Category: Microsoft

An insiders view of Microsoft from the bottom looking up

The Death of the Word Processor

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The title may be provocative, but there is a reasoning behind it based on current trends I see in the industry.   As I look back on the evolution of one of the very first business applications for the personal computer the word processor, I think we are at a time when the standard word processing application is about to evolve again into a different form (and cheaper) than what we have grown used to with packaged applications that we load on our computers hard drive.

If we look back upon the early days there were a lot of players in the industry WordPerfect, Microsoft Word, WordStar, Wang to name but a few.  But because it had a strong long-term vision tied to the operating system which it owned Microsoft’s Word for Windows would emerge the winner.  The last one standing was WordPerfect, but it would just slowly fade away.  Beyond the Word processor, Microsoft looked beyond and incorporated the spreadsheet and presentation software realizing the long-term vision that many people would use all three and would want seamless integration.  The result was Microsoft Office and the rest was history as Microsoft fought battles on all three fronts while the rest just tried to stay afloat.

As we turned the corner into a new century Microsoft Word basically sat alone, unchallenged.  Every document people opened, every attachment received was in a Word.doc format.  With every new release there were new features, new user interface designs (the ribbon anyone?).  It owned the market. It was a cash cow.  When Open Source came onto the scene it was believed it would challenge Word, but in all reality they were just free copy cat images of Word and did not offer anything new.  I always felt that if they did get any traction Microsoft would open its deep pockets to a bunch of lawyers to file a lawsuit for patent infringement etc..This view is simply based on the fact that if did not seem that these Open Source developers were coming up with a single new idea, it looked like they opened Word for Windows and were intent on creating a copy of the software.

Through this past decade there have been numerous challenges, and in certain regions of the world, some have even gained some traction, but they have never been able to gain any sustained momentum.  With the new business models being driven by companies like Google and the fact that pretty much all of us are always connected to the internet, it brings us back to a fundamental question, “If I only use 10 percent of Words capabilities why do I need to install the rest?” and the follow-up question, “why should I pay for innovation that I never will use?”.

What will the future word processor look like?  In a simple word, Notepad.  If you are running Windows just click “Start”, then “All Programs” , then “accessories” – you will find a little application called  Notepad.  You may say is this all?  No but what I believe could and will happen is for your document application you will be presented with a basic framework that allows you to type and provides a subset of fonts.  Then using the persistent connection to the internet you will be able to surf the web and add accessories to your document framework.  It will look like two things already available in the market.  The Eclipse Framework (developers will know what I am talking about), which allows developers just to grab plug-ins for whatever they are working on  and an online store similar to what most people most are already familiar with, the Apple App Store.  Some of these add-ins will be free, some charged for – but your word processor which for years has been a couple of hundred dollars will now be available to do most of what you want to do for under $20 and in some instances it will be free.

For some companies, namely one, Microsoft, this will be a very painful transition.  Unless they get out in front of the market it will be a missed opportunity that will cost them dearly as more and more end-users spend time outside of the Microsoft software ecosystem.  However like everything else in technology when markets change there will be those who seize the opportunity.  Could you have an ad driven model within a word processor?  Why not?  Could the market for cool ad-ons in the document framework explode?  Sure.  In the end the one thing I am sure of is the one benefit will be a better more affordable experience for both end-users and enterprises a like.

Good Night and Good Luck

Hans Henrik Hoffmann December 21, 2010

The end of the Gates Era

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Bill Gates equals Microsoft.  No statement about a corporation is more true than that single statement.  Bill Gates is an industry icon, one of the legends who helped build the industry.  There are many Steve Wozniak, Steve Jobs, Michael Dell, Ray Ozzie, Paul Allen to name but a few.  But possibly, with the exception of Steve Jobs, no one individual has meant more to the success of an individual company than Bill Gates.  Which was why when he left Microsoft it left such an enormous empty space in the company.

In my early days at Microsoft, when I was new to the industry and new to computing, I sat in a cubicle managing the front lines of customer service.  I would receive a hundred calls a day ranging from feature questions about Word for Windows 1.1 to replacement parts for a MACH80 board.  It was trial by fire.  It was fantastic. To educate us the Product managers would often come over from Redmond to our building in Bellevue and provide us the latest details of a recently launched product or an upcoming product release.  In most instances they would talk about a recent product review they had with Bill Gates as during those days of a smaller company he was engaged in every aspect of product development.  Despite not being those meetings, in still felt like everyone in the company had a close personal connection to Bill Gates.

