How Many Microsofts?

Maybe they already broke up the company and we didn’t notice.

By the time you read this, the second remedy trial in the long-running Microsoft antitrust suit should be done, with Judge Colleen Kollar-Kotelly having decided what Microsoft needs to do to be in compliance with Federal law. As of today (Auntie’s editors insisting, as they do, on seeing this column well in advance of its print date), this smart money says that the judge won’t order Microsoft broken up into multiple companies.

“Oh, no,” I can hear you thinking, “she’s going to talk about that trial again!” Well, no. Auntie agrees with her dear readers that there’s been enough ink spilled on that particular subject (and then some). Nevermind that some of it was spilled right here at Chez Auntie. No, what I wanted to talk about was the Microsoft breakup. You know, the one that’s already happening.

Next time you’re in Redmond, visit the Microsoft campus. There, tucked away in one corner, are Buildings 1 through 6, the old heart of the operation. Fabio and I took a short stroll there during a break in the supersecret Microsoft “Bassoon” press briefing this morning. When that was all to Microsoft there was, you could walk from any office to any other in five minutes, even stopping for a bit of soccer in the hallway.

Now, though, there are hundreds of Microsoft buildings around the world, and more pop up every day. It’s no longer possible to point to one spot and say “Here’s Microsoft.” Instead, there are dozens of Microsofts, as comfortable together as a sack of alley cats.

As a certified professional, you probably think of the company as having four major parts: Windows, Office, BackOffice (er, excuse me, .NET Servers), and development tools. After all, those are the things you can get certified on. Well, how about all those other products? Great Plains, Visio, the Microsoft Games line, Encarta, Greetings, the Magic School Bus, the Sidewinder input devices, UltimateTV… the list goes on. Microsoft just spent more than a billion dollars buying Navision, a Danish firm that few of us in the U.S. ever heard of.

Want more evidence of multiple Microsofts? It’s clear that even the people in the certifiable products don’t talk to each other. The most recent Internet Explorer security patch, for instance, goofs up some fonts in Outlook. MDAC updates aren’t compatible with SQL Server clustering. Different server products won’t run on the same machine thanks to conflicting hotfix requirements. Consider, too, the internal struggles that we only hear about when some executive retires “to pursue other interests.” Remember NetDocs, the product that was going to replace Office with a bunch of Web code? Nope, neither does anyone else.

Back in her salad days, Auntie took some B-school courses; she still remembers the story of ITT. Through mergers and acquisitions, that classic conglomerate picked up more than 150 companies in the 1960s and started boasting that its operations extended “from the Arctic to the Antarctic and quite literally from the bottom of the sea to the moon.” (Sound like any other company you know?) But after 15 years of attempting to turn a profit as a conglomerate, ITT gave up and started selling everything off in the hope of finding a core business to concentrate on. (It didn’t find one; in 1997, ITT itself was bought by its own Sheraton hotels business).

Harold Geneen, the driving force behind ITT’s conglomeration, once said, “The worst disease which can afflict executives in their work is not, as popularly supposed, alcoholism; it’s egotism.” Microsoft may look like a single huge company that triumphed over an attempt to rend it asunder. But look a little deeper, and perhaps you’ll agree that the breakup is already in process.

About the Author

Em C. Pea, MCP, is a technology consultant, writer and now budding nanotechnologist who you can expect to turn up somewhere writing about technology once again.

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Mon, Sep 30, 2002 CoolNameDenied

When diversification means lack of communication between divisions of a company, it is not diversification. Instead, it's the loss of the corporate cohesiveness - atomized into loss of divionsal adhesiveness. This article is dead on.

At least the Open Source community communicates a bit more effectively.

Wed, Sep 25, 2002 uhhmsfan, sort of Anytown

What was Ovi saying? I agree with those who believe Microsoft is diversifying its businesses, not splitting up. Microsoft needs some good competition to really get the competitive spirit going. Linux, ehh it's alright, but there needs to be some money behind it to get it into a real competition with MS. Let's face it, MS aint going away and until someone starts investing in putting some competition against MS, we'll always be under their control. By the way, I like the article on EULAs, check it out.

