Ask Paul: July 28 (Premium)

Happy Friday from Mexico City! Here’s another lengthy installment of Ask Paul with some great reader questions to help kick off the weekend.

Ray Ozzie

sabertooth920 asks:

Please, speculate on what the modern Microsoft would look like had Ray Ozzie not left (and been given the authority)?  In hindsight, he looks a lot wiser and more prescient than we all gave him credit for, at the time.

Absolutely.

But we are experiencing Ray Ozzie’s Microsoft right now: it was Ozzie who led Microsoft’s push to the cloud—almost 20 years ago, by the way—in his role succeeding Bill Gates as Chief Software Architect. I told this story in the Software + Services chapter for Windows Everywhere.

Ray Ozzie led Microsoft’s push into cloud computing, appropriately enough, with a 5000-word Gatesian memo, “The Internet Services Disruption,” that would forever change the company.

“Computing and communications technologies have dramatically and progressively improved to enable the viability of a services-based model,” Ozzie writes in the memo to Microsoft’s executive staff and their direct reports. “The ubiquity of broadband and wireless networking has changed the nature of how people interact, and they’re 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 subscription basis.”

“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. This model has the potential to fundamentally impact how we and other developers build, deliver, and monetize innovations. No one yet knows what kind of software and in which markets this model will be embraced, and there is tremendous revenue potential in those where it ultimately is.”

Three years later, Microsoft was ready to show off the work that had happened in the wake of this memo. Key among that work, of course, was Windows Azure, previously codenamed Red Dog, a cloud-scale operating system built by a small team that included NT architect David Cutler.

The PR spin today is that Microsoft’s current success is due solely to the leadership of Satya Nadella. But Nadella simply continued the strategy started by his predecessor, Steve Ballmer, who ordered the company to implement Ozzie’s vision and pivot to cloud computing. This is, I think, one of the more successful business transitions in history, given how Windows-centric the firm was and how hard it is to move away from a successful model that makes money even when that model is starting to wear thin.

Oddly, Ozzie was only at Microsoft for five years: he joined in 2005 when Microsoft acquired his firm Groove Networks for the collaboration technology that still sits at the heart of SharePoint, OneDrive, and everything else under Microsoft 365. He became Chief Software Architect in 2006 and announced Microsoft Azure (then Windows Azure) in 2008. He left the company in 2010 without really explaining why. Based on what I know of the man—he’s as sweet as he is smart—it’s likely that he never really fit in with Microsoft’s brash and highly political corporate culture. He certainly didn’t need or want to be in the spotlight, unlike his predecessor.

Anyway. Imagine a world in which Ozzie stayed at Microsoft and continued pushing his vision for a future of cloud computing. Perhaps he even becomes CEO after Ballmer, which would have been a logical enough move, and one that arguably would have made even more sense than Nadella. Ozzie, after all, wasn’t just an engineer (like Gates and Nadella), he was a visionary who created a proto-messaging service later called Lotus Notes in the mid-1980s(!), and he was an eloquent speaker (unlike Gates and Nadella). He was the real deal.

Given that Microsoft did implement his cloud computing vision, my guess is that Ozzie’s continued influence, in whatever form, might have sped up this transition. Ozzie, unlike Gates or Nadella, had no special connection to the Microsoft past, and he very likely would have more aggressively wound down money-losing legacy businesses in favor of new cloud-based businesses. (Much like Nadella immediately killed Windows Phone, something that was much easier for an outsider to that business than would have been the case with those who had championed it previously.) So there’s that.

But there’s another side to Ray Ozzie that doesn’t get attention, which makes sense given how profound and correct his cloud predictions were: Ozzie believed very strongly in integrating the business and consumer sides of Microsoft. This is something that anyone in and around Microsoft probably understands and vaguely agrees with, this notion that the people who work as IT, engineers, or in other technical roles are, at heart, people, and they use technology in their personal lives. Technology that can cross those boundaries is important, and I use that example about the never-realized potential of Microsoft Band, where Microsoft knowing about both your work schedule and your personal health could lead to what we would now call AI-powered insights that would be impossible if it only knew about one side of that.