The Gates era did not end when he retired to focus on the Bill and Melinda Gates foundation, it really ended when he stepped down as CEO and handed the reigns to his designated number two, Steve Ballmer.  I remember stepping off  of a plane in Atlanta seeing a TV screen right as I entered Hartsfield Airport terminal a  CNN Breaking News Alert with Bill announcing his plans to turn over the running of the day-to-day business of the company so he could focus more on setting the development strategy for Microsoft.    Looking back I could understand.  This was coming on the heels of the DOJ trial that weighed heavily on Bill (and everyone at the company) as it was not so much an attack on Microsoft as it was a personal attack on him.  He was tired.  In some ways it was a good thing as the companies strategy  at the time internally was getting very political as different groups pursued similar goals with different views of what technology to utilize.  Groups were fighting amongst one another. Bill quickly came in and settled those disputes as despite the change in roles Bill’s word was still law. 

During the next 8 years Bill’s voice became much softer at Microsoft. He was  no longer the front man in talking with the press and representing Microsoft.  Steve recognizing the growth at Microsoft set out upon a path of creating a dynamic corporate structure.  While Bill was always focused on technology and the promise of what it could deliver, Steve was reading Jack Welch and how he could create the next GE.  At the annual Microsoft Global Sales Summit, where the highlight was always the closing Bill Gates talk, it was now replaced with the prancing gorilla, Steve Ballmer.  Where the talk was usually a presentation of where Microsoft was technically and where it was going.  It was now replaced with talks of responsible corporate governance.  Technical junkies do not respond well to that type of mantra.  It is no wonder since Microsoft has seen a significant “brain drain” of talent.  The list is long – Paul Maritz, Ray Ozzie, Adam Bosworth, Bill Baker, Todd Nielsen, Brad Silverberg, Cameron Myrvold, Robbie Bach, Brian Valentine, Jim Alchin, Kai-Fu Lee, etc…More importantly since he has left it has been much harder for Microsoft to recruit top-level talent, as Bill was a great recruiter.

When he finally did leave, it was without much fanfare, outside of a funny Bill Gates last day video.  Bill had agonized with his wife Melinda and when he announced he provided a long lag time before he actually left – a little less than 2 years.  He checked out long before that day.  The reigns would be handed over to Ray Ozzie (who has sin ce departed) and Craig Mundie.  What has been left is a gaping hole devoid of leadership.  Microsoft has struggled with the weight of its own identity and its own history.  It was probably unavoidable that without Bill there would be no one individual or group of people who could fill the void left by a legend. 

In the end what has been most missed at Microsoft in Bill’s departure is the calming influence he could have with his words and classic emails.  The ability to craft a strategy that utilized all our assets and take it to the future in a cohesive strategy.  In doing so he inspired those beneath him to follow and follow with passion.  What Bill is doing now with the Bill and Melinda Gates Foundation is monumental.  The fact that he is accumulated wealth that he has decided to try to change some of the big issues and challenges in the world should be admired.   But can Microsoft survive without his guidance may be the true legacy of the Gates era.

Good Night and Good Luck

Hans Henrik Hoffmann Dec 13th, 2010

Technical Vision

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I was drawn recently to an article in the InternetNews announcing that Paul Maritz, current CEO at VMWare was the recipient, for the second time,  of the Internetnews.com CEO Vision Award. Midway through my career at Microsoft I had a one on one meeting with Paul to prepare him for a briefing with one of my customers CEO’s.  At the time he was definitely one of the sharpest people we had at Microsoft and a close confidant of Bill Gates.  He would be a primary driver of Microsoft’s Server and Tools Business, creating the next billion dollar business for Microsoft.  He then went on to create something called Dotnet before retiring and riding off  into the sunset.   However great technical visionaries can never sit on the sidelines too long, they always comeback. To this day, as is evident. he retains that unique technical and business ability to see the direction the industry is headed and get out in front of the curve.

Companies come and go in the tech industry but one thing is certain those that can see the mid-term and long-term horizon stand a much better chance of success than those that simply just follow the lead of others.  A lot of companies start with a mission statement – most I believe is because a company thinks they must have a mission statement.  In the world of tech there are two pieces to a successful mission statement.   First it has to be long terms and have an end goal.  A good example is  the original Microsoft mission statement created back in the mid seventies “A PC on every desktop and in every home”.  One it is long-term it would take over 20 years to realize this dream  Another thing I like about this is nowhere does it mention the business Microsoft is in, software.  Software is implied because of the use of the term PC.  The second piece of a great mission statement is having great and credible people behind it.  In this case you had Bill Gates and Paul Allen and a whole bunch of great technical luminaries who were part of the company at the time (including Paul Maritz),

What if you don’t have those two things?  Well the same company I just referenced does not have those things today.  They live-on as a cash cow.  Not a bad place to be, but long-term it raises questions.  Every company needs to dedicate time to think through a few simple questions: Where will we in 10 years? 15 years? 20 years?  Where will the industry be in that same timeframe?  And how do we participate in those changing trends and stay out in front rather than lag behind?  In technology not an easy thing to do.  When Microsoft launched Windows 95 the future seemed clear and the role the PC would play was going to become greater.  About one month later the internet burst onto the scene and  the whole industry, let alone the world changed.  These type of game changing scenarios keep happening over and over again.  Apple launches it i-devices,  Google jumps out way ahead in search.  Social platforms like Facebook and Twitter come forward, Amazon sees the cloud before the rest and jumps ahead of the curve.  The examples are plentiful.  They are like freight trains leaving the station, catch them before they gain momentum otherwise it is near impossible to stop them.

