Month: September 2011

I read today about the rising poverty levels in the United States to the highest levels since the great depression and how another 800,000 people were added to the list that do not have health care. In addition a local hospital, in Seattle, is laying off employees because of more uninsured patients, bad debts as people are unable to pay their medical bills, cuts in Medicaid at the state level and more cuts at the Federal level in both Medicaid and Medicare. We live in very worrisome times and I sense a lot of nervousness out in society these days. When will this economic decline subside? If I don’t have health care and my children get seriously hurt how will I survive? Are we an insurance policy decision away from ruin? I have spoken with many people who have jobs who would take less or move elsewhere, take time off, retire etc..but one thing holds them all back and its the same answer every time…Health benefits.

Make no mistake first and foremost the issue of health care elicits fear in society today.  The biggest reason is once you are trapped in the system due to an unforeseen illness or tragic accident the bills begin to come in.  It’s like lava flowing from the volcano you can only hope it stops otherwise it will burn everything down in its path.  Except with healthcare it burns down ones life.  At a recent family event I heard of the firefighter who retired in perfect health.  Shortly after he suffered cardiac arrest and now is $200,000- in debt.  As I talk with other family members in that line of work the challenge with the early retirement policy of the profession is the worry of health care, some who still have children to support.  Unfortunately when it comes to health care horror stories are not hard to find.  There are a lot of players that make up the system we have in place today each with their own unique interests

Let’s start with a benefit we worry about, the cost of insurance. Without insurance we are at risk.  We choose not to go to the doctor for fear it may lead to additional costs that we are not prepared for nor can we afford.  In addition as the costs of care rise so do insurance premiums, having an effect on corporate America and having an effect on individual Americans.  What are ways to get costs down?  I am sure an insurance company would say get rid of or charge higher premiums for risky patients.  They would do it in a  heart beat but that goes down a very slippery slope.  An insurance company may then start dictating lifestyles.  As much as I treasure individual liberties, seeing how some people treat their bodies, this may be a good thing.  Don’t get me wrong having worked at Microsoft where we had the best insurance policies on the planet (until recently).  When I had a medical issue I provided my card and that was it.  Everything was covered.  Having left I now understand the debate much better(though unwillingly).  At the end of the day insurance is a business and for them many people are just plain bad risks.

A primary driver of increased cots is the medicines we take. The medications we have to take are run by a giant industrial complex: The pharmaceutical companies.  Back in the seventies a pharmaceutical exec was asked about how do you grow markets and the reply was “I don’t just want to treat the sick, I want to treat everyone”.  Why limit your market.  Fast forward to today and we seem to be well on our way to that vision.  But the bigger concern is what is that doing to our overall costs?  The way big pharma works today is when the release a new drug they need to seek approval from the FDA.  Once approved they have a fifteen year window to “recoup” their research costs.  A good example is Lipitor.  By some estimates Lipitor was taken by 12 million Americans to aid with high cholesterol.  The cost was around $2 per day.  The drug companies have a monopoly for 15 years to recoup costs.  My dad had high cholesterol, but in those days the cure was simple, change your diet.  To be clear that does not work for everyone.  But in that window they will attempt to maximize profits by charging a high price.  Now whether that price is warranted or not is the subject of debate.  Another question is should we reduce the window?  How much are we willing to pay to fight corporate lobbyists?

Advances in medicine have also had an impact both positive and negative.  One problem is many of the advances allow us to treat illnesses and prolong life but not cure major diseases.  Cancer costs continue to increase, because we have the ability to prolong life but the cure is as of yet still illusive. By delaying the inevitable are we succeeding?  I think that is on a case by case basis.  But if we could find a cure for cancer that would be the most optimal and hopefully the most financially viable for everyone involved.  If I have a fear it is that we are, to my earlier quote from the Merck executive, so driven by profits that we are more interested in the treatment than the cure.  I can only hope that is not the case, but it does weigh on my mind.  We cured polio but of late cures seem hard to come by.  We seem more driven by quarterly revenues than moral revenues.