Ozzie’s vision for this future was called “three screens and a cloud.” The screens are PC, TV, and phone, and the cloud was Microsoft’s. But at the time, Ozzie saw Microsoft as a major player in all of that, of course, and that the consumer and enterprise sides were complementary. And I suspect he believed that success in the cloud is what would power the consumer experiences Microsoft and others would also offer. In other words, Ozzie saw Microsoft’s role as a sort of infrastructure or essential service (my words) that would power the consumer world, where there would be popular consumer-facing brands with Microsoft in a support role. But he also wanted Microsoft to play a direct role in the consumer world.

Remember, Ozzie was at Microsoft during a time that saw the rise and success of Microsoft’s biggest competitors today—companies like Apple and Google—and their successes were based almost entirely on consumers, in sharp contrast to Microsoft. And So I think Ozzie would have addressed what I still believe is a core weakness for Microsoft: those who are up-and-coming, from students to startups and other small businesses, are not using Microsoft technologies, they’re using Apple and Google technologies, and when those people enter the workforce or start their own companies, they will continue using what they’re used to, not Microsoft products. And so Microsoft’s grip on the Fortune 500 or however you define the enterprise today could be both tenuous and temporary. Eventually, the old leadership retires and dies, the new blood comes in, and the shift could happen.

(Coincidentally, I am going to address that latter bit in an editorial that might be called The End of Windows soon. It’s not as dire as it sounds, but it’s fair to say that the personal technology transition we’re in the midst of is still ongoing.)

Looking past the specifics of what may or may not have happened, it is important to know that Microsoft implementing the cloud services vision enabled it to succeed in the ways that I imagine Ozzie wanted. No, Microsoft isn’t strong in consumer. But its decades-long cloud push transformed the company’s stock price and market cap past all of its competitors save Apple. And the two are now the biggest companies in the world, Apple because of consumer and Microsoft because of the cloud. That wasn’t all Ozzie’s doing, but it was his idea and his inspiration, and we should never forget that.

Antitrust driving change

helix2301 asks:

Paul I’ve been working on project about Microsoft and I been going through internet I never realized Microsoft wanted to buy intuit but they had back off because antitrust

Right. We’re all familiar with Microsoft’s antitrust woes with the U.S. Department of Justice and EU in the late 1990s and early 2000s, but what gets lost are the earlier antitrust events that shaped and informed those later incidents as Microsoft became the most powerful company in the world during the 1990s. The attempted Intuit acquisition is one of two major antitrust-related Microsoft events before the DOJ finally came down hard. The other was an FTC antitrust case that mirrored the later DOJ case but never came to fruition after the FTC voted 3-3 to not pursue charges.

Microsoft announced that it would purchase Intuit for $1.5 billion in 1994 to obtain Quicken, which dominated the personal finance software market (and was handily beating Microsoft Money.) This deal was squashed by increased scrutiny of the DOJ’s antitrust case, go figure, and Microsoft had to pay Intuit a $46.2 million termination fee. (It is fun to see that Microsoft’s annual revenues at the time were $5 billion. This past fiscal year, it earned $211.9 billion in revenues. Thanks, Ozzie!)

What other things got changed due to antitrust cases?

Many people in and around Microsoft, including myself, often point to the “lost decade” in which antitrust oversight, especially by the EU, distracted Microsoft’s leadership enough that it was unwilling to employ the tactics it had used in the past to destroy competition both real and imagined. The list of companies and products that Microsoft killed off the 1990s is vast, and includes such formerly important entities as WordPerfect, Lotus, Borland, Novell, IBM (at least in PCs and operating systems), and Netscape. But in the 2000s, things changed. The success of companies like Amazon, Apple, Google, and Facebook went unchallenged or were weakly met, and I believe strongly that the Microsoft of the decade before would never have allowed this.

The rise of these firms, while imperfect—they each have their own monopoly business abuses that antitrust regulators need to get a lot more serious about—has at least led to a more heterogeneous and healthy personal computing world. And Microsoft, despite not dominating this world, is bigger than ever. Much bigger, as noted by the figures above. And tied to the previous question, one might also see Microsoft’s emphasis on cloud computing as at least an indirect result of antitrust: had the oversight of Microsoft not occurred, it might have simply continued forward doing what it did before by disabling Amazon, Apple, Google, and Facebook and ignoring a lucrative new market where regulation was not a concern.

