Gosh, what have we here? Have some leaked internal memos from Bill Gates and recently-appointed CTO, Ray Ozzie, shown up all over the Web? I am too tired to go ferreting out whether this is a real leak, and the blogosphere is now so quick at disseminating juicy news, or whether it is just a PR stunt made to look like a leak. Let me be generous and think that it is the former for now.
These kinds of memos provoke less interest than they did way back in 1998, because employee blogs like Mini-Microsoft regularly dissect - and often criticize - Microsoft's strategy from within, providing a view to outsiders that would have been unthinkable seven years ago.
For instance, Mini-Microsoft has just all but called the new Visual Studio a buggy piece of rubbish. So have lots of developers.
But I digress. The new memos are interesting. Firstly the timing is interesting. It is nearly the fifth anniversary of .Net, and the tenth anniversary of chairman Bill's Internet memo. The latest memo from Gates announces the five-yearly sea change, and Ray Ozzie's essay describes it in detail in a fascinating cross between brilliant insight, Microsoft Kool Aid and a new (and I think fatal) attitude towards the company's core business.
This time it is not about the Internet or a new way to develop software. It is about services. Explains Ozzie: "Computing and communications technologies have dramatically and progressively improved to enable the viability of a services-based model. The ubiquity of broadband and wireless networking has changed the nature of how people interact, and they are increasingly drawn toward the simplicity of services and service-enabled software that 'just works'. Businesses are increasingly considering what services-based economics of scale might do to help them reduce infrastructure costs, or deploy solutions as needed and on a subscription basis."
Correct in every way. The next sentence is wrong though (in my humble opinion): "Most challenging and promising to our business, though, is that a new business model has emerged, in the form of advertising-supported services and software." The emphasis is in the original. Leave the phrase out entirely and it is much closer to the truth.
The next wave of services is not promising for Microsoft. At all. Consider this scary fact: it is possible to deploy Web-based applications using services on any platform without Microsoft being involved anywhere in the development stack.
Ozzie seems to recognize this in his memo: "And while we continue to make good progress ... a set of very strong and determined competitors is laser-focused on Internet services and service-enabled software. Even beyond our large competitors, tremendous software-and-services activity is occurring within start-ups, and at the grassroots level. Many start-ups treat the 'raw' Internet as their platform. And the work of these start-ups could be improved with a services platform."
But here is another scary fact: people are not waiting for Vista. Lone developers are charging off and building amazing Web development frameworks that run on anything and target anything. Start-ups are eschewing Microsoft reasons of cost, security, scalability, reliability and the company's perceived lack of interest in small business. Even venture capitalists are getting annoyed. Google seems to be competing with them by buying start-ups just before they start looking for so-called 'A Round' funding.
So is Microsoft going to compete with Google by trying to be like Google? It looks like it. More in next week's rant (and probably the week after, too - it is a long memo with profound implications).
(Charl Bergkamp is an overworked, underpaid systems support engineer in the Lambda Bureau, the ICT department of the Ministry of Boards, Committees and Working Groups. He would love to hear from kindred spirits in the ICT corporate world. Send tip-offs, hints and blatant accusations to charl.bergkamp@gmail.com).