What happened to Microsoft? While the rest of the tech sector exploded and prospered, it stayed still. A MSFT share was worth about $35 dollars when Ballmer took over; it's worth about $35 now. The world moved on, and Microsoft didn't move with it.
He will be remembered for missing mobile. He will also be remembered for caring a lot about developers and about developers and about developers as well. The VB6 folks will still hate him ;-)
Microsoft used to control the future of computing. Now they are yet another enterprise software company with no apparent mission except to make money.
The lay somewhere on a continuum with IBM, Oracle, SAP all the way through to companies like CA. At one end of that spectrum they do research and produce software that people use to do their job 0.5% better than they used to. At the other end they may as well be accounting companies for all the impact they have on the future.
Yes, they make money. And yes, I admit they try to compete with consumer oriented technology companies and have some interesting products. But you are 100% correct - Microsoft is now primarily an enterprise software company.
Meanwhile Apple/Google/Amazon/Facebook/etc look toward the future.
It might already be true, how do you distinguish between a lumbering giant and not without the help of hindsight? The public consensus on such things lags a few years behind reality.
What signs have you seen in 2013 that Google is not a lumbering giant?
This strategy always made Gates paranoid, because the risk was that some alternative to the MS stack would take off too quickly to be killed. Without their near monopoly power as a weapon, they would have no special competitive advantage.
What they feared happened in the mid-90's when the Web took off and the browser/Java combo threatened to be a universal VM on top of every PC. Gates fought back with every weapon he had to fragment the universality of the meta-platform. He was able to greatly slow, but not stop, the emergence of an OS-independent Web, because he controlled the majority of the OS market underneath it.
But then the second shoe dropped. Mobile came along and MS was not able to stop its explosive growth. The growth of mobile made MS just another minority OS underneath the Web, and they lost their ability to disrupt the standardization of the Web platform. They were in the position they had always feared: having to support the standards of others or be abandoned by their customers as the Web became the new monopoly platform.
If Ballmer could have created the mPhone and mPad and given away for free an mOS for phones that was a mini, modified version of .Net, maybe they could have kept the Web fragmented and continued their platform dominance, but whether that was even possible (MS did things second, not first, was only a minor hardware developer, and seldom gave things away except when tied to something they sold), I'll never know. Gates got to wield monopoly power; Ballmer didn't.
MS's monopoly-based business model has to be abandoned, but do they have any other? They'll come up with something, as IBM did, but I don't think they'll ever be leaders again, because they didn't really "lead" before, except in market share.
Google's business model (expand the Web platform for free, dominate Web advertising, and employ an army of PhDs looking for something besides advertising to do) is nothing like Microsoft's. If they ever lost advertising, they'd go down harder than MS, and they could lose it if they ever lost much search mindshare.
And Facebook? They're a website. They are completely dependent on the psychological inertia of their users, which I wouldn't bet on long term.
This is where Jobs learned a lesson from his first time running Apple.
Apple introduced such a polished product for an initial launch, and iterated so fast with iPhone that the market was already taken before Microsoft understood what was happening. I can imagine Gates responding to iPhone with an emergency memo like he famously did with the web, but Ballmer didn't seem to understand the significance of this new market being created until it was too late.
And, it wasn't as if Microsoft didn't have a mobile OS. Windows Mobile always worked decently, but never was just truly great. And it never focused on being just for phones. It was adaptable to any type of mobile environments, like Android is trying to do right now.
It is also more difficult to implement new technologies on top of old ones, which was Microsoft's first choice when they tried to make the phone part of Windows Mobile more modern, until they realized that that house of cards wouldn't stand. Then they did a rewrite of, which lead to Windows 7.
So, from Microsoft's point of view, it was a limited phone, that had no way of adding apps, no business functionality, no keyboard for typing, no true enterprise security, and for a whole lot of money, only available on AT&T. I too thought that the original iPhone wasn't that great, only marginally better than the ROKR E1, functionality-wise. Though, I did think that that original iPhone screen was truly awesome.
So, let's not come down to, to hard on Balmer for not recognizing the iPhone at first for the threat it came to be.
XBox, Surface and ergonomic keyboards would beg to differ. Not mentioning the countless other innovations that didn't become as popular as these ones.
I know the Hacker News hive mind likes to perpetuate the myth that Microsoft doesn't innovate but it innovates at least as much as, if not more than, Google and Apple.
And Google has changed human access to information so profoundly that I can't adequately explain to my kids what it was like growing up in a world so cut off from things other people knew. Google Earth is something from science fiction. Street View lets me get to know my way around a town before I travel there. I can take my kids for a walk past my old homes in four different countries. Astonishing. And Google's self-driving cars may make driving off-limits to humans in another few years.
Then there's Microsoft, with thousands of smart people working for decades with billions of dollars of resources to work with---the most powerful of them all until what feels like "recently" to me. And the evidence of their innovative power: we have one of several game platforms, a billion-dollar write-off tablet that they can't give away, and a kind of keyboard that accounts for less than 1% of keyboards in use today. Oh, and other stuff that "didn't become as popular as these".
I'm not saying they never came up with anything new. I'm saying that relative to their size and resources, their innovations were trivial. Their huge impact on business, on consumer use of the Internet, on the tech industry, on governments, and so on, came not from revolutionary innovation but primarily from their relentless efforts to monopolize markets.
Of course, the lifeblood of a company is profit, not innovation. Without subsidies from ad revenues, Google's innovations could dry up quickly, and cheap knock-offs could eventually take away most of the markets Apple has revolutionized. But even if their profits prove short-lived, their amazing contributions to society will live on. I doubt many in the future will feel the same about Microsoft's contributions.
This is not really fair, and I'm sure you realise that. As a random selection, and in roughly decreasing order of significance from "world defining" to "things you'd really miss if they weren't there":
We have a standardised desktop operating system that is familiar to nearly every computer user on the planet, with which an array of hardware more diverse than at any point in human history mostly just works, and on which software probably written before some people reading this were born still runs.
We have a history of programming languages that have advanced both the state of industrial practice and the state of the art in research, and both traditions continue to this day.
Until very recently, the majority of web pages were presented in one of a handful of carefully designed, screen-optimised fonts that brought digital typography far beyond its previous standard, which are available on almost all major platforms, not just Microsoft's.
We have a wealth of ideas regarding HCI, from more efficient user interface designs to accessibility techniques to support users with disabilities.
It's not difficult to think of more examples, and of course Microsoft have also participated in numerous collaborative endeavours over the years that have advanced the industry in other ways. No doubt an organisation with Microsoft's resources could have achieved much more in recent years with more visionary leadership, but the idea that their work has produced nothing more than a few hardware devices over the years is just silly.
And innovation in programming languages? I was using BASIC before Microsoft existed, and while I thought Visual Basic was a significant innovation, I knew the guy who actually invented it and know how Microsoft took it from him. ("Take our lowball offer or we 'invent it' ourselves and you get nothing.") Nothing Steve Jobs wouldn't stoop to, but not a great example of MS innovation.
And .Net was the MS response to the JVM and C# was their response to Java. Both were improvements, but it was obvious what they were improvements on. And those two (VB and C#) are the only MS languages to have any impact outside the research lab.
And fonts? Was it Bill Gates who took that famous calligraphy class and brought the world of fonts to "microcomputers", or was that Steve Jobs and the Mac? Was it Microsoft who joined with Adobe and created the desktop publishing revolution, or was that Apple, too? Well, yes, Bill and Steve did work together on font technologies later, but that was to try to break Adobe's font monopoly, wasn't it? That m-word again.
Again, I'm not questioning the idea that MS came up with many new ideas, and all innovations have predecessors. It's a question of degree: how big a change is this? MS's innovations, while real, were just not in the same league as innovations from Apple and Google, despite MS's enormous power, because MS's focus was on defending their existing monopoly from competition, while Apple and Google were more focused on attention-grabbing product innovation.
And then there's Windows 8.
Also, while we're on the subject, my 8 year old can put together an amazing Keynote presentation on an iPad. She has never used a Windows OS.
Find a modern 8-year old, who understand PC circuitry (at analog and digital level), seen manufacturing processes, can re-solder components, can write C/assembly, can develop basic useful applications (like, say MS Paint). I bet you could easily find one like that, back in 70s-90s, particularly here in the silicon valley. Now - I'm not so sure.
From "Basic -> C/assembly"? Wow. That escalated quickly.
> Apple revolutionized the music industry
_Napster_ revolutionized the music industry. Apple saw the writing on the wall and made mp3s commercially legitimate.
You don't seem to be very fair in evaluating the merits of tech industries by focusing only on the bad parts of the one you don't like and the good sides of the ones you like.
How? iPods are great, but they are just mp3 players (not the first at that) with a great user interface. iTunes is a program I used as a music player only because I had to in order to transfer songs from my iPod. At least when I was using it, I could get "illegitimate mp3s" by putting in only a slight amount more effort than by buying them from iTunes. And when I did buy mp3s from iTunes, I wasn't able to make them to play on different computers - so an inferior product compared to the illicit mp3s. I have an eBook that I bought from iTunes that I have never been allowed by iTunes to listen to.
Maybe you're (also) talking about some Apple products that I don't know of.
Plus, and I cannot stress this enough, iTunes really was power pushing the iPod and Apple along. First, by truly binding hardware and software together to work together as seamlessly as possible. Second, by being able to purchase songs from iTunes store, and have it automatically appear in iTunes. And thirdly, and this is perhaps the most important bit, by forcing (and by forcing, I mean sometimes using the mob style of forcing) the record industry to play along. No longer did you have to know which artist belonged to which record company in order to buy music. No longer having to browse 4 or 5 different sites to find music. No longer did you have to convert songs, if you could even, to another to get around DRM to get all your music to play on one device.
So, yes, they did revolutionize the music industry.
I don't know. But mp3 players were definitely something people knew about before iPod's (at least the kids, can't speak for the adults at the time). Some even got those mp3 players with 128 MB, enough to cram two albums into. I didn't feel it was worth it before 512 MB, at the least.
Back when I was in the market for a good (gigabits of storage) mp3 player, I don't recall that iPod was the definite go-to choice in the electronics store.
> And you dismiss a feature of the iPods by just saying 'a great user interface'.
Not dismiss in general as much as dismiss when it comes to revolutionizing music listening and the industry. I think that people would still have adapted mp3 players (what were the alternatives? Discmans and those cassette-like players which you could record 320 minutes of music max on each disc?) even if Apple wouldn't have come out with a really nice UI.
> Plus, and I cannot stress this enough, iTunes really was power pushing the iPod and Apple along. First, by truly binding hardware and software together to work together as seamlessly as possible.
All mp3 players I've used (except for iPod's) are very easy to manage: plug it to the computer, open the folder of the mp3 player, and copy-paste songs. I am hardly a 'techie' when it comes to general computer usage, and I was not back then, either. But maybe this was beyond the capabilities of most people for all I know.
> Second, by being able to purchase songs from iTunes store, and have it automatically appear in iTunes.
I could torrent music and have them automatically appear in my Downloads folder. You could say that the iTunes way is more user-friendly, but most people used Windows back then and were used to shuffling around files and folders themselves, because you had to do that at some if you wanted to do more than read your mail.
> And thirdly, and this is perhaps the most important bit, by forcing (and by forcing, I mean sometimes using the mob style of forcing) the record industry to play along. No longer did you have to know which artist belonged to which record company in order to buy music. No longer having to browse 4 or 5 different sites to find music.
I guess I never was big on buying music online. I downloaded illicitlyt, bought some things in the store and the few things I didn't find I bought through iTunes. I know the last part validates your point, but having four more albums in my collection didn't exactly revolutionize my music listening.
> No longer did you have to convert songs, if you could even, to another to get around DRM to get all your music to play on one device.
When I changed computers I couldn't get my songs to play on the new machine.
> So, yes, they did revolutionize the music industry.
What revolutionized music listening for me was: 1. being able to easily download (mostly pirate) music 2. streaming services (only used Spotify myself).
I can tell you right now, that unless they were very technical, most adults didn't have mp3 players and weren't interested in them. Because they didn't even have mp3 files. Don't forget, very often back then, you had to specifically install programs, like winamp, instead of Windows Media Player or Real Player to rip CDs to the mp3 format.
> Not dismiss in general as much as dismiss when it comes to revolutionizing music listening and the industry. I think that people would still have adapted mp3 players (what were the alternatives? Discmans and those cassette-like players which you could record 320 minutes of music max on each disc?) even if Apple wouldn't have come out with a really nice UI.
Well, making a ripped CD was very well known and popularly done. People use to just carry around books of CDs, and it sounded better, too. Those old mp3 sounded like ass, the big rate was so low, like 32-64 bit. Now, if it's not 160 bit or higher, I'd say most people would refuse to purchase.
> All mp3 players I've used (except for iPod's) are very easy to manage: plug it to the computer, open the folder of the mp3 player, and copy-paste songs. I am hardly a 'techie' when it comes to general computer usage, and I was not back then, either. But maybe this was beyond the capabilities of most people for all I know.
You know why Windows 98 and above has AutoPlay? Because it wasn't simple enough for most of the public to just insert a media type device (CD/DVD/Flash type device) and just have the user manually start it.
> I could torrent music and have them automatically appear in my Downloads folder. You could say that the iTunes way is more user-friendly, but most people used Windows back then and were used to shuffling around files and folders themselves, because you had to do that at some if you wanted to do more than read your mail.
Well, maybe you were dealing with more technically inclined people than I was, but to this day I still have people who save EVERYTHING to their desktop, because they don't want to lose files. I still know people who can only find files by opening up which applications they used to create or modify them. They never make backups because they don't know where any of their files are. AND, even if they could, the older mp3 players only played files located in certain folders. If you mistakenly put them in the wrong folder, the mp3 player couldn't play them. Not user friendly at all.
> When I changed computers I couldn't get my songs to play on the new machine.
That's because in iTunes, your media is associated with your iTunes account. If you don't sign with that, then none of your songs would play. Unless you did that already, and it still didn't play. That's an error, which Apple should be obligated to fix on your behalf.
