Microsoft buys used iPhones in latest attempt to get consumers to switch to Windows

September 28, 2013 10:41 AM ETComputerworld - Microsoft on Friday launched yet another trade-in program to convince consumers to switch to a Windows device, this time aimed at iPhone owners.

On its Microsoft Store website, Microsoft outlined the new deal: It will accept "gently used" iPhone 4S and iPhone 5 smartphones -- the 2011 and 2012 editions, respectively -- and pay a minimum of $200 for each. The Redmond, Wash. technology company will issue the funds as a gift card good for purchases at the Microsoft Store.

As in the iPad buyback program that debuted two weeks ago, customers must bring their used iPhones to a retail outlet in the U.S., Canada or Puerto Rico -- trade-ins are not supported online -- where a sales representative will evaluate the device and decide on the dollar amount. Microsoft has 77 stores in the U.S., Canada and Puerto Rico.

"Microsoft Store gift-card value ... is subject to Microsoft's discretion and manager approval," the website said. "All trade-ins are final. Cannot be redeemed for cash. Limit 1 per customer."

The gift cards that result from an iPhone trade-in can be used for anything Microsoft sells in its stores, including its Surface tablets and third-party PCs, but the deal is clearly intended to tempt Apple's current customers into switching to a Windows Phone like the Nokia Lumia 1020.

That may be a very tough pitch.

According to market research company ChangeWave, 70% of iPhone owners polled said they were "very satisfied" with their purchase, the top-ranked percentage in the survey, which also noted that the second-most satisfied customers were ones who had a Samsung smartphone: 54% of those people said they were "very satisfied" with their device.

Like the earlier iPad deal, Microsoft's iPhone buyback program isn't available online so it's impossible to tell what the company's salespeople will pay for an iPhone before getting in the car. Re-commerce vendors such as Gazelle and NextWorth, which do operate online, pay between $190 and $210 for a working 16GB iPhone 4S on AT&T's network, and between $290 and $304 for a 16GB AT&T iPhone 5. The lower prices for both devices were quoted by Gazelle, the higher prices by NextWorth.

Microsoft also has a broader buyback program in place that operates online, and that accepts a wide variety of rivals' devices, including the iPhone. That program produced trade-in quotes for the same 16GB AT&T iPhone 4S and iPhone 5 of $160 and $250, respectively, or between 16% and 24% less for the iPhone 4S, between 14% and 18% less for the iPhone 5, than Gazelle and NextWorth.

Not surprisingly, the new buyback program does not accept Microsoft's own Surface tablets as trade-ins; none of Microsoft's current deals do. That's triggered complaints by owners of the company's first-generation tablets, who last week urged Microsoft to offer cash for their Surface RT and Surface Pro devices so that they could trade up to the second-generation Surface 2 and Surface Pro 2 when they go on sale Oct. 22.

Microsoft's iPhone buyback program expires Nov. 3. Apple has already launched new smartphones -- the flagship iPhone 5S and the lower-priced iPhone 5C -- but the former is in very short supply, with current orders slated to ship at an unspecified date next month.

Gregg Keizer covers Microsoft, security issues, Apple, Web browsers and general technology breaking news for Computerworld. Follow Gregg on Twitter at @gkeizer, or subscribe to Gregg's RSS feed . His email address is gkeizer@ix.netcom.com.

Read more about Smartphones in Computerworld's Smartphones Topic Center.

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SkyDrive stumbles, becomes latest cloud app to get glitchy

Another day, another cloud app gets stung by a bug. Microsoft's SkyDrive cloud storage service began malfunctioning on Tuesday afternoon, a day after Google's Gmail got tripped by a network breakdown.

"SkyDrive is having problems accessing and modifying files. You might not be able to view, change, upload, or delete files," read an alert on the Live Status site, where Microsoft displays the current availability of several consumer online services.

[ Also on InfoWorld: Microsoft fixes SkyDrive problem, issues persist with Outlook.com. | Stay on top of the state of the cloud with InfoWorld's "Cloud Computing Deep Dive" special report. Download it today! | Also check out our "Private Cloud Deep Dive," our "Cloud Security Deep Dive," our "Cloud Storage Deep Dive," and our "Cloud Services Deep Dive." ]

The notice went up at 4 p.m. U.S. Eastern Time and doesn't offer details about the cause or scope of the problem.

Microsoft didn't immediately respond to a request for comment.

SkyDrive plays the critical role of cloud-based storage service in many Microsoft products, including operating systems like Windows 8, devices like Surface tablets, and online and desktop applications like those in Office.

Just Monday, Microsoft announced a new 200GB SkyDrive plan that is now available for purchase or comes bundled at no extra cost with the new Surface 2 tablets.

In May, Microsoft announced that SkyDrive had exceeded the 250 million-user mark.

So far, the week isn't shaping up to be a good one for cloud apps.

On Monday, Google wrestled for much of the morning and afternoon with a persistent network-related bug that affected almost half of Gmail's active users, of which there were more than 425 million last year.

