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Microsoft's Lost Decade 603

theodp writes "Newsweek's Daniel Lyons (that's Fake Steve to you) explains why Steve Ballmer is no Bill Gates, arguing that what most hurt Microsoft was BillG's decision to step down as CEO in January 2000: 'Gates was a software geek. He understood technology. Ballmer is a business guy.' And the problem with putting non-techies in charge of tech companies, concludes Lyons, is that they have blind spots. So while Microsoft's revenues nearly tripled from $23B to $58B on Ballmer's watch, says Lyons, the company became bureaucratic and lumbering, slowing down while the rest of the world — including Google, Apple and Amazon — sped up."
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Microsoft's Lost Decade

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  • Yeah but (Score:5, Insightful)

    by /dev/trash ( 182850 ) on Saturday October 31, 2009 @08:38PM (#29938169) Homepage Journal

    It must really suck to be a billionaire and yet realize if you had been smart you coulda been a trillionaire.

  • by michaelmalak ( 91262 ) <> on Saturday October 31, 2009 @08:41PM (#29938183) Homepage
    Always blaming or crediting the CEO and never the techs, like Martha Stewart's husband.
    • by thue ( 121682 ) on Saturday October 31, 2009 @09:22PM (#29938443) Homepage

      Microsoft has the money to buy the best techs. So it becomes a failure of management if they fail to do so.

      So in the case of Microsoft I would say that blaming the management for failure is reasonable.

      • by Darkness404 ( 1287218 ) on Saturday October 31, 2009 @11:23PM (#29939067)
        The problem isn't the techs at MS. I've talked to many employees of Microsoft, they aren't idiots, they aren't the "bottom barrel" code monkeys, heck some of them even read /. and know more Linux and UNIX than the average Linux sysadmin. The problem is management. Its gotten so bad that in general the people working on Office don't even talk to the guys developing the OS, the OS guys don't talk to the guys making the UI, etc. Microsoft has gotten so big and vast that the people who should be in close contact with one another aren't. Things are developed independently and I believe that they even have multiple projects going on for the same thing and one gets picked and the others get scrapped. Its little wonder nothing gets done.
    • by Anonymous Coward on Saturday October 31, 2009 @11:48PM (#29939173)

      As a long time MS employee I can say that what the article says is only partially true. Because Ballmer is no businessman either.
      He would rather save a dollar than earn 10. He is so focused on reducing costs that he leaves billions in the table to save millions.
      His management style could make sense in a company whose main problem is low margins, but when you have >50% operating margins and your only threats come from your competitors being able to outinnovate you (in many cases, simply through investing more, such as in mobile), then focusing on cost is not only absurd, it is irresponsible. If it wasn't his money as well I would claim he's a crook. Since it is, he's just a jerk.

  • by Stratoukos ( 1446161 ) on Saturday October 31, 2009 @08:42PM (#29938189)

    This says a lot more about Steve Balmer's competence than Bill Gate's geekness. A far as I know Steve Jobs is no geek, but apparently Apple's relevance is affected by him being there.

    • by CharlyFoxtrot ( 1607527 ) on Saturday October 31, 2009 @09:09PM (#29938365)

      This says a lot more about Steve Balmer's competence than Bill Gate's geekness. A far as I know Steve Jobs is no geek, but apparently Apple's relevance is affected by him being there.

      Jobs is not a geek per se but he talks our language, that's how he got involved with Woz. That and he has an uncanny insight into technology and how it can be used and popularized even when he lacks the technical skill to develop it himself. He's not a salesman (bullshit artist) like Balmer, but someone who can genuinely see how cool a technology is and then transfer that enthusiasm to other people.

      • by StreetStealth ( 980200 ) on Saturday October 31, 2009 @09:39PM (#29938559) Journal

        Jobs is basically that guy who may not be very artistically inclined himself, but has absolutely uncanny taste and runs a gallery in SOHO that turns unknowns full of potential into superstars of the art world.

        Only instead of starving artists, it's technologies.

    • Re: (Score:3, Interesting)

      by R3d M3rcury ( 871886 )

      A far as I know Steve Jobs is no geek

      But it's so cute when he tries.

      I remember back in 2003 when Xcode 1.0 came out and Steve was on stage showing "Fix and Run" (where you could have the program running, change some code, recompile and dynamically link that code into the running binary). All he had to do was change a few lines of code in the demo and hit the "Fix & Run" button, but you could see his cheat sheets and he, very carefully, was typing in exactly what was on the sheet and no idea what he was doing.

