

Paul Graham revisits "Microsoft is Dead" - ilamont
http://www.thestandard.com/news/2009/04/09/paul-graham-revisits-microsoft-dead-points-new-factors-shaping-software-industry

======
qeorge
I've never agreed with this PG essay. Granted its a couple of years old, but I
think its totally off-base.

Specifically:

"Gmail also showed how much you could do with web-based software, if you took
advantage of what later came to be called "Ajax." And that was the second
cause of Microsoft's death: everyone can see the desktop is over. It now seems
inevitable that applications will live on the web - not just email, but
everything, right up to Photoshop. Even Microsoft sees that now."

I couldn't possibly disagree with this more. The idea of being forced to use
all software through a browser sounds bloody awful to me. Photoshop through a
browser? DO NOT WANT.

What we're more likely to see is cloud-based apps, which deliver the
portability and connectivity we've come to expect from web apps. I can
absolutely see myself using a cloud based version of Photoshop, but it would
still be "desktop" software. Not surprisingly MS is heavily invested in the
virtualization and server markets.

Surprisingly, I think PG forgot this basic point: products succeed because
people want them, not because of their underlying technology. Gmail became
popular not because it employed AJAX or was based online, but because it
solved a hair-on-fire problem: tiny inbox sizes.

"The third cause of Microsoft's death was broadband Internet. Anyone who cares
can have fast Internet access now. And the bigger the pipe to the server, the
less you need the desktop."

This statement I also find ridiculous. If anything, increased broadband
availability has made computers even more of a must-have product. And I've
seen absolutely nothing to back up a claim that of these new computers less of
them are running Windows.

"The last nail in the coffin came, of all places, from Apple. Thanks to OS X,
Apple has come back from the dead in a way that is extremely rare in
technology. [2] Their victory is so complete that I'm now surprised when I
come across a computer running Windows."

Dude, come on. Yes, Apple made an amazing comeback. No, they haven't had
anything close to a "complete victory."

Now, I say this as someone who makes custom web apps for small businesses, and
someone whose father had an app completely ripped off and suffocated by MS
circa 2000. A big part of me wants this to be true, but I know it isn't.

In conclusion:

The revolution in web apps was making them behave more like desktop apps. So
why is it surprising to see desktop apps enjoy a renaissance by acting more
like web apps?

~~~
axod
>> "Photoshop through a browser? DO NOT WANT."

What you seem to fail to see is that you're an outlier.

Most people want photoshop through a browser. Most people already do most of
their stuff through a browser. It's funny to even debate, because it's
happening/happened for large amounts of people out there already. Ask your
parents what they do on the computer, and it's likely to be 90%+ web, with
perhaps a couple of desktop apps. If that.

Ironically, it's the techie usually early adopters that are lagging here,
preferring to stick with desktop software. The people leading the webapp
charge are people who don't want the fuss of downloading desktop software,
with potential spyware etc, and just go to google and find a webapp instead.

The same phenomenon exists when some people discuss advertising. "No one
clicks on ads anymore" - it's easy to say, if you install adblock, or just
don't click on ads, but this is a total minority. The majority do click on
ads. Just like the majority want, and use webapps over desktop apps.

>> "Gmail became popular not because it employed AJAX or was based online, but
because it solved a hair-on-fire problem: tiny inbox sizes."

I think actually the reason it succeeded was because it had ridiculously fast
searching, and unlike a desktop app, you don't have to worry about your
storage. I don't think the majority of people really cared about inbox size.
The fact you could easily search for things in a simple and blazingly fast
webapp was key. For most people, it is _better_ than a desktop app.

>> "This statement I also find ridiculous. If anything, increased broadband
availability has made computers even more of a must-have product."

The fact that broadband access has increased etc means there's less need to
have a thick client. Where previously you needed to download a video, click on
it, watch it, we all now just watch videos streamed to us by a webapp. When we
all have 1Gbps connections, why would we need a full powerful computer each?
Why would it not be in most persons better interest to just have a very thin
power conserving client that connects up to the big servers doing the grunt
work.

The fact is, it's happening, and will continue to happen. You can't stop it.
It's inevitable. You might prefer to stick with your computer and desktop
apps, but you'll be a small minority, like the people who still buy records on
vinyl.

>> "The revolution in web apps was making them behave more like desktop apps."

I disagree with that. The revolution in webapps is making them work _BETTER_
than desktop apps. Gmail can search my mail much faster than my computer can.
Mibbit can do things impossible with desktop IRC clients. etc etc

The reason Microsoft are 'dead' is that they don't get it. They're dead in a
similar sense to the music industry IMHO - the market changed around them and
they completely failed to adapt.

