Tag Archives: Microsoft

Microsoft pushes Windows 10 upgrade using tactic it once called ‘a mistake’

Maker of ‘GWX Control Panel’ tool reports that Windows 7 and 8.1 PCs receiving upgrade as pre-selected ‘Optional’ item in Windows Update

Microsoft has begun to deliver the Windows 10 upgrade to eligible Windows 7 and Windows 8.1 PCs through Windows Update, making good on an October announcement.

A company spokeswoman confirmed that the Windows 10 upgrade is reaching customers’ systems.

More than three months ago, Terry Myerson, the executive who leads the operating system and devices group, said that the Windows 10 upgrade would be pushed to users via Windows Update, the primary maintenance service for its OSes.

At the time, Myerson said that the upgrade would first appear under the “Optional” section in Windows Update, then later transit to “Recommended.” The difference is more than labeling: In Windows Update, “Optional” is supposed to be just that; customers must explicitly check the box for an item for it to automatically download and install. “Recommended” items, on the other hand, will be retrieved and installed unless the user has changed the default settings of Windows Update.

In the past, Microsoft has issued updates and upgrades in that two-step process under which bits first appeared under Optional, then after a month or more — a span Microsoft used to digest diagnostic data from affected PCs to ensure things worked as expected — the same update shifted to Recommended, and reached the majority of users.

It’s unclear whether Microsoft is following the plan it laid out in October: While several prominent bloggers who focus on Microsoft — including Paul Thurrott and ZDNet’s Mary Jo Foley — said that the Windows 10 upgrade had been deployed as Recommended in Windows Update, there was no explicit evidence that that had, in fact, begun.

But the Windows 10 upgrade has appeared under Windows Update’s Optional list, according to Josh Mayfield, the creator of GWX Control Panel. The free utility made Microsoft’s Get Windows 10 (hence “GWX”) upgrade reservation app go away, purged the system of upgrade files, and blocked the automatic upgrade.

Mayfield maintains a multiple-PC pool of test machines to monitor how Microsoft promotes Windows 10. Yesterday, he confirmed that the upgrade showed up under Optional on both Windows 7 and Windows 8.1 PCs.

“As we saw over the summer, it’s listed as an ‘Optional’ update but automatically selected to install, unlike other updates in that category,” said Mayfield in an email reply to questions Tuesday.

Mayfield was referring to events that began in mid-September at the latest, when users noticed “Upgrade to Windows 10 Home” or “Upgrade to Windows 10 Pro,” in Windows Update. Those items appeared in the Optional section of Windows Update’s listing of available patches and fixes. Normally, updates pegged as Optional will not download to a PC — whether automatically or in a manual check — until the user has ticked a box.

But according to users’ reports at the time, Windows Update itself checked the “Upgrade to Windows 10” optional update as eligible for download and installation. Users with Windows Update set to automatically retrieve and install updates — the norm, and the setting recommended by Microsoft — or who did not examine the optional update list, were then served with the Windows 10 upgrade, whether they wanted it or not.

Microsoft quickly issued a statement saying that the checking of the upgrade’s Optional item “was a mistake.”

Mayfield contended that Microsoft has done the same this week by automatically checking the Windows 10 upgrade box. Under those conditions, it mattered not a whit whether the upgrade was listed under Recommended or Optional: The result would be the same. For the vast majority of users, the upgrade would download — if it wasn’t already on the PC, having been pre-loaded under a long-running campaign to place the bits on customers’ devices — and the installation process would begin.

Microsoft has said that users could decline the Windows 10 upgrade once installation began, but has declined to say whether the upgrade starts in all cases, detail how the user authorization process is to play out, and whether — after a customer declines the upgrade — it presents itself again later.

The company has been little help when asked to clarify exactly what began this week for the Windows 10 upgrade on Windows 7 and 8.1 devices.

“We are committed to making it easy for our Windows 7 and Windows 8.1 customers to upgrade to Windows 10,” Microsoft said in a statement forwarded by the firm’s spokeswoman. “We updated the upgrade experience today to help our customers, who previously reserved their upgrade, schedule[d] a time for their upgrade to take place.”

In a follow-up email, the spokeswoman did not directly answer questions Computerworld posed, including whether the Windows 10 upgrade was being placed in Recommended, Optional or both. “This is rolling out in a phased approach which is why you are seeing different reports,” she said.

Mayfield noted that as far as he can tell, Microsoft has honored the registry settings it had earlier said would block the appearance of the Windows 10 upgrade on PCs powered by Windows 7 and 8.1. Those registry tweaks — made by crafting a Group Policy that could be distributed to large numbers of machines — were spelled out in a support document revised last month.

That means Mayfield’s GWX Control Panel will stymie attempts to place the Windows 10 upgrade in Windows Update, as the tool was designed to do. Previously, Mayfield had warned that might not be the case if Microsoft again changed the rules, an increasingly common practice for the company, which, for example, repeatedly issued a Windows 10 reservation app to users who had managed to uninstall it.

