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Bill Gates Reveals Secret of Microsoft's Success
Hugh Pickens writes "Bill Gates, in a interview with the BBC, revealed the secret of Microsoft's success: 'Most of our competitors were very poorly run. They did not understand how to bring in people with business experience and people with engineering experience and put them together,' said Gates. 'They did not think about software in this broad way. They did not think about tools or efficiency. They would therefore do one product, but would not renew it to get it to the next generation.' Mitch Kapor, founder of the Lotus Corporation, has a different view: 'Claims by Microsoft that people were buying the software because it was good are pretty self-serving. I'd like to smoke what he's smoking.' Gates also said that he took a 'conservative balance sheet approach' to running Microsoft explaining that he wanted 'great financial strength so we would have the flexibility to do software in the new way, or whatever we wanted to do.'"
This I think is a good example of where a better SALES organization wins out.
The problem with software is that there are exit barriers. Once you've bought
a system you are somewhat commited to it. This is what leads to grannies to
think that they need msoffice for their old word documents.
That sort of thing doesn't NEED innovation. All you really need to do is to
not eggregiously piss off your captive audience. That is a much lower bar.
He points to Lotus and whines about lack of innovation. I'd really like to
know exactly what innovations that microsoft have made that are relevant
to their customers and Lotus product.
I really don't see it.
I might as well be running a pre-hegemony copy of smartsuite for all the
actual "innovation" that goes on with this stuff.
Ultimately, he's trying to frame non-technical successes in technical
terms to deflect from the fact that his stuff really isn't all that
great from a technology point of view.
A Pirate and a Puritan look the same on a balance sheet.
While the coup that Billy snagged back in the day was brilliant in hindsight, it was still a very very small financial score. What happened afterwards was a lot of luck and without a doubt a lot of good business sense. You don't have to love Microsoft to still be amazed is how far and fast they grew. Microsoft was so far behind Apple in the GUI business in the late 80s and yet they still own the market. That has to count for something, eh?
Like Steve Jobs said at D5 (http://d5.allthingsd.com/20070531/d5-gates-jobs-transcript/):
"Well, you know, Bill built the first software company in the industry and I think he built the first software company before anybody really in our industry knew what a software company was, except for these guys. And that was huge. That was really huge. And the business model that they ended up pursuing turned out to be the one that worked really well, you know, for the industry..."
So there are two important things, they were focused on software only, and they adapted the correct business model to be focused on software (able to make quick, temporary alliances with many factions).
Basically, it can be summed down to being an agile, nimble competitor. Which has no resemblance to what they've become.
I was a consultant at Lotus at the time Microsoft started winning in desktop applications.
Bill Gates is essentially correct:
1. Lotus did a much worse job of hiring in professional management and bridging the gap between software development and business.
2. Lotus complicated their tools-set and architecture unnecessarily. This is one factor that killed 1-2-3. Lotus went straight from assembly code speedy to bloated and slow. Ironically, as this was happening, Jon Sachs wrote 1-2-3 C, a simple, fast, and very portable reference implementation.
3. Lotus did a bad job with follow up products. Instead of launching and improving, they would launch, get disappointed, give up, do something else. Or, in the case of 1-2-3, they would overcomplicate. They had very innovative products - ones that could have changed spreadsheets in fundamental ways, and that would still be innovative today. But they did not know how to nurture these products.
Microsoft faces a lot of the same problems now. Microsoft can't seem to make regular incremental improvements to key products, for example. But business isn't about being perfect. It is about being less bad than the other guy.
I wrote parts of this stuff
I think you may very well be the only person I have ever seen state that Microsoft Windows "just works," or that Mac is unfriendly.
Windows 9x was a piece of crap. 2000/XP are quite nice, though I am glad I don't administer them professionally.
MacOS confused the shit out of me because it lacked a CLI of any note prior to OSX, but I wouldn't say that it was "unfriendly."
But all the time I spent as a kid trying to get games to work on Windows 95, when they were made for Windows 95, "Just Works" is not something that I would use to label it then.
I'm not implying that it couldn't have happened some other way, just that in this case, that's the way it happened.
Think for a second how the PC hardware world would look like today if Apple had gotten a hold on the desktop before Microsoft. That PC you're running Linux on would probably cost three times as much, or more likely wouldn't even exist.
The widespread use of Windows was what ended up commoditizing PC hardware.
Web2.0: I love when people Flickr my cuil and digg my boingboing until my google is reddit and I start to yahoo
Mr Kapor claims that Microsoft "took advantage" of its position in controlling the operating system to make life hard for independent software developers like Lotus.
When these criticisms are put to Mr Gates, he says he finds it "ironic" that he could be accused of such a thing when Microsoft had "evangelised" its software to other companies, begging them "please write software for our platform".
I was at Lotus from '83 to '93, and I distinctly remember Microsoft visits, begging us to target our apps for their next OS: OS/2. While Excel for Windows was almost certainly already in development.
Let's look at some of Microsoft's early competitors and the dumb decisions they made. Ironically, though, for each and every point I list, you can see that Microsoft has learned all the dumb answers of its competitors.
1. CP/M, ultimately crushed by DOS. Microsoft basically gave DOS away to every OEM there was, while CP/M stuck to its higher priced format. Now, Linux is making inroads on Microsoft because its free, whereas Microsoft is increasingly a stickler for Windows licensing.