~~~
neilc
_What you seem to fail to see is that you're an outlier._

When PG says stuff like "I'm now surprised when I come across a computer
running Windows", I think he's more of an outlier than the parent poster.

 _Gmail can search my mail much faster than my computer can._

There's no technological reason for this to be true. Gmail takes a second or
two to answer search queries over my mail; that is _plenty_ of time for a
typical desktop machine to process full-text search queries over a few GB of
indexed and largely static data.

 _The reason Microsoft are 'dead' is that they don't get it._

I think most of my objection to the original PG article is the shameless
hyperbole it engages in. Microsoft isn't "dead" by any stretch of the
imagination -- they are poorly positioned for cloud computing, but the game is
certainly not over yet. Claiming that Microsoft is "no longer a factor one has
to consider when doing something in technology" is simply wrong -- even if you
narrow your focus to consumer-facing web apps, Microsoft still provides the
dominant client platform (IE), and a very popular backend infrastructure (SQL
+ ASP.NET + CLR + ...).

~~~
pg
_When PG says stuff like "I'm now surprised when I come across a computer
running Windows", I think he's more of an outlier than the parent poster._

Different kind of outlier though: when you're an outlier because you spend an
inordinate amount of time among people creating new technology, then your
anomalous experience makes you better at predicting the future, not worse.

~~~
neilc
_when you're an outlier because you spend an inordinate amount of time among
people creating new technology, then your anomalous experience makes you
better at predicting the future, not worse._

Sometimes, but not always. If you spent all your time hanging out with people
creating new technology in the mid 1980s, you might have been convinced that
Lisp machines would soon become the dominant computing platform.

~~~
brlewis
Mid 1980s one would have predicted Unix/C and distributed computing using
Internet protocols would soon dominate, and would have been wrong...about the
"soon" part.

------
blogimus
How I understand it is that Paul is saying Microsoft is irrelevant to those
trying to build at the forefronts. That it is not going to spot you, the
startup, and eat your lunch, because its core business, its competencies are
not where you are "feeding" (for want of a better metaphor).

~~~
Herring
Well I can see how choosing a flamebait title helps get that message across.

------
yef
People misunderstood PG's essay because he misstated his thesis. "Dead", put
simply, was the wrong word to use.

Microsoft is not "dead" any more than Apple was dead in the mid to late
nineties (and boy, was _that_ a popular statement at the time).

Microsoft still has cash, people, and a position in the industry that, with
the right leadership, can be turned around to be competitive with Google,
Amazon and Apple.

Please back up all prognostications with evidence, or submit yourself to
wrongtomorrow.com :)

~~~
r7000
No it was not the wrong wording at all. "X is dead" is a very well-established
rhetorical phrase. The only controversy that resulted was due to the
enormously over-literal nature of argument on the net.

The "Microsoft" in the title means the "Microsoft as bogeyman of the tech
industry". This is implied. That Microsoft "still has cash, people, and ...
position" is neither here nor there.

~~~
yef
To me, "dead" means something like "checkmated". "X is dead" means that X is
in a situation that it can't get out of. Can you please point me to your
definition?

~~~
r7000
Yes that is it. Microsoft _as the bogeyman of the tech industry_ (i.e. a
factor one _must_ consider). That concept is "checkmated"/dead. It no longer
holds true. And there's nothing immediately obvious MS can do to reverse that
situation ("get out of it").

------
Retric
IMO, Sharepoint is Microsoft's next big thing. They are becoming indispensable
to midsized and large companies and creating a foundation that helps them keep
selling copy's of Windows, and Office while setting up yet another revenue
stream. Granted selling to other companies seems to be what large
organizations do when they die, but it's still a huge source of revenue with
little real competition.

So, if you are building a web app you can probably ignore Microsoft, but if
you are building an OS, or Office product there is still a huge shark swimming
in those waters.

