be one of Microsoft’s most important and widely attended conferences, is going to be relatively small this year, with only a few thousand people making the trip, analysts say. PDC’s hottest news this year is about cloud computing — vital to enterprises, but not exactly sexy stuff.

So is this Microsoft’s Waterloo? Will it become the next IBM  — crucially important to businesses but an afterthought for consumers?

“Microsoft is at a transition point, and there is a risk of that happening,” says Al Hilwa, analyst at IDC. “But Microsoft cares much more about consumers than IBM ever did. It’s in its DNA, and it understands that it is necessary to stay relevant. I don’t see Microsoft ever abandoning consumers.”

As Apple has proven, success in consumer products can fuel explosive growth. Apple surpassed Microsoft’s market value earlier this year, and is on pace to eclipse the company in sales for 2010.

And if Microsoft cedes consumer ground, it risks its enterprise stronghold. Businesses are becoming more willing to allow employees to use their personal devices for work purposes, and a growing number of those gizmos are Macs, iPads, iPhones and Android smartphones.

So it’s up to Microsoft to turn that around by being a leader, rather than a follower, in the consumer market.

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