In politics it is often said if you want to find out about something, “just follow the money”.  In technology I would say just follow the technical talent.    When talent starts leaving Google to go to Facebook, one should ask “why?”  When talent just starts retiring the same question should be asked.  Does a company have the ability to attract new talent?.  When you look across the industry today you see a lot of movement as people try to catch the wave of the next big opportunity or social network.  Once upon a time there were just a few companies that attracted a lot of talented people, now there are hundreds of companies to choose from.

I have been fortunate throughout my career to hear and meet some great technology luminaries in the industry.  I worked at a company with one of the greatest, Bill Gates.  But there are new young guns out in the industry such as Mark Zuckerberg at Facebook and Sergey Brin at Google.  The old guard is still around to guide those passions and promise,  Eric Schmidt, CEO at Google has the business acumen to guide that young talent at Google.  Paul Maritz is still very able and capable, just look at the performance of VMWare, despite increased competition.  My one question to my readers is if you are in the tech industry who is guiding your company to the future?  If you can’t answer or don’t know it may be time to abandon ship, before it sinks.  One thing I can guarantee without a technical vision the boat will sink.

Good Night and Good Luck

Hans Henrik Hoffmann December 7, 2010

Video, Video, Video

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It has become clear that we are entering an age of ubiquitous video content. we want our content everywhere, anywhere, we want it now, and we want in entertaining.  If you think about where we have come from on the internet it is a natural evolution.  We started with rather static content which was just a fancy word document with pictures.  Then we started incorporating basic display ads, followed by more lively content that eventually led us to YouTube.  Now that same YouTube content is available everywhere – I could be on Facebook, iPad, iPhone you name it, it will be shared and made available.  Now we are entering the Netflix era. We are no longer viewing just uploaded content but live streaming of content.  To be clear this has not been new this year, we have been doing it for a while we view our news outlets online, like MSNBC.

Going back in time I remember 10 years ago I tried to view a live concert from New York at my office in Redmond.  It was Madonna doing some party in New York.  I tried and it was awful.  It was hard to connect and when it did, it streamed for a few seconds before it cut out.  It was a very frustrating experience and I am not even a Madonna fan.   Around th e same time iw as working with a ISP in Green Bay, WI doing a test with voice over IP (VOIP) with streaming video.  Again an awful experience and I realized to do any quality video you basically had to own your own studio. But that was 10 years ago and how far we have come.

Today we get video through a number of sources and in different formats.  With the release of the iPhone 4 we now have the ability to do voice and video phone calls.  The idea of a mobile device, be it an Android, iPhone or iPad without an available Netflix application is a non starter for the device that does not have it.  Netflix is becoming the prime example of making high-end video content (movies, television shows etc..) available  whenever you want it and now it ois going global.  The market believes as well as at last glance Netflix (NFLX ) is trading at over $196 – to think that a year ago it was under a $100.

There are issues that are starting to come to the forefront.  When the internet first came of age we had a number of companies laying a lot of fiber in the ground.  Most of it was not used.  It just sat there idle.  We referred to it as dark fiber.  However that was because what we were sending over the net was small files and video was not really that big at the time.  Today we actually are sending large files (not entirely true as streaming technologies take video files and break them down into small chunks..but as a whole the file is large).  We are also streaming live content so you start to see a web with constant and massive traffic flows.

With the rise of mobility and content on the go we are now entering the last great phase and the holy grail of device interaction: the television.  In recent years television has  undergone, popular, but what I view as small steps as we transition to something far greater.  many people have either a LCD or Plasma flat screen TV.  A Tivo device connected for recording.  A lot of road warriors had sling boxes enabling them to view there local Seattle programs while in Orlando, As has been mentioned we can stream movies via Netflix or the xFinity services from Comcast.  Our televisions are becoming more interactive.  The game consoles we connect to our TV are becoming media hubs, the best example being the XBox.  With what they can do with Wii or Kinect they will become home fitness devices. There has been a recent slew of new products around TV.  Both Google and Apple have announced appliances for the television.  Microsoft has been trying to tackle this game for nearly 20 years.  It’s an exciting time.