      Of course, he was joking that

  • by CharlyFoxtrot ( 1607527 ) on Saturday October 31, 2009 @08:51PM (#29938243)

    Nice piece, but he probably got the idea from James Kwak [] via Gruber [].

    "Technology firms also face a similar problem. In technology, as in most businesses, the way to make it to the top is through sales, so you end up with a situation where the CEO is a sales guy who has no understanding of technology and, for example, thinks that you can cut the development time of a project in half by adding twice as many people. I have seen this have catastrophic results. Even when you don’t have the generational issue that Trillin talks about, the problem is that the sociology of corporations leads to a certain kind of CEO, and as corporations become increasingly dependent on complex technology or complex business processes (for example, the kind of data-driven marketing that consumer packaged companies do), you end up with CEOs who don’t understand the key aspects of the companies they are managing."

  • by SuperKendall ( 25149 ) on Saturday October 31, 2009 @08:53PM (#29938259)

    How far back has the software industry been set back by Microsoft?

    How much further along would server side be if Microsoft had truly worked with the Java community instead of going it's own way with .Net?

    How much better would cellphones be if Microsoft had not bought, and slowly strangled, Danger?

    How much further along would so many areas be if Microsoft had not bought up so many experts and stuffed them in an R&D group with almost no real world output, instead of having them work on practical technologies that made it to market?

    Would the HD video market have been as fragmented as it was without Microsoft pushing HD-DVD long past the point it was obviously dead just so they would get licensing revenue from the menu system?

    If Microsoft the company has lost a decade, it is Karma - for the world and our industry has lost so much more at their hands.

    • by gmuslera ( 3436 ) on Saturday October 31, 2009 @09:39PM (#29938555) Homepage Journal
      You must give some credit to Microsoft. If weren't because of them, we would never knew the risks of botnets, trivial exploits and trusting by default in the network. Who knows, if they werent there probably some centuries from now, when we invade some primitive planet, natives would hack our mothership because we never got aware of those risks.
    • Re: (Score:3, Interesting)

      by RAMMS+EIN ( 578166 )

      ``How far back has the software industry been set back by Microsoft?''

      Funny, I was just thinking about these things the other day. I had this idea that, for all the anger directed at Microsoft, they don't seem to actually have made things worse than they were; at worst, they have prevented things from being as good as they could have been. I mean, what is there that we could do before Microsoft, and can't do now?

      Now that you have brought up some points, you have made me thing about it again, and I realize t

  • by Lemming Mark ( 849014 ) on Saturday October 31, 2009 @08:55PM (#29938277) Homepage

    I certainly find the viewpoint of the article very appealing - essentially that just being a manager isn't enough to enable you to manage anything you want. That you need to understand what your company does at a highly intimate level to really run it well. Who wants to be pushed around by people whose only qualification is to manage others? What about the real folks at the coalface who know what the business is really like?

    Question is - is it true? Certainly appeals to me. But has anyone done a study into this? It'd be interesting to see. Although really, the backgrounds of the CEOs and the records of their companies are out there for all to see. MS under Bill Gates, Apple under Steve Jobs - these certainly look like convincing individual cases. What would happen if you analysed the whole computing industry? What about other industries?

    I would suggest that to a certain extent a really good manager could manage anything they choose - because a truly good manager will make sure he understands what he's getting into. But even then, everyone has different aptitudes for different things, so there's no way to guarantee that they'd be as skilled in any given job. You can probably adapt to that, as long as you're aware of it and don't assume that your previous experience will carry you. For CEOs, there's perhaps a requirement to be a good general businessman - maybe those skills do transfer well. But I think understanding the business ought to be pretty darn important if you want to run the company *well* as opposed to just keeping it ticking over. I don't think there should be any excuse for appointing a CEO who doesn't, can't or won't understand the business adequately. But hey, I'm not on any company boards nor am I a shareholder in anything *shrug*

    • Re: (Score:3, Informative)

      by hey! ( 33014 )

      Well, I'd bet a really good manager probably *could*, because part of being a good manager is knowing your limitations. And the skills needed to get the most out of people working for you are valuable and transferrable.

      The thing is, there are lots of *lucky* managers out there who think they're skilled.

      Think of the science museum display with the thousands of balls and pegs that gradually builds a normal distribution as the balls drop. That ball in the far right bin isn't really any smarter than the ones i

    • Re: (Score:3, Insightful)

      by Tom ( 822 )

      "Pure" managers are good - if they understand that they know zilch about what the company actually does and leave that to the people who do. Unfortunately, most CEO types don't have the character for that (hard to fight your way to the top when you're conscious of your shortcomings). Balmer certainly isn't one of the guys who knows what not to do himself. If nothing else convinces you of that, consider that he could've hired an actor/dancer for the monkey dance.