“If GWX Control Panel reports ‘No’ for ‘Are Windows 10 Upgrades allowed?’, then the Windows 10 upgrade doesn’t even appear as an option in the Windows Update control panel,” Mayfield reported. Those who download and install GWX Control Panel can block the Windows 10 upgrade from appearing by clicking “Disable Get Windows 10 app,” and then clicking “Prevent Windows 10 Upgrades.”

Earlier this month, Microsoft said that it would expand Windows 10 upgrade distribution to include all systems running Windows 10 Home and Windows 10 Pro — even domain-joined Windows 10 Pro machines in businesses — that receive their security patches directly from Windows Update. It was also unclear today whether Microsoft is serving the upgrade to domain-joined PCs, which were originally exempt from the push, or only to consumers and commercial systems not connected to a network in which administrators use Active Directory to set access rights.

GWX Control Panel can be downloaded from Mayfield’s website free of charge, although he accepts donations from appreciative users.

Microsoft is placing the Windows 10 upgrade on Windows 7 and Windows 8.1 PCs, but pre-selects the download, even though it’s listed as an ‘Optional” update/upgrade. That’s contrary to how Windows Update’s Optional items usually work, and was called a “mistake” by Microsoft when it did the same last year.

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Microsoft will cut some Azure compute prices

The cloud pricing race to the bottom continues

Good news for businesses using Microsoft’s Azure cloud platform: their infrastructure bills may be shrinking come February.

Microsoft announced that it will be permanently reducing the prices for its Dv2 compute instances by up to 17 percent next month, depending on the type of instance and what it’s being used for. Users will see the greatest savings if they’re running higher performance Linux instances — up to 17 percent lower prices than they’ve been paying previously. Windows instance discounts top out at a 13 percent reduction compared to current prices.

Right now, the exact details of the discount are a little bit vague, but Microsoft says that it will publish full pricing details in February when they go into effect. Dv2 instances are designed for applications that require more compute power and temporary disk performance than Microsoft’s A series instances.

They’re the successor to Azure’s D-series VMs, and come with processors that are 35 percent faster than their predecessors. Greater speed also corresponds to a higher price, but these discounts will make Dv2-series instances more price competitive with their predecessors. That’s good news for price-conscious users, who may be more inclined to reach for the higher-performance instances now that they’ll be cheaper.

The price changes come after Amazon earlier this week introduced scheduled compute instances, which let users pick out a particular time for their workloads to run on a regular basis, and get discounts based on when they decide to use the system. It’s a system that’s designed to help businesses that need computing power for routine tasks at non-peak times get a discount.

Microsoft’s announcement builds on the company’s longstanding history of reducing prices for Azure in keeping with Amazon’s price cuts in order to remain competitive. Odds are we’ll see several more of these cuts in the coming year as the companies continue to duel to try and pick up new users and get existing users to expand their usage of the cloud.

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Apple surpasses Microsoft….in vulnerabilities

Wipe that smug look off your face, Apple owners, Microsoft products are a lot safer

For years, Apple users taunted Windows users for all of the malware and security vulnerabilities that plagued the various Windows operating systems. Well, things have changed a bit. Mac OS and iOS now have more vulnerabilities than Windows.

The tabulation comes by way of CVE Details (Common Vulnerabilities and Exposures), which draws on security vulnerabilities reported to the National Vulnerabilities Database, which is run by the U.S. government.

Apple led the way in 2015, with a total of 384 vulnerabilities for Mac OS X, closely followed by iOS with 375. Adobe held the next four spots, with three going to AIR (with AIR, the AIR SDK and AIR SDK and compiler) at 246 each, followed by Internet Explorer at 231. Google Chrome was next with 187 vulnerabilities, followed by Firefox at 178, which just shows that despite decades on the market, browsers are still a mess.

The highest-ranking Microsoft operating system was, in fact, Windows Server 2012 at 155 vulnerabilities. Windows 7, 8 and 8.1 had 147, 146 and 151, respectively. After that it was a mix of Acrobat, Linux and other products.

Now, you may note the three Windows desktop operating systems combined come out to 444, except that if you ever look at the patches Microsoft issues, they are common across all of the operating systems. That’s why there’s only a tiny difference between the three versions.

Vista also made the list, with 135 vulnerabilities, putting it fairly close to its newer versions. So there is overlap. The same applies to the three Adobe AIR entries. Not sure why they split them out but the fact that all three had the exact same vulnerabilities means they were common to all three versions.

It does not help that the Mac OS X platforms are not broken out while Windows versions are. That’s probably because there are so many versions of Mac OS X out there.

Steam Analytics lists 10 different versions of Mac OS X, each with tiny percentages of market share. And in fairness, while iOS has a lot of vulnerabilities, none of them are as nasty as the ones found on Android, like the malvertising that could destroy your phone or the Stagefright 2.0 virus.