There will be challenges moving forward.  Mainly from the incumbant service providers either cable companies like Comcast, Cablevision, Cox Communications or the traditional telco’s AT&T and Verizon.  They have one asset cherished above all…the last mile.  That is literally the cable or phone line that runs from the curb into your house.  It’s how we get access to the internet through DSL or Cable Modem.  It’s how all those great services mentioned earlier are delivered into our home.  It is the holy grail. When companies devise plans to sidestep them they fight back.  In the market place, but more importantly on Capital Hill.  They are in the offices of your congressperson or Senator.  They bring in their heavy hitters to do the work:  Lobbyists and executives.  I witnessed this first hand on a trip to DC as a bus was loaded and paraded around the hill, clearly labeled “Comcast Executives”.  They were not there for consumer benefit, though they would say they are.

If one thing is certain, the future will come.  There will be those who try to stop it.  However with the advancements made in wireless bandwidth with 4G and then 5g coming down the road in the next 5-7 years things will start to change very quickly.  We are now seeing satellite services propping up again.  The last mile will die and we will be temporarily free.  We will get our content and human interaction wherever we want it when we want it.  It’s a very exciting time in the industry as things only dreamed of 15 years ago are now on the verge of becoming reality.  Just think on some Saturday morning on my 40″ LCD I will be able to view all my favorite soccer games with my 3 boys in my pajamas at once while having my morning coffee, now for me that will be heaven.

Good Night and Good Luck

Hans Henrik Hoffmann November 30, 2010

Mobility, Search and Social Networking….the future as it will be

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I was fascinated by a recent presentation I viewed off of TechCrunch as it epitomized to me what I call the velocity of business.  It was done by an analyst at Morgan-Stanley, Mary Meeker.  She titled it “Ten Questions Internet Execs should ask and answer”.  My only comment is why stop at “internet execs” – any executive with an internet business at all should be asking and looking at these questions.  We have been seeing some emerging trends – that have been around for a while but are now accelerating, creating new market dynamics and new business opportunities.  There are three core areas that Mary Meeker brings up as the current and future business drivers on the internet: Mobility, Search and Social Networking

The area of mobility is interesting and if you believe the slides will deliver a world where most internet browsing is done via a mobile device and not the traditional PC.  I don’t find this hard to believe at all  One of the first points made is around “globility” – in some countries there are trends that compete against yours, either directly or perhaps in a way similar but new.  It would be easy to say in the US PC’s are used in one way while in India they are used in another.  However that is an apple to apples comparison.  The difference being one is Gala and the other a Honey Crisp.  The reality in many countries is mobility has changed the landscape of how people live and communicate in dramatic ways..  Microsoft tried for years to create a model in conjunction with country specific banks to create a model to finance the purchase of PC’s.  While all that was going on the local communities were finding internet access a different way – via their mobile phone.    With the launch of the iPhone and its unique web browsing capability that trend has come to the US.  By that I mean more and more Americans are browsing the web from their mobile phones.   It’s hard for Americans to believe innovative trends can happen outside our borders, but they do.  And in today’s world of connectivity it is happening with more frequency.  A poll was done several years back asking, “where will the next Bill Gates comes from?”  Not surprisingly the majority answered India.   It is both exciting and will be challenging, but it’s the way things will be.

With Search we are in an area that is evolving quickly before us, even though it may not be as sexy as mobility or social networking.  Google continues to lead in this space and with both Android and Chrome are utilizing search to change the traditional industry landscape.  Though we know that the key to Google’s success was being able to monetize advertising online there is still a lot of innovation to come, beyond just recognizing revenue by keyword searches.  Traditional print and video adverting may be disappearing from our papers or minimized on our television, but they are not going away they are just morphing before our eyes and going online.  With Android Google is really looking to monetize on trend one: Mobility.  Based on the rapid increase in market share for Android based phones they are well on there way to succeeding.  On the Social Networking front they are more obsessed with the big Competitive threat: Facebook.

Finally there is Social Networking.  The hottest tech company on the planet is Facebook, followed by Twitter.  As the presentation points out what is impressive about Facebook and its counterpart in China, Tencent is that they each have over 600 million users.  The ability to market and sell to those companies is enormous.  The fact that so much time is open at these locations with friends communicating together creates unique market dynamics and the opportunity to up sell those participants to other services.  Like Search you can see Social Networking using it’s core business to fund other revenue opportunities.  Facebook’s recent plan around email seems to be a good start.  I seem to remember a company called Netscape tried a similar method as it branched out into “big” corporate email plans as an off shoot to its browser business.

As the title says…the future as it will be.  One thing is guaranteed that the future I write about will come to fruition sooner than we expect and it will come to pass that I will write another article with the same title talking about a different set of technologies, probably different companies that will be shaping the future.  Trends and outlooks that once took decades will come much faster as technology evolves.   That is just the velocity of business we operate in today.  That part of my technology predictions you can take to the bank.

Good Night and Good Luck

Hans Henrik Hoffmann November 22, 2010