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How Ray Ozzie is Changing Microsoft

Posted by Zonk on Thu Oct 05, 2006 12:51 PM
from the change-or-die dept.
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."
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[+] IT: Father of WebSphere Leaves IBM For Microsoft 143 comments
jg21 writes ".NET Developer's Journal is reporting that Don Ferguson, the 'Father of WebSphere,' has left IBM to join Microsoft CTO Ray Ozzie's office. Ozzie, whose efforts to rebuild Microsoft have been discussed previously on Slashdot, is gaining a man who while at Blue championed Web services, patterns, Web 2.0, and business-driven development — a potent combo for the future that Microsoft is trying to bring into being." Update: 01/16 12:47 GMT by Z : Previous discussion link fixed.
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  • AAAHHHHH!!! (Score:4, Insightful)

    by hawkbug (94280) <psx@fim b l e .com> on Thursday October 05 2006, @12:56PM (#16324691) Homepage
    I'm going to puke if I see somebody mention that the desktop days are coming to an end!!!! Who says? What proof, besides companies greed, shows that people don't want desktop software? I sure as hell won't be running apps online rather than on my own machine for a lot reasons. Just to name a few:

    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.
    • Re: (Score:3, Insightful)

      I'm not thrilled about the idea either, and I've never heard anyone say that they want their software to exist on the Internet. Even some users of Valve's Steam are worried about having too little control over their games.

      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?
      • Does anyone want it to end, besides Microsoft?

        Have you seen Microsoft asking the question?

        Do you think they care? It's the Next Big Thing(TM), so the world will have to adjust.
        Or not, as it may prove... like MSN replacing Internet.

      • Re:AAAHHHHH!!! (Score:4, Insightful)

        by gutnor (872759) on Thursday October 05 2006, @02:32PM (#16326371)
        Microsoft is one of the last company in the world to want desktop to end. They have a monopoly and control almost anything in Desktop world. They make tons of cash in desktop world.

        When everything goes online, they will have to fight against google, and in online world, Google is the 500pounds gorilla, no Microsoft.
    • by shawn(at)fsu (447153) on Thursday October 05 2006, @01:09PM (#16324907) Homepage
      I'm going to puke if I see somebody mention that the desktop days are coming to an end!!!! Who says?

      I don't know who said it, but Netcraft confirms it....:)

    • Re: (Score:2, Interesting)

      Yup, totally agree with you.

      I read this:

      "but the desktop era is drawing to a close"

      And I thought: I doubt it. If anything, increasing security issues on the big intarweb will make people want more local apps and data storage, not less.

      I think the build-a-big-shitty-OS era is drawing to a close. That I'll agree with.
      • Not to mention how cheap storage is becoming. For only a few hundred dollars I could store more data than I could ever read / view in a lifetime. Its almost getting to the point where the case is the same for media, you can already store thousands of hours of media on a single computer. Why bother to stay connected for anything other than interaction with other users?
    • Re: (Score:3, Interesting)

      But how else is Microsoft going to get you accept paying more money every month for software they already have? It's a big problem in the software industry!

      Think about it this way: the pre-release backlash on Vista has indicated that people might not be willing to pay $200 every couple of years for upgrades, no matter how many glass-effects those upgrades might have. Therefore, the only way to get people to pay money for software anymore is to make sure that your old software stops working when you stop

    • Re:AAAHHHHH!!! (Score:5, Insightful)

      by tpgp (48001) on Thursday October 05 2006, @01:31PM (#16325303) Homepage
      2) Keeping apps under MY control, not somebody elses

      If you want apps under YOUR control, I hope you're not running anything from MS as it is....
    • Re:AAAHHHHH!!! (Score:5, Insightful)

      by garcia (6573) on Thursday October 05 2006, @01:34PM (#16325339) Homepage
      *YOU* won't because you aren't their target market. YOU are the exact opposite of their target market. They want users that are uninformed, not computer literate, and have no desire to maintain a computer.

      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.
    • Re: (Score:3, Interesting)

      I'm going to puke if I see somebody mention that the desktop days are coming to an end!!!! Who says?

      The better way to phrase it would be "the days of desktop being the preeminent focus and source of profit are coming to an end." Similar to the 60's were the heyday of the mainframe. Does IBM still make tons of money on their mainframe business? Hell yes. Are they considered a mainframe company? No - IBM is a "services" company.

      The reality is that there are few apps most non-power users care about -

      • Yes, it was. That's the year I built my current home PC (a Micron Millenia Pro2 Plus tower with a fancy new 200MHz Pentium Pro processor [686 babee!], an Adaptec 2940U, a Creative Labs SoundBlaster 16 with add-on wavetable card [effectively an AWE32], an Intel EtherExpress Pro/100B NIC, and some stupid video card since forgotten (replaced immediately with a 4MB Matrox MGA Millenium)).

