He'll be remembered as a terrible CEO. Ballmer took over as CEO in 2000. In the 13 years since then, Apple has experienced an unprecedented resurgence. Google and Facebook have gone from being obscure startups to giants. The tech industry went through the bubble, recovered, and today is stronger than ever.
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.
I agree that he will probably not be remembered for having more than doubled revenue and almost tripled profits. He will not be remembered for transforming Microsoft into one of the most important enterprise software companies. Not for introducing .NET, C# or Kinect either. All of that will be forgotten.
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 ;-)
It's hard to disagree with sarcasm on the internet. But in this case you are absolutely correct.
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.
There is a tendency to believe that the companies which are doing well right now have 'won' in some sense. We need to understand that this is the state of affairs right now. There is a non-trivial possibility that Facebook/Google etc become lumbering giants just like MSFT.
Microsoft's approach was different: let others innovate, then we'll dominate. Others would come up with new stuff, and Microsoft would "embrace and extend" whatever got traction in the market by adding it to their near-monopoly OS/app stack at whatever price served the purpose of eliminating the inventor and taking their market.
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.
"(MS did things second, not first, was only a minor hardware developer, and seldom gave things away except when tied to something they sold)"
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.
But it WAS too expensive. The fact that the iPhone price dropped within two months of it being introduced is proof of that. And you have to remember, that most touch phones sucked at the time, and they ALL sucked if they didn't have a stylus, and it was a really, really, big deal to have an all touch interface that truly worked.
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.
If you watch jobs unveil the iPhone, there is a moment, when speaking of three new revolutionary devices being released that day (http://youtu.be/0KfrSzyXmiw?t=1m5s), he says "the first one is wide screen iPod with touch controls. The second is a revolutionary mobile phone. And the third is a breakthrough Internet communications device.", repeats the line, and then chuckles as everyone realizes that they're all one device... I remember streaming that live and thinking: "Holy crap, phones don't suck anymore". If Balmer watched that and laughed at it, I'm going to be hard on him. He had the chance to react and he let Jobs walk away with it. So many people, including me, we're just waiting for a cell phone that didn't suck.
But as a leader of technology, Ballmer should have realized that in the early stage, new technology is expensive, and people (particularly fans of apple) will buy. The iPod only a few years earlier was also too expensive, and had a bunch off early tech 'flaws' ( Mac only, FireWire only, etc), yet came to dominate the market, and Microsoft couldn't catch up. Ballmer, or the other senior leaders at MS should have recognized the iPhone as the evolution of the iPod.
Everything is too expensive when it first comes out. The first cars were so expensive that building a car that the men on the assembly line could afford was an innovation (so was using an assembly line). Ballmer himself probably remembers when microcomputers were fairly expensive. Maybe he laughed at his college buddies for dropping out to write microcomputer software and start a company on that premise. But if he didn't learn his lesson in his decades in the tech industry, I don't know what he thought he was doing at Microsoft.
I'm speechless. Well, almost. Apple revolutionized the music industry, how music is sold, and how it's listened to. It revolutionized phones. Its iPad changed consumer computing, media consumption, user interface expectations.... Five year olds are totally at home on an iPad and think a screen without touch "isn't working". As they get older, all screens will have to conform to the new reality. They revolutionized shopping for music, movies, and apps. They revolutionized brick and mortar retailing with the most profitable stores of all time.
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.
Microsoft was there as an epiphenomenon. If they didn't exist (at all) the PC industry would still be here and some would argue that without the monopolistic innovation stifling practices, it would be much more vibrant today.
What? Correct me if I'm remembering incorrectly, but before Microsoft (and Compaq's IBM PC "compatibles") caused PCs to be commoditized, every computer-maker was trying to foist their own closed, proprietary walled garden onto the market. Instead of the PC revolution that created a common platform everywhere, we'd have a hundred small, fragmented, incompatible ecosystems fighting each other for market share. That just does not sound like it would allow for mass adoption through steep hardware price drops and the insane innovation that it enabled (which includes things like Linux). You might think the resultant situation as "vibrant", but I think the more appropriate word is "fragmented".
Citing you as a source, how was MS involved in the clones? Compaq made a clone of the IBM PC. The IBM PC was cloneable in the first place because they went extremely low budget and stuck together off the shelf parts. Yes, the cheap clone army definitely spurred the small computer revolution. But I don't see how MS can viewed as an entity that shepherded it along. They certainly weren't the only ones make a CPM clone either.
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".
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.
I was referring to the examples in the comment I was replying to, not making them up myself. I like your examples much more (and upvoted you for them), but yours are what I had in mind with my original comment. Microsoft was able to create that "familiar" desktop experience after getting the court to rule that they were free to make Win95 as Mac-like as they wanted. "The look and feel of an OS should not be copyrightable" is sort of an odd position for a leading innovator to defend so vigorously in court. Getting that OS to run everywhere was more about making themselves ubiquitous--the "no matter what computer you buy, you'll have to pay us" monopoly thing--than about "innovation". Likewise for the "ancient software still runs" strategy of preserving the franchise vs. innovation.
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.
Yep. All the good once are stuck playing *craft games.
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.
> Apple revolutionized the music industry, how music is sold, and how it's listened to.
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.
Yes, and how many of your family and friends had mp3 players before iPods? And you dismiss a feature of the iPods by just saying 'a great user interface'. I remember mp3 players back then. All monochrome UI's, with the actual bit rate and frequency shown along with the title, as if anyone but an audio fanatic would care about something like that.
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.
> Yes, and how many of your family and friends had mp3 players before iPods?
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 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.
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.
> 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.
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.
> Windows will also ask if you want to open an inserted mp3 device as a folder when you plug it in.
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.
Jamie Shotton and others at MSR were directly responsible for the pose detection software for Kinect. MS bought in the RGBD camera from outside, but did really good work on the software internally, using the talent at MSR. A great success story for the corporate lab model. I don't know how often things work out as well as that, as the labs must be enormously expensive!
I watched a really interesting talk about how XBox (and presumably the Xbox One) uses a technology they call TrueRank to do player matching. As far as I know this was an MSR project to create a Bayesian version of the ELO chess ranking system. Actually, now that I think of it, it was a whole week of ML talks by academics from MSR.
My point being, they produce (and ship) a lot of smaller innovations too, behind the scenes. Sometimes it's just detecting griefers.
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 is a dangerous thought, imo. Robber Barons turned philanthropists are still evil old men trying to buy social indulgences.
I argue that the weight these monopolists tied around their industries had larger negative impact on GDP and innovation than the positive value of the 'works' their charities re-invest in society.
Oh, I completely agree. The point I was trying to make was simply that increasing funding for medical research on malaria, tuberculosis, etc. was more significant than anything he did (or could do) with Microsoft.
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.
Microsoft is a dead brand. I started saying this in 2004. I still believe it today.
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?
Xbox was a response to PlayStation--the only "innovation" of the original Xbox, to use commodity PC hardware, was dropped with the second generation. Surface is an also-ran. Which leaves Microsoft's true innovative legacy as the inventors of the bendy keyboard? Well, that's "as much as, if not more than, Google and Apple" if I've ever seen it.
Yes you can't ignore MS, especially when they still dominate the desktop and workstation market with their OS.
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).
Sys admins who have to click on a GUI to patch a rack-full of servers with the same update? That's just sick. Yeah, we can thank Microsoft for 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)
xbox is msft embracing and extending the console market, if only to further their "3 screen" initiative. that's why you see xbox devs moaning about how msft is loosing touch with gamers... it's because msft was never in touch with gamers. they wanted the consoles to get into living rooms.
I'd argue that search and Ajax did more harm and drove the first wedge. Search gave Google a business model and revenue stream. Ajax enabled Web apps, beginning with Gmail. That enabled platform independence and a split from the Office monopoly, particularly Outlook/Exchange and Active Directory.
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.
Microsoft essentially invented AJAX. In the late 90s they had some HTML remote update thingy via a Java applet, I believe. Then they introduced XMLHttpRequest. Developing for IE around that timeframe wasn't bad. They had excellent documentation, and added (proprietary, sure) extensions that let you do all sorts of neat stuff.