Which is the silver lining for the Mac and its poor showing. It’s important remember that it’s not purely the number of vulnerabilities that matter but the severity of them. The vulnerabilities list is just the total number reported, not how bad they are. A bunch of minor stack overflows is nothing compared to malware that completely takes over your system.

But the Apple faithful can no longer make claims to being bulletproof.

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2015 technology industry graveyard

2015 technology industry graveyard

Cisco, Microsoft, Google and others bury outdated technologies to move ahead with new ones.

The Technology Industry Graveyard is pretty darn full in 2015, and we’re not even including the near-dead such as RadioShack and Microsoft’s IE browser. Pay your respects here…

The self-described “World’s Music Library” is no more after shutting down in April in the wake of serious legal pressure by music companies whose songs GrooveShark allowed to be shared but had never licensed. Apple and Google had each kicked GrooveShark out of their app stores years ago due to complaints from music labels. Much more sadly than the 9-year-old company’s demise, however, was the death of co-founder Josh Greenberg in July at the age of just 28.

Typo iPhone keyboard
Not even the glamor of being co-founded by American Idol host Ryan Seacrest could help Typo Innovations save its iPhone keyboard, which BlackBerry said infringed on its patents. So instead, Typo bailed on the iPhone model and settled for selling ones for devices with screens 7.9-inches or larger (like iPads).

Amazon Fire Phone
With a product name like Fire, you’re just asking for colorful headlines if it bombs. And indeed, Amazon has stopped making its Fire Phone about a year after introducing it and media outlets were quick to highlight the company “extinguishing” it or remarking on the phone being “burnt out.” Amazon has had some success on the hardware front, namely with its Kindle line, but the Fire just didn’t distinguish itself and was going for free with a carrier contract by the end.

Interop New York
Interop Las Vegas carries on as one of the network industry’s top trade shows next May, but little sibling Interop New York is no more this year. The Fall show, traditionally held at the Javits Center since 2005, was always smaller and was discontinued for 2015 despite lively marketing material last year touting “More Than 30 Interop New York Exhibitors and Sponsors to Make Announcements in Anticipation of the Event.”

Google ditched so many things in 2015 that we devoted an entire slideshow to Google’s Graveyard. So to choose just one representative item here, we remember Google Talk, which had a good run, starting up in 2005. But it’s never good when Google pulls out the term “deprecated” as it did in February in reference to this chat service’s Windows App. Google said it was pulling the plug on GTalk in part to focus on Google Hangouts in a world where people have plenty of other ways to chat online. However, Google Talk does live on via third-party apps.

Cisco Invicta storage products
Cisco has a good touch when it comes to acquisitions, but its $415 mlllion WHIPTAIL buyout from 2013 didn’t work out. The company in July revealed it had pulled the plug on its Invicta flash storage appliances acquired via that deal. It’s not unthinkable though that Cisco could go after another storage company, especially in light of the Dell-EMC union.

The once-popular file hosting system, begun in 2002, couldn’t withstand the onslaught of competition from all sides, including Google and Dropbox. Back in 2009, the Switzerland-based operation ran one of the Internet’s 20 most visited websites, according to Wikipedia. It shut down on March 31, and users’ leftover files went away with it.

Windows RT devices
This locked-down Microsoft OS for tablets and convertible laptops fared about as well as Windows 8, after being introduced as a prototype in 2011 at the big CES event in Las Vegas. Microsoft’s software for the 32-bit ARM architecture was intended to enable devices to exploit that architecture’s power efficiency, but overall, the offering proved to be a funky fit with existing Windows software. Production of RT devices stopped earlier in 2015 as Microsoft focuses on Win10 and more professional-focused Surface devices.

OpenStack vendor Nebula
As Network World’s Brandon Butler wrote in April, Nebula became one of the first casualties of the open source OpenStack cloud computing movement when it shuttered its doors. The company, whose founder was CIO for IT at NASA before starting Nebula in 2011, suggested in its farewell letter that it was a bit ahead of its time, unable to convert its $38 million in funding and hardware/software appliances into a sustainable business.

Facebook bought this social news and information feed aggregator in 2009, two years after the smaller business started, and then killed it off in April. People have moved on to other means of gathering and discovering info online, so FriendFeed died from lack of use. It did inspire the very singular website, Is FriendFeed Dead Yet, however, so its legacy lives on.

Apple Aperture
Apple put the final nails in its Aperture photo editing app in 2015, ending the professional-quality post-production app’s 10-year run at Version 3.6. In its place, Apple introduced its Photos app for users of both its OS X Mac and iOS devices.

One of the co-founders of anonymous sharing app shared this in April: The company was shutting down and returning whatever part of its $35 million in funding was left. The company’s reality was just not going to meet up with his vision for it, said co-founder David Byttow. The company faced criticism that it, like other anonymous apps such as Yik Yak, allowed for cyberbullying.

