Amid layoffs, Microsofties reveal further turmoil in Redmond

http://blog.seattlepi.com/microsoft/archives/213808.asp

by timr • 16 years ago

106 132 16 years ago

blog.seattlepi.com

ryanjmo• 16 years ago

It looks like pg was right 3 years ago: http://www.paulgraham.com/microsoft.html

watmough• 16 years ago

Yeah, Microsoft was relevant to me when the launched Access in about '96 or so. Then there was a brief spell of relevance with .NET and all the cool stuff attached to that.

Since then, Linux or OS X have become the OS' of choice for many techies, and open software has eaten the lunch of MS when it comes to internet development.

MS are on life support (though in a quite comfortable state!) kept alive by a HUGE installed and locked-in base. There are flickers of life in Office and Windows 7, but they may be fighting a losing battle in future markets, likely to be more cost sensitive than the high productivity and high-priced US.

lenni• 16 years ago

I think they will go the way of IBM: Relevant and profitable but not the all-encompassing mega-monopolist.

arethuza• 16 years ago

About the comment on Microsoft being evil like Commodus - I've been listening to the excellent "History of Rome" podcast and it points out that the real Commodus was quite a bit nastier/madder than the character in Gladiator.

http://thehistoryofrome.typepad.com/the_history_of_rome/2010...

Anechoic2• 16 years ago

Before succumbing to schadenfreude just remember that this will eventually happen to your favorite tech company in the future, be it HP, Dell, Apple, Google, Yahoo, Fog Creek, Amazon, Y Combinator, etc. Companies have ups and down.

Hopefully MS will see this as a learning experience, become a better competitor and then we as consumers will benefit.

lanstein2• 16 years ago

/ did happen in the past (Apple)

Anechoic2• 16 years ago

Sure, and it's arguably happening right now to some of the companies I mentioned (Dell, Yahoo) but if/when they recover it will likely happen again. Apple will likely face bad times at some point in the future.

rbanffy23• 16 years ago

It's complicated.

Apple's products were always highly regarded. Their problem was pricing - they charged too much for boxes Dell sold for much less.

philwelch9• 16 years ago

HP, too.

thought_alarm• 16 years ago

Yes, but most companies can't rely on the revenue from two gigantic monopolies to keep the zombie alive. It will take a lot more than the failure of the Kin (which it appears was set up to fail all along) to change the corporate and engineering culture at MS.

rbanffy23• 16 years ago

Which means it will bleed more and longer than any previous tech giant.

I'll grab my popcorn and enjoy it thoroughly.

mikecane3• 16 years ago

Or MS is next in line after Nokia and Sony, on the downward spiral. Seemingly-invincible companies go under all the time. It doesn't have to be one big explosion, but death by a thousand cuts.

InclinedPlane3• 16 years ago

Any company that has empire-itis, yes. But there's hope that some companies can escape that disease.

signa11• 16 years ago

> Hopefully MS will see this as a learning experience...

if the london-stock-exchange fiasco didn't change anything at microsoft, i doubt that this will have any impact at all.

WorkerBee• 16 years ago

the london-stock-exchange fiasco

Are you referring to this? http://blogs.computerworld.com/london_stock_exchange_to_aban...

Despite the ignorant and inflammatory commentary that I linked to, I doubt that Accenture's failure to write a system in C# raised much of a wave inside Microsoft. Accenture could have made the same mistakes in Java or in any other language.

gaius3• 16 years ago

It happened already to HP. All the cool people quit en masse and formed Agilent.

rbanffy23• 16 years ago

Wasn't Agilent owned by HP?

tomjen33• 16 years ago

Companies have their ups and downs (thats the funny thing about the runway start ups usually talk about, there is normally another in the end that you go down on).

But Fog Creek and Y combinator aren't near big enough for them to collaps like that, so I doubt that they will fall that far.