Yes. Microsoft invented XMLHTTP so they could build a killer web client for Exchange Email. Remember when you first saw that? It was amazing. IE 5 was hands down a more capable browser than any other when it was current. It was nonstandard, but it was very productive. You could do AJAX, XML to HTML transforms in the browser with XSLT, xpath navigation of XML documents, etc. JSON wasn't popular then but support for XML was excellent.
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.
MS ran off the hell off of Xenix internally. Mail, calendaring, etc. I remember when NT was going to be the best Unix out there... And then Win32 happened and coolaid got sloshed around. The NT Kernel could have been an amazing Unix.
I'm on HN, I'm probably aware of how many people use FB. The question was more to the issue of leading minds. Are smart people, people looking to the future, using Facebook? In my slice of meatspace, the answer is no. I was hoping to tap into the tech sector youngins to shed some light on their experience.
I think there is something there. My 13 year old sister does not want a Facebook. I got her to get a g+ thinking 4 way video chat would be just her thing and she posted for a bit but she and her friends prefer Skype); the AIM of today. Ten years of that sort of success and whatever is HN then will be talking about FB the way HN speaks of Yahoo now.
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.
I think it largely is - the late follow-on and then anti-user insistence that has driven Google+ is clearly out of the playbook of a lumbering giant.
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.
When you look at it, Google probably already has. 20% time is practically gone, Reader gone, iGoogle going, etc. All the various little projects that may not have had huge numbers of users, but still indicated that Google was a fast moving, innovative company are disappearing.
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...
It is inevitable that as companies get bigger, the things they do to allow them to scale takes away from their nimbleness. I can't think of a single instance of where the largest company in an industry is the most nimble.
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.
No sadness here - Microsoft has been a stain on the last decade of the computing industry. The only sadness is that their trajectory of circling of the toilet might change, with a new CEO. But I doubt it.
Exactly. Just ask those app devs that have gotten screwed out of a large chunk of their livelihood because one day Apple decided that functionality of their app competed with Apple/iOS.
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.
I don't get why people compare Facebook's performance to that of Microsoft's. Okay, they are both tech companies that have large interests in the internet. But one makes enterprise and consumer software (exceedingly successfully by any measure) and the other is a website for sharing photos.
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.
> Now the lay somewhere on a continuum with IBM, Oracle, SAP all the way through to companies like CA.
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).
I think we should compare MSFT against other companies in enterprise space.
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+.
I see that slightly differently. Oracle is huge in government, world-wide. But while it used to be "Oracle is the answer. What was the question again?", there's a shift towards F/OSS, open standards, and commodity hardware. This hurts Oracle. And yes, the exact same thing hurts Microsoft, too.
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.
Back in late 1990s and early 2000s, enterprises were much more dependent on MSFT than today. Windows machines were in server rooms, Windows machines were on desktops, Exchange was everywhere.... Companies really depended on Microsoft: they had the entire stack.
Fast forward to 2013 ... what do you see? Did Ballmer really improve Microsoft position in enterprise comparing to Oracle and other competitors?
And how much growth potential is there in selling Active Directory, Excel, and Exchange?
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.
You can't really blame people for abandoning sharepoint, it's really an excellent display of why you shouldn't try to interbreed all your gui applications with internetexplorer iframes.
It's literally the worst MS have ever produced.
"Enterprises will replace their Windows with tablets"
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.
Ten years ago, were you saying the same about laptops?
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.
And then Microsoft makes money by selling 50-100 Remote Desktop CALs to replace those 50-100 physical desktops. The price per CAL is about 90% of the price per license of Windows. But add in the base price of the Windows Server license, and you're back to essentially the same price.
At first. But eventually, less and less will run on the 370^H^H^H Windows box, as people get native clients (or good HTML 5+ clients) for email, memos and spreadsheets, and only "that legacy .NET app we still have to use" will be on the big-iron rack in the DP donjon.
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.
Microsoft still has a problem. AD, Exchange, and Office (no SharePoint is not everywhere) only work on completely Windows networks. Once somebody has to use mobile computers, you are better with Samba, IMAP, and a LibreOffice compatible package.
Every mobile platform that matters hooks into Exchange - iOS, Android, Mac OS X Mail, Surface Mail, Windows Phone, Pre-Windows Nokia, all speak ActiveSync for mail, calendar and contacts. Blackberries hook in with Blackberry Enterprise Server.
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?
You have to understand that some of us, who were around and writing code through the 90s, are still a little PTSD about Microsoft. Back then, when Microsoft did control computing, it was easy to wonder if maybe they would control it forever.
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.
"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."
At one time, IBM controlled around 70% of the whole IT business, probably more. Mainframes, minis, comms, switchboards, typewriters. IBM even ran its own bank (IBM Credit Corp).
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.
Excellent post that captures my feelings precisely. I worked for a MS "partner" whose product integrated with BizTalk (I know, right?) A big part of our strategy was trying to keep MS from locking us out once we became successful. Eventually we got bought out and the product was killed.
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.
All they had to do was get mobile right. To do that, all they needed was one manager who kept an eye on the state of capacitive touchscreen development and moved to lock it down before his/her counterpart at Apple did the same thing.
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.
> all they needed was one manager who kept an eye on the state of capacitive touchscreen development and moved to lock it down before his/her counterpart
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 loved Palm. I wondered why more people didn't buy them.
I once looked up a price of Halo 2 at 9 p.m. on a library
Internet access( open at the time), and bought 500
copies of Halo 2 for $2.99 each. I sole all of them
on ebay for at least 30 a piece. I knew nothing about
vid games, but I knew they were priced to move.
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.
Yes, but he cleverly avoids the fact that a few thousand dollars put into Apple stock in late 90's could have made you a millionaire today, but same in MS would have actually lost value from inflation.
It depends what you bought when. If you held both Apple and Microsoft from the beginning, you made far more money on Microsoft stock. If you bought in the bubble then you probably lost a bundle on whatever you bought, whether it was Microsoft stock or somebody else's.
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 ;-)
I am missing something in what you are saying there, OR you are saying something that I find absurd, and I can't figure out which.
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?
"Microsoft used to control the future of computing. Now they are yet another enterprise software company with no apparent mission except to make money."
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"?
I responded to the sibling comment a while ago, and I'd welcome you joining that thread.
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.
My point is that operating systems are largely commodified now, and that Windows' strategic value (for both Microsoft and the corporations using it) only holds in very homogenous environments.
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).
The person that I originally responded to, whose statement you're apparently defending said:
"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.
I was arguing your point; specifically, I don't think their "major footholds" have sufficient strategic value to push Microsoft into a class of its own.
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.
Failed Windows 7 launch? What the hell are you smoking?
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.
"Did you grow .NET into the most widely adopted application development platform in the world?"
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.
I don't know if MS took out Borland, or Linux took out Borland. Maybe Borland took out Borland.
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)
What does that have to do with anything? The iPhone is still a consumer device as well. The enterprise isn't about mobile anything, it's about internal applications and B2B systems integration and .Net and Java rule the roost here, as does SOAP still. What works on the public net and what works in the enterprise are light years apart and probably always will be.
Not at all, and the iPhone kicked the blackberries ass, but that has shit to do with enterprise space. All business != enterprise space. Enterprise != mobile. Mobile created a new space, apples and oranges.
He's referring to the fact that Ballmer dismissed the iPhone when it first came out as an expensive toy that only consumers would care about. As everyone has seen now, "enterprise" phones like Blackberry are dead in the water and workplaces are adapting to supporting iOS and Android devices instead.
> 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.
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).
I'm no fan of Ballmer, but I think "insulting OEMs" is one of the good things he did. The OEMs carry a great deal of blame for the collapse of Windows. While Apple was shipping beautiful metal enclosures with great convenient features like MagSafe and magnetic latches, OEMs like Dell were shitting all over the Windows brand with plasticky (and still expensive!), heavy, unreliable, loud-as-shit laptops with terrible screens.
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.
>but I think "insulting OEMs" is one of the good things he did.
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?
This is honestly the worst of it IMO. Apple does have better hardware, yes, but the difference in speed out of the box is stunning when bloatware is involved. Microsoft didn't have a chance to keep up with OSX.
Apple does have better hardware, yes, but the difference in speed out of the box is stunning when bloatware is involved
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.
> 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)
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.
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.
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.
Apple's willingness to invest in making higher resolution panels and better screens the standard helped bring down prices for everyone else to be able to get the same level of quality.