Amazon Wallet
Amazon started the year by announcing its Wallet app, the company’s 6-month-old attempt to get into mobile payments, was a bust. The app, which had been in beta, allowed users to store their gift/loyalty/rewards cards, but not debit or credit cards as they can with Apple and Google mobile payment services.

Circa News app
Expired apps could easily fill an entire tech graveyard, so we won’t document all of their deaths here. But among them not making it through 2015 was Circa, which reportedly garnered some $4 million in venture funding since starting in 2012 but didn’t get enough takers for its app-y brand of journalism.


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Microsoft has built software, but not a Linux distribution, for its software switches

A Microsoft Linux distribution would be remarkable, but Redmond says it doesn’t have one.

Late last week, hell had apparently frozen over with the news that Microsoft had developed a Linux distribution of its own. The work was done as part of the company’s Azure cloud platform, which uses Linux-based network switches as part of its software-defined networking infrastructure.

While the software is real, Microsoft isn’t characterizing it as a Linux distribution, telling us that it’s an internal project. That’s an important distinction, and we suspect that we’re not going to see a Microsoft Linux any time soon.

The Open Compute Project (OCP), of which Microsoft is a member, is an industry group that is working together to define hardware and software standards for data center equipment. This includes designs for high-density compute nodes, storage, and networking equipment. One part that Microsoft has been working on is network hardware, in particular, software-defined networking (SDN). SDN adds a layer of software-based programmability, configuration, and centralized management to hardware that is traditionally awkward to manage. Traditional network switches, even managed ones, aren’t designed to enable new policies—alterations to quality-of-service or VLANs, say—to be deployed to hundreds or thousands of devices simultaneously. And to the extent that such capabilities are present, they vary from vendor to vendor.

Earlier this year, Microsoft, Dell, Mellanox, Facebook, Broadcom, and Intel contributed a specification, the Switch Abstraction Interface (SAI), that provides a common API that can span the wide range of ASICs (application-specific integrated circuits—chips tailored to handle very specific workloads, in this case, handling Ethernet frames) used in software-defined switch hardware. The SAI API is, in principle, cross-platform, defined for both Windows and Linux, but much of the switch hardware is supported best, or even exclusively, in Linux. A Linux distribution to support these applications, Open Network Linux, has even been developed.

The Azure Cloud Switch, which is what Microsoft announced on Friday, is Redmond’s software-defined switch. It builds on the SAI API to enable it to work with switch hardware from many different vendors; in August, an ACS switch using six different vendors’ switch ASICs was demonstrated. ACS is built on top of a Linux SAI implementation, and it uses Linux drivers for the switch ASICs.

Given Linux’s dominance in this area, it’s at once both surprising and unsurprising that ACS uses Linux. Unsurprising because there’s little practical alternative for this situation; surprising because Microsoft is still assumed to have some degree of hostility toward Linux. The company today would tell you that this hostility is a thing of the past. Microsoft would say today it’s willing to use the best tool for the job and work to ensure that its software is available on the platforms that people need it on. With this new, more pragmatic Microsoft, the use of Linux should be expected. And accordingly, Microsoft says that it is using this software in its own datacenters. Microsoft has publicly used non-Windows infrastructure before—some Skype infrastructure initially used Linux, for example, and Hotmail ran on FreeBSD when it was bought—but this is nonetheless unusual, as it’s new Microsoft development, not a bought-in project.

So why isn’t the company calling this new endeavor a distribution? The big reason is that the company doesn’t intend to distribute it. Again, it’s an internal development that showcases the OCP approach, but it isn’t a package that will be given to third parties.

Microsoft’s diagram describing ACS might also be significant; the Microsoft components are a set of applications and services that sit above SAI; that’s a chunk of software, but everything else could be taken from an off-the-shelf Linux distribution (Microsoft hasn’t specified). Another confounding factor could be the various switch ASIC components. Each vendor’s ASICs have their own drivers and SDKs, and at least some of these are not open source. This would make it difficult to build a Linux distribution around them.

As such, hell likely remains toasty and warm, and Microsoft won’t be in the Linux distribution business any time soon. But equally, it’s clearer than ever that this isn’t the Microsoft of the 2000s. If Linux is the best tool for the job, Microsoft is willing not only to use it, but to tell the world that it’s doing so.


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Microsoft, U.S. face off again over emails stored in Ireland

The company has refused to turn over to the government the emails stored in Ireland

A dispute between Microsoft and the U.S. government over turning over emails stored in a data center in Ireland comes up for oral arguments in an appeals court in New York on Wednesday.

Microsoft holds that an outcome against it could affect the trust of its cloud customers abroad as well as affect relationships between the U.S. and other governments which have their own data protection and privacy laws.

Customers outside the U.S. would be concerned about extra-territorial access to their user information, the company has said. A decision against Microsoft could also establish a norm that could allow foreign governments to reach into computers in the U.S. of companies over which they assert jurisdiction, to seize the private correspondence of U.S. citizens.