2. Borland vs Microsoft. Borland struck an early lead in Microsoft in tools by making a Pascal that was better than DOS BASIC, and then, by making a C++ that was better than Microsoft's. But, Microsoft came up with VB, whose scripting style made it easier to work with than Borland's Pascal, and negated the advantages of Borland C++, and then, for C++, Microsoft's Visual C++'s 2.0 was hands down a better IDE than Borland's C++ IDE was.
Now, Microsoft is losing tools mindshare to Linux, because, interpreted languages such as Python, Ruby and Perl / PHP are easier to do quick and dirty RAD style web apps with, while Microsoft's own offerings are getting increasingly complicated... and Microsoft's letting their own C++ product languish while the GNU compiler keeps getting better and better, and Linux IDE's such as KDevelop actually now surpass Visual Studio for C++ development. Microsoft needs to realize that the .NET one platform fits all approach is ultimately a loser, but, we Linux fans hope they don't realize it until it is too late!
3. Borland vs Microsoft Round 2. Borland's Quattro Pro was an early favorite over Excel, but Excel wound up carrying the day just through a sheer weight of features. But the really telling battle came when Borland bought Ashton Tate, and Microsoft bought a tiny company that made an Ashton Tate clone called FoxPro. FoxPro was, way, way faster than dBASE and Borland was late with its dBASE anyway. Microsoft would later seal the deal with MS Access, which was easier for quick and dirty database projects than either xBASE product.
Now, Microsoft's own office products are late, and Open Office continues to make inroads. Nobody has really answered Access yet, but... MySQL has quietly dominated the enterprise for quick and dirty databases in the same sort of way Access snuck into the desktop.
4. Microsoft vs IBM. Oh, let's see, how did IBM screw up OS/2, let me count the ways. IBM wanted to tie OS/2 to PS/2 offerings... IBM's OS/2 marketing was hamfisted whereas Microsoft basically let everyone copy Windows like the plague... whereas Microsoft wanted Windows to run on all sorts of PCs... Windows wasn't "as good", but it did have a better message queue than OS/2 and didn't require users to throw away DOS completely at a time when that mattered...
Nowadays, Microsoft is the company that ties Windows to specific hardware, whereas Linux runs on just about everything. While Microsoft still has a stranglehold on PCs, in every other kind of computer out there, from cell phones to digital control devices to routers and set top boxes, Linux actually has a growing presence. And, ironically, if you want to write for POWER Linux, IBM will be more than happy to set you up with an account at an IBM data center... what will Microsoft do, hmmmm?
4. Microsoft vs Apple, round 1. Windows color, Macintosh, black and white. Woops... but even today, we can see Linux rolling out with better and better eye candy and graphic effects. When Vista first threatened integrated 3d graphics ala OS/X, Linux people could have almost panicked, yet, they rolled up their sleeves and by the time Vista arrived, Compviz was here and many Linux desktops actually look better than Windows. Can you say Ubuntu?
5. Openness. Microsoft came to being in a day when Microsoft's level of documentation gave it a more open feel over what software bundled by hardware makers would give. While we think of Microsoft as being hard nosed and closed today, 20 years ago, they were
This is my sig.
Microsoft's business model, as we all know, has been to sell second-rate software to unsophisticated customers. But why did this succeed?
I'm at an age when I can begin touting my age as a factor in making arguments, so here is my take on this. Some of us remember the "mainframe" days. My particular experience was working at Motorola's government electronics group during a time when there was a need to upgrade the (that's right, "the") engineering computer. Bids were taken, executives were wined and dined, and a Sperry Univac was bought (replacing a much-loved but very tired Honeywell model). The engineers were livid because the Univac sucked. I actually sat in a small, packed conference room with Sperry bigshots while we berated them on the problems with their computer. Not two years later, the Univac was dumped for---drum roll--an IBM. Engineers were pleased with the new machine.
It was during this period that I first heard the mantra: "You can't be fired for buying IBM." Everyone knew it. It always remained a mystery what influence Sperry was able to exert, but there was always a suspicion of foul play in the decision to get the Univac.
This period was approximately 1982-1984. An IBM PC showed up in my lab. Other small lab computers were showing up, such as HP and an excellent machine from Three Rivers Computer, which engineers were using for suspicious activities such as writing reports. Management became petrified, and a moratorium against the purchase of new personal computers was put into place. (i'm not kidding--I was on a committee to decide what to do about the "problem." One of the subjects we confronted was networking and Ethernet. The consensus of the committee was, Who the hell would ever need 10 Mbps?)
The decision was made (around the time I left the company to return to graduate school). IBM PCs were the official choice of Motorola's government electronic group.
This might sound like a trite explanation, but I have thought about it for many years. I truly believe that such a reasoning was behind much of the success of the IBM PC (and by IBM's decision to farm out the OS, Microsoft).
"You can't be fired for buying IBM."
I watched TFV in TFA too, and what he seemed to be saying was that a key to their success was having access to the source code for the operating system they were using. Oh the irony.
Though Packard Hell soldiered on for years in the US market as a 'cheap' entry level computer despite it's [well deserved] odious reputation among the cognoscenti. It didn't finally flatline in the US until the mid/late 90's. I remember a (joke) contest at a BBS party in the early 90's - first prize was two (dead) Packard Hell machines. Second prize was one working Packard Hell...
But yeah, even though they are now almost forgotten today (how fast they forget!) Compaq was the leader in PC's through the 80's and most of the 90's.
In 1979 Microsoft 8080 BASIC was the first microcomputer product to win the ICP Million Dollar Award.
No one - no one - had to tell IBM in 1980 how far and how fast Microsoft had risen in the world of the eight bit micro.
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