From a legal standpoint the values and virtues that created the United States also hurts us, in particular in health care. The US has always been great about protecting the rights of individuals.  It is why this country was settled in the first place, to escape the perceived tyranny of the monarchy in Great Britain.  When Jefferson wrote The Declaration of Independence and Madison wrote the Constitution they very much had the rights if individuals in mind.  In health care this, however seems to hurt more than it helps.  Every time a malpractice suit is filed it sets off series of cascading events which ultimately lead to higher costs.  The difference between healthcare and other industries, is that unlike a product where I have a choice whether I want to pay a higher price, my health ultimately determines if I have to buy or not.  We may protect the individual but in the end everyone pays individually.

Is there a fall back to help save you?  When you are 65 you qualify for Medicare, which is another issue.  Unlike Social Security, which I belive mathematically is a solvable problem.  Medicare is like an uncapped Gulf oil spill, except you just cannot pour concrete over the leak and fix it. There is no cap.  It’s a great deal, make no mistake.  Most health care costs come towards the end of life, which my own mother is at the that crossroads now.  Her monthly bill is $128.  If I could cover my whole family for $500 a month I would quit my job today and take time off.  But as we all know $128 would not cover the cots if my mom was hospitalized.  A couple of nights in the hospital, it would likely take a decade of her payments to cover those costs.  In the end Medicare covers those expenses, which means tax payers. Or we just print more money.  Still on the backs of working Americans.

The other area with age is as we get older we are forced into retirement homes.  They are a big piece of the end of life equation.  They are not cheap. I looked into this for my Mom.  Many have entrance fees ranging from $60,00 to $100,000, more now since I am quoting 5 years ago.  They do provide services for additional costs such as providing the daily medicines that many seniors need to take.  The monthly charges I can say since my Mom went into a home have risen from $2600 per month to $3500 per month.  Now if you do not have the money saved up what do you do?  This is where Medicaid comes in, a joint Federal and State program to help cover these costs.  But like Medicare this program has no cap it just keeps costing and costing.  When you look for a retirement home and have no money you have to find one that accepts Medicaid and has available space.  Once in though you are covered.  Crisis averted…for now.

When it comes to Medicare and Medicaid there are those who want to politicize these government services as entitlements and want to be true business professionals and say we cannot pay for these services and therefore we should just do away with them all together.  This was highlighted in one of the recent Republican debates in front of Tea Party supporters who booed anyone supported a government program and cheered when someone suggests they get rid of the programs all together.  I guess my question to them would be what would our country look like if we did get rid of Medicare and Medicaid and what new problems would we face?  The biggest concern here would be senior citizens who are the primary beneficiaries of these government sponsored programs.   If all of a sudden you could not afford for Mom or Dad to be in a retirement home would you be willing and able to take care of them?  What would happen when Mom and Dad’s money ran out and all of sudden the kids have to take in and support?  Would this put stress on your family when all of a sudden your government cannot help out and,your on your own? Some would have private industry supply these services and though I can understand the desire, how are they going to contain costs?  Private industry is there to make money not act as a charity.  Tea Party supporters have thought this through, obviously and have the answer.  They just seem unable to articulate it.

As  I look toward the future it seems apparent that we will be faced with some hard choices.  As we go back to where I started with so many people not having health care they can either hope ObamaCare takes care of them or they may simply just have to drop out of the heath care debate and accept their fate by not participating.  As a  country we have to make some choices as to what we can treat and what we can’t.  I will add in those countries that have socialized medicine they make these choices today as they do not have the doctors to cover certain forms of treatment (Denmark is a good example of this).  That may mean if you are at a certain stage of cancer unless you have the dough, you may just have to accept your fate.  A cruel answer but one I believe may play out to be very true.  I have seen the benefits of Medicare, but understand we cannot move this program forward without some better checks and balances.  It is just not sustainable. However what we don’t want to see happen is a system where some live because they can pay and others die because they are of low means.  It’s beneath us as a country, as a people, to accept such a future.