The U.S. government has a warrant for access to emails held by Microsoft of a person involved in an investigation, but the company holds that nowhere did the U.S. Congress say that the Electronics Communications Privacy Act “should reach private emails stored on providers’ computers in foreign countries.”

It prefers that the government use “mutual legal assistance” treaties it has in place with other countries including Ireland. In an amicus curiae (friend of the court) brief filed in December in the U.S. Court of Appeals for the Second Circuit, Ireland said it “would be pleased to consider, as expeditiously as possible, a request under the treaty, should one be made.”

A number of technology companies, civil rights groups and computer scientists have filed briefs supporting Microsoft.

In a recent filing in the Second Circuit court, Microsoft said “Congress can and should grapple with the question whether, and when, law enforcement should be able to compel providers like Microsoft to help it seize customer emails stored in foreign countries.”

“We hope the U.S. government will work with Congress and with other governments to reform the laws, rather than simply seek to reinterpret them, which risks happening in this case,” Microsoft’s general counsel Brad Smith wrote in a post in April.

Lower courts have disagreed with Microsoft’s point of view. U.S. Magistrate Judge James C. Francis IV of the U.S. District Court for the Southern District of New York had in April last year refused to quash a warrant that authorized the search and seizure of information linked with a specific Web-based email account stored on Microsoft’s premises.

Microsoft complied with the search warrant by providing non-content information held on its U.S. servers but filed to quash the warrant after it concluded that the account was hosted in Dublin and the content was also stored there.

If the territorial restrictions on conventional warrants applied to warrants issued under section 2703 (a) of the Stored Communications Act, a part of the ECPA, the burden on the government would be substantial, and law enforcement efforts would be seriously impeded, the magistrate judge wrote in his order. The act covers required disclosure of wire or electronic communications in electronic storage.

While the company held that courts in the U.S. are not authorized to issue warrants for extraterritorial search and seizure, Judge Francis held that a warrant under the Stored Communications Act, was “a hybrid: part search warrant and part subpoena.” It is executed like a subpoena in that it is served on the Internet service provider who is required to provide the information from its servers wherever located, and does not involve government officials entering the premises, he noted.

Judge Loretta Preska of the District Court for the Southern District of New York rejected Microsoft’s appeal of the ruling, and the company thereafter appealed to the Second Circuit.



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Microsoft’s rollout of Windows 10 gets B+ grade

General vibe of the new OS remains positive, say analysts

Microsoft has done a good job rolling out Windows 10 in the first two weeks, analysts said today, and the general vibe for Windows 8’s replacement has been positive, even though glitches have dampened some enthusiasm.

“If I had to give Microsoft a letter grade, it would be a B or a B+,” said Steve Kleynhans of Gartner. “It’s not an A because it hasn’t gone perfectly. They’ve stubbed their toe over privacy issues, for example.”

Microsoft began serving up the free Windows 10 upgrade late on July 28, giving participants in the firm’s Insider preview program first shot at the production code. It then slowly began triggering upgrade notices on Windows 7 and 8.1 machines whose owners had earlier “reserved” copies through an on-device app planted on their devices this spring.

The Redmond, Wash. company has said little of the rollout’s performance other than to tout that 14 million systems were running Windows 10 within 24 hours of its debut.

Estimates based on user share data from U.S. analytics company Net Applications, however, suggests that by Aug. 8, some 45 million PCs were powered by Windows 10.

Analysts largely applauded the launch. “As far as the roll-out, it’s not any worse than any other Windows,” said Kleynhans. “But it’s all happening at this compressed timetable.

“And social media now amplifies any problems,” he continued, much more so than three years ago when Windows 8 released, much less in 2009, when Microsoft last had a hit on its hands.

Others were more bullish on Microsoft’s performance. “Windows 10’s go-to-market was really quite good,” said Wes Miller of Directions on Microsoft, a research firm that specializes in tracking the company’s moves.

Miller was especially impressed with Microsoft’s ability to make customers covet the upgrade. “Something Microsoft has not always done a great job of is creating a sense of exclusivity,” said Miller. “But they’re withholding [the upgrade] just enough that there’s a sense of excitement. People are saying, ‘I want it, I’m not getting the upgrade yet.’ Arguably, that exactly what Microsoft wants.”

Windows 10’s rollout has departed from those of past editions in significant ways.
Historically, Microsoft released a new Windows to its OEM (original equipment manufacturer) partners first, who were given months to prepare new devices pre-loaded with the operating system. Only when the computer makers were ready did Microsoft deliver paid upgrades to customers who wanted to refresh their current hardware. Relatively few users paid for the upgrades; most preferred to purchase a new PC with the new OS already installed.

This cycle, Microsoft gave away the Windows 10 upgrade to hundreds of millions of customers — those running a Home or Pro/Professional edition of Windows 7 or Windows 8.1 — to jumpstart the new OS’s adoption. With some exceptions, the upgrade hit before OEMs had prepared new devices or seeded them to retail.