> What revolutionized music listening for me was: 1. being able to easily download (mostly pirate) music 2. streaming services (only used Spotify myself).
Technically, streaming services has existed since 1995, when Real was selling their Helix servers, and started streaming media themselves sometime in 1997-1998ish. That's even before Napster came out. Spotify only works because the music industry couldn't do it themselves, and wanted other streams of revenue online other than Apple and Pandora.
That's interesting. I guess I only dealt with kids who downloaded music for their mp3 players, and whatever CD's they had stayed in their CD players.
> You know why Windows 98 and above has AutoPlay? Because it wasn't simple enough for most of the public to just insert a media type device (CD/DVD/Flash type device) and just have the user manually start it.
Windows will also ask if you want to open an inserted mp3 device as a folder when you plug it in.
> Technically, streaming services has existed since 1995, when Real was selling their Helix servers, and started streaming media themselves sometime in 1997-1998ish.
Do you really want to emphasize who was first out with streaming? Hasn't your point all along been that Apple, while not inventing mp3 players, made it mainstream? ;P
> Spotify only works because the music industry couldn't do it themselves, and wanted other streams of revenue online other than Apple and Pandora
Spotify was a thing in my part of the world before Pandora. In fact it's only on the Internet that I've heard of people using Pandora.
When Windows does that, it's running a service called Autoplay. What I'm saying, is that before Windows 98SE, users had to manually open up inserted media, and enough of them had problems with it, that Microsoft included Autoplay ever since with Windows.
> Do you really want to emphasize who was first out with streaming? Hasn't your point all along been that Apple, while not inventing mp3 players, made it mainstream? ;P
Streaming has nothing to do with mp3 players. Even today, Apple doesn't do streaming. It's only going to be on the new IOS 7 where that even starts to be an option. Mp3 players is basically a dead market. The point I was trying to make was that Spotify/Streaming is only becoming a viable solution because Internet speeds and 4g networks are fast enough to stream at high rates. Unless I'm missing something, nothing Spotify is doing is truly unique, other than perhaps working in far more places globally than any other type of service before.
No, but I was saying that mp3 players and Apple are analogous to streaming and Spotify; Apple didn't invent but helped make mp3 players popular, and Spotify didn't invent music streaming but helped make it popular.
An academic friend of mine frequently tells me that Google et al do not compare to MSR in either quality or volume.
My point being, they produce (and ship) a lot of smaller innovations too, behind the scenes. Sometimes it's just detecting griefers.
Having them developing Kinect is obvious, but not so obvious inside MS world
My feeling of Microsoft is that they didn't understand their innovative success; XBox - or how to capitalize on it going forward. The 360 was likely the last product of theirs I will ever buy. The new console - not innovative and if they weren't paying attention to the fall out around the Sim City debacle then that's just added injury to insult. Baller is a bad CEO by today's success standards. He has always come off as arrogant and assuming. Not something an innovative company strives for.
The real dilemma here is that the general population has two unique metrics playing on them in a different manner today. One is a burgeoning idea of rights, ownership and privacy (which Microsoft Flys directly in the face of, in a very bad way) and then there is the subjective problem of attrition and interest that is eroding much faster today as consumers expect "the next big thing" every time a release comes ton market. It's one part "innovator's dilemma" with a sprinkle of fast flux perception.
Microsoft is a dead brand. I started saying this in 2004. I still believe it today. Why? Because instead of having more interest annually I have less. If Gates wanted to leave a mark on the world he'd buy back pieces and parts of the behemoth and set them free for the open market, but the reality is it will continue to fade away and generations coming into the world today will view the giant as relevant as tape decks and CDs.
The technology industry is in a period of change and maturation. It may not feel like it but my thought is 5 years out products will be more cohesive because consumers demanded platforms that were interoperable. If not, then the future may be a very stark and gloomy state of affairs dictated by a few who hold self-interest and money first.
I hope this industry doesn't follow in the footsteps of the financial industry...
This kind of categorical statement always baffles me. How can you be so sure that they will never, ever release a product you might want?
You can't, so maybe you're just showing an emotional bias against a company, another thing that I find baffling.
That's not what they said. They said "likely", in the context of a comment predicting a future of Microsoft decline.
I agree with most of your comment, but that line bothered me. In my opinion, the single worthwhile accomplishment of Microsoft was that it led to the formation of the Gates Foundation.
I don't even agree with many of their objectives, but simply providing funding for "unprofitable" medical research alone has already left "a mark on the world".
But regardless, I agree that the world would be a much better place if addressing our solvable problems didn't require the support of a retired billionaire first.
Really, even after the era of huge success with Windows 7 and the Xbox 360 you were still saying this? Is that when you bought the Xbox 360 from the "dead brand". Do you always throw down hundreds of dollars for products from dead brands?
I was a sysadmin in the 90s, and other admins I knew loved the Microsoft offerings - having gui control panels to server services. Active directory and the like. It wasn't particularly innovative, but MS managed to put lipstick on a pig and managed to sell it, while cleverly locking down their ecosystem through their proprietry platform. For some the CLI and Linux is still a turnoff, and there isn't that much preventing people from putting lipstick on that particular pig - but you don't see that many offerings (arguably you could say that Apple server is kind of like that).
Now, as a developer who remembers the old days, I have to deal with sys admins who have no idea what the hell they are doing on a *nix box. (some of that is hiring, yeah, but that's the pool we have to draw from now)
No, ignore Microsoft at your peril :-(
For instance, MS had a "PC tablet" (WinXP based) much before Apple, but it took iPad to make a revolution.
The PC tablet from MS was a laughable joke. The iPad made a revolution because it was revolutionary. It took Android years to catch up and Microsoft is still trying to fumble something together today.
Mobile was another keg of coffin nails, particularly in consumer space showing that ease of use and zero configuration were possible.
I agree on your assessment of Google's advertising reliance being an Achilles geek,and that the company risks marketshare loss through heavy-handed G+ promotion and privacy concerns.
They didn't have the vision to build consumer oriented "cloud" software like Google did, but they were positioned to do it before anyone else was.
As Oedipus and the Titans showed, sometimes we create our own usurpers.
(I was on my phone at the time, HN's edit lock has enshrined it now, enjoy).
The only reason I haven't deleted my profile is that I don't want to cede the namespace. Don't cross the street to get your ass kicked.
1.1 billion people.
Which makes you part of the majority on the planet that doesn't use it. Does that make you feel good or were you going for the hipster angle?
Notice I mentioned the "Microsoft Munchkins" and other unethical attacks against OS/2 later on was far worse than the Joint Development Agreement between MS and IBM, and the mention of DR-DOS at the end.
That having been said, it still has points of excitement - things like glass and driverless cars and parts of the Android world still feel exciting to consumers and that's part of what keeps lumbering giant company syndrome at bay - innovation leading to consumer excitement, repeated again and again keeps companies lively.
Google Glass (even if it's not commercially viable in its current incarnation). Self-driving cars. Android. Hot air balloon internets.
They've also moved the industry forward on web security.
(Not to defend their Gmail and Google Plus divisions)
If history serves as an indicator, I would say the chances of that happening are relatively high.
It may take a few years for people to realise they are a lumbering giant in decline now, but the seeds are already planted, maybe even full grown...
Coordinating people takes effort and standardization. Also, the larger you get, the harder it is to outgrow your market. This is the price you pay for winning. It's also why employees leave as companies grow. They say, "It just doesn't feel the same" because what got the firm from 100 to 1000 employees isn't what scales them to 10000.
There is (probably) only so much change one company / person can do. Even if there is additional potential, in the end companies will seek profit and stability.
We tend to forget that IBM did that in a previous era.
Another example that "in the end companies will seek profit and stability" and be an "enterprise software company"
Pretty easy to make bold claims without expanding on them.
Wrong decade. Microsoft has made a lot of positive changes these past ten years.
If anything, I'm betting that we are going to uncover some pretty dirty business practices exercised by Apple this past decade (I'm predicting that the e-book price rigging is the tip of the iceberg).
Apple lost me at their ridiculous patent fights with Samsung.
Apple's developer ecosystem is setup to give you everything for free. It's also setup to take everything away as it pleases all while controlling every aspect of it - even subjective components of it. It's not free at that point, and the control for security basis only goes so far before the argument starts to fall apart. Yes, it is a good thing to have controls for that exact reason. Is Google any better? In some regards yes (the platform has dwarfed iOS in terms of technical security controls but fragmentation plagues the ability of everyone to take advantage of updates) and in others no.
Apple is just an accelerated Microsoft at this point. Significantly slowed innovation (compared to the early OS X and iPhone days) - again because of the "innovator's dilemma". They're now locked into this massive ecosystem which will artificially continue to suffocate them over time.
Microsoft is worth roughly three times what Facebook is at one-twentieth the P/E ratio. Why do people assume they are losing? I fully accept that they are continually riding the coat tails of Windows XP for the majority of that and have missed a number of opportunities though. But let's be honest, everyone but Apple missed the smartphone revolution except Google and Samsung and Microsoft owns part of Facebook and isn't really playing in a competing market for the most part.
This absurd notion that Microsoft could have ever possibly retained "control" of the future of computing (apparently forever would be the requirement) is non-sense.
It was a shitty period. There was a sense of futility to building software. You could build small software, but as soon as you reached a certain scale, particularly if you were a platform company, Microsoft would decide that they'd like to take your revenue, so they'd box your software out of their operating system with incompatibilities, launch their own competitor, and eat your lunch.
The only sane strategy at the time was to try to anticipate what areas of computing Microsoft would likely never enter. But even that is Russian Roulette.
So, in 2013, yes. It's "obvious" now that Microsoft couldn't have possibly retained the control they had. But many of us have deep recesses in our brain that are still shocked that we got here.
Sounds like Apple and the 00's.
The thing is, since Apple releases so many new features and software with updates while Microsoft leaves unfinished, crappy software for a decade, you can find dozens of stories like this about Apple.
So many of their default features were popular third party programs that got rebuilt by Apple in-house.
Who will be the MSFT of the '10s, I wonder.
When Windows was the only game in town, that was not true.
I thought Google had already established themselves there by pulling all the free APIs that people had built businesses on top of.
Microsoft happened to steal a very small part of IBM's monopoly, which got bigger over time, but IBM's revenues are still bigger than Microsoft's even 32 years later. (And IBM has been spinning off or selling whole businesses along the way, eg the PC business to Lenovo; spinning off Lexmark).
I was talking to one US corporate IT manager who said IBM was still a third of his budget cf 3% for Microsoft.
Big picture: Microsoft's monopoly has always been much smaller and less powerful than the IBM monopoly used to be. However, in time, all tech monopolies tend to get largely undone by new technologies.
Although in the case of Netscape, they just coerced all of the OEMs not to include it.
Microsoft did not have to do much with this type of competition.
Around 2000, Linux was on the scene and like a lot of people I got the hell out of the MS ecosystem and never looked back.
The iPhone could have been theirs all along, with all that that implies. But first they ignored the underlying technology, then Ballmer laughed at it (on national TV no less), then they fought it, and then they lost.
Ballmer will not be missed.
And they did move.
I was trying to create a startup based on PDAs at the early 00's (no luck, they were too expensive - the idea was flawed from day 1). There was Palm, and the two entrants: Windows and Linux. Palm had a once nice system that nobody wanted to program for anymore (accumulated too much cruft), Windows had a giant marketing campaign that made everybody hear about them (it was getting more known than Palm), but it was so bad that everybody soon learned to run away from it, and Linux got a steady monotonic growth from nowhere into almost-nowhere.
I felt like I was the only one in the world who realized
how great having Internet access was in my pants pocket.
Now Everyone is connected.
And I think that's fine. Added together, these are the bread and butter.
As a whole, we benefit more from them doing what they do well and having stable revenue than trying to make everything under the sun and creating gigantic monopolies that dictate standards and absorb any company doing something remotely interesting (like, sadly, today's Google).
Consumers are fickle, and you have to be on top of the latest trends in GUI, service, products, business models.
Corporate customers tend to be stickier, and more resistant to change.
The A/G/A/F foursome are geared for consumers, and are suitably nimble. The others you listed aren't. The worst thing a company can do is try to be perfect for both types of customers.
So lets take, for example, ORCL.
From 2000 till today, ORCL become the clear leader in enterprise: they acquired PeopleSoft, Siebel, BEA, Sun, etc.
On the other hand, MSFT position in enterprise space is in much weaker position comparing to competitors such as ORCL. Enterprises will replace their Windows with tablets, but I don't see them replacing Oracle Database or Oracle Applications (and Siebel and PeopleSoft apps are not so bad).
So Balmer gets B- for his enterprise work. Larry, on the other hand, gets A+.
Microsoft, however, have three products that will ensure their continued profitability - Excel, Exchange and (probably most importantly), Active Directory. This is over and above their insanely cohesive ecosystem, from SCCM all the way to Dynamics.
Active Directory is so critical because of the vast amount of legacy code that depends on it. Want to guess how many fortune 500 companies rely on AD?
 Nothing is guaranteed so yes, unless they evolve as the environment they generate value for inevitably evolves, they'll go.
Fast forward to 2013 ... what do you see? Did Ballmer really improve Microsoft position in enterprise comparing to Oracle and other competitors?
Every sizable company already has these things installed. Smaller and new companies may choose to spend their dollars elsewhere and that's a change of events for Microsoft. Projects that previously would go on Sharepoint are now done less expensively with cloud services, for example.
In tech, growth is in consumer, and with consumer tech drifting in to the enterprise, even enterprise IT spending may not go to Microsoft.
really? What can you do on your tablet in enterprises? You can have them only as an additional device. They don't even have any port where you can plugin something. And, you will have your tablets interact with whom?
At the end of the day, you need real machine running full blown OS to get shit done and not devices meant for playing with those face painting apps.
Given that there are already enterprise users out there today on Android and iOS devices, this is a pretty bold claim. (And you can, in fact, plug things into tablets with both operating systems - they have USB support.)
These are not all being deployed as "secondary devices" - in many cases companies deploy them because they're cheaper to deploy and maintain than a laptop, which only makes sense if you're not also providing a laptop to the user.