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.
"Content with lower resolution" screens, when almost all of them dramatically led Apple at the time of their retina unveiling. Add that companies like LG, Sony, and Samsung actually make the screen (and rest assured, Apple is not stopping any of those companies from doing what they want with their own lines).
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?
> "Content with lower resolution" screens, when almost all of them dramatically led Apple at the time of their retina unveiling
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.
The original Galaxy S had the same resolution as S2 - 800x480. It was available in June 2010.
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.
Sorry corresation, I should have been more specific that I wasn't referring to the current "Retina" era of screens since yes, all of the competitors (especially Samsung who makes the panels) have the same thing or are doing better.
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.
> 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.
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.
"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"
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 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.
OEMs like Dell were shitting all over the Windows brand with plasticky (and still expensive!), heavy, unreliable, loud-as-shit laptops with terrible screens.
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).
Even the $3000+ laptops from Sony or other oems were littered with crapware. When consumers shifted from desktops to mobile all of the hardware innovation was moved to the oems' suppliers, which led them to drop all of their technical talent. Now the likes of dell and hp are full of mbas whose job is to make deals with companies like McAfee to squeeze an extra penny out of each sale and to annoy clueless consumers who buy that shit.
My most recent purchase was a Dell laptop with a 3rd gen i7, 16GB RAM, eMMC accelerated TB magnetic disc, IPS 1080p screen, fingerprint reader, backlit keyboard, blah blah. Weight and battery life fit my usage.
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.
For me, i7 2650QM, 8 GB of RAM, 500 GB hard drive, 17.3" monitor, fingerprint reader, 9 cell battery.
$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.
Gross oversimplification of the "Mac" consumer. I use Macs and PCs every day and have worked in the computer hardware business with a specific focus on gaming (Newegg) and it's not that people who buy Macs don't realize they're paying a premium, it's that they value more than "equivalent" speed.
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.
I know that I could have purchased 4+ Windows laptops for the price of my MacBook. I know that they would have been faster and have more ports and "features". In fact, I used to hold the same opinion as you do and went through 5 windows laptops before I switched to macs. Then I realized all of those specs are complete bullshit when you have to clear your machine of malware when you buy it, it weighs 10lbs, the hinges break after a year of use, and it's as thick as 4 windows laptops (I kid, sort of...) and the keyboard feels like shit (except my thinkpad, that keyboard was awesome), and anytime you have to reinstall Windows you have to spend time installing drivers for the webcam and fingerprint sensor and all of those awesome features.
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.
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.
> 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.
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.
I can't believe you actually took me seriously when I stated that "nobody really wants" certain features. Obviously there are outliers with strange needs like your friend's. He should count himself lucky that he's able to find any machine that fits his requirements for any price.
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.
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.
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).
This argument drives me crazy! The CPU speed is probably one of the least important things to me, basically any laptop sold today is fast enough. What I care about is weight, build quality and battery life.
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.
Without wanting to agree or disagree with the parent discussion, one very plausible answer is simply that they had hundreds of millions and felt an obligation to invest it in support of their market ecosystem.
Just exactly how imaginative can you be designing a phone's external appearance? It's just plastic (or metal in some cases) around a screen in a somewhat rectangular shape. Hard to get that wrong. What do you mean plasticky? Is plastic a bad thing? The lower density makes the phone take less damage when dropped.
So has Steve Jobs missed social and search as well? No. All companies need not do the exact same thing. Missing mobile is relevant because it is eating into Microsoft's PC revenues, but social and search is a whole new business that Microsoft didn't need to get involved in at all.
In my view, Ballmer's mistake is to not go after Oracle and SAP much more than chasing Apple and Google.
Microsoft saw social and search and thought, "we must create our own!" While apple saw social and search, and said, "that's not our market, let's have google handle that for us."
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.
It does feel like MS just shows up like that. Azure did (and does) give that impression; Zune, as well. And Surface tablets are also a clear response to the iPad (whether MS ever had anything in R&D previously or not, they certainly didn't ship).
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.
That's because that has been Microsoft's strategy from the beginning: let someone else take the risk of proving whether a market for something exists, and then, if it does, get in there quick with their own offering. They got into the PC OS business with MS-DOS after the Apple II; into the GUI business with Windows after the Mac; into the word-processor business with Word after WordPerfect; into the browser business with IE after Netscape, etc.
Maybe I'm being pedantic, but I don't believe that was true for the BASIC through beginning MS-DOS era. Putting a BASIC interpreter on the Altair 8800 and other early microcomputers was an "obvious" thing to do at the time given the language's popularity in minicomputers, and MS-DOS and its wild success essentially fell into their lap, with their critically being willing to bet the company on it (DRI, the CP/M company wasn't willing to do business on IBM's terms, hardly surprising at the time) and successful execution.
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.
I'd go so far as to argue that it really wasn't the same market - the one that Windows Mobile was in was not anything like the smartphone market created by Apple and Google.
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).
The difference I was trying to point out was that Apple and Google had no legacy involvement in the market at all. Microsoft had clearly defined strategies that were playing out, and were working on developments to further those strategies.
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).
Android and iOS are effectively in a different market than the original Windows Mobile because they were designed from the ground up to be used only with fingers on capacitive multi-touch screens. Same thing with the tablets. Windows was designed to be used with mouse and keyboard, which is why it never really worked on tablets. Windows Mobile seemed more like an attempt to make a phone as much like a Windows PC as possible, rather than a genuine rethink of how people would interact with mobile devices. Windows Phone seems much better, but it looks to be too late to get a foothold in the market, even with Microsoft throwing money at it.
What puts them in a different market now? Nothing.
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...
I didn't say they were executing on that strategy well these days. Surface, Zune and Bing are all examples of fast-follower products that either came too late to be relevant (Zune) or that weren't good enough relative to the competition to displace them (Surface, Bing).
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.
Agree with G+ being FB inspired. There's more to it (Google ecosystem etc.) but I'll leave that.
Android, however, was totally unrelated to the iPhone. In fact, Android's development started before the iPhone. Android's inspirations were also totally different. It's just that the iPhone appealed to a larger number of initial users and thus gained market share quickly, because, well that's what it was designed to do.
Azure wasn't so much "Amazon has EC2? We should have our EC2 as well!", Azure was one of the few products Microsoft actually succeeded in launching. Otherwise, Ballmer greeted Microsoft with a series of failures...only when Ballmer has no control does the company actually succeed.
Well couldn't that be said about any company? If the competitor is doing something different, wouldn't you ask yourself why the heck am I not doing that, especially when there is an untapped revenue. Expecting companies not to follow/copy/learn from their competitors is a naive stand.
>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.
I'm sure I'm in the minority but I don't consider ping a social network (nor do I Twitter, honestly). And that's just me. Twitter is so much more communication focused in my book where things like FB anf G+ have been more frivolous.
I never thought of Siri as search. To me it was more about interfacing with your device.
Is that what determines a flop, though? Siri is definitely known, and added value to the iphone and the apple brand overall. While I use Google Now and think it is superior, I'm not sure if performance would be enough to label Siri as a flop.
What about Bing? Microsoft didn't get into social because that is entirely outside their market. The limit of it seemed to be something like msn messenger, which had business use cases as much as social ones.
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.
Nope, he screwed up even bigger than that. As recently 2005, IE's browser share was well into the 90's. Now, it's hovering roughly 40% depending on whose stats you trust. This on the desktop, to say nothing of mobile which would make the comparison between years even worse. This is after Microsoft recognized that the web was their big challenge, after the so called Tidal Wave memo.
He allowed IE6 to languish while the competition was growing.
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.
I think the bad pat about windows 7 is that they put out Windows 8 way too quickly.
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.
The problem was that it was a complete pivot on an operating system people finally saw as the true successor to Windows XP. It's what Vista should have been, a nice polished and professional OS that generally was out of your face, yet extremely useful. Then there was windows 8, not horrible, there were some under the hood improvements but the horrible hybrid metro/desktop interaction alienated the desktop market and no clear incentive to upgrade.
The bad part about every Windows since Windows 2000 is that it didn't really offer any new value. A bit more bling in the GUI, yes, and security, yes, but fundamentally Windows 2000 is just as good as Windows 7 from a productivity standpoint. So a lot of people saw that, and decided to just stay with XP until they are forced to do something different.