Anyway, more specifically, Microsoft might have acquired Yahoo to gain yet another foothold in then still-emerging Internet services market. It might have acquired DoubleClick as part of its strategy to destroy Google (this acquisition led directly to Google’s dominant ad business, which delivered $58.1 billion in revenues in just the most recent quarter). It might have acquired Nintendo to gain a dominant position in video games. Salesforce. Pinterest. So many others. (To be clear, these are companies that Microsoft did try to acquire.) Any combination of this would have led to a bigger Microsoft. But also a less diverse and heterogenous personal computing market, just like the one it fashioned in the 1990s.

I love what-ifs. But the most important outcome here, honestly, is that the world is better (but not perfect, of course) and so is Microsoft because of antitrust. The company that emerged in the wake of the antitrust oversight of the 2000s was ethically superior to its predecessor, and while there will always be issues in a company this size—cough, Alex Kipman—all you need to do is watch how Brad Smith, especially, deals with Microsoft’s responsible roles in this world to see the change. His tireless and transparent approach to the antitrust issues of acquiring Activision Blizzard, for example—partner with competitors, reach consensus with regulators—stands in very sharp contrast with the image of a surly Bill Gates in the late 1990s quarreling during testimony over the meaning of words. This really is a different company today.

Thurrott.com, newsletters, and you

cwfinn asks:

Am I the only Thurrott.com alpha member who finds the “improved” newsletter jarring? I guess I’m just too old for change.

No, you’re not alone. The new newsletter is different, it’s better in many ways, honestly, but it’s different. And yes, change is hard. More important, perhaps, it’s possible that the newsletter was the primary or only way that some readers learned about new content on the site or about what was happening in our corner of the world.

I’ve said this a few times, but let me reiterate that  JR, Chris, and the team behind Windows Intelligence actively seek your feedback and will adjust the newsletter accordingly. Privately, we have met many times and had many discussions about what is working and what isn’t, and I feel like both sides have gone out of their way to make sure this is successful. I will be writing more about the internals here on the site soon via a series of articles that I hope some will find interesting, but now that I’m footing the bill here, I feel this a lot more viscerally, and I have spent a lot of my money to pay for work on the site that promotes the newsletter so that we can both be successful. But it needs to make sense for all parties, not just JR and me, but you and the others who may come to the newsletter from outside Thurrott.com.

Honestly, the week of the announcement was hellacious for me for reasons none of you should ever even think about, just a lot of backend work and customer service stuff. This week, it was nice to put that behind me, if temporarily, and I’ve been able to focus more on what I care about, which is the writing. But we fly home from Mexico on Monday and I’ll be home and on my normal schedule until late October (when we come back to Mexico). Discussing these issues with JR and Chris, thinking about how things might change, and then doing the right thing is a top priority.

Long story short, we will keep working on this.  But I really do believe that the newsletter, which is still in a sort of early launch preview, is in a good place generally and delivers valuable content. That was always the goal.

Related to this, OldITPro2000 asks:

I want to say congratulations on taking Thurrott.com private and hope it all goes well! (I was traveling for work when all was announced and missed it in real time.)

Sorry, I answered this briefly in the comments, but thank you.

(Related to my note about writing articles about the behind-the-scenes stuff at the site, one of the first will deal with moderation, of both comments and forum posts. We have what I feel are excellent systems in place for both to prevent spam, but tied to this is how I read and respond to article comments. I do this two ways, but the primary one is to use the OpenWeb admin interface, where, among many other things, I can read the comments in reverse chronological order. So I saw your comment there, answered it, and then realized it was for Ask Paul. Oops. But, again, I will be writing more about the OpenWeb and moderation stuff soon. I think many of you will find it interesting.)

I like that the Monday Editor’s Desk is going to be on the site now. Are you planning to add any newsletters (Premium or otherwise) beyond what Chris has with Windows Intelligence?

So the short answer is no, as I noted in the comments.