Because of the large number of customers eligible for the free upgrade, Microsoft announced it would distribute the code in several waves that would take weeks (according to Microsoft) or months (the consensus of analysts) to complete. While some had predicted that the upgrade’s massive audience would stress the delivery system Microsoft had built, or even affect the Internet at large, neither happened.

The “Get Windows 10” app — which was silently placed on PCs beginning in March — not only served as a way to queue customers for the upgrade, but also ran compatibility checks to ensure the hardware and software would support the new operating system, another slick move by Microsoft.

“Microsoft rolled out Windows 10 to the audience that would be most receptive,” said Patrick Moorhead, principal analyst at Moor Insights & Strategy, referring to the Insiders-get-it-first tactic. “Then they rolled it out to those who weren’t Insiders, but who had expressed a desire to get the upgrade. And only those [whose devices] passed all of its tests got it. That was a smart thing to do.”

The latter was designed to limit upgrade snafus, something Microsoft has chiefly, although not entirely, accomplished. “While the rollout was pretty clean, there have been glitchy issues here and there,” said Kleynhans, who cited post-Windows-10-upgrade updates that crippled some consumers’ machines.

Moorhead echoed that, highlighting the out-the-gate problem many had keeping Nvidia’s graphic drivers up-to-date as Microsoft’s and Nvidia’s update services tussled over which got to install a driver. “Problems have been more anecdotal than system-wide,” Moorhead said. “And they seem to get remedied very quickly.”

The bungles haven’t been widespread enough to taint the generally favorable impression of Windows 10 generated by social media, news reports and Microsoft’s PR machine, the analysts argued.

“Overall, I’d say Windows 10 has received a much more positive reception than other [editions of] Windows,” said Moorhead, who said the reaction was justified, since the developing consensus is that Windows 10 is a big improvement over its flop-of-a-predecessor, Windows 8.

“The vibe is positive, but it’s much more about consumers now than businesses,” said Directions’ Miller. Enterprises, he said, will take a wait-and-see approach — as they always do — before jumping onto Windows 10, as they must if they’re to stick with Microsoft, a given since there isn’t a viable alternative.

A credible reaction from corporate customers, Miller continued, won’t be visible until Microsoft finishes unveiling its update tracks, called “branches,” particularly the “Long-term servicing branch” (LTSB). That branch will mimic the traditional servicing model where new features and functionality will be blocked from reaching systems that businesses don’t want to see constantly changing.

“People are liking what they are getting out of the other end” of the upgrade, added Kleynhans. “From what I’ve heard, they’re happy, surprisingly happy, and generally pretty positive about the OS. But I’d expect the new shine to wear off after the first couple of weeks.”

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Microsoft buys sales-gamification startup with eye to CRM combo

Microsoft has acquired Incent Games and plans to integrate the Texas startup’s FantasySalesTeam sales-gamification software into Dynamics CRM.

Terms of the deal were not disclosed.

Adding the fantasy sports component to its CRM offering will give companies a tool to make incentive programs for sales staff more engaging, according to Bob Stutz, corporate vice president for Microsoft Dynamics CRM, in a who discussed the news in a blog post.

Microsoft will integrate the platform into its own Dynamics CRM software in the coming months, Stutz said. It will also continue to support customers using FantasySalesTeam with other CRM products.

However, the move drew some derisive commentary from at least one analyst.

“Are they kidding?” said Denis Pombriant, managing principal at Beagle Research Group, via email. “Let’s see, for many years and even centuries, we have incentivized sales people with money (the carrot) and job loss (the stick). That wasn’t enough? Really?”

The real problem with incentives is the difficulty in individualizing and applying them across a product line that contains more than one product, and that can’t be solved with gamification, Pombriant said.

Rather, it’s a big data problem, he suggested, and it can be solved by comprehensive compensation-management systems such as what’s offered by companies like Xactly and Callidus.

“We spend all kinds of effort and resources trying to squeeze more productivity out of sales reps,” Pombriant said. “It makes little sense to me to introduce a game system that takes their attention away from the business at hand rather than pursuing results.”

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Windows revenue takes another bad beating

Third consecutive quarter of double-digit declines, but CEO is confident Windows 10 will ‘restore growth’

Microsoft on Tuesday said that Windows revenue again declined by double digits, the third straight such quarter, with sales of licenses to computer makers down 22% from the same period last year.

For the June quarter, Windows revenue from OEMs (original equipment manufacturers) was off $683 million relative to the same three-month span in 2014, making the decline for the fiscal year — Microsoft’s ended on June 30 — approximately $1.9 billion.

The bulk of Windows’ revenue comes from sales to OEMs, which pre-load the operating system on PCs, 2-in-1s, tablets and a few smartphone models. In the past, Microsoft has said 65% to 72% of Windows revenue stemmed from OEM sales.

Second quarter revenue from OEMs was down 27% for what Microsoft calls the “non-Pro” category and off 21% for the “Pro” class. The terms refer to the kind of Windows license, with non-Pro indicating the OS for consumer PCs and tablets, and Pro for devices targeting businesses. In Windows 10, for instance, the former will be Windows 10 Home while the latter will be Windows 10 Pro.