For about 10 hours, affected Gmail users suffered delivery delays and difficulty downloading attachments. It was one of the longest, most widespread Gmail disruptions in years.

The issue affected individuals who use the free version of Gmail, as well as businesses, schools and government agencies that pay for it as part of the Google Apps cloud collaboration and email suite.

Juan Carlos Perez covers enterprise communication/collaboration suites, operating systems, browsers and general technology breaking news for The IDG News Service. Follow Juan on Twitter at @JuanCPerezIDG.

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Microsoft kicks off iPad buyback deal in latest effort to juice Surface sales

Microsoft will pay at least $200 for used iPads made by rival Apple, and in return issue credit that customers can use to buy one of the company's Surface tablets.

On its Microsoft Store website, Microsoft outlined the buyback deal: It will accept "gently used" iPad 2, and third- and fourth-generation iPads -- the latter two models launched in 2012 -- pay a minimum of $200 for each tablet, and issue the funds as a gift card good for purchases at the Microsoft Store.

[ Also on InfoWorld: Surface 2 leaked details paint lackluster picture. | Get expert advice about planning and implementing your BYOD strategy with InfoWorld's 29-page "Mobile and BYOD Deep Dive" PDF special report. | Keep up on key mobile developments and insights with the Mobilize newsletter. ]

Customers must bring their used iPads to a Canadian or U.S. Microsoft retail outlet -- the program's not supported online -- where a sales person will evaluate the tablet and decide on the dollar amount. Microsoft has approximately 70 stores in the U.S.

Apple's 7.9-in. iPad Mini is not eligible for trade-in.

"Microsoft Store gift-card value ... is subject to Microsoft's discretion and manager approval," the website said. "All trade-ins are final. Limit 1 per customer."

Because the buyback program isn't available online, it's impossible to tell what Microsoft will pay for an iPad before going to a store. Re-commerce vendors such as Gazelle and NextWorth pay between $150 and $240 for a working 16GB Wi-Fi-only iPad, with the lower value for the 2011 iPad 2 and the upper-end for the newest fourth-generation "Retina"-equipped device.

Buyback companies pay more for iPads with more storage space or those equipped for accessing the Internet over a mobile carrier data network.

They also pay cash for the Surface RT and Surface Pro tablets made by Microsoft. NextWorth quoted $187 for a 32GB Surface RT and $338 for the entry-level 64GB Surface Pro, or 54% and 43% of the list price, respectively. Microsoft's tablets start at $349 for the Surface RT, the struggling model powered by Windows RT, a subset of the more powerful Windows 8 that can run only so-called "Metro" apps. The Surface Pro, which relies on Windows 8 and can run legacy software like the desktop version of Office 2013, starts at $799.

The Redmond, Wash. company has cut prices of both models in the last two months to account for over-optimistic inventory plans and to clear the decks before Sept. 23, when it will unveil new models for the holiday selling season.

The resulting gift cards from an iPad trade-in do not have to be used for the purchase of a Microsoft Surface, but can be redeemed for anything Microsoft sells in its stores, including third-party PCs.

The deal also offers a call for action to iPad owners who have been swayed by Microsoft's television campaign that compare various features of the Surface RT with the 9.7-in. iPad, which starts at $499 with 16GB of storage space.

Microsoft's iPad buyback program expires Oct. 27. Apple is expected to roll out new tablets this year, and if it follows last year's practice -- when it also unveiled a new iPhone in September, as it did earlier this week -- the most likely introduction date is Tuesday Oct. 22.

Gregg Keizer covers Microsoft, security issues, Apple, Web browsers and general technology breaking news for Computerworld. Follow Gregg on Twitter at @gkeizer, or subscribe to Gregg's RSS feed . His email address is gkeizer@ix.netcom.com.

Read more about mobile/wireless in Computerworld's Mobile/Wireless Topic Center.

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Microsoft botches still more patches in latest Automatic Update

No sooner did Microsoft release the latest round of Black Tuesday patches, than screams of agony began sounding all over the Internet. At this point, I've seen verified problems with KB 2817630, KB 2810009, KB 2760411, KB 2760588, and KB 2760583. Here's what we know at this point.

KB 2817630 is not a security patch, it's a gratuitously delivered functionality patch for Office 2013, and man has it had an impact on functionality. I've seen dozens of reports that installing this patch, possibly in conjunction with the KB 2810009 patch that is part of MS13-074, causes the folder pane in Outlook 2013 to disappear. An anonymous poster on the SANS Internet Storm Center offers this picture of the effect.

Thirteen hours after the first posts complaining about the problem appeared on the Microsoft TechNet forum, Microsoft still hasn't done anything. As of 00:15 a.m. PDT on Wednesday, Sept. 11, the patches are still available, still marked for automatic installation, and the KB articles have not been updated to reflect the screw-up.

It appears as if uninstalling both patches will bring the folders back, although there's a more substantive workaround offered by one of the posters on the TechNet forum:

This behaviour seems to be caused by using the latest version of the shared Office library mso.dll 15.0.4535.1002 from KB2817630 in combination with an outdated version of Outlook. Try installing KB2817503 to update Outlook to the matching version 15.0.4535.1004. I don't have the issue with the missing folder pane in this constellation. Updating Outlook with the August 2013 hotfix (KB2817503) restored the reading pane on multiple machines.

