How Ray Ozzie is Changing Microsoft 266
prostoalex writes "The October issue of Wired magazine takes a look at Ray Ozzie's work with Microsoft. To hear the article describe it, he's rebuilding the company from the ground up. A 70,000-employee company is quietly changing its ways by thinking of software as deliverable services that perhaps could be rented on a monthly subscription basis." From the article: "There are, of course, two major reasons for Ozzie's ascendancy at Microsoft: Gates and Ballmer. Ozzie is one of the few technologists anywhere whom they respect; they'd been trying for years to get him to join the company. Now he's carrying their hopes for the future, and it's a heavy load. Ozzie needs to move Microsoft from selling software in a box to selling lightning-fast, powerful online applications ranging from gaming to spreadsheets. The risks are enormous. The mission is to radically alter the way the company sells its most profitable software and to pursue the great unknown of so-called Web services - trading an old cash cow for an as-yet-to-be-determined cash cow. No, Microsoft doesn't think its customers will stop using PCs with hard drives and work entirely online, but the desktop era is drawing to a close, and that promises to force some painful trade-offs."
AAAHHHHH!!! (Score:4, Insightful)
1) Bandwidth
2) Keeping apps under MY control, not somebody elses
3) I don't like being required to have an internet connection to type an f'n paper.
And those are just to name a few.
"Perhaps"? "Quietly"? (Score:4, Insightful)
MS has been making it increasingly plain, at a very high volume and in no uncertain terms, that this model is precisely what they are aiming toward.
Service? (Score:5, Insightful)
Software as a service? Perpetual payments? No thanks.
Who -- besides companies looking for more profits and a constant revenue stream -- actually wants this? The cons far, far outweight the pros for the typical customer.
Re:AAAHHHHH!!! (Score:3, Insightful)
Why would the "desktop era" suddenly end? It's not the Ice Age, it doesn't just simply "end" as if it was controlled by the forces of nature. It ends if people want it to end. Does anyone want it to end, besides Microsoft?
It's not necessarily one or the other... (Score:2, Insightful)
Look at the Xbox. Microsoft is a big enough of a company that it can afford to branch off into another market and create a whole new division dedicated to new services/products without the other aspects of their business suffering (not any more than usualy, anyway).
Although we may be talking about a change in company culture as well - which most definitely does change a company from the ground up - expandinding into new fields and with new products and service offerings doesn't mean that we should expect an entirely Microsoft that completely departs from it's desktop offerings.
Not to mention that I don't see too many businesses that currently use desktops in their office switching things over to cell phones in the near future.
I agree (Score:1, Insightful)
Tales of Desktop's Death Greatly Exaggerated (Score:5, Insightful)
Web applications are not new. I've built my fair share of them. (Maybe even more than my fair share.) In some circumstances, they work very well:
They have downsides, too:
And yet for many applications, particularly specialized applications dealing with customer account access, inventory management, project management, online publishing, or a whole slew of other things, we accept these limitations. We assess the costs of not using a web application and determine that, overall, the web application provides value for the money.
What's interesting here is that while existing web applications have enough benefits to outweigh the risks, it's not clear that replacing standard desktop apps will come out the same in the risk/benefit analysis. The kinds of things we're doing on the web, we're doing because they work better that way; we've had years of experience with the desktop, and we know some things work better with centralized server models, and others work better with all the work done on the client. Microsoft is betting the farm on everyone being happy to push to the server model, but it won't happen; there are too many compelling reasons to keep ordinary desktop apps right where they are, on your desktop.
What they're afraid of is losing the fight for the desktop. This is their long-term strategy to lock everyone into their system. First they tried to lock up the OS. Then they tried to lock up the file formats. While Linux and OpenOffice are not quite credible threats (if you consider market share only) MS can look ahead and see a day when they have enough market share to seriously threaten their dominance on the desktop, and it isn't 50%, or even 25%. Maybe it's 20%, that magic point where people feel like there is an alternative, and then it's the tipping point, people no longer feel locked in. So MS wants to keep people locked in, because it keeps the cash flowing. That means locking up the data itself. And that's what their online apps are all about.
/. market not home market (Score:2, Insightful)
Re:AAAHHHHH!!! (Score:5, Insightful)
If you want apps under YOUR control, I hope you're not running anything from MS as it is....
Re:AAAHHHHH!!! (Score:5, Insightful)
These people are cash cows for businesses. They get them to buy/rent the software, they are able to convince them that they won't have to care for the applications, and they convince them that this is the best way.
These people don't know what bandwidth is, they are people that don't want to control anything, and they don't think about things like requiring an Internet connection to do their tasks. As long as everything works they're thrilled to fork the money over monthly, just like they do for electric, gas, water, telephone, and their cable TV.
I call BS. (Score:2, Insightful)
What is DRM/TC if not forcing a desktop into more controlled states, i.e., officially-sanctioned consumption devices? Time to puke, dude.
Re:Here's an idea for Ozzie (Score:3, Insightful)
* 45,000 workers in a large services company = $48,600.
Tell me who would buy it with that kind of tax per day.
MOD PARENT UP (Score:4, Insightful)
"The company said it would retool its product line to shift the very focus of computing away from hardware devices and toward a new generation of Internet-based software allowing people to interact with data and one another whether they are using computers, digital cell phones or interactive televisions. William H. Gates, Microsoft's chairman, portrayed the long-awaited move as 'more ambitious than anything we've done' adding, 'There is no Microsoft product that isn't touched by this activity....'
