So You Think I’m A Barstard

Today Steve Ballmer sent out an all points memo to the troops within Microsoft, some of what he says makes sense, some of his assumptions are questionable and some are just great in theory but the gun is facing towards Microsoft’s foot.

here is the email in its entirety and I will highlight the areas where I think MS will fail and my reasons for thinking that.

From: Steve Ballmer

Sent: Wednesday, July 23, 2008 4:30 PM

To: Microsoft–All Employees

Subject: FY09 Strategic Update

With FY08 complete, I want to discuss my priorities for the year ahead and share my thoughts about the key strategic topics that are on everybody’s mind, including Windows, competition with Apple and Google, our software plus services strategy, and Yahoo.

Well Steve you forgot your biggest threat so far, forget Apple for the moment, they have a few problems of their own to worry about before they are any real threat, Google is so far in front of you at the moment that they possibly dont even consider you a threat yet and Yahoo, well the further you distance yourself from that, the better, you really need to worry about Linux, and Ubuntu in particular as the current version called Hardy Heron out Vista’s Vista. It out performs Vista on the same hardware and it works right out of the box without a drama, the inclusion of Wubi, thus giving it the ability to install within a folder on a Windows machine, yet run as a complete OS without having to fiddle with boot loaders and such will give a lot of die hard Windows users a look at just what Vista should have been, and maybe turn them towards open source.

I also have news about an organizational change and a transition in our Senior Leadership Team.

First, I want to thank you for your hard work and the dedication you showed during the past 12 months. FY08 was a milestone year. Our revenue jumped $9.3 billion to more than $60 billion. Operating profit grew 21 percent to $22.5 billion.

These outstanding numbers are the direct result of your commitment to the priorities I outlined last July. A lot has happened since then, but our fundamental strengths, challenges, and strategic goals remain largely the same. Therefore, my priorities are consistent with last year. In FY09 we must continue to:

1. Invest in the right opportunities;

Fair enough, so why did you pursue Yahoo??

2. Expand our presence with Windows, Office, and developers;

Maybe you should be consolidating what you have instead of losing major clients like Intel, or 9000 schools in Switzerland going open source. You have to get it right before you can expand, because expanding something that is flawed from the outset only exposes the flaw to a larger audience.

3. Drive end user excitement for our products;

Good luck, Seems blaming Apple for your failings with Vista hasn’t helped your cause, maybe to much bad blood has flowed from the hallowed halls of Microsoft for people to give you any credibility.

4. Embrace software plus services; and

you need software that people are actually excited about first, rather than people just going “Well if I HAVE to have it…” before you can sell them services Steve.

5. Focus on employee excellence.

Actually I think you have probably the best coders in the business, your management just sucks at the moment, rather than focusing on what is actualy happening, you lot are whining about how it didn’t happen the way you wanted.

By focusing on these five areas, we can continue to grow revenue, increase profit, and expand our market share. These priorities are also critical as we work to address key issues surrounding our business in the coming year:

· Windows: The success of Windows is our number one job. With SP1 and the work we’ve done with PC manufacturers and our software ecosystem, we’ve addressed device and application compatibility issues in Windows Vista. Now it’s time to tell our story. In the weeks ahead, we’ll launch a campaign to address any lingering doubts our customers may have about Windows Vista. And later this year, you’ll see a more comprehensive effort to redefine the meaning and value of Windows for our customers.

Good luck, honestly, I know of entire organisations that will be avoiding any push to Vista, much preferring to stick it out and wait for Windows 7. I know that NSW Education Dept wont have a bar of Vista in its current guise and probably a few other Govt. dept’s are hoping that Windows 7 ships on time as well.

We also have to drive developers to create rich applications for Windows. With Internet Explorer and Silverlight, we have great tools for creating applications that run everywhere. But we also need to make sure developers have the .NET skills to write unique Windows applications using Windows Presentation Foundation. To keep today’s Windows applications alive, vibrant, and exciting, we need both—applications that run everywhere and rich client applications.

Rightly so, but please stop buying up all the good little developers with the good ideas and then subsuming them into the belly of the beast, never to be seen or heard from again, that’s called stifling, not encouraging.

· Apple: In the competition between PCs and Macs, we outsell Apple 30-to-1. But there is no doubt that Apple is thriving. Why? Because they are good at providing an experience that is narrow but complete, while our commitment to choice often comes with some compromises to the end-to-end experience. Today, we’re changing the way we work with hardware vendors to ensure that we can provide complete experiences with absolutely no compromises. We’ll do the same with phones—providing choice as we work to create great end-to-end experiences.

Don’t go there Steve, Apple is where they are today because they went down that path and essential shut out any competition. Competition is what DRIVES the market place Steve, if you shut out the third party innovators you will only open the floodgates for the Open Source community.

· Business and enterprise: Our enterprise and server business has never been stronger—today we are on the verge of becoming the number one enterprise software company. We need to continue to push on all fronts—mail with Exchange, business intelligence with PerformancePoint, virtualization with Hyper-V, and databases with SQL Server. We have to drive our enterprise search capabilities, our unified communications solutions, and our collaboration technologies. And we must continue to compete against Linux in key workloads such as Web servers and high performance computing.