Having companies run solely on laptops or tablets has nothing to do with whether or not there are enterprise tablet deployments. Your logic is flawed.
Net impact on Microsoft's bottom line: zero.
google now says you interact with the tablet by voice, and you watch the screen with your eyes. Now, tablets can even derive events from looking at your face (samsung you look away video stops).
Noticed you don't need a mouse with a tablet?
Oh, the software will have to be rewritten, no doubt, but since most of the software is interface anyway...
Is that true?
Microsoft's ActiveDirectory, Exchange, and SharePoint are every where.
Perhaps they have different parts of "enterprise" pie.
In last 10 years, I have visited 100s of enterprise data centers and seen the transformation from primarily UNIX (non-Linux) and Windows server to Linux. Today I rarely come across UNIX and come across shrinking base of Windows servers. Ten years ago, I saw shops exclusively being either UNIX or Windows. Today shops are either Linux or a combination of Windows and Linux. In Enterprise OS market, Linux ate UNIX for lunch and now nibbling at Windows for dinner.
Active Directory and Exchange are much more popular because of its utility with windows workstation managements and user familiarity with PC and Outlook. With the acceptance of BYOD, thanks primarily due to iPhone and iPad, the MSFT hold on workstation side has started to be impacted.
Sharepount is not that much popular except in dominantly Windows server shops.
Most of the money is made on Windows Server licenses and many of these things get thrown in.
os, sql server, office/exchange.
Everything else is tiddly winks.
And most if not all of them have some kind of Office Document viewer and basic levels of editor, either built in, shipped with, or available as an app.
And how is Samba, a clone of Windows SMB file shares, going to help anything mobile?
Are you meaning to say that an enterprise software company can't be looking toward the future, and/or that only consumer facing technology companies are innovating and creating new stuff that will affect the future?
Heh. You really think any successful tech company has ever had a mission besides making money? Some of them talk big in their first few years, but they never follow through and they get embarrassed and try to sweep it under the rug pretty quick. Remember when the RealPlayer company was called Progressive Networks, because it was supposed to "provide a distribution channel for politically progressive content"? Remember "don't be evil"?
You're forgetting the XBox a bit too quickly.
If you bought Apple at $700, you're still in a big hole.
However, if you bought Apple stock instead of Apple computers, then over the years, you probably did pretty well ;-)
What other enterprise company has major footholds in even half of the markets that Microsoft has? Who else has Windows?
But for a quick synopsis of my response to your statement:
1. Billions of people use computers with a variety of operating systems every day;
2. Thousands of people touch their first computer ever, every day, and very, very few run Windows;
3. Millions of people use computers every day and are still deeply confused when the start button moves.
Regardless, the point I was responding to was that Microsoft had some sort of special advantage over the run-of-the-mill enterprise soul-suckers like IBM or Oracle. They might; but they won't for long.
Ultimately, I don't see how any reasonable person could disagree with simply making note of the fact that Microsoft no longer has the ability to change the course of computing: enterprise or consumer.
Are you aware that like 90% of corporations run Windows? No other operating system can claim anything even close to that.
That is the state of most corporations today, but at best, I would consider Windows a rapidly depreciating asset (in a strategic sense -- I'm sure it will continue to be a major source of cash for a while).
"Microsoft used to control the future of computing. Now they are yet another enterprise software company with no apparent mission except to make money.
Meanwhile Apple/Google/Amazon/Facebook/etc look toward the future"
I disagreed with the part where they said "just another enterprise software company". I also happen to disagree that they have no apparent mission, but that's another story; please forget that I said it :)
So, would you argue my point for a second? Why is Microsoft NOT just another enterprise software company now or in the next decade? I think I can come up with more, "bigger" and more provable reasons that they are NOT than that they are, but could be wrong. And who knows the future? Right now, they're surely not just another enterprise company and the future is not static, it's based on the now.
And to be clear, my "just another enterprise software company" category includes IBM and Oracle, as well. And I imagine Microsoft is still on the top of that list, but I don't think they have a radically stronger position. It is a very profitable position for now, but that wasn't what the original comment was about.
The question is whether they can again "control the future of computing" or just continue to make a lot of money on roughly the status quo (i.e. simply be "yet another enterprise software company"). I can't speak for the original commenter, but I suspect their emphasis was on "enterprise software company with no apparent mission except to make money" rather than "yet another", so that line could probably be replaced with something like "yet another boring, immensely profitable company".
On that question, I think you can make a good argument that some of their footholds are actually a handicap now. For example, Windows and Office make so much money that the company becomes conservative, unwilling to do anything that might significantly disrupt them.
They haven't released an OS without the Windows name in about 20 years now. Even with their mobile OS attempts, it always has Windows in the name. Even the original XBox promotion had a bit of "it's based on Windows" push. And on that line of thought, why hasn't there been an XBox Phone? The smartphone market is largely consumer right now, so why not try a different brand approach?
Yes, Microsoft dominates in the enterprise space right now, but they are losing badly in the consumer space (which will eventually break into the enterprise position) and the cloud space (which is the enterprise position of new companies). What do you see them doing to change the course now?
On a "consumer tech" tangent, IE 11 will finally implement WebGL. Direct3D gave them a unique hold on desktop gaming, paired with a really strong console gaming position. WebGL finally forced them to submit. I expect there are a few divisions that are wickedly pissed off now, and I totally understand why: Direct3D is now in its deathbed.
An utterly dominant, gaming tech position undermined and eliminated in the span of maybe five years.
In the enterprise market, I'd give them a longer timeline, but it's hard to imagine a moribund, hydrogen blimp of that size managing to see (much less avoid) the fireball collapse that's coming.
For one man, he sure has a lot of failures on his plate.
Has a lot of failures on his plate for one man? Please hand this comment an award for middlebrow remark of the year.
Let's put Steve Ballmer's accomplishments in perspective: Have you tripled a multi-billion dollar company's revenue over ten years? Did you launch the Xbox? Did you launch Windows Phone (10% marketshare in 3 years)? Did you launch Bing (growing faster than the search market)? Did you grow .NET into the most widely adopted application development platform in the world? Did you grow the Windows Server business out of nothing compared to where it was 15 years ago? Did you turn Visual Studio into the gold standard for IDEs?
Didn't think so. Ballmer will be remembered for one great mistake, and that's denying Microsoft's culture and employees a strong technical visionary over the course of his tenure.
Ballmer is a COO, kind of like the guy running Apple these days - neither Ballmer nor Tim Cook have a strong ability to anticipate changes in the way technology is consumed compared to their predecessors. And this is largely what's responsible for Microsoft's big whiffs - they missed the mark multiple times on the consumerization of technology.
People are already starting to grumble many of the same criticisms of Tim Cook's innovation that they did about Steve Ballmer, and who can blame them? Over the past three years all Apple has shipped are the same products they had before but with different screen sizes.
However, that doesn't mean that Tim Cook won't be successful in growing Apple's business, nor does it mean that Steve Ballmer was a failure.
As an ex-Microsoftie, I could not be happier to see Steve go. The company needs a technical visionary in order to stop having to play from behind every time there's a change in the market.
But to call Steve a failure is utter nonsense and requires overlooking all of the successes that he and Microsoft had during his tenure.
They already had the most widely adopted platform in Win32. The transition to .NET was horrible. No one was sure what .NET actually meant for a while, as it was used in marketing for all kinds of things. They also seemed to change their minds every few months about how which platform people should use. Finally it converged, and .NET is not bad. But they already owned the desktop app OS and dev platform since the mid 90s, when they overtook Borland and others.
All I know is that for a sample of 1, me, I used to use (and really like) the Borland (Pascal, C, ...) compilers in the late 80s and early 90s. Then, I started doing more unix and then Linux work. GCC, perl and later Java was there. By the time Delphi was there, it was too late - Java had already provided a free equivalent. (Java is just Modula + OOP + UCSD-P-code in C++ clothing)
More than iOS and Android SDKs?
There are 1.5 billion PCs world wide.
Are all of them running .NET?
Gee, when have we heard this before. Oh, yes: when the iPhone was released.
This is why these "mobility" servers like IBM WorkLight or SAP/Sybase Unwired are hot products.
Blackberry's are going away, we have remote email via iOS, and its only a matter of time before other people get the gear sales has.
I think the big difference is, Cook doesn't seem to be pushing innovative people out. The only big head to roll under Cook's watch was Scott Forstall's, and apparently he left because he clashed with Jonny Ive (and wanted to go to war with Google in the machine learning space - not just having a few in-house alternatives, but trying to lock Google out of the iPhone to promote Apple's stuff).
The same thing happened with WinPhone. MSFT spent a lot of time developing an honestly pretty decent OS, only to have its launch lineup filled with unimaginative, plasticky bullshit phones from Samsung and LG.
I for one think Microsoft's messy divorce from OEMs is a great thing, my only disappointment was that they didn't throw the OEMs under the bus at supersonic speed.
Agree with this statement. OEMs is also the one of the reasons why Android gets a bad rep. Android doesn't suck, it just gets thrown into incompatible and low spec'd devices and when the lag starts rolling in, people blame the OS. I guess this is one of those unavoidable quirks of being an OS vendor and having no say in the hardware. Atleast in Microsofts case, if they wanted, they could get restrict their OS from being installed on an under spec'd device but would Google be able to do the same, especially in light of Android's openness?
Aside from the odd "Apple has better hardware" bit (they use the same binned devices that other OEMs like Dell do, so not sure where that comes from), you've benchmarked this purported speed difference?
Because most of the crapware that companies like Dell, HP, and others put on, while irritating, consumes exactly 0% of processor or I/O time, and has zero impact on performance of the device, beyond the hysterical, easily-convinced responses of the placebo effect. The vast majority is nothing more than trials. It's irritating, and wastes users time if you want to clean up your desktop and app lists, but the commonly stated impact is just not at all supported.
And then there's the issue of what exactly is crapware and what isn't. Buy a pure Windows device and you'll be pestered endlessly for Skydrive, Hotmail, Bing, photo backups, Xbox coupling, active your Office trial, etc (just as if you buy an xbox 360 and then pay for the privilege of using it online, in return you get ads and sponsored placements on your dashboard).
Apple is predominately a hardware vendor that has made enormous bank on that (pivoting their MP3 player market into a smartphone market into a tablet market into a bonafide desktop market). Microsoft is predominately a software vendor.
Everyone told Microsoft that they should mirror Apple: it got them a billion dollar+ write down so far, and offended all of their prior allies to start grouping behind alternatives. This "Microsoft should be like Apple" plan isn't really paying dividends.
Apple pushed IPS screens when PC OEMs were happy with the lowest quality TFT panels available. For years Apple insisted on having a proper GPU in their machines, until Intel finally was able to offer a competitive IGP. And finally Apple also moved forward with SSDs early on.
Add on top of that, Apple's laptops look good. Asus is one of the few PC OEMs making laptops that are even within striking distance of Apple, but their distribution and advertising is abysmal. Asus's best ultrabook was exclusively available from Amazon for the longest time! And then their model numbers are so confusing I knew what I wanted to buy but I couldn't figure out exactly what magic combination of model numbers equated to the machine that I desired.
Every PC Laptop out there has "something" missing from it. Then there is the terrible buying experience, pretty much the only sane way to buy a Dell or an HP machine is to find a magic sales link that takes you to the site which will now show you the real price of the laptop, rather than the rather insane price that is shown by default.
> Buy a pure Windows device and you'll be pestered endlessly for Skydrive, Hotmail, Bing, photo backups
Really? Pestered? I signed into my MS account and my Skydrive files are synced down, but aside from that, I've had no other notifications or requests on either of my Win8 machines. Granted these are both raw Win8 installs.
Even stayed one CPU generation back in order to do so.
There have always been a diversity of options available in the PC market, and those who wanted to pay the premium for an IPS screen (you know, Apple still sells devices with TN screens...), GPU, or SSD could. Picking the lowest priced PC and pointing and jeering "see!!???" is not a useful tactic, just as someone can't point at the Macbook Pro and jeer at the price without equalizing hardware.
On the phone side, for several years, the iPhone had the BEST possible screen available on any phone because they invested in the panel and locked up the supply (since they paid for it) while other phone makers were content with lower resolution screens.
This is the mythology of Apple that is so bizarre. Apple overshot competitors not because Apple has such a dedication to technology excellence (I mean, at the time their offerings were dramatically behind all competitors), but because the simplicity of the SDK meant that they had to simply double existing resolutions.
It's going to be interesting to see what Apple does with the market-lagging iPad Mini on the refresh -- double each dimension resolution, yielding a hilariously excessive pixel density purely to maintain the wrong-headed SDK?
I call bullshit, that's not how I remember it at all.
The iPhone 4 was released in June 2010 at 960x640. The Samsung Galaxy S2 wasn't available until 11 months later - May 2011, at 800x480. The Motorola Droid X was also available May 2011, at 960x540, along with the HTC Sensation, with the same resolution.
This is the mythology of anti-Apple postings that is so bizarre. They just know that Apple is always technologically inferior.
By 2012, the Android competition has gotten better than Apple in resolution... but only because Apple made resolution important.
But it was also not the first. The Nexus One/HTC Desire had also 800x480 resolution - 6 months before iPhone 4. Also, the original Motorola Droid - available since November 2009 - had 854x480 resolution.
I'm talking about when the first iPhone came out (2007?) and you couldn't find a multi-touch capacitive touch screen in any mass market device that was able to match the precision and responsiveness of what Apple delivered in v1 of their mobile phone. It was not for a few years that competitive devices came out with a screen that had the same level of responsiveness.
In the laptop arena? Not so much.
When buying my last laptop (~2 years ago) I wanted a 14" laptop, 1080p IPS screen, and a quality dedicated GPU.
I was out of luck, NO ONE made a machine like that. I could get any of those two, but not all three. I ended up with a 14" 1080 TFT and a GPU.
A few laptop manufacturers have started pushing the boundaries of quality, but it is by no means universal. Even today getting a well build (e.g. not Clevo) 14" machine with a GPU and a good screen isn't easy, you have a couple of options to choose from.