Good Night and Good Luck

Hans Henrik Hoffmann September 28, 2011

Recently at VMWorld. VM Ware CEO and former Microsoft President Paul Maritz stated that, “Steve Jobs said we are entering the post PC Era, we agree with that”. Strong words coming from the man who used to run the Windows division at Microsoft and played a large part in building the Windows empire.  To be clear, in my mind, the PC is not going away but it’s importance will be diminished as new devices and new use case scenarios come into the marketplace.  The Microsoft response has been rather predictable as they move to protect their cash-cow, with yet another new slogan – the PC + era. A world without PC’s is rather unthinkable or unimaginable in Redmond.  It’s a question of seeing the future versus trying to prevent it.  The former has a perfect record so far.  The future is inevitable.  Still maybe the more relevant question is not will it happen but how far off is it.    Maybe it’s already here.

Certainly trends both at the consumer level and enterprise level over the past few years tell us we are moving to a world where the PC is not the centerpiece of our technology universe.  Looking first at the universe of the consumer it seems readily apparent. If Steve Jobs did anything he introduced the iPhone that allowed us for freedom far beyond what we had before with a mobile device.  Did it end the need for a PC?  Am I writing this blog on a iPhone or a PC?  I will give you a hint, it would be a bit slow withe the iPhone.  Though I understand the defensive posture from Microsoft and even agree with it, we are most definitely moving into the post PC era.  One where we will be less tied to the idea of a keyboard.  We are in the connected universe .  It means we will see a lot of innovation in terms of device form factors – some will be single use devices like the Amazon Kindle, however even as I write (you read) this is morphing into a new Amazon Tablet.  It was not that long ago a Garmen GPS was hot, now I can do all that on my iPhone.  I believe that we will finally soon see these features introduced into day-to-day appliances – where on our stove or refrigerator we may have wireless access to provide us relevant information specific to the appliance.  Anything from recipes to repair instructions and support.  It’s one of those scenarios that have been talked about for years, but I think the technology has matured enough to make it a reality.  It’s also a scenario that does not require me to boot up my PC.

At the enterprise level it is really about cloud computing and allowing companies to offload a lot of their IT costs and focus back on their core business.  When I was covering News Corp I heard through the grapevine that Rupert Murdoch viewed IT as a necessary evil.  I think he speaks for a lot of companies who have had to invest in areas of support and services that are not core to their business. Over the years time and time again in the industry you would hear about companies who launched big IT initiatives which were to streamline the company and make them a more agile business, only to have those project fall into disarray and end up costing millions of dollars in cost over runs, and finally  to ultimately fail.  Cloud computing at a high level is an easy sale.  Let someone else worry about your IT infrastructure and get back to what your core competencies as a business are.  The move to the cloud starts in the data center and moves all the way down to the desktops and laptops.

When you think about desktops and laptops it may make you think we have returned to mainframes with dumb terminals. To a certain degree it has.  But I was listening to CNBC one morning and they were talking about Generation Y (those born 1980 or later) and how they use or do not use technology. This generation is the Tablet, Laptop and Mobile phone group. The idea of a desktop is not their thing.  They are also the generation that will feel more comfortable with using cloud based services.  In addition many things that were thought to be only available using the power of the PC are now readily available in the cloud and can be viewed through a web browser.  Think if all the mapping technologies we have available to us today.  We take for granted that all of that is being provided to us remotely and we are just consuming a  service.  We need a user interface to consume services but where those services reside is not relevant to the majority the world’s population.

In the industry we often talk about “tidal wave” changes that transform the industry and how we compute.  Some are obvious and others just happen.  The obvious would be the rise of personal computing, the internet etc..Others are less obvious – One I think would be the convergence of mobility.  One minute it was just a cell phone and the next it was a part of everything.  Our home, our coffee shop, our work etc…It just seemed to naturally happen over time.    The 90’s was the PC era.  The first decade of the new millennium was the software decade.  Now is the decade of the cloud as all we know get set free and is just available for us to consume, wherever and whenever we want.