The longer answer is of course more nuanced. And tied to what I wrote above, we will continue evaluating feedback and make changes accordingly. And JR has graciously offered me some options that I could pull the trigger on. We’ll see. But the underlying tension here, on my end, is what I wrote previously about the costs involved, and newsletter services were so prohibitively expensive that had I not been introduced to JR, I would have been forced to simply stop publishing newsletters entirely. My wife and I did a lot of work over the past four months to lower the monthly operating costs of the site and we are pretty proud about that, in part because it happened with no disruption and without notice, and of course because it saved us money. The newsletter is a more disruptive change because it’s reader-facing and it’s happening to you.

Anyway, we are sensitive to all this. And as noted, we’re going to keep evolving it as necessary, and as possible. (Without losing sight of the fact that is really is better. Maybe not perfect, but better.)

Surface: hot or not?

will asks:

This week you talked about Surface and the recent financial update from Microsoft that pretty says the product line is not doing well. There is a lot to unpack here, including why big tech companies are allowed to hide and obscure financial data in so many ways that you can never really know how things are doing, but besides that IMO ever since the Surface Pro 4/Surface Book launch problems things have never seemed to fully go well for the Surface line. The hardware is decent, looks good, but still never seems to get past the “we also make computers” stage. But, why is Surface doing so poorly over a decade later?

I think about this a lot.

Lost in my lengthy analysis of the recent earnings and my comments in there about Surface is that, despite its horrible genesis, its often me-too products, the reliability issues, and whatever else, is that I really like Surface. I mean, God help, I see the flaws, but I do like Surface quite a bit.

Part of the initial business plan for Surface was that it would be distributed exclusively at Microsoft’s retail stores, which were then growing in number, with the idea being that people could see and touch the PCs and could then buy them, assured of their quality. This was a miscalculation: Microsoft never had the big distribution system it needed, especially internationally, and so it expanded the distribution. And then killed off its stores. But for big retailers, Surface was never more than a boutique brand, and for consumers, it was a non-entity, with none of the presence or familiarity of brands like HP, Lenovo, and Dell.

Perhaps this is tied to Microsoft’s image as a business company, not a consumer brand. Perhaps Microsoft’s on-again, off-again positioning strategy—it’s a consumer brand, it’s a premium brand, it’s a little bit of everything, no it’s a premium brand again—has confused the market enough that customers simply ignore it and don’t even know it exists. It’s hard to say.

Looking at the product family now, I see too many models. I see a confusing mix of low-end and high-end products. I see products that sacrifice too much of what makes a Surface a Surface, and products that are too expensive for anyone to afford. It’s a mess and it feels unfocused.

Surface would not be able to exist on its own doing this poorly, and without the Microsoft name attached would anyone want the hardware?  They lag behind in tech and keep designs around for many, many, many years without very much change. Is it a hardware issue with mediocre performance? Is it a design issue with products that while look cool, have not been practical? Is it the leadership with Panos that wants the “wow” moments but things never go past that?

Aside from competing with its biggest partners, the biggest issue with Surface, to me, is that this team believes that it somehow occupies a design leadership position in a market in which its partners/competitors have spent decades evolving and improving. This is ludicrous thinking, like a 7-year-old announcing to their parents that they will now be responsible for the family’s budget.

Tied to this, the Surface team believes its biggest strength is designing new form factors when, in fact, it has never designed a single new form factor but has rather evolved existing form factors. There are/were good ideas in there—like, every tablet should have a kickstand—but they’re not always universal ideas—like, what about in portrait mode?—but also many bombs (Alcantara) and many me-too’s. (Surface Laptop is literally a MacBook Air rip-off. I love it. But let’s be honest here.) Surface only produced one truly successful form factor, and it wasn’t even the first Surface, it was Surface Pro 3. Which they have since recreated again and again and again. So the notion that Surface somehow inspires the rest of the industry is ludicrous: almost no one is using tablet 2-in-1s out in the world. And Surface has now taken more ideas from the industry than vice versa.

One interesting thing about Satya Nadella is that he requires businesses within Microsoft to not just justify their existence but to be financially viable on their own. He made this case emphatically by killing Windows Phone early on, and Phil Spencer referenced this reality during the FTC hearings last month when he explained that this was true for Xbox too. It can’t just be subsidized by other parts of the business and be this never-ending investment with no return: Xbox has to make money.