I hate the UI in Vista/7 and the corresponding Office versions. I managed to trim most of the eye-cruft off of the default, which trims down the edges of most programs, but that god-ahhhwful UI in office just won't go away.
A CEO gets to take credit for anything good that happens during his tenure? MSFT succeeded in areas where it already had a foothold through inertia, in spite of Ballmer, not because of him. Meanwhile, it completely failed in areas like mobile where it was initiating its presence. As recently as 2011, Wall Street was calling for him to be replaced , and I imagine now they're all breathing a cautious sigh of relief.
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.
Saying RIM missed mobile would be like saying the Wright Company missed aviation.
...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.
I remember a friend who owned a MS phone (winphone?) around the time that iphone began. He was really happy that he could integrate exchange, use excel and word and do lots of other things with windows. After a month of living with the phone, he told me, "you won't believe how much I hate this thing." It kept crashing, freezing, and locking up on him and he returned it 3 times already. He said that if he had to return it again, he was going to get something else. Now he uses an Android phone and loves it.
> I remember a friend who owned a MS phone (winphone?) around the time that iphone began. ... It kept crashing, freezing, and locking up on him and he returned it 3 times already.
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.
And it's worth noticing that many parts of the .NET framework have gone through horrible hiccups. I mean, while the C# language is great, it feels like every framework built around a .NET seems to be implemented and then dropped without substantial improvements about 3 years later. As a developer, nothing ever seems to get fixed. They get replaced, and the replacements bring a new learning curve and a suite of new bugs and problems, and these bugs can never be fixed for backwards-compatibility reasons.
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.
Yes, but with C# we got ASP.Net web-forms. Holy crap what a technological boondoggle. In general, MS seems to have serious ADD under Ballmer. They introduce massive thundering huge frameworks every other year as some spectacularly big deal, and then drop them soon after.
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?
Joel Spolsky's classic 2004 essay on Microsoft resonates as strongly as ever. He contrasts what he calls the Raymond Chan camp, i.e. maintain the integrity of the API at all costs, with what he calls the MSDN Magazine camp:
> 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.
Funny, I see the .NET framework as a microcosm of Spolsky's criticism. The core C# language is fantastic - imho, it eclipsed Java at v2.0, C# 3 caught up with the popular OSS languages (Python et al) and since then some fantastic concurrency features have been added. But at the same time, almost every edition has completely thrown out the database library and started from scratch. Ditto remote execution. Serialization has done similar dances. Microsoft has written one great language and like 5 mediocre complete frameworks for every subject under the sun.
I feel that many people dislike the idea of him, without exactly knowing what he did during his time as CEO, because the Windows platforms are known as being notoriously buggy and unsecure. XP was a nightmare that caused SysAdmins to cry themselves to sleep until the expansion pack 3 came out, Windows Vista was an unmitigated disaster, Windows 7 was surprisingly decent, and Windows 8 has been hailed as a terrible idea that should have died in its crib.
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.
Are you talking about their fall in the idealogical sense, that happened in 2000? I seem to remember at least 10 years after that where their software dominated every office I walked into. Even today as far as private cloud goes, they are a major player. Again, this references my point of Microsoft getting a bad name for releasing buggy and insecure OS's.
No, SP2 was the big security patch for XP. Most notably, the firewall was on by default. This blocked a whole class of remote-control attacks, because you weren't exposing every single service just by connecting a network cable.
Given his newly announced re-org , the timing is a bit weird.
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.
.Net and C# are prime examples of Microsoft waiting until someone else invented something (Java) and then doing it again. The problem is that it seemed that was the strategy for everything! Very little innovation mostly just copying and one upping.
> he will probably not be remembered for having more than doubled revenue and almost tripled profits.
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.
Regardless of how much profits have gone up, Balmer will be remembered in the business world for one number: $35. It doesn't matter how much they sold, what investors care about is the stock price. And during his tenure, it has remained stagnant.
Before Ballmer, Microsoft was a company that had accomplished the incredible, world-changing feat of democratizing computing, bringing a PC into every household and on every office desk, and generally changing the way people think about using computers in their daily lives.
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.
Did the size of the market more than double over the same time period, for reasons not caused by Microsoft? If so, it is not quite so praiseworthy to have doubled revenue.
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.
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.
'the platform is completely wide open for developers'
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.
> Windows 7 and 8 were the first mobile OS that didn't completely rip off Apple
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.
WP7 was released in 2010. Three years later they now have an estimated 3.3% market share. If that's not a failure for company the size of Microsoft, and with the millions spent on marketing, I don't know what is.
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.
There's the May 2011 purchase of Skype. A year later Nokia said that made Windows Phone toxic to a lot of carriers; I have to say it doesn't look like wise move in conjunction with the Windows Phone effort.
Not a valid comparison - the smartphone market was much smaller in 2008. The percentages would be more interesting/valid, but that's exactly the problem - the market is getting closer to saturation/more mature now and so Windows Phone has more trouble getting elbow room because of it.
.NET started as COM2 back in 1998 along with a predecessor of C#, so I'm disinclined to give ballmer credit for it. Likewise, Kinect was brought to Microsoft by an Israil R&D firm, it was not home grown.
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.
Kinect was home-grown, then halfway through they realized an Israeli company did it cheaper so they used that instead. The far more accurate version of Kinect releasing with the Xbox One doesn't use any of PrimeSense's tech.
No, I don't think he'll be seen worse than the CEOs of AOL Time Warner, Enron, Worldcom, or Bernard L. Madoff Investment Securities, but sure you go on with your hyperbole. It's turning into a staple on HN. Really raising the bar there.
Edit: parent comment used to say "worst CEO of modern history"
That probably would've happened anyway. Nokia was far to late in the post-iPhone introduction market. In fact, I get the impression that they are slowly recovering. They have a good hardware lineup and are starting to get traction in lower-income markets (e.g. South America). Also, the Lumia 521 and 520 are now topping the non-contract phones best-seller charts on Amazon.com.
Apologies, but Harmattan (aka Maemo 6 aka ‘MeeGo Instance’) is still my favourite mobile OS, and even though it was released in 2010 it still easily keeps up with the standard stuff on Android, iOS and Windows Phone (no voice recognition à la Siri, though).
There are a few things worth noting when talking about Balmer and MSFT's share price. Since 2004, MSFT has returned over $164 billion  to shareholders in a ~50/50 split of buybacks and dividends -- on today's balance sheet, that cash would be worth an incremental ~$20/share (assuming $0 reinvested). Meanwhile, revenue and free cash flow have grown at a respectable 12.4% compounded, and it wasn't until 2012 that Apple passed Microsoft in terms of gross profit.
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.
To be fair, MSFT revenue and net income has climbed steadily these past 10 years. AAPL finally overtook them in 2011-12. Microsoft very publically bumbles their consumer products, but their enterprise division is doing well AFAIK. And that's a steady reliable revenue stream compared to the fickle consumer market. AAPL is one bad iPhone away from getting beaten by Samsung.
>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.
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.
I'm no financial expert at any stretch, however the following occurs to me. My iTunes bill comes at the end of the month. Presumably developers and content producers are paid monthly at a minimum. So Apple must have same very loaded bank accounts by the months end. I have read/heard discussion around how (at a vastly greater scale) Amazon have a similar situation. It might be a relatively low profit area, but it must give a massive fund?
The enterprise revenue is steady and stable because Windows and Office is entrenched. It will be for years to come, but if other platforms gain a strong foothold in enterprise (like iOS and Android seem to be doing now), that stable revenue can quickly shring.
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.
If an MSFT share was worth 35 when he took over (at the top of the bubble) and it's the same now then it does not mean (at all) that he was a crap CEO. MSFT still remains one of the most important tech companies ever, that's not a small feat. I don't think that he's an extremely brilliant CEO, but tech companies come and go, and MSFT is still close to the top. Even if everyone in the media is 100% focused on mobile now.
$60 at the top of the bubble; it was already in decline when he took over; surely not (entirely) his fault. On the other hand, $35 in 2000 dollars is $47 today, so that’s a significant inflation-adjusted loss of value. On the other other hand, they paid out $7.69 in dividends during that time, which is a reasonable portion of what is lost to inflation.
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.