KB 2760411, KB 2760588, and KB 2760583 are parts of the MS13-072 and MS13-073 security patches for Office 2007. There are many reports of the patches being offered and re-offered and re-re- ... you get the idea. On sevenforums, poster harin35 says:

No error messages. Windows Update appears to install them; but the updates have not been installed. These are 'important' updates.When I run Windows Update again, these three updates reappear as 'important' updates.

No guidance for handling the problem is on offer in the usual forums, because the people moderating the forums haven't a clue what went wrong and Microsoft isn't saying a thing.

Again, as of 00:15 am PDT on Wednesday, Microsoft hadn't pulled any of the patches, nor had it updated the KB articles, posted any recommendations on the usual fora, issued a press release, or made one iota of effort to help its customers. 

Does this make you feel warm and fuzzy about automatic app updates in Windows 8.1? Terry Myerson, are you listening?

t/h SB

This story, "Microsoft botches still more patches in latest Automatic Update," was originally published at InfoWorld.com. Get the first word on what the important tech news really means with the InfoWorld Tech Watch blog. For the latest developments in business technology news, follow InfoWorld.com on Twitter.

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!MEDIA ALERT: September 11, 2012 - Smith Experts Available to Comment on Latest Kodak Moves to Exit Bankruptcy

Media Alert: Sept. 10, 2012

Smith Experts Available to Comment on Latest Kodak
Moves to Exit Bankruptcy

COLLEGE PARK, Md. – Faculty experts in the University of Maryland’s Robert H. Smith School of Business are available to discuss, and give historical perspective on, the recently announced Kodak-management changes and job cuts as the company maneuvers to emerge from bankruptcy protection.

The Smith School has an in-house facility for live or taped interviews via fiber-optic line for television or multimedia content.

Kodak Misses its Moment

Hank Lucas, the Robert H. Smith Professor of Information systems, has written Searching for Survival: Lessons from Disruptive Technologies (Praeger, 2012). Contact him at 301-405-0100 or hlucas@rhsmith.umd.edu. 

Lucas’ book includes a chapter "Kodak Misses its Moment." He summarizes it here:

“Kodak is a tragic example of a company that had everything going for it, but was unable to cope when innovative digital technologies came along. Kodak’s demise was brought about not by a single event, but as with many disasters, a series of conditions and events brought the company down." These include:

Kodak’s own invention of the digital camera in 1975The firm’s inability to understand that others flooding the market with digital cameras, combined with the Internet, changed the process by which people captured and shared images The company’s rigid bureaucratic structure prevented it from responding quickly to threatsSenior management was unable to convince middle managers to move away from their analog, chemical and film mindsetManagement was distracted by foreign competition (e.g. Fuji) in film and a suit by Polaroid on instant photographyKodak exhibited a certain amount of arrogance thinking that it could control the pace at which consumers converted from film to digital photographyThe company wanted to protect its cash cow film business as long as possibleOver the years Kodak tried to diversify into unrelated fields and then pulled outOne hundred-plus years of success and a market share that at times exceeded 90 percent 'Kodak Should Have Folded Earlier'

Brent Goldfarb, associate professor of entrepreneurship and management, recently co-authored "Optimal Inertia: When Organizations Should Fail" in the journal Ecology and Strategy. He says Kodak is one such company that should have "failed," or closed down in an orderly fashion, instead of turning to bankruptcy. Contact him at 301-405-9672 or bgoldfarb@rhsmith.umd.edu.

Goldfarb's position, detailed in this Smith YouTube Channel video, is summarized here:

"Kodak was faced with a particularly difficult problem. The production of film is a very sensitive process, and for this reason Kodak was a rigid organization - small mistakes could have large consequences. This made the transition to digital costly. Ironically, Kodak was reasonably successful in their transition and quickly achieved a market leading position. The problem was that market leadership in a low-margin business is not a great prize. Kodak was not a victim of poor management, rather, the poor circumstance of being on the wrong side of creative destruction; its fate largely unavoidable.

Instead of trying to pursue the digital photography market, (Kodak) would have been better off slowly shutting down while profiting as much as possible from the dying film market. While this is a terrible outcome for Kodak stakeholders, particularly employees, history did not treat the company kindly anyway. They might have been better off trying to provide enough resources to the employees being displaced and to those managing the shrinking enterprise so as to ensure continuity and thereby extracting as much profit as possible from the market. They could then return what's left to the shareholders, whose dividends are increased further with the company not plowing money back into research and development."

About the Robert H. Smith School of Business
The Robert H. Smith School of Business is an internationally recognized leader in management education and research. One of 12 colleges and schools at the University of Maryland, College Park, the Smith School offers undergraduate, full-time and part-time MBA, executive MBA, MS in business, PhD and executive education programs, as well as outreach services to the corporate community. The school offers its degree, custom and certification programs in learning locations in North America and Asia.

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