Suffice to say for my laptop purchase I bought my own SSD and installed it myself, much more powerful and lower cost than anything the OEM was offering at the time.
1 - Startup time is affected by all the bloat
2 - Trial for slow/crappy AV, affects IO and CPU usage (more than other anti-virus)
3 - OEM "tools" that make it "easier" to use the computer, consuming a non trivial amount of CPU to check for updates, show several tray icons because of course you need a special utility to switch from builtin screen to external monitor even though the builtin one works better and by the way do you want to sign up to our special partner offers?
I suggest you smash a finger with a hammer, when I did that it hurt but of course it's only anecdotal evidence
I have used countless installs of Windows, through MSDN, retail, Technet, and through vendors like Dell. I happen to avoid being a suggestible simpleton so I don't simply adopt the sophistry that is so common. Sorry if this offends you into hilarious insults.
It's not a matter of benchmark, it's about computing 101.
This is utter nonsense. There simply is no other way to put it.
There have always been premium Windows machines (Sony was doing the extremely-thin, fits in an envelope, made-with-unobtanium laptop thing years before Apple did), and discount machines. Focus-on-aesthetics machines, and ugly but functional machines.
That is how a diverse ecosystems work, and the consumer gets to choose what they want, and what matches their priorities (the fact that you have some sort of hipsterism dislike of "plasticy" should not restrict my purchase when I see it as simply a material that is often optimal. I don't have a fetish for materials).
Not 100% true. I remember buying a $2000 Vaio Z a couple years ago that had the option of getting a clean windows install (for $50 more)
I believe it was somewhere around $800, and is a perfect device for my needs. Spent a few minutes after booting removing the various trials of junk on it.
Colour me clueless, I guess.
$550. People who buy Macs can't even conceive that you can buy 4 PC notebooks for the price they are buying 1 Mac notebook. They can't conceive that the typical person doesn't buy overpriced Ultrabooks that are different only in marketing name.
All they will say is that their computer "holds its resale value" or that it will "last longer". When it is literally 4x more expensive for equivalent speed, these things are meaningless.
When I have a notebook, I don't want it to weight 10lbs because I'll be walking around with it. What's the point in having a fast notebook when you dread taking it around with you? I also appreciate the design aesthetic and the "it just works" feeling I get when I use OS X. The battery life is great, the laptop is portable, the design is beautiful, I get the job done. That's why I use my Mac notebook and that's what I'm paying for.
Once I switched to mac I began to focus more on the work I do, and less on the machine I use to do it. Plus, I sold my 3 year old MacBook Air for ~70% of it's value, whereas my brother was barely able to sell his 2 year old xps 15z (which is NOT a cheap laptop) for ~40% of it's value.
Another thing I have noticed is that many Windows laptops have their own strengths, ThinkPads have great keyboards and are indestructible but are pretty thick, not very stylish, and still quite expensive. The Asus Zenbook has great build quality and looks very stylish, but is also expensive, has a finicky trackpad, not the best keyboard, and still has some bullshit software that comes preinstalled (although it is better than most Windows machines in this regard). That's what I love about my MacBook, sure it's expensive, but it has amazing build quality, it's plenty fast for 99% of my needs, has an amazing screen, no malware when you buy it, the best trackpad in the industry, keyboard is as good as the ThinkPad (in some ways better, in some worse), the warranty is unmatchable, and the resale value is also the best in the industry. These are the things that matter to me now.
Much like they don't see cars as fungible transportation commodities priced in $/Watt and $/N·m.
Windows laptops are packed full of hardware and software crap that nobody really wants. Fingerprint readers are unsafe toys. 17 inch monitors make it impossible to use comfortably on your lap. Doesn't matter how many cells are in your battery, it won't outlast mine because Windows drinks juice like a sailor.
I don't care how much more money I'm paying for my MacBook over a comparably specced PC. There's just no comparison. Software, hardware, support. I took my laptop to the Apple Store three times last year, got a quick turnaround and paid nothing for the repairs. I did not have to go through a phone maze or argue with anybody.
People who buy PCs just don't understand quality. Only price.
You're making a logical fallacy: "I don't want this feature, therefore nobody wants this feature."
I just helped a friend pick out a new laptop. He insisted on a 17-inch screen. This was his single absolute must-have. No 17-inch screen? No purchase. Any other spec was negotiable. The screen was an absolute must-have. Even a 15.6-inch screen was too small for him.
Weight? He didn't care. Battery life? He didn't care. It had to have a 17-inch screen. He didn't want to use it on his lap. He wanted a desktop replacement that he'd keep plugged in all the time -- with the option of picking it up and moving it to another desk.
> People who buy PCs just don't understand quality. Only price.
He didn't care about price. He was willing to spend $1500, $2000, whatever it took to get a 17-inch laptop. Except, of course, that Apple cancelled the 17-inch MacBook Pro -- the one feature that might've won his purchase.
That's the nature of the new economy we live in. If it's not profitable, if millions of people don't want it, it's relegated to the back-channels and specialty web dealers. Companies just can't afford to release anything anymore without excellent product-market fit.
It used to be you could get Dell to build you anything you damned well pleased. I just went to the Dell website, and you can't even look at their laptops until you identify as a member of an organization. They don't sell to consumers anymore. You have to go to Best Buy.
If you want to know who's responsible for this shitty state of affairs, walk over to a mirror and take a good long look in it. Silly, unrealistic, demanding consumers who don't understand quality, only price, are turning the entire industry into shitty versions of Apple.
So I'm sorry, I have zero patience for asshole customers who think they're always right. It's good that your friend was willing to pay whatever it took to get his 17 inch screen. Most of these idiots don't. And they ruined PCs.
Ridiculous claim. Visit http://www.dell.com, click on "For Home" on the menu at the top, then in the menu click "laptops & ultrabooks".
That puts you on a page showing consumer laptops you can buy, right there, two clicks from the homepage. Or you can search/filter on ten different fields (including 17" screen size which finds a choice of 34 laptops).
The macbook air weighs ~1kg, has a 12 hour battery life, and has a nice aluminium body. Last time I looked, not only is it impossible to get a PC laptop like that for a comparable price, it is impossible to buy such a laptop from any PC manufacturer for any price.
Best money I ever spend
Today, unless you're doing heavy processing stuff, CPU speed DOES NOT MATTER. Memory does. I was perfectly happy with the CPU speed of the notebook I had before, the problem of course was memory size.
(I wouldn't buy a 17' notebook, you'll pay the price on back problems)
I can't stand using Windows and the Linux distributions nowadays take much of my time with BS like Gnome 3 and other bloated crap.
So, Mac OS.
We're not talking about a 100x price multiplier here, where clearly one's into the land of diminishing returns.
This kind of self-righteousness is just as faddish / cliquish as excessive fan-boy-ism.
In my view, Ballmer's mistake is to not go after Oracle and SAP much more than chasing Apple and Google.
Edit: Apple did acquire ping, but that was social music, which is a bit different. They also introduced siri, which simply plugged in to preexisting search services (Google in iOS 6, Bing in iOS7) so it really is agnostic on that front.
"Google are making baked beans? Why aren't we in the baked bean market? Let's make beans!"
"What? Now Facebook are making Facebook Soda? We need to make Microsoft Soda!"
Every time a tech company produces something new MS have to muscle in on the market, despite having a) no prior experience, b) no aptitude, c) existing products that could use their attention.
But I think Google is much more prone to jump in to a market with force, they just seem to execute "better" (I leave that open to interpretation).
FB comes out and MS buys in whereas Google makes their own social network. Apple makes the iPhone and Google makes Android. Only much later (as the ship has already left port) does Microsoft come in with Windows Phone (I'm only considering 7 & 8). Somewhat related, I feel like MS and Dell were on target with the Axim from a product idea standpoint but Apple really capitalized on combining the functionality of a phone and forward thinking hardware and software design with iOS devices.
This is an established enough business strategy there's a name for it: "fast follower." (See http://www.businessinsider.com/youre-better-off-being-a-fast...).
After that, yeah, a lot of following, then again for the GUI introduction era everyone was following Douglas Engelbart, and Xerox PARC for the graphical part.
Microsoft's failure was in hesitating to change with the market, not a failure to have products on the market.
Tablets, you can make a case for, as above, I guess, but again, the leap with the iPad was so great that it wasn't just an iteration but a leap, leaving it open for a fast follower to come on (as Google did there too).
Apple and Google didn't have Windows Mobile 6, 7, and 8 being planned and developed when iOS or Android were released. Microsoft did. It's slower to turn a ship around than it is to start one going in the right direction in the first place.
And besides faster processors and a slicker UI, what exactly puts Android in a different market than Windows Mobile? Serious question. Both allow you to develop, download, and install apps. Both are pocket computers with a cell phone built in, built on the same paradigm that Microsoft ushered in throughout the 90's (give users almost complete control, let OEMs do whatever they want on the hardware side). Windows Mobile has touchscreen support. Both can/could be gotten for very cheap or very expensive. Android seems to be, for all intents and purposes, a straight-line evolution of Windows Mobile with a Linux kernel (yet still closed-source where it really counts).
What supports my claim that the market was created by Apple and Google? You cannot exclude "faster processors and a slicker UI", as you put it - nor what they're a part of. It was a revolutionary change in user experience.
Your point about neither Google or Apple having involvement in the industry is a good one and it's not completely uncommon for stories of disruptive innovation - which this clearly is...
Which is not to say they can't execute a fast-follower play successfully anymore -- see XBox and Azure. Just that they don't nail it as thoroughly and consistently as they used to.
I find it hard to believe that someone who writes something this wrong can function in society.
Microsoft invented the tablet computer a decade before the iPad existed.
Their marketing may have sucked, but they were well ahead of the rest of the industry (and apparently the world).
Please, stay civil. :)
Anyway, I don't think the statement is wrong. Sure, Microsoft had tablet computers first, but I think it's also true that the Surface RT and Surface Pro were made in response to the iPad's success.
Are you referring to PixelSense?
The antecedents to the Metro design were in Zune HD and the Zune desktop client, among other things.
>Every time a tech company produces something new MS have to muscle in on the market, despite having a) no prior experience, b) no aptitude, c) existing products that could use their attention.
Similar to what Google is also trying to achieve with Google+, especially with muscling in part? Although I don't like their approach, I can't blame them for going with it. There is a huge untapped market in the social segment and they were right to put a footing on it.
Android was bought in.
I never thought of Siri as search. To me it was more about interfacing with your device.
Bing on the other hand, not so much.
Native speakers might not see a huge difference though.
Also MS was into search before Google was.
Yes, but at least for the past two years Jobs has had a really good excuse.
I mean, its not like MS didn't try the search thing, but search is something Google will own until they fuck it up, not from anyone entering to compete with them, because free & good enough are hard to break. Albeit, Google has been doing a good job fucking up their search in the last several years.
To me, Ballmer is symbolic of Microsoft-with-ADD. They ignore things until they become urgent, and then shovel money into the furnace until victory comes. Look at Windows Phone - microsoft had a mobile offering when iOS came on the scene, but took years to move on with WP7. Desktops languished on IE6 for far, far too long.
And Vista's long death-march process and lackluster result is another point.
There are a lot of people that would be OK with being dragged into upgrading if Windows 7 was an easily available option. Bu now, MS is pushing manufacturers into pre-installing 8, which is NOT a good transition path from XP as Windows 7 was.
Good thing I don't have to run that crap at home.
As do all successful people. If success were easy, everyone would be doing it.
For all the ways I disagree with Ballmer, this seems like a poor choice to point out.
Failures are acceptable if there is ultimate success, what is Ballmer's success? Retiring rich? (Most of which was accomplished on Gate's stewardship.)
Perhaps his name could become a unit for excess inventory. The "Ballmer", 500 cubic metres of unsold goods.
EDIT: or perhaps the name of a new airplane seat, "The Ballmer" the only chair to fly in!
Windows 7 and 8 were the first mobile OS that didn't completely rip off Apple, had the first original interface since Apple's iphone and you're saying they missed the target? Seriously?
WP 8 has some incredibly original features my Android and Apple friends swoon over. Not to mention the platform is completely wide open for developers. It's not completely crowded out like the android and apple markets are.
Like hell it is. If you're a small individual developer, you get the 3rd class treatment and access to their "open" api. If you're a big company, you get much more access to the OS than everyone else. Example: when WP7 was introduced, only large companies could make apps using the double wide tiles for their apps, individual developers didn't have access. This and MANY other examples were prevalent all over the platform. I know of an ex-MS developer who complains that only large companies get access to the faster and better undocumented apis not available to everyday developers. As for incredible features, WP8 also lags behind android and apple in many areas.
Is everyone here too young to remember Palm, Windows CE, Pocket PC, et al?
We need new terminology for describing the transition that occurred once we had pervasive smartphones with built-in app stores, because it's nonsensical to claim that "mobile" didn't exist before that.
Personally I think WP8 is an excellent OS. But it's a distant third in market share.
It's like my Google+ account ... wide open for my friends. Except none of them are on there.
I'm sure you must have been saying the same thing about Android then huh?
By comparison they only sold around 640K handsets in 2008 (their first year of release) then sold around 6 million in 2009.
I'll never say never, but it's looking pretty much like the Zune. Nice and solid product with some nifty features, but not different enough to dethrone the dominant players.
The problem is that Apple dominates the high-end and calls the shots regarding the operators (that by experience knows that they will lose customers if they don't offer the iPhone), while Google panders to all the OEMs by giving away a very capable operating system with top notch apps, and to operators by allowing them to customize it with crapware.
Kinect was invented by an Israeli company before being bought out by Microsoft.
Your point still stands though :-)
No. The sensor was developed by PrimeSense.
However, the key part of Kinect is the software, which was based on machine learning work done at Microsoft Research.
MSR is somewhat infamous for developing all sorts of whiz-bang prototypes that never make it to market. Kinect was an exception.
As for who convinced Anders Hejlsberg to jump ship, that was Bill Gates. He was still CEO of Microsoft in 1996.
Generics, one of the CLR's major distinguishing features over the JVM, came entirely from MSR, at considerable resistance from MS Corp.