We can choose to hold onto the past, it’s a natural human condition to do so.  To think of happier times.  Of times when everything seemed to go right.  But unlike humans businesses are not driven by fond remembrances of the past they are driven by the bottom line.  You can be nostalgic about your history but don’t do so at the risk of your future.  In the technology space that is particularly true because it is all about the future and things are meant to change.  The PC changed mankind and will be remembered as a defining moment, but like everything it was not infinite.  By its own creation only one thing was certain that it had to die.  Thanks PC you changed everything but the future awaits and you are not as relevant as you once were.  All revolutions end.  Welcome to the post PC Era and enjoy as in time it will just be a happy memory.

Good Night and Good Luck

Hans Henrik Hoffmann September 13, 2011

“Our envy of others devours us most of all. Rub your eyes and purify your heart and prize above all else those in the world who love you and wish you well. Do not hurt them or scold them, and never part from them in anger”

– Alexander Solzhenitsyn

In my journal on Sept 16th I wrote those words as they seemed to help cope with those tragic events of September 11th, 2001. I find the Russian writers heavy hand a good way of dealing with life’s lower points. I cannot add much to a day that so many of us experienced in so many ways. This is just an account of my day, which was just another day in which I was going to work at Microsoft.

The morning started like so many. I had two young boys at the time. One was 2 and the other was nearly 6 months old. I woke up with the oldest and my wife soon followed with the youngest. He was hungry so she fed like many mothers do, child to breast. It was Tuesday and I had to go to work. It was also the day my parents took care of my older son. Luckily my parents lived not more than 2 minutes from the Microsoft campus so it was convenient. That day I was attending an internal conference at the new conference center on campus.

Before I went to work I needed to fill up my 1994 four-wheel drive Ford Ranger with gas. I was dressed and ready to go so I took my two-year old and we hopped into the Ford Ranger and drove over to Costco to fill up the truck. As usual I was listening to Fisher and West on 103.7 the Mountain. They were playing music and providing traffic updates. A small news item was about a small aircraft that had hit the World Trade Center. As we drove and Fisher and West spoke we neared Costco. It was then Fisher said, “another plane has hit the World Trade Center”. As Fisher and West continued to talk Fisher abruptly said, “I have got to leave for a second and check this out”. It was at that moment I knew this was no accident. These two DJ’s had been on the air for a long time and were true professionals, for Fisher to suddenly leave on air for a moment to watch the television told me something was not right in the world.

I filled up the truck and raced home as the news was starting to filter in that a United Airlines Jet had hit the World Trade Center and it was believed the first plane was a jet as well. I got home jumped out of the truck, ran round to the other side and pulled my two-year old out the passenger door of the truck and raced into the house. As I launched myself through the door I put my two-year old down and raced into the living room. My wife heard me and saw me running to the television and was asking, “what’s going on?”. I replied, “A plane hit the world trade center”. Then I turned on the television to Channel Five and the Today show. And then there it was, a Boeing 767 flying directly into the World Trade Center. Before our eyes, as a look of horror overcame our faces, we had just watched at least 300 and probably more people die. Fathers, mothers, brothers and sisters would not be coming again, ever.

As we watched the news reports we had to get ready for the day. I got my son in the truck and we drove off to Redmond. As I drove south on I-5 and then merged west bound onto 520 the reports were streaming across the radio. Many reports were unconfirmed. Car bombs in Washington DC, planes hi-jacked but how many? The reports kept coming in. What was happening was our entire nation had become unsettled and no-one, not even the “freedom of the press” knew what was going on. It was a moment unlike any in US history.

When I got to my parents they of course were watching. I asked them not to watch TV as I did not want my son watching, since he was at that age where he was beginning to take in and absorb everything he saw. This was one event I did not want him to absorb. For the first time in fatherhood I found myself saying that old cliché, “he is only a child”. It just was not so cliché anymore. With that I said my goodbye’s and I got back in my Ford Ranger and drove off to the Microsoft conference center.