The declines of both non-Pro and Pro were both slightly larger than for the first quarter of 2015.
Microsoft blamed the consumer licensing downturn on slack in the sales channel as OEMs prepared devices for Windows 10, a 180-degree turn from the prior quarter, when it said the channel was still stuffed with PCs left over from the holidays.

“OEMs tightly managed PC inventory ahead of the Windows 10 launch, particularly in developed markets,” said CFO Amy Hood in prepared remarks during the front end of an earnings call with Wall Street Tuesday. “In our view, this is a healthy state for the channel as we head into a transformational launch that starts next week,” she added, referring to the July 29 debut of Windows 10.

Hood returned to the scaled-back OEM inventories when she responded to a question about whether Windows 10 would make up some of its second-quarter declines caused by the emptying retail sales channel. “Before every launch, we tend to have a tightening in the channel as they prepare and run reasonably lean,” Hood answered. “This is a healthy state. It’s within the range of normal.”

Meanwhile, Hood said Pro license revenue was still hamstrung by the tough comparisons in 2014 when sales of business PCs jumped as companies purged Windows XP — which was retired in April of that year — from their organizations. Microsoft has used XP as the whipping boy for the last several reporting periods, and gave the 2001 OS a few more licks Tuesday.

Also in play, although not stressed much by Microsoft, perhaps because it’s a broken record: The underlying problems of the PC industry, which continued a 14-quarters-and-counting contraction, and seems destined to be almost entirely a replacement market, with little signs of any meaningful growth down the line.

Both Hood and CEO Satya Nadella, who was also on the call, spun the Windows declines as less about the loss of revenue in the quarter just past and more about the opportunities ahead with Windows 10.

“With Windows 10, we expect momentum to build throughout the year, as we and our partners bring new devices, applications, and services to market,” said Hood. “We expect this to benefit our business results in the second half of the fiscal year.” Microsoft’s fiscal year runs from July to the following June, so Hood was referring to the first half of 2016.

Nadella pitched in as well. “Our aspiration with Windows 10 is to move people from meeting to choosing to loving Windows,” he said, repeating remarks he made earlier this year.

Not surprising — because it’s part of every CEO’s job description, no matter what industry or under what circumstances — Nadella was confident Windows 10 would turn around the company’s OS fortunes, if not in direct licensing revenue then in sales of after-market services and software, and advertising opportunities in its Bing search site.

“While the PC ecosystem has been under pressure recently, I do believe that Windows 10 will broaden our economic opportunity and return Windows to growth,” Nadella said. He touted the large number of devices and configurations in the testing process for Windows 10 certification, most of which won’t be available until later this year, as well as some revenue and gross margin growth possibilities from Microsoft’s own hardware, primarily the Surface Pro portfolio.

“Third, we will grow monetization opportunities across the commercial and consumer space,” Nadella pledged. “For consumers, Windows 10 creates monetization opportunities with store, search, and gaming.”

The three money-makers Nadella ticked off were the same ones Hood outlined to financial analysts in May, when she fleshed out the firm’s “Windows as a service” monetization strategy. Microsoft intends to shift revenue generation from its decades-long practice of licensing Windows to one more reliant on revenue from search ads within Bing results, gaming and apps sold through the Windows Store.

That strategy has led Microsoft to a number of radical decisions, including giving away Windows licenses to smartphone and small tablet makers — a move that hasn’t done much for the OS’s share in those categories — subsidizing Windows to makers of cut-rate notebooks, and most importantly for Windows 10, giving away upgrades to the new OS from Windows 7 and Windows 8.1.

The biggest contributor to that money-making strategy in the June quarter was clearly Bing. In a filing with the U.S. Securities and Exchange Commission (SEC), Microsoft said that Bing search advertising revenue had increased 21%, or $160 million, in the second quarter compared to the same period the year prior. Adding Cortana, Microsoft’s digital assistant and prognosticator, to Windows 10 was also part of the plan to increase Bing’s importance to the OS — which features strong links to the search engine in multiple components, including the new Edge browser — and use Windows 10 to drive the search service’s revenues.

While the growth in Bing ad revenue was less than a fourth of the decline in Windows revenue during the quarter, it was something.
Microsoft said nothing in the SEC filing about app revenue — perhaps because it remains minuscule — but it did boast of a $205 million increase, representing a 58% boost, from Xbox Live, its subscription-based multi-player network. Xbox Live is baked into Windows 10, and Microsoft has pinned significant revenue hope on the OS and Xbox Live reinvigorating the company’s PC gaming business, with the monetization angle coming from the ties between the two platforms — console and PC — and sales of and on the former since the service will be free on PCs and tablets running Windows 10.

“Gaming is an important scenario for Windows 10, and our success with Xbox this quarter gives us a strong starting position heading into launch,” said Nadella Tuesday.