Yeah, but a CEO also gets blamed for everything bad that happens during his tenure.
Wait, what? That's like saying RIM missed mobile. Microsoft was doing mobile years before Apple or Google ever entered the market.
My guess is that Microsoft and Ballmer's real-world experience in mobile actually constrained their imaginations. Their failure to see how mobile could be reinvented was due more to hubris than naivete.
...that is to say, it is a fairly reasonable thing to say. They just "missed it" in the opposite direction from how companies usually miss things. They came and went too soon. They sold smartphones and airplanes before everybody was buying them.
The problems with your friend's phone were probably caused by non-Microsoft code. And just like bluescreens on XP, Microsoft got all of the blame.
Around 2006, I had a Windows Mobile phone that was freezing up almost every other day, as it came configured from Cingular. After resetting to a clean copy of Windows Mobile, the phone would easily run for two months between reboots.
This could be done using a little-known trick: Hard-reset the phone, and wait for it to reflash with the OS. When "Installing customizations ..." comes up, immediately press the reset button. This cancelled the installation of all the "value added" components from the carrier. You ended up with a completely clean copy of Windows Mobile, as it was developed by Microsoft (plus OEM drivers and utilities).
It was essentially the phone equivalent of reinstalling Windows on a PC to eliminate all the OEM preloaded crap. The only difference was that it was the carriers who dictated the preloads on Windows Mobile -- whereas the OEM utilities were reasonably reliable.
Ballmer is/was probably a good CEO for a conservative, old school company, which can derive profits from a stable and well used product line.
But that's not what MS is/was advertised as being about. In that circumstance, Ballmer is the wrong type of CEO.
So we get a constant barrage of misstep boondoggles like Web Forms, Click Once Installers, Linq2SQL getting deprecated almost as soon as it was launched, etc. And with every step a larger pile of configuration and attributes that need to be added to get things to play nice with the OS.
Windows NT/2000 and Exchange had already killed the established leaders in their fields, and SQL server was pretty close to #2 database already, in 2001.
You ever noticed how every Office and Visual Studio version has a completely new suite of program icons? Are they deliberately trying to hurt the usability of their programs?
> The MSDN Magazine Camp is always trying to convince you to use new and complicated external technology like COM+, MSMQ, MSDE, Microsoft Office, Internet Explorer and its components, MSXML, DirectX (the very latest version, please), Windows Media Player, and Sharepoint... Sharepoint! which nobody has; a veritable panoply of external dependencies each one of which is going to be a huge headache when you ship your application to a paying customer and it doesn't work right. The technical name for this is DLL Hell. It works here: why doesn't it work there?
> The Raymond Chen Camp believes in making things easy for developers by making it easy to write once and run anywhere (well, on any Windows box). The MSDN Magazine Camp believes in making things easy for developers by giving them really powerful chunks of code which they can leverage, if they are willing to pay the price of incredibly complicated deployment and installation headaches, not to mention the huge learning curve. The Raymond Chen camp is all about consolidation. Please, don't make things any worse, let's just keep making what we already have still work. The MSDN Magazine Camp needs to keep churning out new gigantic pieces of technology that nobody can keep up with.
Spolsky concludes, "Inside Microsoft, the MSDN Magazine Camp has won the battle."
Incidentally, .NET was what finally convinced me to jump ship from the Microsoft world, and I've never looked back.
Don't get me wrong, I think MSFT will be better served with a different CEO, but I wonder whether the two are connected. Certainly, the re-org will struggle without strong leadership to hold it together.
You know what makes sense to me? MS is only broken according to engineers inside and people in the SV echochamber. They've got piles of cash, they generate piles of cash, they pay a dividend... Other than equity prices, they look pretty good. They were late to search but bing has carved out a niche, late to mobile but they've got a niche, late to games but they look like they are doing just fine there. Vista, Windows 8, RT and Surface seem to be missteps but they are still shipping numbers that most companies would be envious of.
If they were or are bothered by the flat equity prices, why did it take so long? And to be very honest, the engineers I've spoke to that have mentioned "problems" within the company generally have options that have been underwater, FWIW.
I think Ballmer and upper management think they are doing just fine, they think there is a competitive landscape but they are still making tons of money and leading a few sectors. He reorged them for what he sees as the next 10 years or something and he's going to find a replacement that sees his vision. They won't pull an outsider and probably don't see the need as there isn't anything "broken" that needs to be "changed." I predict no big changes.
C# and Java do look the same, but the use cases for them are totally and completely different.
Java is a cross-platform language used when you don't want to write code more than once for more than 1 platform.
C# is a Windows-exclusive deal that gives you access to WFs and other Windows-centric things, including some low level shit that would be a pain to deal with otherwise.
Despite the languages looking really similar, they don't fill the same slot.
I'm glad they lost that lawsuit
Along with "what have the Romans ever done for us", Ballmer can also be forgotten for some billion-dollar business such as SharePoint and for making Microsoft a serious player in cloud computing ;-)
He won't be remembered for that also because he inherited a monopoly company. But he should be remembered for transforming Microsoft into an enterprise software company, which will extend its monopoly status there for a long time, as long as the mediocre class of IT workforce remains, which is probably going to be a very long time.
He is not good at making technology innovation decisions, everybody knows that, especially himself. That as a given, he set out to make the best business strategic decisions for the company. How did it go? It might be easier to tell when Tim Cook reaches his 10 year anniversary taking over Apple.
After Ballmer, Microsoft is yet another directionless corporate shitshow that has found out that selling enterprise shlockware to enterprise clients is a good short term revenue model.
This is exactly what Microsoft did to IBM 25 years ago. In this round however, Microsoft is playing the role of IBM.
GP: Talking about MSFT share prices instead of MSFT market cap makes the Market Economics Fairy cry. Even if you talk market cap, she wants to know about dividends and share repurchases, then adjust for inflation.
Kudos for executing, but the vision thing was always missing with Ballmer. He didn't just miss mobile, he laughed at it. He will be remembered for Windows Vista.
Those are irrelevant metrics unless you plot them against the growth of the industry as a whole. The results speak for themselves.
In the last 13 years, we've all seen the rise of Microsoft, and are now seeing the beginning of it's fall. Ballmer was an extremely important figure in the tech world. I just wish the Operating Systems that came out during his time didn't suck so much.
I used to hate MS. Now I feel sorry for them, I hope they can make a go of it in the future. The people who came after them in market dominance were so much worse..
You mean SP2? Reminds me of "Feature Packs".
SP3 came four years later, in 2008.
Edit: parent comment used to say "worst CEO of modern history"
What about Stephen Elop?
"As of June 2013, Nokia's [...] stock value dropped by 85% since Elop's takeover."
How so? The guy is absolutely brilliant!
Of course, you must realize he actually works for Microsoft, not Nokia.
I don't think anyone would argue that Ballmer's been the most innovative CEO of his era, but as a custodian of shareholder value, it's pretty hard to fault him. Could he have done better? In hindsight, we know the answer is yes, but the answer in hindsight is always yes. He managed to try and fail at big ideas without bankrupting -- or even significantly impairing -- his company. Not many CEOs can claim the same.
What happened to Microsoft? It built and sold unsexy products that people were willing to pay gobs of money for. I'm sure many businesses would love to fail so successfully.
 http://www.gurufocus.com/financials/MSFT#cs. For the sake of reference, AAPL returned ~$26 billion to shareholders over the same period.
1) The stock was closer to $57 in January 2000 if you average the trading days, not $35 (high in Jan was $64 at the end of the month, low was $42 at the beginning of the month).
2) They generated $22.9b in sales and $9.4b in profit in the fiscal 2000 year. Ballmer inherited about a 45 PE ratio, which is a massive multiple for a company with a $425+ billion market cap. An impossible multiple to maintain at that size I'll note. Just ask Apple, their PE has imploded from 35 to 60 several years ago, down to 9 recently (now 12 or so). Does that make Cook a terrible CEO, the fact that it's very likely impossible for him to build a trillion dollar company? No, he inherited a growth monster that is rapidly slowing down. Welcome to the law of big numbers.
3) Sales have increased from $22.9b to $77b so far under Ballmer. And profits have gone from $9.4b to $21.8b for fiscal 2013. For a company that was already the largest software company in the world, that's a spectacular operating performance. Meanwhile they've returned 40% of their market cap in cash to investors.
The notion that any company can dominate all industries simultaneously, such that Microsoft was going to own search, social and mobile is absurd to put it very lightly. The notion that Microsoft can just magically stop all future giant companies from existing, is equally absurd.
I don't think he was a great CEO, but your bashing is completely off target. You're criticizing Ballmer for basically not being a trillion dollar company with $100 billion per year in profit by not being a combined MSFT + GOOG + AAPL + FB. That makes no sense.
MS is surprisingly well rounded regarding where its revenue comes from. More so than I had assumed reading a lot of the reporting.
>AAPL is one bad iPhone away from getting beaten by Samsung.
Look at how much of Apple's revenue is just iOS. Crazy. I'm not sure that Samsung is the threat, as they are just a hardware vendor like Apple, but without the profitable app and digital goods store (I'm assuming that App Store revenue is falling under iPhone/iPad in chart but could be wrong). I also see Apple more willing to change the business it is in if it needs to than some of its competitors. Apple got a lot of flack for the Maps "debacle," but it was a bold and decisive move. Apple couldn't come to terms with Google so they just built their own global mapping service. With so many eggs in one basket though, the revenue is certainly Apple's to lose or keep, depending on how it executes.
The Google chart is just amazing. Everybody knows why Android is free, but this just hits it home. They're an advertising company plain and simple. Anybody, anywhere, that can build better storefronts (search, email, native apps, etc) is a threat.
Profit-wise, Apple claim that their digital stores only break-even, but revenue-wise, the stores dwarf the Macintosh line, with music alone matching Macs.
In 2011 it was estimated near 300 million. Now in 2013 it is alleged to be making over a billion:
Still small potatoes profit-wise, but if the share of actual revenue is that significant, than this is definitely a nice little trend for Apple. To be clear, I think the iTunes and the App store are more of an advantage/differentiator over Samsung in terms of potential (especially in the context of Apple's willingness to make bold steps in new directions). I think I came off as a little too glowing when I described Apple's digital offerings above.
Remember, this is how Microsoft overtook Novell, DEC and the likes that were the kings of business computing in the 80s/90s.
And Apple isn't just one bad iPhone away from being beaten. They have consistently released good updates to their hardware and software for the past 10 years, and have built up a huge, satisfied customer base because of that.
Where am I going with this? Oh yeah, share price is not a great metric for company or CEO performance, and when its used people rarely evaluate all the factors correctly.
Most public companies could give less of a crap about their share price after the IPO. What people trade shares for is really inconsequential as long as the company itself maintains 51% and stock market panics on them don't leak to their profit centers.
Microsoft is a railroad company in the early days of the automobile. They're a typewriter company in the early days of the microcomputer. They're a sailing-ship builder in the early days of steam. They're important currently, but they're being left behind, and they have not positioned themselves to get in on the new stuff.
It takes a long time for changes to happen. Microsoft can live fat off the PC for a long time to come. But they will slowly slide into irrelevancy if they stick with that.
The comparison to railroads is apt. Railroads are still immensely important, even if people no longer romanticize them. Innovations in railroad technology are still very important. The financial difficulties railroads faced in the middle of the 20th century had more to do with the government promoting automobiles than with the superiority of cars and trucks. If Microsoft is the technology world's' equivalent of a railroad they are in a pretty good position -- they might not be the company everyone is talking about but they will be the company that everyone is dependent on.
I think he made one hideous strategic mistake -- deciding Microsoft was the Windows company instead of the Office (or "whatever makes money") company. If he had reacted to iOS and Android by selling Office for those platforms Microsoft would probably be making money off the mobile revolution instead of facing oblivion (or at least irrelevance). (Recall that Microsoft makes, or used to make, more money per Mac than per Windows PC.) Instead by emphasizing Windows over Office he made a whole bunch of people realize that they don't need Office to get through their days.
Betting on Windows was, I still think, the correct strategic decision.
Holy cherry picked statistics. In August of 2000, the near height of the tech bubble saw the NASDAQ at 4,234 and MSFT at about $35. Today, the NASDAQ is at 3,652 and MSFT is at about $35.
So the NASDAQ is down 14% while MSFT which is best benchmarked by NASDAQ is flat. From the most ridiculous tech bubble the world has ever seen.
There was a 2 for 1 stock split in 2003. Also, MSFT paid no dividend in 2000. Since then the dividend has gone from $0 in 2004 to $0.23 per share this past quarter. That's real value created and returned to shareholders. There's more to a company than share price.
Ballmer was no Steve Jobs. But he was no Leo Apothekar either. He'll be remembered exactly as he should be; that is, barely remembered at all.
As someone noted below, "Microsoft used to control the future of computing". This was a very bad proposition, as we all know how evil they are in general, and incompetent whenever it comes to actually doing something new, as opposed to copycatting and driving out of business their competition.
I will always remember and be thankful to Ballmer for making MS a nonissue.
However, you really should not quote Microsoft's share performance without detailing the dividends they have been consistently paying: http://www.nasdaq.com/symbol/msft/dividend-history
When doing this type of calculation, please adjust for Dividends, which have been substantial from Microsoft, and only recently started from Apple.
That works out to an annualized return of about 4.3%. That's better than a punch in the face but it's not that great compared to any other similarly sized tech company in any related industry.
Inflation is only relevant if you want to see how the purchasing power of Microsoft owners changed.
It's a bit unfair to say Ballmer hasn't increased the MSFT share price -- just today he's put the price up from $32 to $34.5.
That's not to say that Steve Jobs was wrong about the future, but he had to sell devices in the present which meant pretending that they were perfect even though they weren't. Ballmer may have been doing the same. It's likely that his failures occurred much earlier in the process, and then he had to try to sell doomed products which is where those silly statements come from.
They have had failures though, of course. Ping was another, for example.
Under Jobs Apple made stellar hardware and good-enough software.
Where they fail is web services. Apple cannot engineer a decent web service to save their sorry lives. The Cocoa API is pretty well thought out, generally well-documented, and pretty well-engineered.
