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Leaked Memo Gives Microsoft New Direction?
daria42 writes "An e-mail memo sent from Microsoft chairman Bill Gates to top execs at Microsoft has been leaked, revealing the executive wants his company to hurriedly change its focus and start to tap online advertising and services as new revenue sources. In the e-mail, Gates cites another, earlier memo, sent from MS exec Ray Ozzie, in which Ozzie also warns MS of the importance of focusing on the online medium. 'It's clear that if we fail to do so, our business as we know it is at risk,' Ozzie wrote. 'We must respond quickly and decisively. We should've been leaders with all our web properties in harnessing the potential of Ajax, following our pioneering work in OWA (Outlook Web Access),' he continued. 'We knew search would be important, but through Google's focus they've gained a tremendously strong position.'"
Gates memo warns of 'disruptive' changes
Ina Fried, Special to ZDNet
November 09, 2005
URL: http://www.zdnet.com.au/news/software/soa/Gates_me mo_warns_of_disruptive_changes/0,2000061733,392214 68,00.htm
Aiming to stir up the same kind of momentum as his Internet Tidal Wave memo of a decade earlier, Microsoft chairman Bill Gates has penned a memo outlining the challenges Microsoft faces from a host of online competitors.
"This coming 'services wave' will be very disruptive," Gates said in an Oct. 30 e-mail to top Microsoft employees. "We have competitors who will seize on these approaches and challenge us."
In the memo, Gates cites an earlier missive from Ray Ozzie, outlining the importance of tapping online advertising and services as new revenue sources.
"It's clear that if we fail to do so, our business as we know it is at risk," Ozzie wrote. "We must respond quickly and decisively."
Ozzie's memo, which was also seen by CNET News.com, includes a laundry list of missed opportunities for the software maker, citing competitive threats from rivals such as Google, Skype, Research In Motion and Adobe.
Ozzie notes areas that Microsoft could have led, such as Web-based applications, but where other companies are instead more heavily focused.
"We should've been leaders with all our web properties in harnessing the potential of Ajax, following our pioneering work in OWA (Outlook Web Access)," Ozzie wrote. "We knew search would be important, but through Google's focus they've gained a tremendously strong position."
In the memo, Ozzie talks about Google as Microsoft's most prominent of the emerging competitors, but also makes reference to Yahoo and Apple Computer.
"Google is obviously the most visible here, although given the hype level it is difficult to ascertain which of their myriad initiatives are simply adjuncts intended to drive scale for their advertising business, or which might ultimately grow to substantively challenge our offerings," Ozzie wrote. "Although Yahoo also has significant communications assets that combine software and services, they are more of a media company and--with the notable exception of their advertising platform--they seem to be utilising their platform capabilities largely as an internal asset.
"The same is true of Apple, which has done an enviable job integrating hardware, software and services into a seamless experience with dotMac, iPod and iTunes, but seems less focused on enabling developers to build substantial products and businesses," Ozzie wrote in his memo.
He also makes reference to smaller, emerging companies that are developing software and services that use the Internet, rather than Windows, as their base platform.
"Developers needing tools and libraries to do their work just search the Internet, download, develop and integrate, deploy, refine," Ozzie wrote. "Speed, simplicity and loose coupling are paramount."
At the same time, Ozzie sees am opportunity if Microsoft can create a Web-based development platform.
"The work of these startups could be improved with a 'services platform'," Ozzie said. "Ironically, the same things that enable and catalyse rapid innovation can also be constraints to their success. "
Microsoft has talked of a developer platform in conjunction with Windows Live, but the company has offered few details of how third parties will be able to build on top of Microsoft's work.
Microsoft has already reorganised the company and outlined some of its plans, but the two memos make clear the urgency and importance that the company is placing on this effort.
The company announced in September that it was reorganising itself into three units and tapping Ozzie to lead a companywide services push. Last week, Microsoft announced the first fruits of that effort--products called Windows Liv
Charles Ferguson created the company that produced FrontPage. He sold out to MicroSoft when he realized that Netscape would lose, due to their own faults. He wrote a great book on his story dealing with VCs and selling out to MicroSoft.
5 ,308,p1.html
In the book, he describes how MicroSoft slept through the early 'net, until the Netscape Wunderkind (can't remember his name) said Windows would be reduced to a bunch of buggy device drivers by the web. Then Bill woke up. He writes about it like Sauron has been up in Redmond, sleeping away, until the Netscape guy wakes him up. And then Bill wakes up, like a big pissed off Sauron, turns Ballmer loose so he can get medieval on Netscape and so on.
Charles Ferguson also happens to have a PhD, and has done a lot on high tech competition. Here's something he's written on the topic of Microsoft fighting Google -- for real.
"... But if Microsoft gets serious about search--and there is every reason to believe that it will--Google will need brilliant strategy and flawless execution simply to survive..."
Which is an amazing think to consider.
Here's the article where discusses this:
http://www.technologyreview.com/InfoTech/wtr_1406
http://www.thebricktestament.com/the_law/when_to_
http://www.hypercamp.org/2005/11/09#a43
http://www.thebricktestament.com/the_law/when_to_
On second thoughts, based on their recent TV marketing campaign (the one where they show a bunch of children with aspirations including for things like music creation that Microsoft doesn't have any software offering for) which basically has no point whatsoever apart from an opportunity to say "Hi we're Microsoft, don't forget about us" and display a Microsoft logo
Except, if you do any sort of work - in almost any capacity - to support or deal with the successful aspirants they portray in those ads (famous musician, famous designer, fashionable scooter manufacturer, whatever), you're going to use business software. Every one of the roles they describe is backed up accountants, tax people, messaging, web sites, and a zillion other things that MS very aggressively wants to be a part of. A lot of people don't even know that Great Plains, Solomon, Navision, and Axapta (all widely-used accounting software packages) are Microsoft products.
They've got armies of custom developers and consulting companies out there adapting those packages for "vertical" integration into all sorts of speciality business models, from mom-and-pop scale bookeeping up to major manufacturing. There's more to that ad campaign than meets the normal desktop user's eye.
Don't disappoint your bird dog. Go to the range.
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