"Microsoft's new view of computing calls for processing to be done everywhere,
"Mr. Gates said that the bet on
Re:Here's an idea for Ozzie (Score:3, Insightful)
Re:AAAHHHHH!!! (Score:4, Insightful)
When everything goes online, they will have to fight against google, and in online world, Google is the 500pounds gorilla, no Microsoft.
Re:/. market not home market (Score:2, Insightful)
Laymen like their computers simple and reliable. They don't want to worry about activation dates and ISP issues. SOA is fine, but it is not for everybody. What happens when the "home users" discover they can't write their essays on their brand-new laptop unless they have a connection?
Lost customers, and plenty of hatemail.
Re:Service? (Score:4, Insightful)
My company sells software packages where the license alone costs you a million or more. Installation can take from 2-3 hours to a day, and fully configuring it can take anywhere from a couple of hours to weeks. Properly administrating the app, as well as taking advantage of the data it spits out, can take anywhere from a lone admin to 20-30 people (administrators as well as a full fledged NOC). Finally, it's complex enough that learning the ins and outs of it can take upwards of a year. Needless to say, one of the biggest problems we have when people buy it is that they screw up the installation, screw up the configuration, or don't have the manpower or processes in place to properly take advantage of it. So what's the alternative?
Well, the same app is available as a hosted service. People buy a temporary license, tell us what they want the app to do, and it's all set up for them. They don't have to buy hardware for it, don't have to administrate it, don't have to configure it, don't have to maintain it, troubleshoot it, write scripts for it or do any of the other things that are difficult and expensive. All they need to do is log into the web interface, look at the pretty pictures, or look into their email for the pretty pictures that the app sends them. They can be complete users of the app, without ever having to go to the trouble of becoming admins. And that is worth a ton of money to them. Not only that, but it gives them time to learn the app without having to worry about screwing things up. Not only that, but they have someone to yell at when something goes wrong.
The end result is that our customers are much happier with the hosted version than with the stand-alone app. This happyness often translates into hosted services customers buying the stand-alone app, but now they're actually power users, and far less likely to shoot themselves in the foot.
There will be an explosion of hosted services in the near future. Actually, you can already see it now. Just beware of anyone who's trying to tell you that they'll completely replace stand-alone apps. There is a place for hosted services and there is a place for stand-alone apps. Don't confuse them, or you'll end up in a world of hurt.
Re:Linux usability. (Score:4, Insightful)
I agree with most of your comments. Usability is a big problem in linux, and open source in general. Most open source software is not created with the end user in mind. However, I don't think that using Windows is the solution. There are other things to consider to. For one thing, linux is free as in freedom (for me that's a big thing). Linux based software tends towards open standards (another big thing, I've been bitten by MS Word too many times). Also, While Linux is complicated, it tends to be fairly consistant, and the things that I learn are easier to remember. Integration is nice, but it has it's ugly parts too.
Re:Service? (Score:2, Insightful)
Who -- besides companies looking for more profits and a constant revenue stream -- actually wants this?
Who would be so stupid as to lease a vehicle, when they can buy one, own it and be free to drive it as far as they want without penalty? It's a crazy business model that's doomed to fail!
People will gladly be nickeled and dimed to death vs pay a large sum up front for more freedom. Look at iTunes. Who would buy a DRM infested single song when the CD is available in stores?
That aside (that people in general can't do basic math and realize that 12x100 is always more then 1000), there are good reasons to rent / lease / perpetually pay for a service. What businesses are realizing is that selling a product is a race to the bottom - someone will find a way to sell a similar product for less. The challenge for business is to justify a service model. Either take the options away or better yet, find a reason to continually charge - unlimited upgrades, data storage and backup/recovery procedures, help desk, etc.
Re:Service? (Score:3, Insightful)
Unless you've bought the Linux model, or are pirating your O/S, you already are. Or, are you actually still running that ancient copy of Windows 3.1 on your peppy 80286/12?
I didn't think so.
Every few years, you upgrade your O/S. Whether you use the same hardware or buy new hardware is of no consequence. You still do the upgrade, and your $75 every 2-5 years gets sent in to Microsoft. How is that different than spending $19.95/year? That $19.95 gives you updates, follows you through hardware upgrades, etc.
We do something similar with our software. The client pays on a per-customer basis, and in exchange, we let them use the software on as many computers as they like. Backups are inherent in the system, and we "take all the worries" out. In many cases, there's nothing to install (parts of our software stack are web-based) and everybody always gets the updates! Not everybody we've approached has bought into the idea, but enough have that we've grown into a viable business providing a very comfortable income.
The cons far, far outweight the pros for the typical customer.
I think what you meant was
The cons far, far outweight the pros for the typical software pirate.
You personally may not like software sold thusly, but the fact is, it's really not much different than what you're already doing, and there are a number of advantages to doing things this way.
Realistically, how many people actually BACKUP THEIR DATA on a regular basis? How many people ACTUALLY APPLY SOFTWARE PATCHES on a regular basis, unless kicked in the head to do so? "Software as a service" allows many of these indiscretions to be solved by people competent to do so, while in most cases REDUCING the cost of software by leveraging the power of economies of scale. If we can eliminate 1 admin at a client site, we save them $50,000 to $75,000 per year. That goes a long, long, LONG way when negotiating license fees...
Don't like it? Don't buy it. Continue using your Windows 3.1 on your 80286 for as long as you like - remember your license to that is perpetual!
Never rent!! (Score:3, Insightful)