Then you get into things where you have to talk to Apple via a network. StoreKit? [shudder]. iCloud? [terrified scream]. iMessage? Oh lord.
I agree, their APIs are generally very nice. But the last few releases of OS X haven't been great. Multi-monitor support will finally be fixed in 10.9, after having been broken in 10.7 and 10.8. Also, recent releases have become very slow. A 2009 Mac Mini running 10.8 is unbearably slow, while the same machine is on 10.6 is almost as fast as a recent machine machine with a SSD on 10.8.
And along with NextStep, Apple got its new iCEO, its new head of hardware, and its new head of software ;-)
Ultimately, you have to remember that he had an agenda, and if he wasn't selling it that day, then he would probably say something negative about the idea or implementation (of a competitor's product).
Here's a page that has more examples: http://www.wired.com/gadgetlab/2010/02/steve-jobs/
When Ballmer said nobody wants a phone with a keyboard, or that Zune would kill iPod he acted on that until reality was exhausted from beating him mercilessly over the head with proof he was wrong.
Also having to sell silly products again is the CEOs problem for having to decided to sell those. Its just that the past 10-13 years have been cluttered with bad products and I would assume the ceo had a major role to play in it.
Maybe you meant 'envision' the future? Outside of Nostradamus, who, by the way, predicted not only Hacker News, Steve Ballmer's downfall, but also this very thread on the same subject, not many people have the ability to see the future, although some are better than others at imagining how it could be.
Really though, do you think the CEO should say anything different?
"Yeah, our Zune isn't too bad, but the iPod is still better."
IMHO his legacy though, is the culture he leaves behind. Its an intensely competitive internal culture that has
- employees jousting with each other in the rankings game
- pressure across the board for businesses and individuals to deliver "results" in time for each annual and half year review which limited experiments and blue sky endeavors.
- over the top status mails and visibility exercises to preserve and extends one's influence
Everything else is a symptom of that - products that are kinda incomplete, or only incrementally better than the previous ones because it insanely hard to get everyone on board and ship truly game changing products in a manner that fit into the appraisal cycles.
Note the incremental approach is extremely good for more risk averse sectors like enterprise software but not really for the wild west of consumer technologies.
This article puts the cash value of the 2004 special dividend at 32 billion. (And that's not to include the quarterly dividends that they haven't missed a beat on.)
If I've held a share since 1999, in place of it I don't just have a share today: I have whatever I've done with the dividend payments that came in the interim.
Actually, $35 from 2000 would be much more than $35 now. The stock value declined while he was CEO.
But yes, the engineer in me laments with you. Microsoft has gone from an innovator to an optimizer very good at minting cash.
This is incorrect.
In December of 1999 the shares were selling around $58/share. Even in March after he took over the stock still hovered around $53/share. By May, the price had crashed to around $30/share - which coincides with the first dot com bubble bursting.
Only decent, and only proxy. Say you worked the first 5 years propping up a dying business, and the next 5 years building a bunch of incredible value. The stock market may not have reacted to that, but your company is set to explode in value. Or you may have started in a bubble, or finished in a bubble, or...
So of course it is not the only measure, but it is certainly an extremely large part of measuring a CEO, since it is his job to maintain and/or grow the value of the company. It will never tell you if the company is bettering humanity, good to its employees, or other very worthwhile measures.
So why are you completely ignoring dividends and a stock split?
Looking at 10 years of stock performance while ignoring those factors isn't decent analysis, it's terrible.
I would argue that by other measures, Microsoft under Ballmer has not seen improvement either. These might include market power (the power to dictate future market directions), product sales share, product mind share, cultural association, recruiting, innovation, etc.
That said, I think there are a few areas where Microsoft has seen improvement under Ballmer. Xbox went from a "what? really?" product, to the clear console leader. And Microsoft government affairs is miles ahead of where it was under Bill Gates--from its own federal conviction, to instigating multiple actions against competitors.
Even more importantly SQL Server really matured in SQL server 2005, as did IIS leading to a large proportion of the server share too.
.NET / C# was also post-2000, another very important strategic asset with Visual Studio.
I'm not sure that it is fair to characterise MS post 2000 as missing out completely.
You've got a huge case of reality distortion field.
== Negatives ==
* Clashes with Gates during CEO transition of power: http://online.wsj.com/article/SB121261241035146237.html
* Developer relations / motivational speaking (thanks mathattack): https://www.youtube.com/watch?v=wvsboPUjrGc
* Employee retention (thanks JonnieCache, Ziomislaw): http://www.smh.com.au/news/technology/microsoft-ceo-im-going...
* Windows Phone: http://www.forbes.com/sites/markrogowsky/2013/07/18/if-you-h...
* IPTV platform Microsoft Mediaroom (thanks nixy): http://www.theregister.co.uk/2012/02/03/bt_vision_upgrade/
* Vista (thanks balakk, danieldk)
* Internet Explorer neglect and market share declines.
== Mixed ==
* Failed Yahoo acquisition (thanks michaelpinto, seanmcdirmid, throwaway1979): http://www.microsoft.com/en-us/news/press/2008/may08/05-03le...
== Positives ==
* Xbox / games division (thanks benihana)
* Enterprise successes (thanks gregd, facorreia)
* Facebook investment (thanks riffraff)
[edits: updates per reply comment suggestions]
I suspect this is a more true statement.
* C#, F#, and all of .NET
* Visual Studio
* SQL Server
You can safely add AJAX to the list, XMLHttpRequest is from Microsoft as well.
I never had much symphathy for Microsoft, but I can't help but respect some of the things they've done, both in the Gates and Ballmer eras. They used to really care about developers.
Their programming tools may be great. But I will never care. Because I'd rather hit myself with a stick than use Windows.
Famous quote from 90's:
"Anybody who thinks a little 9,000-line program that's distributed free and can be cloned by anyone is going to affect anything we do at Microsoft has his head screwed on wrong." - Bill Gates (regarding Java, shortly before Microsoft licensed Java and cancelled the Blackbird project)
Server and tools (e.g. System Center 2012 R2, Windows Azure).
Increasing profits. E.g., FY 13 profits of $26.76 billion against FY 12 profits of $21.76 billion. That 5 billion dollars of additional profit in that fiscal year. I wonder how much profit Ballmer's detractors generate?
Relevant: How Apple's profits stack up against Google and Microsoft
Active Directory (copied, but marketed better than Novell), Group Policies, Visual Studio (arguably the best IDE available today), Sql Server, .NET, Azure.
And trust me, I am no fan of Ballmer. I think this announcement is the best thing to happen to Microsoft in a LONG time.
Most hardware was not powerful enough for Vista when it was released. It's the pressed who killed it. Windows 7 received glamorous reviews. However, in hindsight, Vista and 7 are not all that different. Most of the changes that daily users would encounter are cosmetic.
Microsofts primary problem was that it was late and (as one of the consequences) there are not that many Windows Phone apps. However, WP7 and WP8 were generally quite well-received by the media. Windows Phone is really a nice phone OS, what Microsoft f*cked up is the transition from WP7 to WP8.
And even if many changes between vista and 7 were "cosmetic", that's how people interact with their PCs, and things like having different UI styles all over the place is a huge dealbreaker that puts people off using it. (See also: Windows 8).
But Microsoft gave them the gun by agreeing to the OEMs' demand to create a "Vista Capable" classification, for machines that were too underpowered to run Vista well (see http://www.crn.com/slide-shows/channel-programs/206905984/tr...).
The OEMs didn't care about customer experience, they just wanted a "Vista!" sticker they could slap on as many machines as possible. MS had to know these machines would make Vista look bad; they should have resisted the demand. But they didn't, so tons of people bought machines they thought would run Vista acceptably, only to find out they did not. So they (understandably) thought Vista was just a dog that couldn't run well even on "Vista certified" hardware.
While their sales are down in the US, they are on a (very slow) rise almost everywhere else. In Latin America, WP is now ranked 2nd (http://techcrunch.com/2013/08/22/windows-phone-snags-second-...).
WP is definitely not a widely successful platform, but it is not yet a total failure, and given some more attention from Microsoft, it may yet succeed in being relevant.
edited for typos.
I'm still convinced that eReaders are a good future for distributing books. It isn't Microsoft's fault that the Nook is failing (Barnes and Noble need to pick up the slack), but I think its a good idea that Microsoft branches out into that distribution platform.
Its a Hail Mary pass to attempt to get into the eBooks market, but probably the best attempt that Microsoft could reasonably make. Actually, even if Nook ends up losing money for Microsoft, I'd argue it was a good move.
 http://www.youtube.com/watch?v=PWylb_5IOw0&feature=player_de... (go to 38:59 time mark)
IIRC the deal in 2007 was at one fifth of the current facebook value, plus they got to sneak bing in the platform, and cut out google.
If this is accurate, Microsoft has been turning a profit in recent years, but not enough to make up for years of losses from the first Xbox and the first few years of the Xbox 360. They’re about to launch a new system, which probably means they’re again going to be losing money again for a while.
One interesting thing to note from that chart is their Beta (a measure of link to market volatility) is less than 1, which is very low for a high tech stock. It basically means that the market views them as less volatile to market conditions than an index fund. Or put another way, more like a utility than a high tech firm.
What does this mean for Microsoft? I think an awful lot will depend on his replacement. I don't think they can get Gates to do another round. Who has the breadth of skills to manage it all? Seems like a complex enough beast that finding an appropriate outsider would be difficult too.
Going to another source  I see:
“As a member of the succession planning committee, I’ll work closely with the other members of the board to identify a great new CEO,” said Gates. “We’re fortunate to have Steve in his role until the new CEO assumes these duties.”
This suggests that he could be gone much sooner if the search goes well. These things don't happen overnight, but it could be by the end of the year or even sooner.
Hopefully MS will lose the "we need to put Windows on everything, including embedded systems" attitude. Windows is a horrible bloated mess barely capable of successfully running on a tablet PC, much less smaller things. (And if you've ever had to /build/ Windows . . . OMG. OMFG).
There are core bits of Windows that are great; the I/O system is incredibly well done. Then then are core pieces of Windows which are incredibly shitty -- in fact, there are registry entries that /nobody knows what they do/. No one has had the gumption to clean that stuff up. But until they do, folks like Apple (who seem to have a good handle on their technology /and/ consumer design) will continue to be fierce competitors.
If they pick the wrong CEO, this could go south pretty quickly. They're going to need someone tough, who has a good horse sense about consumers and can't be snowed by engineering management trying to cover up mistakes.
BillG isn't coming back, but they need someone like him.
OSX doesnt. OSX doesnt even run on tablets (not that it can't, idk)
Ubuntu cant run on smartphones either. The edge was the most powerful smartphone ever envisioned just to be able to run ubuntu well.
I don't see how not being able to run a desktop OS on a smartphone is a criticism. When it comes to tablets windows actually runs quite well on the surface RT which isn't all that impressive hardware wise. Sure it might not be able to run intensive apps but that's mainly the fault of the app makers, not windows.
Linux is superior for mobile platforms. Even Ubuntu with it's bloated software and UI can run. Someone just needs to develop a good ecosystem for that merges Desktop, Laptops, tablets and other mobile devices where you actually develop for them sort of simultaneously. Or your framework can be designed to incorporate all factors of computing and even make them interoperable.
I'm voting for private cloud.
1. They have a strong presence in businesses in both the desktop and server spaces.
2. They have the cash in the bank and plenty of good people to throw into a serious push to move the market.
3. They'd be playing to their established strengths, instead of trying to challenge the likes of Apple and Google in areas where the latter are already far ahead.
4. They'd be playing to today's cloud-happy market sentiment, but also able to avoid some of the inescapable flaws that have been starting to show as more businesses have gained experience with the reality of outsourcing too much.
5. This strategy is compatible with almost any serious strategy for the home user/entertainment market. In fact, with the rise of practices like remote working via VPNs and mobile working with BYOD, there is a lot of potential to bridge the two, again in ways their competitors simply aren't geared up for.
With Ballmer gone, if people like Hanselman and ScottGu gain more influence within the company, I'm sure we'll see great things being open sourced.
It's hard to shift the company to open source with someone like Ballmer at the top, it would be like admitting defeat to the open source movement, and people in such positions of power never like to admit they were wrong in their strategy. It's human nature, I almost don't blame him.
Huh? How do you figure?
Look what phone DIRNSA uses today: a Blackberry.
I'd sell non-core assets (Xbox, Bing, hotmail, consumer stuff in general, etc.), and focus on the core OS/mobile/Azure/Office/MSDN systems.
I would grant that there are specialized markets that MS could serve well in the enterprise market, but what do you think the typical enterprise deployment needs out of the box that iOS can't provide right now?
iOS is undeniably a better web browser experience than Blackberry. It also has a viable app ecosystem, but that mostly doesn't matter for enterprise.
The only large OS X Server-managed deployment I've heard of is Apple internally. In Silicon Valley, I'd probably go with iOS-only (I don't believe in BYOD, and crossplatform means LCD and pain) with either a third-party MDM or maybe try OS X server. No way I'd do that in a 100k seat enterprise with high security requirements -- 30-50 person shops aren't really "enterprise".
I am excited about iOS 7, but not at all excited about Apple's lack of any real focus on enterprise. The only reason Apple has stuff like Kerberos support in OSX is that Apple uses it internally.
Apple focuses on consumer (primarily), with iCloud, etc. as the main management tool. There is a little bit more for small businesses and some smaller education deployments, but aside from Apple.com, there isn't much attention given to the enterprise market.
(If I got to pick a job, I'd rather be HHIC of Apple Enterprise Products/Enterprise Security rather than CEO of Microsoft, personally. Either would be a turnaround.)
The underlying OS on the Exchange server doesn't matter. That DoD is (I'm pretty sure) the world's biggest MS deployment does matter, though -- even though I prefer UNIX, if I'm in an environment where 99% of systems are Windows based, I'd build my ancillary systems on Windows, too.
I'm with you on splitting the enterprise cash cow from the rest of the business.
They really need to either spin off a separate business, sell some divisions or just stop trying to compete in some areas. Experience shows their OS dominance doesn't count for much in the phone, tablet, search or cloud markets.