      In the end, if you can delegate and trust peop

  • Classic case (Score:4, Insightful)

    by HangingChad ( 677530 ) on Saturday October 31, 2009 @08:59PM (#29938307) Homepage

    Microsoft is a classic case of what you get when the problem is dictating the solution.

  • Not just Microsoft (Score:4, Interesting)

    by methano ( 519830 ) on Saturday October 31, 2009 @09:02PM (#29938329)
    This has happened in a lot of businesses. The pharmaceutical industry is in similar shape for the same reasons. Maybe even more so.
  • Tripled (Score:3, Insightful)

    by BigBadBus ( 653823 ) on Saturday October 31, 2009 @09:21PM (#29938435) Homepage
    The bean counters who manage Microsoft won't give two hoots that the technies within and without the company are disgruntled. Why should they? The article says that Microsoft's fortunes nearly tripled, and thats all they care about.
  • The one thing a good manager cannot manage is creativity; they've either got it or they don't. In MS's case they never had it unless you count buying up the ideas others had come up with (DOS, SQL, Excel, Word, and on and on). This problem is compounded when, at some point, HR steps in with focus on credentials instead of competence and further strangles any new ideas. Go ahead, tell your HR department to hire more creative people and watch them demand more credentials from every applicant.

    Google has managed to attract the best and brightest because they've promoted a sense of excitement and stressed competence. But at some point HR at Google will get the upper hand too. Art History majors always prevail.

  • Not just Microsoft (Score:5, Interesting)

    by michaelmalak ( 91262 ) <> on Saturday October 31, 2009 @09:27PM (#29938477) Homepage
    The decade was lost for the entire tech sector, not just Microsoft. 9/11 triggered a recession that caused most companies to pull back and take on only low-risk maintenance-type projects -- nothing cutting edge. All the good software developers and cutting edge work were relegated to black ops, which we don't hear about, except in bits and pieces like Total Information Awareness and Google's Singularity sub-campus on the NASA Ames campus (which is known for its AI work).

    Oh, there was a bit of an economic lift in the middle of the decade -- the housing boom triggered by Greenspan's one-percent interest rates. So, some software development work went into the mortgage industry. That's as useful, as exciting, and as enduring as granite countertops (which were just a waystation between Corian and compressed quartz). Then the Great Recession hit in 2007 -- back to no innovation at all (as least outside of cleared work).

    What do we have to show for it on the desktop? Window bars that are blurry and hard to read. Faaaan-tastic.

    Where the heck is end-user database/web development? It's like Microsoft Access and Lotus Notes are living time capsules of their 1995 versions. Where is a unified naming system that treats e-mail messages, files, web URLs, and database records homogeneously? Where are agents? Why do I have to manually save every check images from my online banking? Why aren't these automatically downloaded to my computer by a software agent?

    • Re: (Score:3, Interesting)

      by Tablizer ( 95088 )

      9/11 triggered a recession that caused most companies to pull back and

      That's not true; the dot-com stock crash around April 2000 triggered it, and it came before 9/11/2001. Maybe 9/11 worsened it, it's hard to say, but it clearly started before that.

      And many companies grew relatively quickly despite economic interruptions, including Google and Apple.

  • by mbkennel ( 97636 ) on Saturday October 31, 2009 @09:32PM (#29938511)

    The original article is too timid.

    The problem is not just Ballmer. The problem is that Microsoft wasn't broken up. Ballmer is the symptom.

    After the antitrust ruling was emasculated, Bill Gates should have said "OK, we won. Now we're going to break Microsoft up anyway. That's the only way to prevent us from turning into exactly what we despised when we founded the company: IBM."

    They have many smart people working there but they are all Thralls, in service to the continued maintenance of the Windows Empire, whose first commandment is Thou Shalt Not Think Different.

    • by Anonymous Coward on Sunday November 01, 2009 @04:32AM (#29940243)

      Having worked at Microsoft for several years up until very recently I have to say I agree with this.

      Microsoft is getting too big and is starting to develop the endemic characteristics of all corporations that grow too large. Bureaucracy is growing. Innovation and individual initiative are dying. Honesty is dying. Agility is dying.

      Microsoft is not, yet, populated by Thralls, there are still some amazing, even truly innovative things coming out of Microsoft and they are, to this day, still making good, positive changes toward improving the health of the company (embracing open source, for example). But all of these good things are the byproducts of the sorts of individuals, groups, and processes that will eventually be choked off by Microsoft's increasingly stultifying business culture.