~~~
qeorge
Could you explain this:

"Granted selling [products] to other companies seems to be what large
organizations do when they die"

I couldn't disagree more. Could you please elaborate?

~~~
Retric
I think focusing on selling to other companies is a difficult trap to get out
of. After the first sale companies can be milked for an extended period for
support contracts / upgrades. Innovation is not really needed and growth /
profit are an easy to understand process. You can even make money by bribing
middle managers (see: drug companies for an example of this).

However, individuals require far more bang for the buck. So the margins tend
to be far smaller and you need to sell to large numbers of people constantly
to keep up.

At the same time selling to companies tends to focus on boring products so
most of your innovative people tend to leave. It's not exactly a binary
choice, but companies like AT&T often go from selling to individuals, to
making money from companies, to making money from the government. In the end
the quality of your competition tends to drop the closer you are to working
for the government which is why I think it's a death spiral. Overtime the
company becomes unable to deal with change and the next round of innovative
companies tend to disrupt them.

PS: Which is not to say old companies like GM can't sell products to customers
it's just they stop being able to make much money doing so unless they can
leverage a monopoly.

------
cubicle67
PG, if you're around, are you able to post your entire response? This article
reads like there's a lot more you said that wasn't printed.

~~~
pg
from Paul Graham

to Ian Lamont

date Wed, Apr 8, 2009 at 9:22 AM

subject Re: 2nd anniversary of "Microsoft is Dead" essay - new factors to
consider?

A lot of people misunderstood that essay, and asked how I could claim a
company making so much money was dead. Obviously I didn't mean Microsoft was
bankrupt. What I meant was that they were no longer a factor one had to
consider when doing something in technology.

That's still true today. The big stories in the 2 years since have been AWS
and iPhone apps. Microsoft's mindshare has continued to slowly erode.

Thanks to AWS, someone starting a startup today thinks more about Amazon than
Microsoft. An online retailer! It would have seemed almost impossible to
people in 1999 that anyone would be saying that in 2009.

\--pg

~~~
cubicle67
Thanks

------
nick007
Technology startups don't have to worry about what Microsoft is doing?
Microsoft is losing in a few fields but is still the world's largest and most
lucrative software company. Just because it's no longer the youngest, hippest,
and fastest growing company doesn't mean that it is dying.

~~~
swombat
Put it this way: Fifteen years ago, if you were trying to convince someone to
invest in you, the question on their lips might have been "What if Microsoft
move into your market?"

Now the question is "What if Google move into your market?"

Far from being a threat, Microsoft is now an opportunity target... "We're
going to steal this market from Microsoft" is a plausible claim. And so, they
are no longer a big worry.

~~~
Tangurena
15 years ago, Stac Electronics was on everyone's mind. Where Microsoft might
say they wanted to buy your company, or license your technology, then go on to
steal it anyway.

<http://en.wikipedia.org/wiki/Stac_Electronics>

------
jasongullickson
Most of the criticism of this essay could be eliminated by replacing "dead"
with "irrelevant".

What has Microsoft done in the last five years that has been copied by a
competitor (the sincerest form of flattery and all)

~~~
actf
Wow I honestly can't believe that pg is so short sighted.

Let's compare work that's being directly copied by competitors:

Microsoft: C#, actually for that matter the entire .NET Framework,
Singularity, Gazelle, Visual Studio, Powershell, Office, WPF, Silverlight,
Photosynth, the list goes on and on

Apple: iPhone

Microsoft is by no means "dead" or "irrelevant". Generally I like reading Paul
Graham's essays, but I think this one is a bunch of gibberish.

~~~
jasongullickson
Fascinating.

What would be illuminating is if you would point to the competitor and the
copied product instead of just listing Microsoft products.

also, what does the line "Apple:iPhone" have to do with this?

(admittedly, Singularity is very, very cool)

~~~
actf
Sure, I'll provide some examples

The companies copying Microsoft products:

C# -> Novell

Visual Studio -> Just about every other IDE out there rips off features that
appear in Visual Studio first.Intellisense is the obvious example here.

Office -> Open Office, parts of Google Docs

Powershell -> Open source projects are directly copying this shell for linux

WPF -> KDE 4, Nokia

Gazelle -> Google is doing something very similar to this

As for the line: Apple: IPhone

I was trying to get the point across that this was the only product from apple
that I could think of which has been copied by others. Perhaps you could make
a case for parts of OSX as well. Either way my main point was that it's easy
to find products that illustrate Microsoft's innovation.