But, there was a time when Microsoft entering a market would send all the existing players running for the hills. They used their OS dominance to control what software OEMs installed and killed off every desktop software competitor they ever had. Your best hope was to sell your company to them. But they couldn't do that with the phone, tablet, search or cloud markets. They've built some good products and some of them are doing ok, but they haven't had the kind of automatic win in those markets that those of us around in the 90s remember.
Maybe it was the delays in getting products out? Or false starts? Or that they just started playing nicer?
Nobody is close to unseating them on the desktop, but the excitement is everywhere else.
And the chairs breathe a sigh of relief ;-)
A happy chair makes a happy programmer ;-)
I think they said the same thing right before Lou Gerstner went to IBM, and that turned out very well, at least from an investor's point of view. Obviously IBM was in a lot more trouble business-wise then than Microsoft is today, but I expect a similar degree of transformation out of a successful new CEO.
Services in IBM's parlance are quite often high dollar customizations to IBM products or high dollar custom applications built on top of them or integrating them.
I'm not sure 'services' or a similar concept exists for MS. I hope they do pull in a genius outsider like Lou Gerstner though, I really hope he's/she's willing to make some very tough choices and honestly, I kind of hope that some of MS's better products are spun out in to their own independent companies to fly on their own. Fundamentally, whatever happens, MS is going to change in some ways and while I don't trust them or like them, I really hope it's a positive change that benefits the whole industry.
They've gotten much bigger on corporate services: They compete with Accenture on large software implementations, and do big EDS style outsourcing projects. In doing this they've shifted away from hardware preferences.
They've also bought many enterprise software packages which lend themselves to implementations and ongoing support.
From a shareholders perspective Gerstner was very aggressive about share repurchases, or giving money back. One problem with big companies is they get so much money that they start wasting it. A company can appear very large and strong, but do nothing for the shareholders, if they're just pissing away retained earnings. (One could argue that Microsoft was guilty of this)
Also, investor-wise people were happy with what he did. A thriving company doing i-have-no-idea-what is a better investment than a sinking mainframe company.
There are plenty of stocks that have beta < 1 that are much more volatile than the indexes.
Having a low beta simply means its price isn't as correlated with the overall market. An example, Netflix has a beta < 1 but is extremely volatile.
Beta is volatility relative to the entire market. That's why I said "less volatile to market conditions than an index fund" Basically if the market has a big day, it will move up less than the whole market. Similarly on a down day. I think for both Netflix and Microsoft it's because they have strong brands and recurring revenue streams. They are also less dependent on external funding, so whether the market goes up or down has little impact on their P&L.
The converse, which you pointed out, is that they are highly impacted by non-market risks, which is very big, especially in the case of Netflix. There is a lot of discounting of future cashflows, so if something small happens (like splitting off the CDs business) then it creates a lot of volatility.
I think we're on the same page, no? Should I edit the original to be more precise?
Beta = cor(S,M)*vol(S)/vol(M)
Where cor(A,B) is correlation between A and B, and vol(X) is volatility of X (i.e. standard deviation).
Not really, Looking at my Bloomberg terminal shows that AAPL US Equity has a beta of .944, YHOO US Equity has a beta of .748 and GOGO US Equity has a beta of .894.
Facebook has a 3.29, LinkedIn is 1.81, Accenture is 1.4 and SAP is 1.5.
Do you think this is based on revenue models? Size? The amount of cash on hand? Brand strength? Likelihood of needing to go to the public markets for money?
As you pointed out, Beta is the correlation of a security's price history to the market's movement.
Approximately half of any group of equities will have a correlation below 1 against the group's weighted average performance. If the group is large enough, its movement will closely mirror the market, so for a large enough group of equities (chosen randomly) about half will have correlation below 1, and half above.
It merely means that Microsoft is reasonably closely tied to the market's movement, though slightly below.
You compared it against its sector, technology. The tech sector has a higher average beta than the utilites sector. That's just the nature of the sector.
Where it gets interesting is something like FB at 3.29. That's really high. But its price history is also short, having IPOd so recently... perhaps over time it will stabilize at a lower number.
I'd love to sit down and talk to him, and see if his vision is a bit more long range than your average industry analyst, similar Paul O'Neill's vision on worker safety and Alcoa in 1987.
But new product development, particularly consumer product development, at Microsoft has largely fallen flat in the Ballmer years. WinPhone, Win8, Kin?
So while Ballmer has certainly increased the profitability of Microsoft, critics are IMO right to point out that they've been unsuccessful in developing future products to ensure their long-term survival.
Under Ballmer, Microsoft had the same pattern repeatedly: Zune, Kin, Windows Phone, Surface, Windows 8 -- they took too long to see the need, took way too long to make the product, and when they did it was either not good enough, too late, or both.
This is completely irrelevant. By the same logic, iPod was nothing special, just another mp3 player.
IE and XBox managed to muscle into an established market. This is harder than making a new market, and should very much be congratulated.
> In fact with IE 6 he so badly misjudged the market that he assumed the game was over and didn't even bother continuing development. IE 7 didn't come out until 4 years later!
Not so much misjudged, but started seeing as a threat. IE development hit a wall because the meme that web-based apps will replace windows-based apps got popular, and Microsoft didn't want to wipe out their own monopoly. IE4-IE6 were, at the time, absolutely crushingly good. IE6 is now remembered as the really bad browser, but that is because they stopped updating it, and in the later years it had to compete with much, much better browsers.
> You count XBox as a success, yet MS is in the hole over XBox by over a Billion dollars and will probably never make money on it, taking past losses and write-offs into account.
XBox also supports windows game development, strengthening their main money maker. What is that worth?
Microsoft did a complete re-write to componentize the browser and after IE3 (I think), IE was generally better than Netscape. At least, Walt Mossberg said so.
Hard to know why Microsoft stopped developing IE6 and you may be right. However, the next browser was scheduled to appear with the next OS, which was Vista, which turned into a debacle. If Vista had come out on time then it might not have been so bad.
You will recall that the US gov sued Microsoft on the basis that the browser was a separate market from the OS, whereas Microsoft argued it was a part of the OS. This gave Microsoft no incentive to develop IE on the sort of separate fast-track schedule that would have been best for the industry, and for consumers.
That's probably just one of the ways the anti-trust action helped harm consumers. Another was that it gave OEMs complete freedom to install crapware, which also harmed the whole PC industry.
Surprisingly little known story: in short MS was afraid of Linux as desktop OS, OSS world was seen as capably of quickly copying any innovative single feature. This is resulted in idea of "integrated innovation": produce innovation in app development, app framework, data access, communication, os based on it and ship it all at once, so Linux would never catch up (.Net Framework, Avalon - WPF, WinFS, Indigo - WCF, Longhorn). Obviously, plan failed (well, Linux failed to come to desktop too).
So IE was seen as done and future to be elsewhere. After IE6 ship with XP, IE team was transformed into Avalon team, consumed bunch of other teams and at it's peak Avalon project had something like 500 people working on it (after much struggle and numerous delays it shipped as WPF). So for something like two years, starting at summer of 2001, only 4-6 people worked on IE - IE Sustained Engineering team, patching security vulnerabilities. Then it became obvious that they can't keep up and some rearchitecture and refactoring are required in order to fix security problems for real. So IE Security Team was created, and some old timers were transferred from Avalon to do this security fix up, probably around 20 people.
Then it became obvious that "integrated innovation" is, in fact, too integrated to ship on time, Avalon and Longhorn are nowhere is sight, and browser war is effectively being lost for the second time to Firefox, of all things (MS management couldn't take fork of OSS fork of NN seriously for awhile). So IE Security Team was expanded, became IE7 team and happily started to work on a browser again, 3-4 years too late.
>However, the next browser was scheduled to appear with the next OS, which was Vista, which turned into a debacle.
As you can see from the story above, initially it's wasn't scheduled to appear at all.
Presumably all that happened under Allchin after bradsi left....
There is another twist - after XP Windows was split into two branches (since they didn't want to delay client to wait for server): Server and Longhorn. Brian Valentine managed Server (shipped as Server 2003), at same time different war room, different managers managed Longhorn ship. So essentially experienced management team was shipping server, and non-so heavy weight - Longhorn. Then some people were taken to manage XP SP2 (result of "security push"). So there is no surprise Longhorn had problems and required "reset" to finally ship as Vista.
And the lesson is: never ever branch to v+1 and v+2 branches unless absolutely required - one of them is going to be neglected.
IE6 was a terrible browser, but it was the best browser at the time. The anti-competitive behaviour helped, and then of course they sat on their laurels for years, but the best browser won.
Everyone seems to forget the most important examples...
If you forget that they now have 12 or so divisions with $billion plus in revenue.
But no product lines last forever - even Windows is bleeding market share, and upgrade rates are dropping like a brick. It seems a lot of people are happy with Win7 (or even WinXP) and not moving.
This strikes me as a Blackberry situation - market leader by a mile, but attempts to modernize and develop the Next Big Thing have all failed. They have enormous momentum and can coast for a long time - but what happens after? RIM failed to react to changing markets due to iPhone/Android, and arrogantly threw around their (momentum-based) sales numbers. Then those dried up.
Profits are a lagging indicator for a once-successful company. A large company with entrenched products can coast for a long time while in decline. For example, RIM basically sank in 2007-2008. They had opportunities to save themselves well after that, but that's when it started, and they passed up those opportunities. However, their decline didn't really show up in their financials until 2012.
Microsoft looks to me like they're the same way. Surface and the new Windows Phone are analogous to RIM's late, lame attempts to ship a large-touchscreen Blackberry. Microsoft is profitable for the same reason they've been profitable for the past couple of decades: Windows and Office. However, that's now a declining market. It's still huge, and they can milk it for a long time, but it's on the way out. It looks like they missed their chance to move on to something else in favor of hanging on to their cash cows as they sink.
The "Entertainment and Devices Division" is profitable, but contributes a negligible quantity to the overall profits.
And either way, the home game console is also a declining market.
I think the numbers back it up to an extent, though:
None of the latest generation of consoles are near the top, despite the fact that populations are larger, and the population of people able to afford video game electronics is much larger. That the PS3 and Xbox 360 barely outsold the original NES, despite having access to a billion or two more potential customers, says to me that the market is declining relative to the overall computing world.
The Playstation 2 for example was king of the hill and dwarfed its competition (Gamecube/Xbox) but still overall you're looking at about ~200 million units. However, with the current generation you're looking at Wii, PS3, X360 all sharing an about even share with PS3 and X360 very closely tied, but the total is around ~250 million units.
So we're still seeing growth in that area, and one part that's not reflected is the added value in each platform in terms of revenue for each network (PSN, Xbox Live) as well as the growing list of peripherals (Kinect, Move) that are part of each platform.
Not only that, but PS3 and X360 had higher prices on their consoles, some even coming close to doubling the price (a top of the line PS3 at launch was $600 vs a $300 PS2).
I would say that gaming over all is becoming more mainstream to the point that the consoles are no longer the realm of hardcore gamers, because they wouldn't have kept those numbers up while people were buying iPads, iPhones and DS3's in such massive quantities if they were really a complete gaming replacement.
The only reason people use it at all isn't because it's fantastic, but because it's incrementally better than Windows XP without all the garbage Vista foisted on the user.
After having used it for an extended period of time, the only real improvements I've seen are in the explorer shell, which are minor at best, and the theme.
So last I heard there were 630 million licenses of Windows 7 sold. Even at OEM prices, that's 63 billion dollars of revenue. If that's not success, you're probably setting the bar too high.
>"The only reason people use it at all isn't because it's fantastic, but because it's incrementally better than Windows XP without all the garbage Vista foisted on the user."
That's a pretty broad brush you're using there. Really, that's the ONLY reason?
And what's wrong with incrementally better? The iPhone has only been incrementally better since the first version, and that's even more true of the 4s to 5. The iPhone 5 is still a fantastic phone! Amount of change from prior versions is a poor measure of quality.
A failure would've been a steep decline in Windows license sales. That they managed to not screw this up is not something they should be bragging about. With Windows 8 being very poorly received, this might happen yet. When people go out of their way to get an older version of your software, you know you've done something wrong.
Look at the sales curve (http://thenextweb.com/microsoft/2013/05/07/six-months-in-win...) and you'll see that Microsoft has a near literal cash cow. That curve tracks very closely with PC sales in general, following the usual upgrade cycles.
The iPhone, and the software behind it, have been improving significantly with each annual iteration. In 2007 the iPhone did not exist. Now it's iOS7, Apple's "Windows 8" moment, which so far looks to be a hit.
Microsoft should make a version of Windows specifically for enterprise on a slow release, long support cycle, and branch off a consumer one that's on a much more aggressive schedule.
A lot of the improvements under the hood the consumer didn't see or notice. One that they might have noticed is the ability for the OS to find proper drivers for pretty much any consumer device from a major manufacturer.
Other than that, there are other features that put W7 was ahead of XP in terms of management ease.
The registry is still there and even more crammed with crap than ever. Uninstaller applications are still a necessity.
Finding things in the control panel is both easier (search) and way harder than before (more tabs, more drop-downs, more everything). The simple mode is almost useless, which leaves you with the ridiculous "Advanced" mode.
Drive letters? Still there. Task manager? Still essential. Programs menu? Still filled with nonsense injected there by the vendors.
This doesn't even touch on the fact that the Windows software ecosystem is full of literal junk, programs that either overtly or covertly install adware, malware, or sneaky debris on your machine, and this includes major vendors like Oracle (Java) and Adobe (Flash). It takes discipline to keep your machine clean, everyone wants to set up shop.
The only thing I'm happy about is that Windows 7 does have much better resilience against virus type programs and application level exploits than Windows XP ever did.
Take Amazon and Apple for example. Amazon barely makes profit while Apple made huge profit, and yet when they released their financial reports (last quarter or 2 quarters ago), AAPL got hit yet AMZN upped.