And he remained glass-half-full. “We are confident that these are the right levers to revitalize Windows and restore growth,” Nadella said.

In general, Microsoft’s second quarter was a mess because of $8.4 billion in charges and layoffs in its phone division, resulting in the biggest-ever single-quarter loss and the first since 2012.

Microsoft took a $3.2 billion net loss for the quarter, compared to a $4.6 billion net profit for the second quarter of 2014, a $7.8 billion flip.

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Windows 10 to run rings around customers

Microsoft talks up release cadence rings within the consumer-oriented Current Branch; promises at least one fast, one slower

Microsoft’s top operating system executive today confirmed that the two main Windows 10 update and upgrade “branches” will offer customers multiple “rings,” or tempos, that they can select to receive changes quickly or after they’ve been tested by others.

“We won’t be updating every Windows consumer device on the second Tuesday of the month,” said Terry Myerson, who leads the Windows and Device Group. “We’re going to let consumers opt into what we’re calling ‘rings.’ Some consumers just want to go first. And we have consumers that say, ‘I’m okay not being first.'”

Myerson spoke during the Monday keynote that opened Microsoft’s Worldwide Partner Conference (WPC) in Orlando, Fla.

Customers who want to opt in to a “fast” ring on the Current Branch — the Windows update track geared towards consumers running Windows 10 Home — will receive updates first, while those who adopt the “slow” ring will get slightly more stable and reliable code later. There may be other rings, but those were the two that Myerson mentioned.

The fast-slow ring approach debuted with the Windows Insider Program, the preview and testing deal that kicked off in October 2014.

While Myerson had said in May that the Current Branch for Business (CBB), the primary release track for Windows 10 Pro users, and one that Windows 10 Enterprise can also adopt, would feature rings he had not said the same about consumers’ CB. Computerworld and some analysts had assumed that the two tracks — CB and CBB — would each offer at least two rings when the new OS launched July 29.

“Once Windows 10 ships, rings won’t determine how many updates you get, but rather your place in the queue to get a new update,” explained Steve Kleynhans of Gartner in a recent interview. “As such, rings will be more about controlling the rate at which the updates flood out into market.”

Windows Insider participants have been placed on the slow ring by default, requiring users to reset an option to get on the faster cadence. It’s unknown whether the same slow-is-the-default setting will be used on the final edition’s CB and CBB tracks.

There are still unanswered questions about Windows 10’s update and upgrade pace, including the lag between fast and slow, but Microsoft has slowly been dribbling out details. There will be several tracks, including Insider — which will continue to serve the adventurous with previews — Current Branch, Current Branch for Business, and Long-term Service Branch (LTSB), a static channel that delivers only security patches and critical bug fixes. LTSB does not offer the feature and functionality, user interface (UI) and user experience (UX) changes the others will receive three times annually.

The plethora of branches and rings, and their staggered releases — which will result in a 16-month active lifespan for any one build because of delayed deployment options for CBB users — has raised questions about fragmentation that could affect developers and support teams, or make management more complicated for corporate IT staffs.

Analysts, however, have largely discounted such concerns, saying that while Windows 10 will create some fragmentation, ultimately it will create a more uniform ecosystem than the current Windows scene.

“For customers and developers, it won’t be too different than targeting all the Windows versions and service packs that they have to today,” agreed Gary Chen, an analyst at IDC. “”There are really only four rings that matter, [the two each in] CB and CBB, and a business may only be concerned about CBB, so that’s effectively two rings to manage, not a big change from what they support today.”

Today, Myerson again denigrated what he dubbed “selective patching” to make a less-than-subtle pitch for adoption of CCB served by the new Windows Update for Business (WUB) service. “This introduces costs, complexities and delays,” Myerson said of selective patching and updating. “In today’s threat environment, that’s a problem.” WUB will deliver all update changes, eliminating the pick-a-patch practice used by many IT administrators for decades. (Shops on CBB may also use the traditional WSUS — Windows Server Update Services — to selectively deploy updates.)

Myerson also reiterated the strategy of Windows 10, which Microsoft has characterized as “Windows as a service,” by emphasizing the continual updates and upgrades that will reach customers. “We’re committed to continuous upgrades of [the] Windows device base,” he said.

While Myerson also used the phrase the supported lifetime of the device today in talking about updates, he did not define it. That phrase has been dissected since its first use in January because it will restrict the time that free updates and upgrades will be offered to Windows 10. Late last month, the Redmond, Wash. company said that device lives would range from two to four years.

In that disclosure — a footnote on a presentation outlining how Microsoft will defer some revenue from Windows 10 — Microsoft said the device lifetime would be calculated on “customer type,” hinting that it would separate consumer and business device owners, probably by sniffing out the edition of Windows 10 running on the device.

What still remains unclear is which devices will receive feature/functionality and UI/UX updates and upgrades for the minimum of two years, which get the maximum of four, and which are part of an in-between span.


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