IT|Redux

Bring Your Own Computer

Thursday, January 18th 2007 | Ismael Ghalimi

If we believe Gartner, Total Cost of Ownership for a business class desktop is about $5,000 per year. Over a four-year period, that’s a whopping $20,000. Within large corporations, a disproportionate amount of IT budgets is spent on support and maintenance — up to 90%, to which desktop maintenance is no small contributor. Some CIOs are starting to have issues with such a picture, and are becoming quite creative in coming up with solutions that might significalty accelerate the adoption of Office 2.0 alternatives within the corporate world, much faster than I originally envisioned.

The paradox with corporate desktop and laptop computers is that huge amounts of money are spent on systems that deliver a very poor user experience, especially when compared to computers available at home. Because installing new applications might interfere with existing ones, or create security issues, corporate users are discouraged — if not prevented, from doing it. And because personal computers — especially laptops, might contain sensitive information, all kinds of security measures are put in place, using a mix of funky hardware and poorly-designed software that can very quickly cripple an otherwise perfectly good PC — the same would apply to a Mac by the way, no preferred treatment.

The problem has gotten so bad that some CIOs are willing to reconsider the entire corporate PC model entirely. In the past two weeks, I have met with IT executives from two Global 2000 firms that are experimenting with a completely new model: instead of giving a PC to their employees and being responsible for maintaining it, they are giving them a yearly allowance of $1,000 to $1,500, let them buy whatever they want with it (PC running Windows or Linux, Mac, etc.), and train them to do their own maintenance work on them. They also let them install whichever applications they want, and mainly rely on Web interfaces to provide access to corporate data and services.

Of course, such a model is not yet conceivable within highly-regulated industries. Also, some employees might still require the use of secure desktop or laptop computers that would process locally-stored data. These employees are out of luck for the time being, but they tend to represent a small fraction of the overall employee base, therefore this Bring Your Own Computer model still makes sense from a pure budgeting standpoint.

Both companies I talked to will still give their employees the option of installing Microsoft Office on their self-managed personal computers, mainly because they benefit from corporate licenses that are nowhere as expensive on a per unit basis as what you and I have to pay for it in a retail store. Nevertheless, they are actively looking at Office 2.0 alternatives such as ThinkFree and Zoho, which would provide some interesting benefits, beyond the usual collaboration features that easily come to mind.

First, using online office productivity suites would result in storing all documents online, actually making them more secure than when they reside on a personal computer’s hard drive that could crash or get stolen.

Second, using online applications for doing email and working with documents significantly reduces the risk of getting contaminated by malware that propagates through email attachments and macros. Having been a pure Office 2.0 knowledge worker for more than a year now, I can personally attest that such a benefit holds true. And keep in mind: for an IT manager, less malware means less support, which results in more money to be spent on cool new hardware, software, and services.

Third, having data stored into a corporate account owned by the employer makes it a lot more difficult for the employee to keep it when going to work for a competitor. Of course, the employee could download all her documents at once before tendering her resignation, but it would be fairly easy to log such a thing, and use it in a court of law afterwards.

Last but not least, Office 2.0 applications, because they were designed for the Web from the get go, tend to be easier to integrate with back office systems than their 1.0 counterparts — the Duet team at SAP might disagree, but we’ll leave this to another post. And when it comes to building new business processes on top of existing IT systems, getting the right end-user interface is at least as critical as getting the back-end connectivity to work.

Quite franly, I did not expect that things would move so fast, and I might have found a blue bird — or a couple of them, so it’s too early to tell whether this model will work or not, and at what pace the transition will be made. But let me tell you a story that might help convince you that we might very well be onto something significant here: according to my sources, which were corroborated by Niall Kennedy, our friends up in Redmond are currently building a datacenter that will make Google’s grow pale with envy. Bill’s company is rumored to be spending about half a billion dollars on a mind blowing 1.5 million square feet datacenter — that’s more than 17 football fields, in case you wondered, and 15 times larger than Google’s newest one. I am sure that a Microsoft alternative to iTunes for Zune could use some of that space, but my best guess is that Ray and his folks are building the infrastructure required for launching their very own version of Office 2.0.

Things should get very interesting, very soon…

Entry filed under: Office 2.0

One Comment - Add a comment

1. Frank Daley  |  February 6th, 2007 at 3:39 am

Except that Microsoft continues to lose the confidence of partners and customers. Incidents such as the recent PlaysForSure fiasco have yet again reminded partners that Microsoft only ever cares about itself—and that partners are dispensable.

Microsoft’s major customers have lost their faith in the forced upgrade cycle. Microsoft can no longer attract and/or hold the people that it needs to win. Yes, it will be a player, but not a winner.

It is already years behind Google in the server race, and Google is hardly standing still. The latest feedback from those with their ear to the ground is that Google has numerous new data centers underway, with massive data communications capacity ready for its next big growth spurt.

More than ever, Microsoft is just a follower, and is increasingly desperate to copy segment leaders such as Google and Apple.

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