This. Why is everyone caring about share price? Look more at revenue and market growth. Xbox took over consoles, Bing is the only search engine to capture whole percenetage points of search from Google, and they still have an ungodly monopoly on enterprise software from office to visual studio.
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.
I think it depends on what you mean by "important". If you mean big in the industry and making products on which a lot of people depend, yes. If you mean influential in the future, then I think not.
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.
What makes you think desktops and laptops are going to stop being relevant within our lifetimes? In reality, Microsoft is in a very safe position, only facing competition in markets they never had a strong hold on to begin with. In the markets Microsoft is really dominant in they are in almost no danger. Let's put it this way: top business-user reasons for virtualization on GNU/Linux are running Windows Server to run Exchange and running Windows to run stock market software. Try taking Office away from the big business customers who bring major income to Microsoft.
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.
With the exception of typewriter, all of those markets are still around today. Not only that, sailing ships remained vital to intercontinental trade over the next hundred years after steam ships were introduced. These days rail is still hugely important in the transportation of goods and energy all around the world.
You need to consider both the dividend and inflation; $35 in 2000 dollars is $47 today. In the intervening time, they paid a total dividend of $7.69. I haven’t done the full inflation-adjusted dividend computation, but I would guess that it works out pretty close to a wash, but slightly in the red.
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.
Microsoft beats out a number of other big name tech stocks over the same period (Oracle, Dell, HP, Sony, Nokia, Intel, AMD, CA), plus outlived a bunch of others. So while I'm not defending him, and I'm certainly glad to see him go, calling him terrible simple because there where other better performing companies in the same sector is a bit harsh.
Being a terrible CEO at Microsoft is being a hero in my book.
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.
The more appropriate time window is from 2008 to now, since that has been when Gates was absent from the company and when Ballmer truly ran the show on his own. Over that time the stock went from roughly $28.5 to roughly $34.5, while giving out a total of $3.51 in dividends per share. Inflation has a slight but non-trivial effect (adjusting that $28.5 stock price to about $30.9 in today's dollars). Overall you get a total rate of return on MSFT stock of about 23.5% over that 5 year period (even adjusting for inflation of the value of the dividends).
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.
Ballmer has always lacked the ability to see the future. Be it about him calling Zune the iPhone killer, or much prior to that claiming it in the media that no one would ever wan tto buy an iPhone. Also, really below par products.
To be fair, one of the greatest "see the future" CEOs has said similar things. Just off the top of my head, I know that Steve Jobs said that no one would want a larger screen than the original iPhone had, and he said that 7" tablets didn't make any sense. Now Apple has a larger iPhone screen and 7" tablet.
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.
It seems like they're moving towards it. They've been signing deals with cable companies and hiring people related to TV. It's certainly not an easy process, especially as people in TV are wary of Apple.
The Cocoa API is pretty well thought out, generally well-documented, and pretty well-engineered.
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.
Ever watch Steve Jobs promote Mac OS 8 or 9? Rumour is, he didn't use either (he used NextStep until Mac OS X). He also spoke negatively about video being on iPods while it was being developed.
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).
Yes, probably. But then again, Ballmer failed quite often. Also I wouldn't really think of any CEO bashing another companies product just for the sake of rivalry and then fail. Its a huge risk to take.
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.
> Ballmer has always lacked the ability to see the future.
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.
There's a lot written about Ballmer's successes and failures and most focus on the tangibles - Like growing revenues by x and profits by Y and such and such product bombing or taking off.
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.
OTOH, Microsoft was a well established company at the time you are referring, while google/facebook/New Apple were startups. MSFT's competition was IBM,Oracle,Sun,Old Apple etc. Most of their generation are dormant names now, while microsoft's products are still popular.
The stock investor in me loves this attitude because while MSFT has done an impressive job of milking their cash cows (Windows, Server, & Office), Wallstreet & the press have been completely un-exuberant on the company, making the stock price very appetizing (until recently).
But yes, the engineer in me laments with you. Microsoft has gone from an innovator to an optimizer very good at minting cash.
No he won't. Microsoft may have lost ground in some areas that they wanted to be in, but the 2000s entrenched them in the enterprise, and now they are very well diversified, with multiple big revenue streams. It could have gone better for them, but overall they are doing very well. They may still pull out (big) wins with phones, tablets, search and internet in general.
You're judging the share price coming out of the greatest stock market bubble in world history.
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.
The CEO's job is to make the company valuable. That's kind of a sociopathic view, of course (gee, I thought our job was to make heart valve replacements or whatever). But, that is the trade off you make when you go public. And, just in case it isn't clear, stock price + dividends over time should equal the cash flow generated by the company. So, looking at stock price over a ten year period is a decent proxy for evaluating a CEO's performance.
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.
The CEO's job is to make money (profits) for shareholders. Manipulating the stock price is not part of the job and is probably illegal. Besides, the OP failed to account for the dividends Microsoft paid during Steve Balmers tenure as CEO.
Stock price is his comparison. His point, is that, Balmer let apple and facebook overtake Microsoft when the market was equally fertile for any company to explode. But what did the aftermath look like for Microsoft? Positive enough to adjust for inflation -- an equal stock price.
It's not, but it's one of the best financial measures (as opposed to revenue, for example).
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.
Microsoft had already lost all of its momentum by 2000. The antitrust case was a major distraction and by the time it was over Microsoft had a badly damaged brand image that has never recovered. Gates overreached during his later years and made the company too insular, leading to them missing out on all of the advances to come.
Well said. I am 100% with you on this. At the time of the internet bubble MSFT share was around $60 and it been more than 13 years now and still no luck as far as shares are concern. I guess the best Microsoft product so far is XBOX/XBOX360. Windows was suppose to be huge but I guess gone are those days.
You can't claim that MS didn't try to jump onto every trend. I think it may be asking the impossible to expect trends to be predicted in advance. Consider that MS already had a business to run. It would be irresponsible to risk that business to bet all-out on something that might never happen.
To be honest a lot of the damage had been done before Ballmer was CEO. The alienation of web developers was well under way, proprietary lock in was a major concern for enterprise and they had already painted themselves in a corner by eschewing the web in favour of a desktop only strategy.
>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.
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.
>>>A MSFT share was worth about $35 dollars when Ballmer took over
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.
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.
You've got a huge case of reality distortion field.
Positives: Only threw away 10-20b on pointless acquisitions (aQ, etc.). Successfully avoided buying Nokia, or pulling an HP/Compaq Fiorina fiasco, and didn't buy a big dying services organization to chase IBM. Also didn't do like HP's board with the lawsuits and revolving door CEOs and such. Avoided major criminal activity.
What about Microsoft developing some of the best enterprise programming tools in the world? I don't use any of the following, but I have to admit that they are (or at one time were) best-in-class is basically all of them:
* C#, F#, and all of .NET
* Visual Studio
* SQL Server
 ActiveX is not the best technology, but it paved the way for the AJAX programming that everyone does today.
It's good to realize that most of it was developed as response to innovation elsewhere. And they don't make up for those horrible Visual Basic versions they pushed for years.
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
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.
Hardware wasn't powerful enough because Vista was terrible. At the time of Vista's launch I had a 2yr old PC running ubuntu with compiz with full 3D effects (but more importantly generally working window composition) while adverts on TV were trying to tell me Vista had "WOW!" while it ran poorly on new machines but actually had not much in the way of wow! like visuals.
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).
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.
I question the relevancy of that article from Forbes regarding Windows Phone. It is written by a Contributor, so it is basically an editorial piece. The sentence "Nokia becomes a low-end smartphone-maker" strikes me as particularly weird, as Nokia was always a low-end phone maker.
He grew revenue and profits at incredible levels. He doesn't get credit because the stock price hasn't gone up, but that is just because he took over during the tech bubble and Microsoft was greatly overvalued at the time. I think profit has more than tripled since he started.
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.
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.
Huge news! Let's see what happens to the stock today. It edged up a little at the end of the day, suggesting that perhaps news was getting out. It's up 8% in premarket trading. 
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.
Not sure if you're talking about the kernel (which I've heard very good things about and has been ported to run on WP smartphones with as little as 256mb ram and crappy processors) or specifically just the windows layer on top of it but I don't know of any desktop class OS that runs on smartphones.
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.
I can run Ubuntu on my Nexus 4 and Android wishes it could run that smoothly. Even in beta it is incredible smooth, it just a shame it can't really do anything since the apps are all just filler.