I find it frustrating when people dismiss Microsoft's products as inferior to
the alternatives when they haven't even given them a fair evaluation. I find I
encounter a lot of people where I work that immediately dismiss Microsoft's
products, just because it's Microsoft or because it costs more than the open
source alternatives. In my mind this is nothing more than "software racism".
It shows that these people are just closed minded.

~~~
jasongullickson
I see your point, and I do agree that it is stupid to dismiss something just
because it's from Microsoft (the same goes for any vendor/platform/etc.).

I disagree however with your list. I'm not familiar with Gazelle or WPF, but
the rest of these items were not "invented" by Microsoft either and can be
sourced back to some other point of origin. So it's not fair to say
Microsoft's technology is being copied in these cases because they themselves
copied the ideas.

The frustrating part is that, similar to General Motors, Microsoft does have
good engineering going on but most of the results that come from these efforts
never see the light of day in commercial productions. This is the nature of a
large company organized in this way, and why we tend to see innovation in
newer, smaller companies that don't know any better.

------
mattmaroon
iPhone apps are a media sensation for sure, but the real money is more in
social network apps. The top Facebook app makes every month what the top
iPhone app has made in total.

~~~
jasongullickson
Do you have evidence to back up this statement?

~~~
mattmaroon
Sure. It's actually fairly public. Everyone celebrated iShoot making $700k.
It's well-known that Mob Wars and a few other apps make more than that
monthly. And as an app developer, I can attest to the sort of eCPMs that
requires among Facebook RPGs.

To put it in perspective, I'll probably bring in more rev than iShoot this
year, and I'm nowhere near Mob Wars in traffic numbers. There have to be
hundreds of guys out there bigger than me. And unlike iShoot, I'll keep doing
it indefinitely, not just until I fall off of the top 25 (which I never even
had to hit).

When it comes to third party apps, Facebook is really the leader right now. In
fact, I'd argue that in the tech world, they're setting the terms more than
Apple at the moment, just in a different sphere.

~~~
jasongullickson
Is iShoot the number one selling app (in volume or revenue) in the app store?
Do you have Mob War's specific numbers?

This is what I mean by "evidence". The reason I ask is that most developers
(other than publicly held companies) don't discuss these details with the
general public.

~~~
mattmaroon
I don't have any evidence that would be permissible in court, no. Nonetheless
I know a lot of people involved in both worlds (including on the monetization
angle) and unless there's a wide-spread, concerted conspiracy to trick me into
not releasing an iPhone app, Facebook/Myspace ones monetize at least an order
of magnitude better.

~~~
jasongullickson
Just because your paranoid doesn't mean they're not after you, Matt ; )

Kidding aside, one other aspect to consider is the amount of investment
required to get an application released on either platform (the true profit
vs. just revenue). A game like iShoot can be put together by a single
developer using commodity hardware in less than 100 hours. This application,
once released incurs no maintenance cost in order to generate revenue (see
note below). A developer can therefore turn out additional applications of
this class with little support overhead required.

I haven't written a Facebook app yet, and perhaps a successful Facebook
application can be created using the meager developer resources described
above. However in addition to initial development costs, as I understand it,
the developer must provide the infrastructure to run the application (web
hosting, bandwidth, etc.). On an application which receives the volume of
users you describe, this can add up to a significant ongoing expense.

You clearly know more and have more experience with the Facebook platform than
I do, if I am incorrect in my statements please enlighten me.

*of course you can continue to spend money on promotion and advertising, but since this applies at least equally between both platforms, I consider it implicit.

~~~
mattmaroon
Using rails and Facebooker we released our first app I think in something like
2 days. We went from 0 platform experience and an idea to a simple but
functional app (that grew like crazy, but unfortunately had only 2 weeks to
sign up new members) in probably under 20 developer hours. Our following app
(the one that is doing fairly well today) took something like 1 developer
month to launch, though we've since put probably put 1 developer year into
improving it, generalizing the engine and launching two new themes on top of
it, as well as porting the whole thing to Myspace. We'll be releasing game #4
onto both networks this week.

We didn't have to worry about being accepted into any store. (Facebook has an
app directory that takes a couple days to get reviewed for, but honestly
there's very little benefit to even being in it.) After we launched, upgrading
was as simple as any website. We didn't have to make some fairly hard to
achieve top 25 list to get traffic, in fact, we're hoping for the reverse.

Developing for Facebook isn't that different than any other web development
(in fact a lot of apps run in an iframe). It's far easier, and gives far less
control to a third party. It's far more lucrative, doesn't have the "hit or
miss" aspect of the app store.

You're right about the hosting cost. Only some iPhone apps need that, many do
not. All Facebook/Myspace ones do. But the greater monetization potential more
than makes up for it if you're doing games (I'm not so sure about other types
of apps). eCPMs on offer pages are measured in the $100s. Many people I know
(in a way that would be admissible in court) are pulling in north of $500.
Even if that only amounts to 1% of your traffic, that's still ludicrously
high, especially on the volume you can get very quickly.

The only way in which it is inferior is it isn't sexy and nobody is going to
write lots of articles about you. The iShoot guy got more coverage in bigger
media outlets for bringing in $600k than Zynga did for making $40-$50m last
year.