        Over the years I've added some additional SCSI drives, a CD burner, a 12MB Voodoo2 card, and various other things, but the c
  • by Woldry (928749) on Thursday October 05 2006, @12:58PM (#16324717) Journal
    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.

    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.
    • by Ubergrendle (531719) on Thursday October 05 2006, @01:17PM (#16325043) Homepage Journal
      In fairness, Microsoft has ALWAYS wanted to go to a subscription model. They want an ongoing revenue stream.

      I remember Gates talking about subscription servicesvs one-time licensing long before the internet came along. The question has always been how to make this great leap, without orphaning or crippling their existing install base business. Ironically their greatest threat (the internet) will become their greatest enabler.

      My company is using MS Project Web and MS Outlook Web to a large extent, and I am very impressed. How come we're all happy to use gmail, google maps, google calendar, etc but not a web version of MS word, MS outlook, or MS Project? There will always be a practical need to local installations and local software, but a centralised produtivity app model has tremendous advantages.
  • Service? (Score:5, Insightful)

    by Digital Vomit (891734) on Thursday October 05 2006, @01:00PM (#16324749) Homepage Journal

    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.

    • I can't see something like this taking off for home users. For businesses, however, who knows. The monthly fees for on-site tech support vs monthly fees for always-up-to-date software might be feasible.
    • by HalAtWork (926717) on Thursday October 05 2006, @01:17PM (#16325045)
      Not only that, but given that your customers would also have to subscribe to MS's software services, what developer in their right mind would use such services as dependencies for their software? If MS moves the bulk of their software online, they will want developer tie-ins to such software. Or, will MS simply switch from selling IIS to providing hosting services with APIs and daemons that developers and end-users won't be able to run themselves, and that competitors won't provide? It seems far-fetched and not even beneficial for Microsoft.

      A more far-fetched idea is that they might just do a total end-run around developers and provide complete solutions for businesses and even take on administration duties as well... but is that even realistic? Sounds like a nightmare for MS. Maybe developers on MS platforms will be reduced to middle-men in this situation?
    • 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.

      Just as computing can be provided as a service, so can software. It all depends on what is being provided, and what the customer needs.
      Do you buy Google Search Engine software, or do you utilize Google as a service?
      • The way I see it, *software* isn't a service, but *writing/updating/etc. software* is a service. Just the same as making a tractor is a service, but the tractor itself is not a service.

          • Re: (Score:3, Interesting)

            Author's Note: In reviewing my post before submitting, I see that it's a bit of a brainstorming, but I like the way the thoughts developed. I think it fairly accurately illustrates what web-based "services" really are compared to other products and services. Please bear with the thought-development process.

            True - but I would consider your example of hiring someone to plow your field the same as hiring someone to use software - bascially for their services to use the software. That's different than buying

    • Actually, I know of several enterprises that wouldn't mind trading in their huge infrastructure of Support Centers, Compatability Labs, Desktop Maintenance, etc. SAAS (Software As A Service) won't remove all this, but if the netework-based OS grows, there a bit less to manage in-house.

      Service models are already common in technology (power, bandwidth, hardware, projects). Software will be no different, and I'm quite eager to see companies leapfrog over one another to offer the best model.
    • Who -- besides companies looking for more profits and a constant revenue stream -- actually wants this?

      Does it matter if no one besides companies looking for more profits and a constant revenue stream actually wants this? They're the ones making the software, and if there's no easy alternative, people will subscribe to it. What do you think people are gonna do? Start using Linux? Continue using their Windows XP machines for the next 10 years, using an outdated, unsupported browser to check their e-mail? It
    • Re:Service? (Score:4, Insightful)

      by NeutronCowboy (896098) on Thursday October 05 2006, @02:38PM (#16326459)
      I take it you haven't actually looked at the costs of running a complex app, or at the manpower required to do so. I'll give you an example:
      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: (Score:3, Informative)

      Who -- besides companies looking for more profits and a constant revenue stream -- actually wants this?

      Large companies who currently pay through the nose for maintaining "enterprise-class" software. You can't imagine the dancing in the street there would be if someone like SAP announced that you wouldn't have to have a couple hundred servers and a legion of support staff to run their software anymore. Just configure your network to enable QoS on the SAN service and point everyone's browser at http://www.s [software-ag.com]

    • Re: (Score:3, Insightful)

      Software as a service? Perpetual payments? No thanks.