But inertia fades: Exchange servers are being decommissioned. SQL Server instances are being replaced. People are supplanting an enormous amount of computing time that they did on desktops with non-Microsoft tablets and smartphone devices, which is a migration that makes Windows dramatically less entrenched (Office was once the lynchpin of Microsoft's maintenance of a captive market, however the need to use a mix of devices has made Office much less palatable than it once was). In other markets, such as online and Home and Entertainment, it has been a decade of losses, and the xbox is being usurped right as Microsoft was supposed to start profiting off of their moves.
And as this happens, Microsoft has responded by essentially tapping their existing business customer base to make up for lost market. The prices of some of the new versions are extraordinary (e.g. a Sharepoint 2013 deploy), leading to more departures. It is unsustainable.
Microsoft today feels very similar to RIM of 2010 -- the profits are still there, but the industry has moved on. In no way does that mean that they're doomed, and they can still pivot, but things don't look good.
Many younger people on HN have no knowledge of just how much Microsoft dominated technology at the turn of the millennium. I remember eagerly waiting for betas of far off Microsoft products, because every shift of Microsoft had a profound impact on the entire industry.
| Microsoft has encountered an error |
| and Wall Street is not responding. |
| If you choose to retire the CEO |
| immediately, you will lose any |
| unsaved cash cows and reboot the |
| corporate strategy. |
| [ Retire ] [ Cancel ] |
"On a personal note, I'll just add that Ballmer was one of the good guys. Though he was relentlessly mocked for his over-the-top public appearances in years past, Ballmer was also relentlessly pro-Microsoft and it's very clear that the troubles of the past decade were at least in part not of his making: Ballmer inherited a Microsoft that had been driven into an antitrust quagmire by Mr. Gates, handicapping its ability to compete effectively or respond to new trends quickly. While many called for his ouster for many years, I never saw a single leader emerge at Microsoft who could fill his shoes or the needs of this lofty position. Looking at the available options today, I still don't."
This in and of itself is a failure of leadership. If you can't groom a leader to replace you in 15 years, that's a problem. Some could argue it's deliberate (defending their job) others might argue that he just didn't have it in him to make it a priority. The board should have insisted. I would argue that our last 2 presidents, and the current mayor of NYC have made the same problem.
If I were him, there would be two candidates: Qi Lu (insider, obvious choice), or, for the ultimate in turnaround ballerdom: Ben Horowitz (from a16z). Either would be a vast improvement on Ballmer, but Qi Lu would be the "safe" choice, mostly doubling down on trends within Microsoft. Ben Horowitz would put Microsoft solidly at the core of Silicon Valley, plus it would signify that Microsoft views the next 10 years as "wartime" with a CEO to match.
(The other low-odds pick would be Bill Gates Round 2, but that seems unlikely just due to where he is in life. I could maybe see it as "Interim CEO". He'd do an awesome job I'm sure.)
According to its most recent SEC Form 13F, the Gates Foundation Trust does not hold any Microsoft stock whatsoever. About 47% of its stock holdings are in Berkshire Hathaway.
As for Bill Gates himself, he currently owns less than 5% of Microsoft. That's still almost $14 billion, but it's just 11% of Bill Gates + Warren Buffett's combined wealth. (Both of them are giving essentially their entire fortunes to the Foundation.)
Another amazing thing about the BMGF is that it doesn't want to be permanent -- spending all assets within 20 years of the deaths of Bill and Melinda, and for the Buffet contribution, within 10 years of his death. (Based on age, it's highly likely WB will predecease either Bill or Melinda Gates.)
Dallas Independent School District uses it.
Chances are that Bill Gates becomes interim CEO and personally recruits the more permanent leader from the outside.
I think that he could turn the company around in months. After all recent failures in MS history are policy errors and not execution ones. The teams still ship high quality software - the problem is mostly with what management wants (at least what I see from the consumer side)
It would certainly send popcorn futures soaring if nothing else.
The list of such companies includes some really big ones, like Babylon and Conduit. These companies are making their profits by degrading Windows users' experience. Not only didn't Ballmer do anything to fight them, Microsoft actually has affiliate agreements with these companies to take a slice of the profits. Screwing your own customers like that cannot end well for Microsoft.
Interestingly, that link implies that Conduit had a deal with Google before they got a better deal for switching to Bing.
Ad injection - Putting ads on web pages they didn't write, such as Google search results.
Ad substitution - Replacing ads on web sites with their own ads.
Cookie stuffing - Injecting or clobbering referral cookies for sites like Amazon so that they get an undeserved commission on things you buy.
I'm sure there are larger malware operations, but the Israeli adware economy is probably the largest "legit" one.
- Within Tech: They hire an Apple type key executive whose background is all around getting hardware/software/direct sales to work together. They want to move to be a super tight, integrated brand.
- Outside of Tech: They hire from a GE type of company. This acknowledges that they're a sprawling behemoth and will stay that way. They need someone who can manage a hugely disparate conglomerate.
- Tech vs Sales: Broadly speaking Bill was a product guru with a huge slice of business acumen. Ballmer was all sales and number driven. How we describe the new hire will be interesting.
- Mobile vs Cloud. Do we end up with someone really well known for their mobile background? Or someone who is really well thought of for understanding the cloud? For example Apple has generally nailed mobile and struggled in cloud. MSFT has actually done a little better in cloud than they're given credit for. But it will tell us what they think is more important by the hire.
Any other suggestions?
It would mean he needs to get out of his leather couch, but why not?
I think the best way to look at it is to start off by looking at Microsoft's acquisitions in the psat 10-15 (20?) years and see which former CEOs have integrated well within Microsoft. Consider that Microsoft doesn't even have a current Chief Software Architect anymore. I'm not particularly familiar with Microsoft's portfolio of companies, but perhaps someone like the former President of Skype (Tony Bates) would be someone they would put into the CEO position.
 http://www.youtube.com/watch?v=PWylb_5IOw0&feature=player_de... (go to 38:59 time mark)
This, and the other company response to it, might be good for +0.05% GDP growth or something crazy like that.
Are these 4 independent corporations somehow conspiring to restrict your choices in some way? :)
Gate's is very intelligent guy, brilliant and ruthless businessman and knows software, but he is not software architect. When Ray Ozzie took over, things turned instantly better. Chief software architect is the guy who have to balance between the need to add features and general soundness of the system that translates into quality in long term. Gates clearly did not have that ability. MS products never had general feel of good design principles you get from many other software products.
while i don't actually think he was a good ceo, i think he is much better than he gets credit for. they say he missed mobile, but i think windows phone is pretty good and new take on it. it was just a year or 2 late. xbox has been pretty fantastic overall. windows 7 was good. i think windows 8 has potential. azure is pretty good as far as i can tell. sure vista sucked (though not as badly as everyone says), and there have been other failures (kin anyone?).
People act like other good ceo's don't ever fail. Jobs had plenty of failures. Ping, mobile me, etc... Jobs had the "benefit" of taking over an almost dead company. making it thrive meant stock went crazy and he gets to be awesome. Ballmer just got in on the wrong end of the market. Tim Cook might have this problem as well, but at least Apple wasn't wildly overvalued at the time.
Tell that to the people who, you know, own the company.
I'm sure they'd be thrilled with your plan to make pretty interfaces but no profits.
"CEO of Microsoft" is a prestigious title. They could use it as an opportunity to pull a coup. Like offering to merge with Facebook and giving the title to Zuckerberg. It doesn't have to be with FB, any big guy that would bring a missing market to Microsoft's empire would be a coup.
But the reasonable thing to do is to hire from inside.
That being said, it's about time. Microsoft has had too much misdirection lately and really needs to either pull it together or drop out of some of its markets.
On the other hand the stock was trading around that price just a few weeks ago. He must realize how fickle the market is.
Microsoft is forcing OEM's to pay licenses for using open sources operating systems, they're throwing mud against competitors in the media and in social media, and there's still this very real feeling that Microsoft hasn't shaken off the "evil" attitude and culture inside the company.
New pretty colors on its OS and hiring better PR people aren't going to help with that. The company need to change from the inside-out, not outside-in.
But the media hates them, OEMs mostly don't seem to care very much about making good hardware for PCs, Windows tablets and windows phones. To me this is at least partly a symptom of their image problem.
EDIT: I say this as an open source advocate - I would love it if Linux based systems became more popular, but I recognize the quality of Microsoft's products in terms of what they are intended for.
The other day HN had an item where a MS guy was talking about "dark matter developers" -- devs who are plugging along writing WinForm/WebForm apps like it's 2003. That's Microsoft's constituency and they simply don't care about WPF/WinPhone/Metro/etc.
Disclaimer: as a OS X and Linux user, I don't know much about Windows.
Still, he's not been an awful CEO, business has been good under Ballmer but progression has been awful.
I don't know if current Microsoft issues are in their DNA or not. Personally I was bullish (yes I put my money where my mouth is) of MSFT but I mainly found the following obstacles to be more optimistic:
- The relationship with developers was deteriorating: I am a MSDN customer and tried to upgrade but they don't give me any discount in the first year of upgrade while keeping with my same subscription level I have discounts. In our company we also have issues with getting new keys (or using the existing ones) for their software and we need to talk to someone personally to receive them.
- Windows 8 / Office are in the middle of a transition but not there: I think having a hybrid mobile/desktop OS is a good idea. But I don't like to use my desktop in the way I use a mobile device (i.e: the famous start button) or the reverse. If they want to go mobile they must implement an Office that can be used with a new UI.
- The Microsoft web offerings like Microsoft 365 are slow, difficult to configure, buggy. If they just copy Google/Apple style they would benefit a lot.
Disclaimer: I love Visual Studio and C#.
I've never encountered the issues you have with MSDN. I believe you only because the team that dreams up their licensing/key schemes, should be forced to use them.
The jury is still out on Windows 8. Having left my enterprise setting prior to Windows 8 become widely available (hell I left even before we moved to Windows 7), I wonder how Win8 is to manage in an enterprise setting. Most users that I've encountered, would have had a hell of a time transitioning from the traditional Windows XP/7 desktop, to Metro. My office would have been queued with "Where is the Start menu?"
Ballmer's Microsoft was always late to the party, overseeing important technology trends and society transformations out of, I'd call it a mix of ignorance and arrogance; maybe they were also too blended by their previous successes. The way he dismissed iPhones, iPads, the way they developed their OS. Or the Zune, or Bing, there has been much criticism over the years. I don't know which moves would have been better (except for seeing the mobile future and the suckyness that was Windows Mobile 6 in time), but Ballmer was always more of a numbers guy I hear, and less of a visionary. I hope their next big guy is going to have more vision.
This may be a good day to buy their stock, if you like 50/50 games.
The word you want is "overlooking." To oversee is to supervise. That was more what apple did.
(Also BTW overseer has historical connotations of slavery, so it's generally a word best avoided.)
Sorry if this is pedantic, just trying to help non-native speakers.
A similar memo would have done the most good in 2005, when it was becoming clear that we'd soon all have access to pretty decent wireless networks and high performance pocket computers, but also clear that WinCE and the PocketPC were lousy ways to take advantage of those facts.
I agree that trying to remake the PC space in the PDA and phone worlds was a strategic blunder for Microsoft. OEMs competing to build low-margin devices for a common OS worked for Google because they could afford to give Android away for free and the carriers and handset makers were terrified of Apple.
On hardware, Microsoft had a model to follow: XBox. Imagine if they'd built an "XPhone" in 2005 instead of playing me-too to Apple with the Zune.
Hopefully this means a lot less "Metro" in Windows 9.
Its a hard choice: too much enterprise for anyone at Google, have to talk to folks outside of Microsoft (partners, enterprise) so that rules out anyone at Apple. So who then?
> Ballmer was initially offered a salary of $50,000 as well as a percentage of ownership of the company. When Microsoft was incorporated in 1981, Ballmer owned 8 percent of the company. In 2003, Ballmer sold 8.3% of his shareholdings, leaving him with a 4% stake in the company
Wow. How common is it for such a late employee to have so much percentage of a company?
Glad you did!
It might sound ridiculous but he's been involved with his foundation work now for several years so it should be running well. He could probably leave the foundation to others to run now. So, he could return to Microsoft to try to lead it's resurgence. It's a challenge I wonder if he's up for.
(to the cheers of investors)
Instead it's tying everything back into Windows and Windows phone. Those things should stand on their own feet. Microsoft can create great versions of its software for all platforms, but instead it handicaps itself to no great effect. Limiting Office to just its own platform hasn't really made much of an impact.
I'm not sure what part about that is confusing. In case you are ESL it means that Ballmer will retire before one year has elapsed.
> Like, if the deadline hits, they'll just take whoever they can get?
Running one of the largest, profitable and most prestigious companies in the world is a pretty good job. I'm pretty certain that there will be no shortage of qualified people willing to become the CEO:)
No one makes an announcement like this without planning ahead, they've already got either a new CEO or a very short list of people who they've already vetted.
Throwing a deadline in there is just odd.
"The Board of Directors has appointed a special committee to direct the process. [...] The special committee is working with Heidrick & Struggles International Inc., a leading executive recruiting firm, and will consider both external and internal candidates."
On the off chance anyone at Microsoft reads this, my Microsoft account got deleted by a bug in Live Domains and I haven't been able to successfully contact anyone to report it or fix it. The forums have been useless and now I can't do anything MS related without my account including my phone!
My e-mail is in my profile.
(Apologies for posting this as I know it doesn't add to the discussion but I have no idea how else to contact an MS engineer.)
Considering the rising impact Linux has been having over the past few years, I'd only be glad to see Microsoft try to come up with a superior operating system.
And when, pray tell, did they do that?
They need someone who will innovate and continue to innovate.
I didn't include AAPL, because that would have destroyed the others. And GOOG wasn't around in 2000.
Just looked after the reasons Bill Gates Stepped down, could not find a lot
He could give away the XBox, windows and office for free and migrate Microsoft more to enterprise software.
Or did Ballmer got into the 10% stack at last!?
I would not wait twelve months; just pretend he died, and move on.
MS has had some massive misses, a couple of super bungled opportunities in the past decade only because of the ageing 'bored' (pun intended) that thought marketing is the only thing to drive innovation. I hope they find a replacement that's good and that his/her selection is not too much influenced by the existing board or its psyche.