~~~
jasongullickson
Cool stuff, thanks for all the info Matt.

------
eugenejen
IMHO if anyone has ever read Freidrich Nietzsche's "Gott ist tot" will
understand what PG meant by "Microsoft is Dead".

------
shimi
If you build a web app you must test it on IE, WM is the third biggest mobile
OS for smartphones, and that's before desktops.

Sorry PG I can't agree with you on this account.

------
henning
How are iPhone apps a big story when the market is dominated by fart noise
programs and games?

(Since when do Web 2.0 people give a crap about mobile gaming?)

------
neilo
Maybe "de-clawed"? They're not quite DEAD yet. I think I'll go for a walk...

------
access_denied
The linked to article is weak. Summary: 1. PG wrote that article 2. I called
him, and he reinforced his sentiment by giving 2 more incidents for support.
iPhone Apps and the fact many web startups use Amazon's services for hostinge
ect.

------
TweedHeads
In summary, a retarded article bragging about billions and market share
without any substance at all to dispute PG's assertion.

M$ is dead, nobody fears them anymore, their products are no longer required,
for every M$ product there are many competing products that work as well or
better.

Like saying IE is the best browser because it has 60% of market share without
saying it had 90% a year before.

Nobody uses it anymore and nobody cares.

That's the real issue.

~~~
ashot
Please don't use "M$"

~~~
TweedHeads
From Wikipedia:

M$ (Microsoft): used to emphasize the allegation that Microsoft has business
practices that focus on making money rather than producing good products or
looking after the end user's needs and interests. Microsoft was convicted
under United States anti-trust law of taking unfair advantage of its monopoly
position. Also criticized for taking advantage of loyal customers and
upgrading products annually for an expensive price, thus "shafting" the people
who bought last year's products.

I don't see anything wrong with using M$ to imply all of the above in one
simple and worldwide recognizable _satiric_ misspelling.

See also, _satire_

~~~
nailer
All businesses should primary focus on making money. That's what businesses
do.

If you'd like to draw attention to Microsoft's illegal behavavior in the
market, you have to explicitly state it, a dollar sign won't be enough for
most people, who think you might simply be poor and envious.

~~~
prewett
I strongly disagree that "businesses should primarily focus on making money."
They should focus on solving problems or making great products. The money
follows. There's a word for "primarily focusing on making money": greed. I
don't think we want more greedy companies around...

~~~
jordyhoyt
I strong agree about the greed, but would like to add one more entry to what
their primary focus should be on: the customer.

~~~
jibiki
In what order should a company consider customers, employees, and
shareholders?

~~~
jordyhoyt
that order sounds pretty good to me. also, "employees" ought to be a subset of
"shareholders", simplifying the prioritization a bit.

------
_bn
no, no, no. Microsoft is far from dead. PG is simply wrong.

Just look at the work that Live Labs is producing. No "Web 2.0" company can
compete with the brilliance behind photosynth. They are kidding themselves if
they think they can.

I'll tell you why Microsoft won't survive. It's because Microsoft isn't a
leader in innovation. Steve Ballmer doesn't have any balls. He's simply
satisfied with being #2 and playing it safe while letting Steve Jobs create
new markets and dominating them (with style).

Again, Microsoft isn't dead. If anything, this whole "Web 2.0" and Ycombinator
incubation thing is dead. If the big boys think that there is any serious
competition coming out of these programs then they have another thing coming.
The recession has reduced a lot of this noise, and the real animals have been
let out of their cage.

~~~
olefoo
Microsoft Research is not Microsoft; it's like the Honors College at a large
state university a small enclave of excellence set against a larger backdrop
of mediocrity.

The larger culture at Microsoft is still operating under the assumptions of
the 1990's when they were large and in charge. They have been coasting on the
monopoly for some time. But, they are not the hundred year computing culture;
by their very nature they can't be.

------
sscheper
In that article, it's hilarious because the microsoft biz dev guy
misunderstands what he seeks to establish.

------
c00p3r
iPhone was changed everything.

Facebook and Twitter shows what the people really want.

No body cares about OS or PC anymore. Stay connected - it's a trend.

------
TweedHeads
I didn't see PG 'revisiting' his post.

Did he write a follow-up I missed?

~~~
thalur
I think it's referring to an email quote in the article.