Well, so does Surface. And there is no doubt that Surface’s share of the PC market is smaller, percentage-wise, than was Windows Phone/Lumia in the smartphone market. That the size of this market, meaning units sold, is exponentially lower. And that Surface has never once been profitable. There have been some ups, revenue-wise, tied no doubt to reasonably good product generations. But there have mostly been downs. So why on earth would the pragmatic, results-driven Nadella keep Surface around? The parallels to Lumia are obvious.

But there is a central issue with Surface that gnaws at the back of my brain. It makes me crazy. And I feel like I will never get a good answer to it. And that’s …

Maybe this is why at Build his talk was so flat. The areas he is over are not doing very well including Surface and to some extent Windows with its ever growing update methods and schedules.

I do not understand how or why Panos Panay, a man who came up at Microsoft designing keyboards, was given the reins of Microsoft’s first-ever PC business. Why in the wake of the post-Sinofsky purges of 2012 and beyond, that Panay, alone among Sinofsky’s key lieutenants, not only persisted at Microsoft but was somehow instead promoted and elevated. Why he was picked to lead Windows, and allowed to exert his influence on that much bigger and more important product line, is beyond unclear. This makes no sense, and it really calls into question Nadella’s leadership acumen.

Tied to this, Panay is a poor and uninspiring speaker and the wrong person to publicly front any important product. Things go off the rails horribly when he doesn’t have a favorable, cheerleading crowd, so much so that he started literally planting fans in the front several rows of each presentation. Things also go off the rails when he doesn’t know the product he’s discussing at all, as we saw with the Lumia 950 he was forced to introduce at the Surface Pro 4 and Surface Book launch. He needs to rehearse carefully, or he falls apart, and that’s what we saw at Build 2023 this year, as a major announcement he planned to make was taken by Nadella.

This is perhaps mean, but there’s nothing impromptu about this guy, and to me, that means there’s nothing there, nothing real. It’s all a show, a show that I find contrived and unbelievable. And this guy, somehow, is on the Microsoft senior leadership team (SLT). Why?

Sorry for the rant. But there is only one person who leads Surface, and only one person who has ever led Surface. And no matter your opinion of this person, he is ultimately to blame for its lack of success. That he has been rewarded and not let go is that question I will never see answered.

Anyway, back to my OG question: should Microsoft jettison the Surface line or would be seen as a big failure?

I feel that the impact of Microsoft killing off Surface would be minimal at best, outside of the myopic and tiny audience of people who compulsively compile lists of products that Microsoft killed. And, more horribly, for the teams that make these products today.

One tiny but vague possibility I consider is that Microsoft keeps Surface around only so that its employees have a Microsoft logo on the PC lid that faces audiences at shows and events. But that makes me think about Intel, the NUC, and ASUS: couldn’t Microsoft just spin off Surface and have some secondary or tertiary PC maker either carry on with the product line or just produce laptops for it with that logo?

I don’t know. But pragmatically speaking, Surface makes no sense as a business. Emotionally, I like it, and I would like to see it succeed. But I have no insight into how Microsoft might accomplish that. Hey, neither does its leadership!

I’m here all week, folks. Sorry.

You are not missing a thing

TheJoeFin asks:

I make apps for Windows as a side project and because I love punishment.

Love it. This is like the conversations I have with Rafael.

Rafael: Why do I even care about Windows software development?

Me Self-loathing?

Do you have any insight into the Windows SDK team and what is going on over there? The team is very secretive and when compared to the .NET team they are worse by every single metric: communication, clear & realistic roadmaps, previewing features, delivering features, open source, performance improvements, etc.

I guess this depends on what you mean by the Windows SDK. Do you mean Win32?

If so, and without actually knowing this is true, I might argue that this team is almost non-existent at this point. We’re decades past the point where the SDK was the central focus for developers and I’d say that its role today is the same as it’s been since the arrival of .NET, which is one of maintenance. Not because they’re just fixing bugs and so on—they add features all the time in the form of new APIs, as you know, to support new features in Windows—but rather because few developers, comparatively speaking, are working at that level of the stack unless they’re supporting legacy applications themselves. I guess I sort of view Win32 now the way I viewed the teams inside Windows that created and supported service packs back in the day. Necessary and important, of course. But not the focus.

