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July 27, 2006

Microsoft just can’t resist dabbling in hardware design

Posted by David Hunter at 2:10 PM ET.

Jay Greene and Peter Burrows, with Steve Hamm at BusinessWeek online:

A How-To kit for the ideal PC has been making the rounds of leading design shops. It calls for “accelerated curves” and “purposeful contrast.” The preferred colors include a shade of black called Obsidian and a translucent white dubbed Ice. “We want people to fall in love with their PCs, not to simply use them to be productive and successful,” reads the enclosed booklet. “We want PCs to be objects of pure desire.”

Doesn’t sound much like Microsoft (MSFT), does it? But it is. BusinessWeek has learned that a team of 20 in-house designers has been working quietly for the past 18 months on an elegant new look for PCs that will run Microsoft’s next operating system, Windows Vista. It’s a major departure for the company, which historically has left design to the likes of Dell (DELL), Hewlett-Packard (HPQ), and Gateway (GTW). Persuading the hardware guys to embrace the toolkit won’t be easy. They’re already working overtime to build better-looking gear on their own.

Microsoft for years has pushed their functional specifications on OEMs via the Windows Hardware Engineering Conferences and other mechanisms, but style?

Microsoft is no newcomer to hardware design, of course. The company has made PC mice and keyboards for years. The Xbox game console has been a hit. Microsoft is working on a music player, Zune, that it hopes will rival the iPod.

Microsoft’s mice and keyboards are nicely done, but they’re a niche and the Xbox 360 was created with significant outside design help. I expect that the same is true for the Zune, so it’s not quite clear exactly what Microsoft brings to the table. More to the point, the PC business has some tough cost strictures:

But trying to transform the PC ecosystem—even peripherals makers such as Logitech received the kit—takes things to a whole new level. It reflects the fact that the economics of the computer business is changing. The PC world used to be divided into two camps: those who made lucrative software and the poor schlubs who built the low-margin hardware it ran on.

Apple has turned that model on its head. From the beginning it has managed to create a unified design for its products by building everything itself, first with the Mac and then later with the iPod. Although Apple sells one computer for every 20 PCs, the iPod’s success has proved how crucial it is to create a seamless experience for consumers, who are buying much of the gear these days. Says a top PC design executive: “You’re going to see more and more of this desire to integrate hardware and software.”

I’ll buy that, but it’s not clear to me how a color scheme will make the experience seamless – I would have thought the seamless part would start a little closer to Redmond. Besides, if you really want something snappier than a beige box, you don’t have to look too far (e.g. [1] if you like bright lights). It sounds more like Microsoft is worried that the OEMs aren’t following their functional “suggestions” in lockstep and the styling suggestions are just a bonus.

Hit the link for much more, but the big PC makers aren’t exactly jumping for joy at the chance to further commoditize their products. When all Windows PCs are the same except for the manufacturer’s logo, their margin inevitably goes to zero. I do wonder though if Microsoft has any thoughts of ditching their pesky partners on PCs, just like they did on personal media players with the Zune? It would make the Apple emulation complete.

Filed under Apple, Argo, Beta and CTP, Commoditization, Coopetition, Dell, Google, HP, Keyboards, Lenovo, Mice, Microsoft, Microsoft Hardware, OS - Client, PC Prototypes, Technologies, Windows Vista, Zune

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3 Responses to “Microsoft just can’t resist dabbling in hardware design”

  1. Not much happening in Gates’s CES07 keynote -- Microsoft News Tracker Says:

    [...] New Vista PC form factors – see the press release. These are presumably the result of Microsoft “helping out” the PC manufacturers on design. [...]

  2. More revelations at the Microsoft antitrust trial -- Microsoft News Tracker Says:

    [...] Finally, Microsoft shipping their own personal media player hardware because of perceived partner ineptness sets an interesting precedent. Right now Microsoft seems to be dismissive of the PCs their OEM partners are turning out and currently is in the “help them do better” stage. One can’t help but wonder how soon that will be followed by Microsoft “rolling up their sleeves and doing it right.” Filed under Coopetition, Legal, Technologies, Windows Mobile, Hardware, Apple, Governmental Relations, General Business, Antitrust, Portable Media Center, Creative, iriver, Portable Media Center, Dell, Microsoft, Argo, Zune, PlaysForSure [...]

  3. Microsoft dabbles with Courier dual screen tablet | Microsoft News Tracker Says:

    [...] would be more excited if Microsoft didn’t have a long history of dabbling in PC hardware prototypes, all the better to spur on their OEM partners. It would be very surprising if Microsoft did more [...]

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