Remember the bigger they are, they harder they fall. And lets face it - Microsoft is insanely big.

tmsh4• 16 years ago

Can you think of a project, a product or a company that succeeded with a somewhat negative-sounding name (even if meant somewhat ironically or as sort of a renegade mentality)? I'm drawing a blank.... It's odd that I can't think of a single one though. Even among game studios, etc.

shasta• 16 years ago

Garage games?

kaisdavisOR• 16 years ago

Upvoted since I live in Eugene and know some of their employees. :)

mhansen• 16 years ago

Git

astrange• 16 years ago

What do you mean "a somewhat negative-sounding name"? Products succeed with embarrassing names like "Wii" all the time.

tmsh4• 16 years ago

I mean like Evil. Or Gloom. Or Danger. Embarrassing is a much wider set. Anyway, just curious...

mikecane3• 16 years ago

But Wii = Whee.

macrael• 16 years ago

Wii. iPad.

idoh• 16 years ago

Waste Management, Inc.

thatoneguy• 16 years ago

Wii.

nkassis• 16 years ago

iOS, and considering Cisco used the name first, it only makes it look more dated.

JMiao• 16 years ago

um, cisco also had a "product" called the iphone.

vlad2• 16 years ago

Gimp

kevbin• 16 years ago

Company: Humble Oil http://en.wikipedia.org/wiki/Humble_Oil, Micro Soft, Borland, SMEG

Product: * For dummies, dilbert, crack, SCSI

Project: Butt-head astronomer, operation enduring freedom (when emphasis on 2nd instead of 3rd word), unix, lisp

mahmud• 16 years ago

And the previous Operation Just Cause, to remove Noreaga, just because.

robryan• 16 years ago

You'd have to think they would be better off giving up on owning the mobile platform, given that they are up against Android and iOS/iPhone I don't think they could possibly come up with something compelling enough to get mobile companies to pay for a license over the free Android OS which iterate much faster.

Possibly they could form a partnership with the aim of bringing other products to a platform. They could support Android, build it into there development tools and release mobile versions of their software there, integrate with xbox ect. Would probably be a bigger opportunity than the dead end that is windows mobile.

I think there would be a lot of businesses at Microsoft that could be cut in order to regain some focus. Although the same could be said about Google and they seem to be doing pretty well at the moment.

rbanffy23• 16 years ago

> they would be better off giving up on owning the mobile platform

They can't afford that. Their strength comes from the lack of viable options - each of their product lines reinforces the dependency on other product lines. If you use Exchange, you probably won't be able to use anything other than Outlook, which runs on Windows and is part of Office, which makes using Sharepoint more or less painless, which runs only on top of Windows servers and requires Microsoft's database...

Their value proposition is based on dependency loops. Break the loops and the value disappears (or becomes negative).

kenjackson9• 16 years ago

Or the other more sensible response that mobile devices are one of the major growth segment in the industry. Why would you give up on that?

But conspiracy theories work too.

MartinCron• 16 years ago

I agree with everything but your comment about Sharepoint. Nothing can ever make that painless.

jsz0• 16 years ago

I think they still have a shot in mobile simply because there isn't as big of a barrier in switching platforms. Moving from iPhone to Android to WM7 might end up costing the average person $50 in apps over a period of years. One really good WM7 handset could totally change the market.

Personally I see the Android market is on track for much less diversity in the future. HTC and Motorola seem to be the only companies doing a really good job with Android. The big problem with Android is your handset maker can cut corners and give you a terrible product. Google doesn't do a whole lot to support OEMs besides a link to the source code and words of encouragement. Microsoft has lots of experience as an OEM software partner. The license fee may end up being a reasonable price for handset makers to pay to avoid some of the difficulty of developing an Android device.

Tichy3• 16 years ago

It's all a symptom of too much money and too many resources, I think. Focus get's completely lost.

Isn't there a way to run a big company? Is anything known on how Apple does it? How big are their development teams, even?

Would it make sense to manage internal teams a bit like startups, that is they would have to succeed on their own and pitch for investments?

rbanffy23• 16 years ago

> It's all a symptom of too much money and too many resources

Not only that. Wrong people in the wrong places.

city412• 16 years ago

According to Wikipedia, Apple has 34k employees. Microsoft has over 100k. Maybe at that scale, 34k and 100k aren't very different, or maybe that's like night and day.

Tichy3• 16 years ago

34K still seems a lot, but how many are really involved in developing the core products? A lot of them would probably be sales people etc?

Maybe MS would do better with 34K than 100K people...

rao• 16 years ago

The range of products offered by Microsoft is huge. Multiple versions of OS, Office, VS and various websites.

dgallagher• 16 years ago

Apple has a product-driven leader at the very top. Microsoft has a marketing-driven leader at the very top. That's definitely part of it.

