Break Microsoft Up 355
Hugh Pickens DOT Com writes "Tom Worstall writes in Forbes that the only way to get around the entrenched culture that has made Microsoft a graveyard for the kind of big ideas that have inspired companies like Apple, Google, and Amazon is to split the company up so as to remove conflicts between new and old products. With Ballmer's departure, instead of finding someone new to run the company, bring in experts to handle the legal side and find suitable CEOs for the new companies. 'The underlying problem for Microsoft is that the computing market has rapidly left behind the company's basic strategy of controlling the machines that people use with operating-system software,' says Erik Sherman. 'The combination of mobile devices that broke Microsoft's grip on the client end, and cloud computing that didn't necessarily need the company in data centers, shattered this form of control.' Anyone can see how easily you could split off the gaming folks, business division, retail stores, and hardware division says John Dvorak. Each entity would have agreements in place for long-term supply of software and services. 'This sort of shake up would ferret out all the empire builders and allow for new and more creative structures to emerge. And since everyone will have to be in a semi-startup mode, the dead wood will be eliminated by actual hard work.'"
What's good for others apparently is no good for M (Score:5, Interesting)
Too big to fail (Score:1, Interesting)
How come it makes sense to split up MS, but banks and other financial companies that are huge and have a real impact on the economy can't be split up?
Yes and No (Score:5, Interesting)
Agreed. Each of those areas could be self-contained, if it isn't already.
"Each entity would have agreements in place for long-term supply of software and services. 'This sort of shake up would ferret out all the empire builders and allow for new and more creative structures to emerge."
Why? There will always be empire builders. And why would "new and more creative structures" emerge? If the existing divisions are lagely self-contained, what stops that now? I have witnessed companies down-sizing and splitting up - management become obsessed with it as an end in itself, like "well we shut down that department, what can we shut down next?". They stop thinking about the product. "Creative" groups are the first up against the wall.
On a much smaller scale, I saw a company of about 30 people reduced to about 5 because the new owner, a devout Thatcherite, just thought "The smaller the better". It ended up with the craftsman in the workshop keep having to stop making stuff to go and answer the phone; that was not efficient.
Re:What's good for others apparently is no good fo (Score:5, Interesting)
they haven't come up with anything good on their own for a long time
I'd say that they at least deserved credit for Kinect. While it was obviously released in response to the unforeseen success of the original Wii and its novel control methods, the fact remains that it went beyond being just a "me too" product and was genuinely innovative in its own right.
That said, it was arguably the exception rather than the rule, probably because it came from the XBox division and wasn't a threat [slashdot.org] to the entrenched interests and politics of the main Windows and Office divisions that have crushed so much potential innovation within MS.
Re:What's good for others apparently is no good fo (Score:2, Interesting)
Imagine if the Apple Mac department had blocked the iPhone and/or iPad because it could eat into the Mac market share (which I'm sure it did). I guess Apple would by far not be as profitable as it is now.
Re:Yeah (Score:4, Interesting)
You could also argue that Ballmer brought a failure culture into MSFT too.
http://www.slate.com/blogs/future_tense/2013/08/23/stack_ranking_steve_ballmer_s_employee_evaluation_system_and_microsoft_s.html [slate.com]
'Surround yourself with idiots so you don't get fired' doesn't seem like a very good way to have a successful company.
Re:Amusing (Score:4, Interesting)
Well "fucking it up" is one way of putting it. And it's true, if by "fucking it up" people mean moving towards being just another player rather than the dominant player in the market.
Sears was the Amazon of its heyday -- if not more so. It dominated a huge slice of the American retail economy, using the hot technology of the day: the mail order catalog. It spent decades in decine, powered by inertia and massive paid-for infrastructure -- hundreds of yellow brick stand-alone stores and distribution centers across the country built in the 1920s to 1950s. I remember the Sears of the early 70s. Dirty, unattactive stores full of (except for tools) shoddy, undesirable merchandise.
Sears went though a decline-driven break up, divesting itself of insurance, consumer credit, construction and other non-retail operations before selling the rump of the retail business to K-Mart in 2005. "Sears" today is essentially a re-branded K-Mart, and many spun-off pieces of the old Sears conglomerate survive and prosper as independent entities or with new owners in a related business. The problem wasn't with any of the individual pieces of the business, it was moving with the times while managing all the different *kinds* of pieces of the business.
Which is not to say that Microsoft is necessarily going the way of Sears, but there are some interesting parallels. Like Sears, MS exploited an unique market position to enter many other markets. Like Sears, MS has several highly successful cash cow operations that can sustain marginally successful side businesses. That's a blessing in the short term, but sometimes a curse in the long term. In the mobile space, MS wore Palm down with shear financial persistence, only to lose that hard won market to more agile and creative competitors.
MS may still regain its mobile position by funding that business from its cash cows, but it's not sure thing. Doing that across many business areas could translate into a lot of lost profit in the long term, depending on its future success in those areas.
Re:What's good for others apparently is no good fo (Score:5, Interesting)
The problem is that there's people running Microsoft who still think the way to sell more Windows 8 isn't to listen to customers and fix Windows 8's problems,
There's a reason for this.
The root of the problem is that Microsoft believes in a zero-sum game, namely that:
"Empowering the customer results in Microsoft losing power."
This is a very common attitude in the publishing industry. They would rather lose their customers than lose their grip on power.
This is the driving philosophy that explains so much of what's going on in the industry:
* DRM -- Screw paying customers for the sake of retaining power over them
* Artificial limitations -- Hurt the customer so that products don't cannibalize each other
* Metro -- Badly inconvenience the customer for the sake of some dubious strategic marketing theories
* Locked-down RT bootloader -- Make the hardware less valuable simply to prevent a few Android installs
The list goes on and on.
Re:What's good for others apparently is no good fo (Score:3, Interesting)
I love how badly this strategy is backfiring. A lot of game developers have realized that OpenGL is a better choice than D3D, for the simple fact that if they use OpenGL, their work is easily portable between PS4, iOS, Android, OS X, Linux, and others, while with DirectX they're stuck with Windows and XBox.