      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 u
  • MS investing a lot of time and research/development into online-ready "mini-apps" does not necessitate a trade off in the quality or time spent developing their desktop OSes.

    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 wel
  • Is it just me who finds this direction questionable? I write software for a pure online company, so I think online software services are wonderful for a whole bunch of stuff. But there's a lot of things I don't want to do online. Actually, I find the current division pretty good... the more communication oriented something is the more online it is. I think this falls out naturally from what consumers want and what makes sense technically. Do consumers really want an online spreadsheet yet, for example?
  • by PurifyYourMind (776223) on Thursday October 05 2006, @01:08PM (#16324897) Homepage
    I've always balked at the idea of people being willing to do software subscriptions. However, I look at the huge success of World of Warcraft, which is basically the same thing, and think it might work. Corporations and other large orgs already pay Microsoft yearly fees to be able to get guaranteed updates at a fixed price. My university paid $250,000 per year to get unlimited seats for Office and the OS. However, the one thing that could undue this is the very long delays for things like Vista. If Microsoft went to an Ubuntu-type model where they promised updates every six months, I could see it working.
    • You seem to be forgetting that WoW is lot more fun to play than Word.
    • Microsoft World of Office will include an Orc that will offer helpful hints!

      It loooks like you are trying to pwn a n00b!

      [] he's camping my lewt!
      [] ph3ar!

      [] Do not show this again

  • by r_jensen11 (598210) on Thursday October 05 2006, @01:10PM (#16324933)
    If ISP's have their way, plans like these could seriously backfire. Especially if the ISP's begin to be more strict on how much people are exceeding bandwidth quotas. Yes, I know that right now quotas are not that common; however, for the likes of the people on my network, we are only allowed 5GB of data, from a combined upload and download, per any given 7 consecutive days. Needless to say, if I turn on and off my computer daily (and we'll keep it simple at once a day,) and I have to download Word, Excel, and Outlook every day, that doesn't leave me with much more data remaining for activites such as watching internet video streams or listening to audio over the internet at a decent bitrate, both of which are applications that many analysts say are likely to boom in the coming years (however, I tend to view this to actually boom once DN:F comes out, but I actually do like to listen to some radio stations from across the world, such as Minnesota Public Radio's The Current.)

    The only way we could have applications be truly web-based is if ISP's don't impose quotas, or those quotas are set at such a high level that they are meaningless.
  • Not about any one company in particular; but, I said this years ago that the software industry will move to a services model. The competition will no longer be who provides the best product; but, who provides the best services. Symantec discovered this maxim years ago when they moved from providing A/V protection with free virus definitions and moved to a A/V protection through virus definition-update subscription. Why? {cue speculation} Any john with a computer and their A/V software was getting free up
  • Chiapaint [bricklin.com]. A decade old, and more relevant than ever. The only thing out of date is the modem squawk.

    Of course, if Chiapaint doesn't convince you, enjoy, you can go to any number of websites that will cause a cute little picture of a steaming coffee cup to appear in your browser window for about a minute and then crash, misbehave, post error messages, display a grey rectangle, or tell you to update your version of Java.
  • by fractalus (322043) on Thursday October 05 2006, @01:19PM (#16325097) Homepage
    Okay, set aside for a moment that it's Microsoft here. Think for a second.

    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:

    • application can be accessed for anywhere with net access
    • application can be updated instantly
    • easy to share data between users
    • customer relieved of burden of maintaining servers and data storage

    They have downsides, too:

    • application requires a functional web browser; browser bugs may impact web application
    • application provider might go out of business, taking your data with them
    • pay-as-you-go
    • centralized data repository is an attractive target for hackers

    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.
  • by Siguy (634325) on Thursday October 05 2006, @01:21PM (#16325131)
    I've read this same basic article for the last 5 years. Even right after Windows XP came out, Microsoft was making press releases and giving interviews all about "betting the company" and turning things on their head. .NET, C sharp, everything gets one of these articles.

    Frankly, they shouldn't keep running their mouth about these big grand ideas if they're never gonna actually follow through. Sure, they released .NET and have done small parts of what they said they'd do, but so far nothing has come close to completely changing the company the way they keep claiming.

    • MOD PARENT UP (Score:4, Insightful)

      by dpbsmith (263124) on Thursday October 05 2006, @02:06PM (#16325945) Homepage
      New York Times, June 23, 2000, John Markoff:

      "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....' ...The strategy will involve repackaging some of the company's core products, like its Office software, as subscription-based services obtained over the Internet."