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.
But what could be the future of MS look like a strategic perspective? I am pondering a bit about that. They are somewhat squeezed in between closed system and open source. How can they position themselves for a solid path for the future in that middle-ground.
I can't talk from a consumer perspective, but from a developer perspective, they need to open source everything .NET-related if they want to remain relevant.
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.
A lot of developers don't trust MS even if they have some really nice tools and a huge platform. Microsoft has a reputation for killing off development platforms when they start thrashing around seeking relevance in some new way. With the shift to Win 8 for example, Silverlight and XNA were axed with little more than the promise that critical bugs and security issues will be fixed. If the platforms were open sourced the community could pick up the slack. The Mono project did that for XNA care of Mono Game. No such luck for Silverlight as Moonlight is dead as well.
A non-crappy enterprise mobile option alone (basically Blackberry 2013) would be a $100b business. Neither Android nor iOS is that out of the box, and the bolt-on ecosystem of crap doesn't turn either into as good a system as RIM was in its heyday.
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 think you might be underselling the enterprise features of iOS, particularly with all of the Exchange support built in, ability to manage profiles with OS X server, the remote wipe, encryption, etc. It's what I use for work, and a Blackberry 2013 wouldn't get me to switch.
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 devices themselves offer most of the hardware security features Blackberry (old) offers (I actually know zero about BB X; it seemed unlikely to live to adulthood, so I've ignored it). I love iOS for that.
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.)
It's that Blackberry with BES has actually decent management and security, unlike a cobbled-on-Android MDM, and the Blackberry keyboard.
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've always felt MS is two businesses, an enterprise systems (Office, SQL Server, Project, Dynamics, Azure) business and a consumer devices business (Windows, Xbox, Phone, Bing) which should have started building hardware sooner than it did.
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.
I was thinking there wasn't much synergy if you're just using the profits of one business as a VC pool for the rest. Better to give the cash back to shareholders and let the market decide which to fund.
Yes, Azure. It's developed into a good offering and I'm pleased for them that they're doing well.
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.
Their dominance over Netscape scared a lot of people. "What if Microsoft comes in and gives everything away for free to keep the OS monopoly?" was a legit fear. Gates was simultaneously a product master, and very competitive. Sometime between then and now people stopped fearing them.
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.
But what could be the future of MS look like a strategic perspective?
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.
Seems like a complex enough beast that finding an appropriate outsider would be difficult too.
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.
Yes - Lou Gerstner was a very rare bird as a CEO. He was a consultant who became a great executive, then a CEO, then led a transformation the likes of which he'd advised on as a consultant. What's needed is of that order of magnitude. How do you find folks like that?
As a side note, I really have a hard time figuring out what was it that Gerstner did at IBM. When he started, IBM was the mainframe company. What is it doing today? They say it's services, but what are services? When I did an internship there, everyone I asked just shrugged their shoulders.
When Gerstner stepped in to IBM, they literally had their fingers in just about everything remotely related to computers and usually there was a product. Not just mainframes.. No joke, there were IBM branded type writers(!), floppy disks, joysticks and printer paper. (Effectively a marked up version of a product made by someone else with a logo on it and a very very expensive 'process' behind it that you could order direct from IBM...) He ended all of that, lopped off products, lopped off divisions. He did it in a measured way though. Initially he made IBM a holding company for wholly owned subsidiaries, they got some more leeway (like they didn't have to buy IBM PCs for their work if there was something better) and they got some marching orders to perform and put up numbers. Some companies got spun out, some products just died. You would have to be a real IBMer to truly understand the vastness of the cuts, they had a finger in EVERYTHING.
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 were mainframes, PCs and Operating Systems. Now they're out of PCs and home operating systems.
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)
Whatever you think about Microsoft, IBM is just a worse experience from an employee perspective. I did two stints at IBM as an intern, the first in Boca (!!) and the second at Hawthorne. IBM Research is almost dead, with most of the researchers having moved on to academia and Google NYC. I work for MSR(A), which is still a very good research lab and probably the last big industrial one.
You are correct in your definition. I thought that's how I explained it.
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?
I would hesitate to try to put a narrative-based explanation to it.
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.
It's a strong assertion to say that it edged up based on news possibly getting out. After the NASDAQ halt yesterday the NASDAQ composite as a whole edged up. MSFT's movement looks correlated to this broader move.
Good point. I was thinking it was rumors getting out because of the gradual nature of the move, but I think that you're right. Traders were slow to put orders back into the market, which created a gradual drift up, rather than an instant reset in the market when it re-opened.
That said, I am one to believe that news always leaks at least to small indirect parties. It's not in those parties interest to spread the news or bet big enough to attract attention. It happens though.
Who really cares what this does to the stock market today? It's about the long-term success of the company and the products that will lead it into the next generation (or not), and not the short-term fluctuation of stock.
I think Ballmer is an interesting case study in perception versus results. He's commonly portrayed as a poor CEO that has led Microsoft in the direction of irrelevance. And yet, to quote oft critic Gruber, "he knows how to make money" (http://daringfireball.net/linked/2013/04/19/msft-q3)
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.
I think both are correct. Ballmer was gloriously good at extracting profits - out of existing, successful product divisions. I believe Ballmer has a firm grasp of the enterprise market, and Microsoft's revenue and profitability numbers reflect this.
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.
Reacting to new market conditions is definitely Ballmer's problem. Under Gates, the explosive growth of the web took them totally by surprise, and he managed to swing the whole company around, producing the market-crushing behemoth that was Internet Explorer 6, and green-lit the XBox on the basis that "convergence" (i.e. computers running your TV) was inevitable. Those two alone are really tough, smart, forward-thinking decisions that Gates nailed.
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.
Except that IE was just a clone of Netscape and XBox was an attempt to duplicate PlayStation. Neither of these were original or ground breaking products. 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! Gates founded Microsoft's online businesses, which have been losing money ever since. 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.
> Except that IE was just a clone of Netscape and XBox was an attempt to duplicate PlayStation. Neither of these were original or ground breaking products.
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?
Originally, of course, Netscape was a rewrite of Mosaic (they even tried to rip off the name) and Microsoft licensed the Mosaic code to get a quick start in the browser business.
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.
>Hard to know why Microsoft stopped developing IE6 and you may be right.
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.
Yes, it was under Allchin, but I suspect that "integrated innovation" couldn't happen without Gates' approval and stewardship.
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.
I can't really speak to XBox as it's not my field, but IE 6 was definitely not a clone of Netscape. I hate it with every fiber of my being, but Internet Explorer invented a bunch of stuff we take for granted every day -- the iframe tag is the first one that comes to mind, and they were also the first browser to adopt CSS, way back in IE3. People forget that for a hot second in 1995 Netscape started swinging its weight around as the dominant browser and introduced a bunch of half-baked ideas (the layer tag, for example).
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.
Right, so they're doing fine now - and they will be doing fine for the near future.
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.
I think the point was, how many of those billion dollar businesses did he inherit? Doesn't the emergence of, say, SharePoint, show that he didn't just extract money from existing profitable businesses? Microsoft seems to have done pretty well at creating new profitable businesses under his tenure, but they're not the sexy consumer products that people like talking about.
I would argue that Gruber is wrong. Microsoft would have made money during it's Ballmer years, regardless of who was at the helm. When Gates left, MS was a Katamari ball rolling down hill, catching all the money in it's path.
People often point to MS's continued profitability in these discussions, but they're missing the point. The question isn't whether they're profitable today, but whether they're profitable and relevant in ten or twenty years.
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.
That's only if you ignore the enterprise. SharePoint, Exchange, SQL Server and Active Directory are dominant forces there and that wasn't the case in 2000. Microsoft's enterprise activities are very profitable and they are growing fast.
It's mostly my opinion, based on the rise of mobile. I don't think they're going to go away, but it does seem like they're already becoming more specialized. Hardcore gamers will always be with us, but the much larger casual market is moving away.
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.
If you only look at individual console you might get that impression, but if you take the generation's totals you'll still see an upward trend.
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 man missed mobile. He screwed up search. And social. And Windows Vista, and Windows 7, and Windows 8. He insulted the OEMs with the Windows Tablet, which was also a failure. He created the Zune. He even managed to screw up with Mac Office, by removing and then putting back in VBA.