      Microsoft would be much better off if it were split into multiple smaller companies. Many parts of Microsoft would be stand-alone profitable (operating systems, office, xbox, developer tools, etc.) For many parts of Microsoft that are unprofitable the cost of having to pay the Microsoft strategy tax is far worse than would being forced to sink or swim in the wild. Indeed, many parts of Microsoft would be far better off if they were forced to prove their viability of their product in the market sooner rather than later.

      In the end the only good raison d'etre of the continued existence of a monolithic Microsoft is the vanity of top executives to retain a giant empire.

      And if you think only Microsoft has this problem, just wait. Google is headed in the same direction (at an incredibly fast pace), and Apple is arguably already an evil company (though with excellent leadership).

  • by Seanasy ( 21730 ) on Saturday October 31, 2009 @09:53PM (#29938657)
    No, he'll always be "the shill for SCO" [] to me and not worthy of the click-through.
  • Not Just Fake Steve (Score:5, Informative)

    by Jah-Wren Ryel ( 80510 ) on Saturday October 31, 2009 @10:05PM (#29938717)

    "Newsweek's Daniel Lyons (that's Fake Steve to you)

    Or more likely to be recognized here as Forbes Magazine's massive and unrepentant SCO shill.

    (Unrepentant in that his excuse for his ridiculously one-sided reporting was the flaming he got on the topic in the first place).

  • by Tablizer ( 95088 ) on Saturday October 31, 2009 @10:11PM (#29938749) Journal

    I have to disagree that it's about a tech-oriented CEO. MS's problem is that they are good at leveraging dominance of one market to conquer another. They are bundlers and package-oriented wheeler-dealers. However, the internet relies on open standards to function, and MS simply hasn't found out how to work smoothly among open-standards. Their instinct is and has always been to to kill them off via manipulation, and their reputation surrounding standards has hampered them. They simply came to the end of the leveraging-of-proprietary rope. This would have happened with or without Gates.

    They would have to almost completely change company personality to get out of their rut, much like IBM did when they decided that services, not hardware, were going to be their thing. But IBM had to have it's face shoved into the boiling calderon of death before it realized it had to start over. MS is still a ways from that point.

    • Re: (Score:3, Interesting)

      by daveime ( 1253762 )

      the internet relies on open standards to function

      Oh I'm so tired of this tired old mantra. If everyone relied so much on standards, why do all the major browsers support .innerHTML, which is not part of W3C ?

      Because Microsoft did it first (right or wrong, it works, and is a lot cleaner than all that messing with DOM nodes), and the competition had to make a choice between :-

      1) Aceepting that standards are out-of-date before they are ever finalised (because anything decided by a committee of 1000's is doomed

  • by Anonymous Coward on Sunday November 01, 2009 @12:14AM (#29939285)

    Microsoft mission statement under Bill Gates:

    "A computer on every desk and in every home, running Microsoft software".

    Translation: we want world domination!

    Microsoft mission statement under Steve Ballmer:

    "Help people and businesses throughout the world realize their full potential."

    Translation: none: no meaningful information conveyed; incomprehensible marketspeak.

    Everything else is just following from that, really.

  • by Fujisawa Sensei ( 207127 ) on Sunday November 01, 2009 @01:13AM (#29939585) Journal

    Microsoft was a dinosaur since the 1980s.

    They only thing they were good at was getting in bed with the OEMs, and marketing.

    For a technology company they've always been behind and their implementations have always been shit.

  • by Animats ( 122034 ) on Sunday November 01, 2009 @01:23AM (#29939635) Homepage

    Microsoft's revenues nearly tripled from $23B to $58B on Ballmer's watch.

    And this was a "lost decade?"

    General Motors had a lost decade. Microsoft did not.

  • It's obvioius (Score:5, Insightful)

    by kimvette ( 919543 ) on Sunday November 01, 2009 @10:23AM (#29941441) Homepage Journal

    Gates: Buys out your company if he perceives you as a threat. Your employees might be screwed but you're set for life.

    Ballmer: Throws chairs out the window and shouts death threats "I'M GOING TO F$^@ING KILL YOU"


    Gates: Works with developers in a cooperative fashion, making feature suggestions and helping architect back ends

    Ballmer: has for years been trying to turn Microsoft into a cult, much like multi-level-marketing companies, what with his stomping around like an orangatan while chanting "developers developers developers" although he couldn't code his way through a batch file


    Gates: is actually somewhat friendly and down to earth even though he's cutthroat in business

    Ballmer: Douchebag to the core

"So why don't you make like a tree, and get outta here." -- Biff in "Back to the Future"