      "Microsoft's new view of computing calls for processing to be done everywhere, ... But while he and Mr. Gates insisted that those services would be based on an open Internet standard, enabling users with non-Windows-based platforms like the Palm computer and Apple Computer's Macintosh to take advantage of them, the executives acknowledged that such users would be second-class citizens. Mr. Gates said the "richest" interactions with the new .NET services would require the new Windows.NET operating system."

      "Mr. Gates said that the bet on .NET was equivalent to the 100 percent bet the company placed on its shift to the Internet strategy in 1995. Mr. Ballmer said he was confident, but he realized that the strategy was still a gamble. 'It's a bet I feel very confident about,' he said. 'But it's a bet.'"

  • Really? So how does one do any of the following from a thin client or mobile phone?

    *Edit digital video
    *Edit digital audio
    *Create 3d graphics and animations
    *Editing large images
    *Develop and compile software

    As long as anyone has any interest in doing any of these, the "desktop era" will keep on keepin' on.

    However, if Microsoft wants to turn towards a renting-software-over-the-network paradigm, it'll make it that much easier for me to ignore their offerings. Especially if they only run on Windows.
  • Linux usability. (Score:5, Interesting)

    by headkase (533448) <pickett.bill@gmail.com> on Thursday October 05 2006, @01:43PM (#16325513)
    from the change-or-die dept.

    I'm not trolling here, I've had SuSE installed as my only OS for 8 months at one time. I've had Ubuntu installed in a dual boot (and it had a lot less pain than SuSE when it came time to install software). But now I'm back to just Win XP as my only OS. The reason is usability. I'm talking about consistency and integration with other Microsoft products. Download Visual Studio Express. Install it (no pain unlike SuSE). Now try out the code completion including automatically looking inside your own classes for documentation tool tips. Look how easy it is to programmatically leverage other Microsoft products (Yes Microsoft is opening their API's). Use the debugger (hover over a variable in your source code to see it's value, etc.). Wizards. Compared to the PythonWin IDE I was using it's heaven.
    Gnome has the right idea, usability should be a major focus of software. It does no good to be technically superior if your users can't make it go. I'm not bashing GNU/Linux here, I think it's great but as good as it is Linux still needs to be heavily polished before it's ready for mass consumption. I've drank Microsoft's kool-aid and you should too.
    This is just a bit of constructive criticism. Microsoft's strength is the people on a project that they assign exclusively to polish their products. Shiny. And unlike the past current Microsoft products just go.
    I believe in Open Source and I also believe that it is a better process on longer timescales. I also believe that Microsoft will switch to open document formats to keep most users on Windows. But in the mean-time Microsoft (especially with Visual Studio) has the advantage with getting people up to speed and generating useful code sooner than someone trying to master the intricacies of EMACS from scratch. This leads into productivity which is Microsoft's major redeeming strength. I think that in twenty years we'll all be using some-unix inspired operating system with amazing software made by a variety of vendors some free, some not, and with-all-their-money definately including Microsoft. Getting to that point however means producing code and that's where Microsoft is putting their development money.
    I could go on about a million other things too, like XNA (Microsoft's new environment to standardize game development and yes it's integrated with Visual Studio). But that would be better left to another comment.
    Developers! Developers! Developers! ;)
    • by a.d.trick (894813) on Thursday October 05 2006, @02:50PM (#16326621) Homepage
      I've drank Microsoft's kool-aid and you should too.

      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.

  • Never rent!! (Score:3, Insightful)

    by HermMunster (972336) on Thursday October 05 2006, @07:42PM (#16330693)
    I will never fall to that model of distribution. It was tried years ago and it is a pathetic idea. Anyone falling for it is stupid. You buy a product and you are entitled to use it till the end of time. You never want to keep paying for software over a long period of time even if you think you are getting a deal because in the long run you pay exceptionally more and you get nothing for it in the end.
    • I thought it was funny then, and I still think it's funny, although the image ought to be re-worked (it's a bit rough). It's not "belittling," it's very appropriate -- the Borg is a perfect analogy for Microsoft's anti-competitive maneuvering. And, like it or not, Gates is emblematic of Microsoft, so the image is absolutely perfect.

      As far as "growing up" is concerned, I guess I'll "grow up" when the process dispatcher inside Microsoft Windows is as good as the process dispatcher inside the Compatible Time
      • Re: (Score:3, Insightful)

        Hmm, lets do some quick math: .12 x 9 hours in a corporate workday (Allowing for lunch)= 1.08
          * 45,000 workers in a large services company = $48,600.

        Tell me who would buy it with that kind of tax per day.
          • Re: (Score:3, Insightful)

            The problem there is when you start charging people for what used to be free (and most people will tell you Windows is, in fact free. After all, it comes with the computer!) and people will drop it like a hot potato.