Micro-startups inside MS would be a killer idea. Small teams of 2-5 people, isolated, given time and necessary resources to create idea's. The challenge would be to keep entrepreneurial types tethered to MS, rather than watching them leave to start a company on their own (be their own boss, reap more financial rewards, etc...).

--------------------

It looks, from the outside at least, that MS has been dealing with plenty of political turmoil for quite some time now. If you exclude legacy products (Windows/Office), you see a pretty bad track record in terms of financial success over the last 10 years. Zune, Kin, Tablet PC's, Windows Mobile (profitable, but who wants one now?), Xbox (successful as a product, how about paying off its multi-billion dollar investment?), MSN, Pocket PC's, etc...

Most of the tech Apple is creating today, Microsoft had years ago. The thing is, MS didn't refine it well enough. They need to spit and polish the crap out of their products. Not release a product, saturate the market with it, declare victory, and ignore nurturing it.

What are they doing most wrong? Lately they've been in reaction mode. They don't innovate. They copy. And by the time they get their copy out it's too late. They've always copied, but their copies use to be good. Or at least tethered to a commonly-used proprietary OS or file format with high switching costs.

Lately their mantra has been along the lines of this:

1) See an idea that's successful.

2) Decide to compete with it.

3) Form a team to build it. Possibly acquire companies to do so.

4) Build it internally behind closed doors.

5) 1-3 years pass. Competitors gobble up market share. Microsoft spends lots of cash.

6) Launch it! Expect consumers to replace their other gizmo with MS's gizmo, costing them money, and time with switching costs (how do you migrate an iTunes database with 10,000 ACC's, ratings, album artwork, et all, to Windows Media Player in a few minutes?).

And people must like it, right? We spent all this money building it, our focus groups said it was awesome, and it does what our competitors product does too!

They're missing a much-needed feedback loop. Alpha users, and beta users. They don't know if their masterpiece is any good until millions have been spent and they show it off. It's hit or miss.

jasonlotito• 16 years ago

> They're missing a much-needed feedback loop. Alpha users, and beta users.

That's true, but they've learned. Windows 7 is a massive success and Office 2010 is a great product. Both had extensive testing and user feedback.

Windows Phone is getting a lot of traction before it's release as well. Developer tools, getting devices into the hands of developers, releasing information very early long before it's release and getting it out there.

MS in the past few years has started to ramp up it's outreach to developers and the community, and it seems like they are working that way with their consumer oriented products.

And let's not forget that they have gone into markets not #1 and taken the spot. Linux was supposedly going to be the Netbook OS, but then in practically one year, MS took over that market.

It's not like Apple doesn't ever release underperforming products (see Apple TV for a recent example).

MS is struggling, but struggling from a good position.

russell• 16 years ago

So what's different from google? Top down control vs bottom up innovation. Google engineers have 20% free time to work on interesting projects. Something like that would do wonders for MS. Google didn't invent the 20% free time, 3M has let technical types devote 15% of their to their own projects for decades.

mikecane3• 16 years ago

The problem with Microsoft isn't a lack of bright talent. It's "Who's Next?" People are jockeying for political positions, not concentrating on products. Ballmer won't be there forever and everyone wants to be the next Ballmer. If Steve Jobs passed away tomorrow, there could be similar jockeying at Apple -- we've already seen how product introductions lacking Jobs have been split up among several people. We don't know how many of those people got the idea from that experience that they could be "the next Jobs."

Jobs also once criticized company leadership in general (someone else can go find this), stating that what happens after a founder leaves is that a marketing person ascends to the top -- and he pointed to Ballmer as an example. It's interesting to note that Palm began to sink also when a marketing person was leading it -- Ed Colligan.

gfodor• 16 years ago

Eh, Ives is almost certainly heir to the throne.

wmeredith• 16 years ago

As a shareholder, I certainly hope so.

dieterrams2• 16 years ago

I don't know anything about Ives' business skills, but I'd worry that making him CEO would be promoting him to his level of incompetence. He's a fantastic designer, and I'd rather not see him distracted from that role.

But it might be wise for him to have final approval over product designs, the way Jobs presumably does now.

rbanffy23• 16 years ago

> everyone wants to be the next Ballmer.

Eww... I would never want to become Ballmer. ;-)

And to keep with your example, Apple also floundered after Jobs was kicked out. They had decent products, but nothing insanely great.

