From the mouths of Microsoft: Ozzie and Gates on software-as-a-service
"Complexity kills. It sucks the life out of developers, it makes products difficult to plan, build and test, it introduces security challenges, and it causes end-user and administrator frustration. Moving forward, within all parts of the organization, each of us should ask 'What's different?' and explore and embrace techniques to reduce complexity."
Ray Ozzie, Microsoft
Dear Vorticians,
Last week, I mentioned our on-stage discussion with Ray Ozzie, Microsoft's newly minted champion of software-as-service. Shortly after appearing with Geoffrey Moore at Vortex05, Ozzie was on another stage with Microsoft founder Bill Gates to launch Microsoft's services plans.
Microsoft is embroiled in one of its periodic spasms of self-examination where the leadership, spurred by market changes and frustration within employee ranks and among customers, issues a call-to-arms aimed at ensuring that the operating systems giant doesn't miss the Next Big Thing. Bill Gates' memos about the Internet and the need to refocus around improving security are legendary.
Gates' latest manifesto involves software as a service and his thoughts for his charges at Microsoft were complemented by a lengthier, insightful missive penned by Ozzie, who came to Redmond via Bill's acquisition of Ozzie's Groove Networks collaboration software company. Vortician Alan Cohn sent along this link that provides access to what are purported to be the full text of the Gates and Ozzie notes and I'd really encourage you to read them. Here's the link. (Of course, I can't absolutely guarantee that the documents presented are "real," but if the Ozzie memo is not legit, whoever wrote it is one savvy individual and should probably be spearheading Microsoft's efforts in this area.)
I wanted to share a couple of passages with you from the Ozzie note, in particular where he talks about what Microsoft has accomplished and, more important, how key opportunities have slipped out of the company's grasp.
"Our products have embraced the Internet in many amazing ways. We've transformed the desktop into a rich platform for interactive Internet browsing, media and communications-centric applications. We've transformed Windows into best-of-breed infrastructure for Internet applications and services. We've created, in .NET, the most popular development platform in the world. We've got amazing products in Office and our other IW offerings, having fully embraced standards such as XML, HTML, RSS and SIP. Our MSN team has demonstrated great innovation and has held its own in a highly competitive and rapidly changing environment - particularly with Spaces and in growing a base of 180M active Messenger users worldwide. The Xbox team has also built a huge user community and has demonstrated that Internet-based "Live" interaction is a high-value, strong differentiator.
"But for all our great progress, our efforts have not always led to the degree that perhaps they could have. We should've been leaders with all our Web properties in harnessing the potential of AJAX, following our pioneering work in OWA. We knew search would be important, but through Google's focus they've gained a tremendously strong position. RSS is the Internet's answer to the notification scenarios we've discussed and worked on for some time, and is filling a role as 'the UNIX pipe of the Internet' as people use it to connect data and systems in unanticipated ways. For all its tremendous innovation and its embracing of HTML and XML, Office is not yet the source of key Web data formats - surely not to the level of PDF. While we've led with great capabilities in Messenger & Communicator, it was Skype, not us, who made VoIP broadly popular and created a new category. We have long understood the importance of mobile messaging scenarios and have made significant investment in device software, yet only now are we surpassing the Blackberry.
"And while we continue to make good progress on these many fronts, a set of very strong and determined competitors is laser-focused on Internet services and service-enabled software. 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. 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 utilizing 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.
"Even beyond our large competitors, tremendous software-and-services activity is occurring within startups and at the grassroots level. Only a few years ago I'd have pointed to the Weblog and the Wiki as significant emerging trends; by now they're mainstream and have moved into the enterprise. Flickr and others have done innovative work around community sharing and tagging based on simple data formats and metadata. GoToMyPC and GoToMeeting are very popular low-end solutions to remote PC access and online meetings. A number of startups have built interesting solutions for cross-device file and remote media access. VoIP seems on the verge of exploding - not just in Skype, but also as indicated by things such as the Asterisk soft-PBX. Innovations abound from small developers - from RAD frameworks to lightweight project management services and solutions."
Along with his candor on the challenges Microsoft faces, Ozzie does a good job of portraying the scope of opportunity this shift presents for the company. After you read it, I'd like to hear your thoughts. Is this market shift occurring as rapidly as some pundits would have us believe? Could Microsoft retool to survive and thrive in this era?
Next week, I'll tell you why I think Microsoft can and will. As always, you can reach me here.
Bye for now.
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