For one man, he sure has a lot of failures on his plate.
>"Windows 7 is not a success. It's just a non-failure."
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.
Success would've been an uptick in PC sales, but this is not happening. Instead Microsoft is king of a shrinking market.
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.
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.
Windows 7 is just the finished version of Vista. All the big transitions that started in Vista (UAC, DWM, new driver models, etc) are there in Windows 7. If you go back and look at Vista now, you can see how half-baked it is -- a mix of Windows 7 UI and XP UI.
Windows 7 is orders of magnitude easier to manage.
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.
I've found it just as obnoxiously difficult to find and install drivers in Windows 7. They all seem to have their own proprietary installer, their own crappy control panel, their own quirky bugs and insane workarounds.
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.
Do you know of any specific actions that Ballmer took to "make money"? My understanding/perception is that all the increase is in part result of inflation over last 13 years and in part of enterprise contract strategy that was already in place since Gates era. I don't understand when people say Ballmer helped Microsoft produce .net/C#/XBox. These products were envisioned, created and delivered by few smart people in Microsoft and I personally don't know of any specific contribution from Ballmer in to these products either technical or otherwise.
I think the stock ups or downs isn't about profit. It's more about people's believe.
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.
The markets where Microsoft makes money are almost identical to the markets that they made money in pre-Ballmer, despite a massively changed computing landscape, and it is possibly inertia that has them still making loads of profits.
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 |
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| unsaved cash cows and reboot the |
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"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."
"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.
Not disagreeing, just clarifying. . .do you mean that the last 2 presidents and Bloomberg should have been/should be more involved in grooming folks within their respective parties to take their places?
Yes. Independent of your political stance, shouldn't Bush have groomed a few successors? You can see Obama's failure to groom the next generation when the top two candidates predate him by 20 years. NYC's mayor took a third term because there was no obvious candidate, and there's still not a good one.
Since the Bill and Melinda Gates Foundation has a huge percentage of its wealth still in MSFT stock, I think Bill Gates can make a case to himself that picking the best possible leader for MSFT will save hundreds of thousands of marginal children.
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.)
> Since the Bill and Melinda Gates Foundation has a huge percentage of its wealth still in MSFT stock, I think Bill Gates can make a case to himself that picking the best possible leader for MSFT will save hundreds of thousands of marginal children.
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.)
Wow, thanks for digging that up. I assumed BG had done transfers of stock, but I guess he sold it on a plan and gave the cash 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.)
i wonder if they are going to try and preserve the multi-headed monster that is microsoft today, or whether they are going to break it up into constituent parts. i know that the temptation is great to try and compete head to head with google on the plan to totally annihilate each other, but i wonder if that makes any sense. google docs has been around for six years and i've never encountered it in a corporate setting. so does office need to be tied to bing? (and vice versa). will be interesting to see what they choose to do next.
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)
Would BH leave a16z is the question though. I mean sure, ShoeDazzle, Zynga, Groupon, whatever. They're really doing a lot to mess with SV culture, which could be (long term) more transformative than guiding an ailing giant.
Let me tell you an anecdote why I think Ballmer was incompetent and largely responsible for the sorry state that Microsoft is in at the moment. Yesterday there was a long article in the Israeli newspaper Globes about the success of the Israeli adware companies. Israel has in recent years become a world leader in software that installs unwanted toolbars on your elderly dad and mom's PC and "monetizes" them until they get their son or daughter to come over and fix it.
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.
Unfortunately I can't find anything in English, although Babylon was going to do an IPO in the US earlier this year, so you would expect there to be some information about them in English. The Hebrew article talks about how they are
"diversifying away" from Google by making affiliate agreements with Microsoft Bing and Yahoo. The Hebrew article is here: http://www.globes.co.il/news/article.aspx?did=1000874482.
They sell traffic to Pay Per View companies, which in turn sell it to affiliates. Basically, if you are an affiliate you can go to a PPV company and buy pageview for a landing page of your choice which will be prompted in response to a given action by the user. For example, you might want to prompt your scammy acai berry trial affiliate page to people who searched for the word 'diet' in google or visited weightwatchers.com. The ad software takes care of popping up the right ad for the right user, according to the criteria of the campaign.
Conduit is a billion dollar company, with a successful business pimping installers and toolbars, and is Israeli. Babylon is just a few hundred millions, doing mostly the same (they started out with a very nice dictionary system, but that doesn't make much money, especially after google translate). Cydoor, that ran the ads inside Kazaa and programs of the day, was also Israeli. iMesh, if I'm not mistaken, as also Israeli.
I'm sure there are larger malware operations, but the Israeli adware economy is probably the largest "legit" one.
As someone who spent five years working at MSFT under Steve as CEO, my first reaction is sadness. Steve spent over three decades working there, it is an end of an exceptional career, regardless of how his run as CEO might have been.
I'm most interested with the "type" of CEO they replace him with. Broad categories:
- 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.
Well the general strategy that SteveB has been preaching the past year is the "devices and services" strategy as well as consolidating Microsoft into functional units. And given Microsoft's push towards services to meet their bottom-line, cloud/services is likely their target.
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.
People here will argue that he is the worst CEO ever, that's debatable of-course. But I want to say some good things about him. To me he is a guy in a suit who understood software development. He shouted (in)famous "developers, developers, developers", he knew that LOC is not a good measurement of software development, he poured loads of money in MSR ignoring the pressure of shareholders. For these reasons only he is a fine guy in my book. So I thank him for his works in Microsoft.
5 > 4. And really they're not all players in everything Microsoft does (Google is closest); FB isn't going to touch a phone again, and doesn't do a desktop OS, etc. Azure/AWS/GCE would be better than today (where we really just have AWS). Android/iOS/WP would be nice. etc.
I only realized what was wrong with Gate's version of Microsoft few years before he retired. It was only then when I learned that Gate's has been the chief software architect of MS all these years.
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.
I feel bad for ballmer. his legacy is going to be pretty terrible because the stock price was flat from when he took over until now. nobody seems to take into account that he took over in the middle of the tech bubble bursting and msft was hugely overvalued at the time. I think profit has tripled since he took over or something like that. following gates was already going to be one of the hardest tasks possible. getting handed an overvalued company in the middle of a bubble bursting makes it all but impossible.
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.
Steve Ballmer is the perfect example of why a business person should not run a software company. The opinion that "Steve knows how to make money" is a poor indicator of a successful leader. Microsoft has alienated developers leaving only enterprise developers to create boring interfaces for users causing many personal computer users to find something more aesthetically pleasing (OSX/Ubuntu). A company based solely on making money is like a marriage based solely around sex and benefit to social-status. If you're a .NET developer and this offended you; good. Money != happiness
This is the tragedy that is a publicly-traded software company. Ballmer's sole responsibility as CEO is to maximize shareholder value, and the Board has to hold him to that. If A CEO prioritizes anything else, they will be fired and will become vulnerable personal lawsuits. It is literally their job description to make money over anything else. Taking the "long view" rarely appeases the Board, because short-term quarterly numbers are what determines the corporation's value.
"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.
I always believed leaders should do the main thing the company does. Microsoft's new CEO should write software and make hardware. It's hard for me to respect a manager that doesn't understand what I do.
Good news, this really had to happen. One of Microsoft's biggest problems is one of PR - too many people, particularly in the media have just hated Microsoft for years, and Ballmer is not charismatic enough to ever recover from that position. They need new blood, and to shake off the "old Microsoft" image if they want to win hearts and minds again.
Marketing and PR can only do so much to improve the image of a company or product. That company or product actually has to have great core values or qualities.
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.
I really don't think Microsoft's main product offerings are that bad. The biggest issue with Metro and Windows Phone is a lack of developer support - and I think a significant part of that is caused by a lot of the best developers being either Apple or Google "fanboys". Office remains excellent, Windows 8 is excellent at what it intended for - office productivity, games, VS development etc.
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.
Bullshit. Microsoft crapped on it's developers, IT and users when it released Windows 8. How are you supposed to develop for a system when the frameworks change every couple of years? Not to mention pissing off independents, dropping TechNet and raising license costs across the board. Price out a decent MS server solution and 60 to 80 percent of the cost is Microsoft licenses. Azure isn't a solution either since Redmond is Yet Another NSA Bitch.