InclinedPlane3• 16 years ago

Many of these complaints are the same reasons I left Microsoft about a year ago. It's becoming less and less a place where good work is rewarded; where engineering reality trumps corporate BS; where you feel empowered to make the best products; where you look forward to spending time at work.

As more and more talented people are pushed out or leave, as the compensation continues to stagnate, as the corporate culture continues to rot all of this will snow-ball. People will find that they no longer enjoy work because all of the good people on their team have left. They'll no longer be bound by MS's golden handcuffs because their compensation won't be any better than a dozen competing companies in the same city. Etc, etc, etc. Increasingly I get the feeling that the exodus is just beginning from MS.

todayiamme2• 16 years ago

I don't think that even if Microsoft layed off 60% of its staff it would become competitive as Apple or Google. The more I read into their problems the more I think that this is not a management issue. No they have rigid management controls to ensure that stuff doesn't go wrong like the other giants, but due to the lack of a vision.

If you ask an Apple, Google, old HP, or any employee of an innovative company they will be able to tell you what their company is about. They will be able to define what they are contributing towards at in work. They know what their company's mission is and what that company stands for in respect to their product line and their positioning in the market. This has stopped happening in Microsoft.

An interesting question is whether all failing companies have similar blind spots of vision.

As someone once put it; management is knowing how to cut down trees efficiently, vision is about knowing if you're in the right jungle in the first place.

nostrademons5• 16 years ago

I think a lot of Microsoft's problem is that they succeeded in their mission statement. "A computer on every desk, all running Microsoft software" was incredible hubris in 1974. It's reality now. What can Microsoft do to top that?

It makes me wonder about what the world will look like in 15 years. Google's mission statement is "Organize the world's information, and make it universally accessible and useful." Right now, I'd tend to think that Google is safe from many of Microsoft's woes, because I couldn't imagine how they could possibly finish their mission statement. But I would've thought the same thing about Microsoft in the 1970s.

todayiamme2• 16 years ago

I agree with what you say, but a part of having a vision also means looking beyond your own accomplishments. I have noticed something in how I think/do things everything feeds to the next thing. Unrelated things become connected somehow and just continue some undefinable chain. 'What's next?' is really the question they can't seem to answer.

Maybe, the problem over here is that the dreamers have stopped dreaming and they're now concentrating on spreadsheets?

Look at Elon Musk after he exited PayPal he could have coasted in that paradigm. Done incrementally better things, or just continued looking after it. He didn't do that. Instead, he asked himself what's next for me, and put his money where his mind was. In a lot of ways to me that defines a vision.

Or, we could take the perennial example, Steve Jobs, Apple could have coasted after the iPod, or the iPhone but they somehow keep on pushing on and they've started creating an ecosystem where all the other products feed into one another. It is true that his dictatorial style helps him, but someone had to see this possibility to work towards it, and that's where the challenge lies in my opinion.

jolan2• 16 years ago

> I couldn't imagine how they could possibly finish their mission statement.

Aren't they almost there already? Documents, email, maps, news, phone/voice, search, videos online, and soon television.

> "Organize the world's information, and make it universally accessible and useful."

... and to sell ads based on that information. Google is still primarily an ad company that just happens to also do technology that helps them sell more ads.

philwelch9• 16 years ago

Microsoft's vision was a computer on every desk and in every home. They accomplished their vision, and they're a mature company collecting massive amounts of rent on the software that runs on most of those computers. They don't lack vision so much as they gain illusions--illusions that they can still be a young, growing concern with one foot firmly planted in a mature business.

That's not how business ecology works, though. Microsoft's shareholders are not well served with stock in a company that's half mature, dividend-paying, high-market-share titan and half scrappy innovator. They're probably better off having stock in a Microsoft comfortable with its maturity as well as a separate, younger, scrappier company. The entire economy would be better off with that.

aresant• 16 years ago

Yes, MSFT lacks focus but they are virtually forced to compete across dozens of fronts hoping that someday all the nodes add up to the former glorious whole.

known• 16 years ago

Splitting Microsoft into 3 companies would have helped. http://en.wikipedia.org/wiki/Thomas_Penfield_Jackson

rbanffy23• 16 years ago

In retrospect, not splitting it will prove to make it fail faster.

Amid layoffs, Microsofties reveal further turmoil in Redmond

Related Stories