When I got to the conference center I walked in to the new facility with its new rooms and tables set with breakfast items. I walked into room we were scheduled to be in which was a large room that held around 100 people with a big movie size video screen. But rather than Powerpoint’s today we had the news on and the site of the World trade Center’s twin towers on fire. People from offices all over Microsoft North America. It was to discuss some new Partner Programs as far as I remembered, but who cared. It was a dazed audience as we just all sat and stared at the big screen . It was as if no one was comprehending what was going on. We just watched. Then at 9:59 am the South Tower fell. There were screams in the audience. We were so far removed yet so close. Who could do such a thing? Why? We sat another 30 minutes until 10:28 when the North Tower fell. The screams and yell came again and then it was over. What had started as a quite morning had produced a horror that no one could envision.

After the North Tower fell news began to filter in. The skies were closed. Anyone who had a flight out of Seattle would not be going home anytime soon. When I went out into the hall people were already in planning mode. I heard of some guys from Detroit who had rented a car and were driving home. Confusion was everywhere. I was just in a daze. I went back into the room and it was apparent the people who had organized the meeting were trying to figure out what to do. At 11:30 they decided to move forward with the presentations. They started and I listened and watched. Some people were actually engaged and asking questions. I couldn’t. The event was just too great for to me and many people in the audience to ignore. I thought it was a poor decision and around noon I just left and decided to go home.

I left and went to pick up my son a couple of miles away at my parents house. As I left for the drive home my mind was filled with anger and confusion over the events that I had seen that day. Even though the day was only half over I was tired. As I drove over the 520 bridge on Lake Washington and saw Seattle before me I realized how beautiful the day was. It was similar to New York in that regard. The sky was clear blue and the water on the lake was very calm and soothing. It seemed like the flames of hell were in my mind but the beauty of my hometown was captivating and I could not reconcile the two. I crossed the bridge and decided to go to the church where I was married, Blessed Sacrament. I needed peace. I needed to turn the radio off. I needed to turn the TV off. I needed to turn the media off.

To my surprise when I got there and went into the parish. My son and I were the only two people there. I sat in thepews and bowed my head. Looking. Searching. Trying to understand and find reason in a world I did not understand anymore. My son was jumping and running around the pews in a joyful kind of play. It was a paradoxical sort of moment, that maybe only a child could provide. In its own way it was as real as life could be. I went home and the rest of the day has fallen from memory. Probably because I turned the TV on. The one thing I remember is the sky was quiet, except for the occasional fighter jet that flew over head. It was frightening.

In the coming days many acts of heroism would come to light and there were people at Microsoft who did their part. Kim Daley the GM for the Microsoft Ney York office did her part in working with Mayor Rudy Giuliani’s office. I knew Kim having worked with her before, she was a very hard working dedicated Microsoft employee and it did not surprise me she rose to the occasion. I am sure there were many employees not just at Microsoft but many other companies in corporate America who rose to the occasion. It was just what had to be done. The Microsoft human resources department, on a global scale, communicated throughout the week and kept every employee informed on what we as a company were doing and what people could do to help. It was great work ,it was impassioned work.

The events of 9/11 caused many Americans to do things just because it was the right thing to do. because it was what was needed at the time. As a country we came together because things needed to be done. Imagine what we could accomplish if we thought that way all the time. Unfortunately that is not the way things work. But in any case lets just pause and maybe, just maybe let’s imagine what could be.

A month later the season of Fall had settled in. I love fall above all other seasons. I love the changing of colors. The change in temperature to a coolness greeted with warmth in the afternoons. I looked forward to raking the leaves from underneath the large maple tree in our yard. It was kind of magical experience. On this day on October I was with my eldest son, he with his little leaf rake and me with my man rake. As we sat there under a bright blue sky a jet plane flew over head. Leaving a jet stream in its wake. then my son uttered words that caused all the blood in my veins to freeze, “Daddy, Daddy, plane fall down, plane fall down…plane fall down….”. Then I wept.

Good Night and Good Luck

Hans Hoffmann September 11, 2011