I don't know if Microsoft crapped on it's developers as much as they lost touch with them.
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.
You are quite a drama queen :). Windows 8 applications can still be programmed in .NET languages. Given that probably 80% of the application is not 'front-end' code, it can be compiled without changes. On the front-end you can still use whatever was used before, since the desktop still exists. And if you want to go all-'Metro': there is a learning curve, but it is not that steep, since Windows 8 applications are also developed using XAML et al.
Disclaimer: as a OS X and Linux user, I don't know much about Windows.
I have not been a Windows developer for many years, so I admit I may be wrong about things from that perspective. As a Windows user, I still think that their products are pretty good at what they do and that a large proportion of the media and its customer base hate everything Microsoft does by default.
$24 billion. That's the increase in market value as of 15 minutes before the open. This has to be a record for a CEO announcing he's leaving. I've always wondered how much these types of things bruise the egos of the retiring execs.
'It'll be better without Ballmer' is the 'If Jobs were alive' of the Microsoft world. I don't necessarily think that Microsoft has been doing a swell job, but I didn't think they were when Gates was in charge. Mostly it's a disappointment that they're that big and doing that little progressive.
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.
Microsoft's licensing schemes are riddles, wrapped in enigma's and covered with shit. I'm actually surprised that Windows doesn't have In App Purchases. You want to search? It's only 2.99! You want the desktop? It's only .99!
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?"
Licensing being complex is a feature. It gives Microsoft something easy to wheel and deal on; it also gives OEM salespeople something to hide profit in ("gosh, sorry your enterprise desktops came out $40/seat high, but Microsoft gets all of that" while $35 of that is pure profit for the OEM)
MSDN is a different beast. They give you a lot of licenses for development. In our company we have hundreds of VMs that are created and thrashed all the time so having issues with licenses is a problem for QA.
Now the question is, whoever will be next at the helm, will he / she be able to reverse directions and steer Microsoft into more relevant and fruitful territories.
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.
They also clearly missed the internet revolution, but managed to recover. Big companies have trouble adapting to new paradigms, but it's not impossible for them to do it, especially when they have so many resources at their disposal.
I don't think Microsoft's response to the web is comparable to their failures in mobile. billg's "Internet Tidal Wave" memo went out in 1995, long before the web had become ubiquitous. They still had plenty of time to (legally or otherwise!) ride the .com tidal wave to dominant marketshare and huge profitability.
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 don't think missing the Internet revolution was their biggest mistake. If you look at Apple they focused on hardware. What Microsoft could have done too. Instead, they just tried to continue this Windows monopoly and overlooked everything else.
My point was they didn't miss the Internet revolution. In fact, they picked up on it faster than most of the '80's tech companies and radically shifted strategy because billg knew that by, say, 1997, it might have been too late.
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.
> Steve Ballmer joined Microsoft on June 11, 1980, and became Microsoft's 30th employee, the first business manager hired by Gates.
> 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?
I would bet on it. This seems to be the cycle of tech companies: Innovate when small, rake in profits for years, lag behind, and slowly die. What has Apple produced under Cook? A couple small improvements to current products, and nothing new or noteworthy. There may be a couple innovations still in their incubator from days past, but in 5-10 years people will be saying the same things about Apple.
Anyone else thinking Bill Gates might be "chosen" to be the next CEO of Microsoft?
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.
I think the main problem with it's leadership is that Microsoft lost it's innovative spirit. I think the main reason for that is that Ballmer is a business and marketing guy, and not a tech guy.
All the giants today are led by tech people and that's effect the entire culture of all the company.
Tim Cook has an MBA and a BS (earned in 1982) in industrial engineering. I was in college in the years leading up to 1982 and I socialized with industrial engineers. It is likely that Cook took only one course that involved programming (excluding programmable calculators). And the descriptions of his jobs ("chief operating officer (COO) of the computer reseller division of Intelligent Electronics", "12 years in IBM's personal computer business as the director of North American Fulfillment") suggest strongly that he did not do any programming once he left school.
People may scoff at this - but why not? His experience from Apple and NeXT should transcend into an organization like Microsoft. He will be an extremely useful asset, although perhaps a bit dictatorial from what I've heard.
Microsoft isn't going in the opposite direction that it should be going on. Instead of integrating more, it needs to make more software for Android and iOS. If it weren't tying everything into Windows all the time Office and other Microsoft software would be dominating App Store and Google Play, ensuring its success for the next generation.
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.
Some people are claiming Balmer deserves some credit for keeping Microsoft profitable/status quo, but it seems like they're forgetting the stranglehold Gates had on computing when he left. It's not hard to keep the gravy train flowing. This is part of Balmer's problem, is that Microsoft thought it could stay current by essentially continuing its model of releasing new, sleeker versions of the same software every few years, ignoring that the fundamental way in which we interact with computers has changed drastically over the part decade. By the time they do innovate, they're too far behind to matter.
Terrible CEO or not. Under his leadership Microsoft stopped becoming a software leader. They stopped leading and started following. Yes. Great products were launched. Windows Phone 8 (really cool interface), the Surface tablet, the xBox, Azure, various improvements to Bing. But they were outdone by competitors in almost all of these areas. Microsoft has to keep innovating, they have to become the disruptors. Right now, they're just busy playing catchup.
> If you think about it, what does the "within 12 months" part even mean?
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.
I mean, a much more common way to do this is something like "has informed the company of his intention to retire as soon as a successor is announced." Or "announced he will retire at the end of the year and that the company’s board of directors has approved the promotion of X to CEO."
It may be more common, but I think that if it's stated the first way, it seems less planned and deliberate and it's more likely to rattle the market - or at the very least, send the media off looking for nefarious, non-business-related reasons for the retirement. It's almost as bad as suddenly retiring to "spend more time with the family".
That they see 12 months as a safe timeline for transition (I'm sure the board already has a short-list), but if they place a CEO in that role before then, and the transition is complete, then Steve will leave early.
Possible - but the official statement indicates that no decision has been made.
"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.)
Microsoft successfully won the battle of the desktop computer. It's amazing how this monument of achievement actually gave Microsoft a long-term disadvantage as desktop computing slowly became irrelevant to laptops and mobile. Failing now promotes success in the future. It will be interesting to see what happens over the next 10 years, especially with DIY and web dev on the rise.
My biggest hope from all of this would be for Microsoft to enhance its current products. They have been trying to get into too many fields while at the same time forgetting to make their main priority products perfect.
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.
About time. I hope that he picks someone that can take MSFT from the boring and problematic company that we have no choice but to deal with, to a company that is producing products that actually make it easier to use things and more powerful (Windows 8 was a huge step back).
They need someone who will innovate and continue to innovate.
Microsoft stifled innovation. For a twenty year period, they held market dominance and used their monopoly power to maintain the status quo. They did a huge disservice to our entire industry. I say good riddance to bad rubbish.
Indeed. His reign over the past 10 years not only resulted in not much progress for microsoft but also hampered its reputation. Would be really interesting to see how the new management takes over and brings about some real changes.
Nice. Microsoft does some really awesome research work and can easily come out to position themselves as leading the tech space again. Though some would argue they already do, but that's not correct looking at the growth other companies have demonstrated.
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.
Ballmer's Microsoft really did have some intensely great research and development going under the hood, but the management was completely unacceptable for such a large company. There needed to be individual units so each team could work at their best, but unfortunately, the piss-poor management that Ballmer headed didn't allow this, and resulted in the up-down nature of Microsoft's product releases.
Hmm , so who will be the new boss ? I think it should have been Sinofsky. He delivered W7 which the best Windows ever period ( and i'm a linux fanboy ). W8 was not that great but i dont think he designed that whole Metro fiasco, Metro came from the top. Anyway good luck MSFT.
I don't understand. Marissa Mayer would be a great choice for this job. I doubt she would take it, because Microsoft is totally invested in the dying PC business and she'd have to put up with whiny old Bill, but, hey, Yahoo didn't look very good until she got there.
I don't have a resume that could even begin to get a second look for CEO for a company this size, but boy oh boy would i love to take this position. CEO of Microsoft or CEO of HP is something i'd absolutely love to do! Two companies I think i could really fix - as I'm sure could a million others, but just in case the recruiting firm is reading this and have decided to try a novel approach and try someone with no former Fortune 500 CEO experience. You never know. lol.