First you need to build a server that doesn’t need to be rebooted every time you update something.

· Software plus services: Some people think software plus services is all about search. But it’s really about changing the way software is written and deployed. The future is about having a platform in the cloud and delivering applications across PCs, phones, TVs, and other devices, at work and in the home. It’s also about driving change in business models through advertising, subscriptions, and online transactions. Software plus services is a huge opportunity for us to deliver new value on the desktop and the server to all of our customers. This year at PDC, you’ll hear more about our cloud platform initiatives and the next versions of our Live and Online technologies.

Broadband rollout around the world will be the deciding factor in this one, I know for a fact that server sided computing wont work in Australia because of the cost of transporting every byte of information between the server and client is high. and when the big players in the telecommunications market are increasing costs to the end user, instead of reducing them, it will only get worse.

· Google: We continue to compete with Google on two fronts—in the enterprise, where we lead; and in search, where we trail. In search, our technology has come a long way in a very short time and it’s an area where we’ll continue to invest to be a market leader. Why? Because search is the key to unlocking the enormous market opportunities in advertising, and it is an area that is ripe for innovation. In the coming years, we’ll make progress against Google in search first by upping the ante in R&D through organic innovation and strategic acquisitions. Second, we will out-innovate Google in key areas—we’re already seeing this in our maps and news search. Third, we are going to reinvent the search category through user experience and business model innovation. We’ll introduce new approaches that move beyond a white page with 10 blue links to provide customers with a customized view of their world. This is a long-term battle for our company—and it’s one we’ll continue to fight with persistence and tenacity.

Two things here, firstly you don’t really compete with Google, your playing catchup, and from a LONG way behind.
Secondly, you don’t need to re-invent the wheel, and your complete failure to understand that those 10 blue links on a white page is what keeps Google out in front, people don’t want to be blasted with adds, regardless of them being targeted to the search or not, every time they go looking for a new recipe for Chicken Soup, they like the fact that Google will give them a ranked selection in an easy to decipher format with any paid results clearly defined.

· Yahoo: Related to Google and our search strategy are the discussions we had with Yahoo. I want to emphasize the point I’ve been making all along—Yahoo was a tactic, not a strategy. We want to accelerate our share of search queries and create a bigger pool of advertisers, and Yahoo would have helped us get there faster. But we will get there with or without Yahoo. We have the right people, we’ve made incredible progress in our technology, and we’ll continue to make smart investments that will enable us to build an industry-leading business.

Might I respectfully suggest that you get there without Yahoo, as a Tactic it was right up there with Custer waiting in a ditch for the Indians to come and scalp him, much like Yahoo’s massive debt would have scalped Microsoft if you paid the reported premium, it would have left you cash strapped and floundering in a sea of debt. Though don’t worry, I’m sure Google could have bought you up and helped you consolidate.

As I mentioned earlier, I have important organizational news. Today we are announcing that the Platforms and Services Division will be split into two businesses: Windows/Windows Live and Online Services. We are also announcing that Kevin Johnson will leave the company. He will work to ensure a smooth transition.

Since 1992, Kevin has been a key contributor to many of this company’s most important achievements. As president of the Platforms and Services Division, Kevin has built an incredibly talented organization and laid the foundation for the future success of Windows and our Online Services Business. Over the last 16 years, through everything from his work as head of the company’s worldwide sales, marketing, and services efforts, to his leadership in transforming our field operations and repositioning the company to focus on opportunities in emerging markets, Kevin has played a vital role in this company’s success. There is no doubt that his passion and dedication will be missed.

Effective immediately, Steven Sinofsky, Jon DeVaan, and Bill Veghte will report directly to me to lead Windows/Windows Live. In the Online Services Business, we will create a new senior leadership position and conduct a search that will span internal and external candidates. In the meantime, Satya Nadella will continue to lead Microsoft’s search, ad platform, and MSN engineering efforts, and Brian McAndrews will continue to lead the Advertiser and Publisher Solutions Group. Both Windows/Windows Live and the Online Services Business are led by a strong group of executives on the technical and business side who have the talent and experience to address the challenges we face and drive the next generation of growth and success.

Looking ahead, I see an incredibly bright future for our company. As I said at the June 27th Town Hall for Bill, we are the best in the world at doing software and nobody should be confused about this. It doesn’t mean that we can’t improve, but nobody is better than we are. Nobody works harder than we do. Nobody is more tenacious than we are. We’re investing more broadly and more seriously than anybody else. Our opportunities to change the world have never been greater.

Hopefully these changes will see you looking ahead at what is coming at you, rather than looking at your crystal ball and wondering why the world didn’t do what you wanted it to. I know it is hard to shift position when your a giant behemoth of a company, but maybe a leaner, more flexible Microsoft is what you should be striving for, rather then a sedentary giant that expects the minions to come to it and shovel food in it’s voracious maw, maybe eating some of those feeding hands in the process.

I look forward to working with all of you as we focus on our five priorities in FY09.

Steve

So do I Steve, I wish you luck.

As always, I crave comment, even if you think I’m a complete tool with both thumbs up my arse and drool dripping from my chin, or my preferred type of comment, saying how you think I’m a genius of the highest order and you wish to name your first born after me