Or perhaps you mean the Windows App SDK. If so, this is also in a similar mode, now that it’s out. It provides UWP developers, who would otherwise have been abandoned, with a path forward, and it’s a desktop path, not a mobile path, so one might call this thing a native platform. But like Win32, the Windows App SDK is not where any developer would turn for new app development.

Am I missing something here or are these two teams basically living on different planets?

You are not missing a thing.

Related to this, I’ve been working in an on-again, off-again way on future sections and new chapters for Windows Everywhere that deal with the period since the launch of Windows 10. One section, called Open, covers the new .NET, as I think of it, which involves Miguel de Icaza creating open-source implementations of .NET and related frameworks outside of Microsoft when .NET was mostly not open, and then finally joining Microsoft when it acquired his company Xamarin. This led to an explosion of support for open-source inside of Microsoft (well, much of Microsoft, not so much in established teams for dominant products like Windows and Office), and the gradual and complete open-sourcing of .NET and its transition to a cross-platform solution. First as .NET Core, and then just as .NET.

Open source lends itself to transparency, obviously. And I think the .NET team’s open development process has led naturally to their regular, transparent, announcements. After all, each revision requires the feedback and participation of the community. If anything, I find that the .NET team communicates too much, which is kind of ironic. Every .NET 8 pre-release milestone is accompanied by the release of numerous long and detailed blog posts for each piece of the stack. I find it too much to digest for the most part. But I do love what they’re doing, of course.

Contrast this to the native SDK teams. There’s a lot less communication, but there’s also a lot less happening (especially now that the Windows App SDK is out). Are some number of developers clamoring for new SDK frameworks or Windows App SDK features? Not really: both groups are maintaining legacy code bases and maybe modernizing here and there.

If you look at Visual Studio, you’ll see that there are of course workloads for desktop development with C++ (Windows SDK) alongside those for .NET desktop development (WinForms, WPF), UWP, and even .NET MAUI. But support for the Windows App SDK, curiously, is added via a series of optional templates across multiple workloads. It’s not obvious at all, and nothing says more about the status of this thing, I think, than that. (And .NET is making a lot of inroads in Visual Studio Code, too, which is likewise interesting.)

Today, .NET addresses the reality of an open, cross-platform world. And the SDK/Windows App SDK addressed the needs of legacy app developers mostly. (Obviously, also device driver writers, and other low-level needs too. But again, what is essentially maintenance not exciting new work.) And I think that explains the relative quantity and quality of the communications.

On a side note, I asked Raphael about this, as he works with one of the owners of the SDK regularly, and he confirmed that it was a small team. He also noted that the Win32 SDK isn’t technically legacy since everything else is built on top of it, of course, but he agreed that it’s not a popular entry point for new apps or services, and said that WinForms and WPF remain the most popular for new work, which is interesting.

Not that there’s a lot of that now. But Microsoft lost the script with what’s now called UWP, and combined with the obvious industry trends that occurred in the past few decades, there’s little if any Windows-only new app development now. In this sense, the .NET team got it right: open and cross-platform is the future.

Change of address

ggolcher asks:

I am currently moving and am going through a world of pain by having to go down my 1Password list of sites and updating my address in a bunch of them. This doesn’t even contemplate my wife doing basically having to do the same thing. How have you handled this when you moved recently?

Poorly. There’s no centralized way that I know of to handle this efficiently, or at all.

And the way this works is, we’ll be dealing with it for a long time, as strays will come in here and there. Aside from the obvious real-world change-of-address stuff, which involved the post office handling things, we did most of this as it came up. But we started with our credit cards, bank, and investment accounts for obvious reasons. And then moved to online accounts like Google and Microsoft, important commerce services (Amazon, etc.), entertainment services, etc.

But you never get them all. And so we handle these things as we do so much, as they happen. A new bill will be forwarded physically, for example. A monthly or yearly charge will occur online (and perhaps be denied for address change reasons). I can’t think of a single way to make this better.

You know, aside from not ever moving. 🙂