Mon, Aug 12, 2002 Ovi Romania

I've just bought a new car and there is a small screw sustaining switch. I'd like to call this screw "Internet Explorer". Now, a company that only produces this kind of screws are charging in a court the car company because it sells cars with this screw, and they do not have any chance on the market. As a customer, I'm asking myself: "should I buy the car and the screw separately, from different providers, in order to have something operational in my car?" As a Microsoft Certified... I really like it... I mean the coffee... So, let Microsoft help people!

Sat, Aug 10, 2002 ed charlotte

I disagree. While it is true that Microsoft does have communications problems, (all companies - both large and small have issues with this), I believe that what we have seen recently is a move towards a more consistant voice. With the transition of Bill G. to the role of chief software archetect, we are now seeing product offerings that really work and play well together. The .net framework, and the .net server line are going to have a profound effect on not only enterprise computing, but also on the Internet (via web services). Heck, who knows, maybe the next version of Xbox will be running an embeded OS not all that different than your web server.

Fri, Aug 9, 2002 Anonymous Anonymous

As a recovered Alcoholic I have observed the signs for many years. He (Bill G. ) may not be alcoholic, but his runaway egotism will be the downfall of the company.

Fri, Aug 9, 2002 Chris New York

I disagree. Unlike other large corporations, these apparent divisions within Microsoft are the result of rapid growth and aggressive entries into new markets; not the stagnation and management paralysis of older companies.

Fri, Aug 9, 2002 Anonymous Anonymous

So, basically what she is saying is that:
1. Having multiple buildings is evidence of multiple companies?
2. Having multiple products is evidence of multiple companies?
and lastly:
3. Having multiple software development groups who don't communicate with one another is also evidence of multiple companies??

Umm, nooo, what that describes is pretty much any big business and NOT, I repeat, NOT a broken up corporation.

Thu, Aug 8, 2002 Anonymous Anonymous

I believe that the demise of Microsoft will come from within, not from the Government of from a competitor. Some day, personal issues will take precedence over business. It will happen three nanoseconds after the managers perceive that they can fool the leadership with PowerPoint presentations. I see this phenomenon every day. Which is unfortunate because there is no substitute for Microsoft. We will go through 5-10 years of Dark Ages. After that, some sort of Renaissance will occur and the show will continue as it always does.

Thu, Aug 8, 2002 Hans Sixhöj Sweden

Great Article!

Thu, Aug 8, 2002 Sergio Belgium

I disagree with some other comments and the main article. "Clichés" are getting irritating, sometimes.

First, Microsoft is doing a lot of things, but it is still tied to its core business - software. It is not correct to compare it with a company that was invested in nearly every industrial or non-industrial sectors you could dream of. Second, you can hardly say, whatever the current accounting debate, that MSFT is not turning any profit (ITT was not that profitable ...). Last, the glitches on a familly of products becoming more and more complex and interconnected are normal in software.

Being consultant, and confronted with software from other companies (IBM, Oracle, ...) I must say the similarity of user-interfaces, ease of install (I'm tired hearing about how great Linux is - sure, just ask end-users that tried to swap from their Windows world into this "thing"), integration and cooperation with Windows platforms ... of MSFT products (both applications and development tools) are still head and shoulders above the rest.

Thu, Aug 8, 2002 Ron New Jersey

One of the better articles I have read in the last year…Great Work!

Well there are a few short direct thoughts on Microsoft in simplified words:
Government: It would be in our government’s best interest for our country and people not to break Microsoft up, due to the fact that at this point of time they could affect the US economy and job market. As much as people would disagree with this statement it is economically based not technically.

I believe that most people would agree technology has replaced many types of blue and white collar jobs in the U.S. over the last ten years or more. If the government breaks them up, we are going to feel the aftershocks……… in many respects in our every day lives personally and economically. Technology has become America’s fabric that helps hold us together since many other types of companies have moved to lesser paying countries and brought their non-technical work outside the U.S.

Enough said on that aspect………..

Microsoft as a whole: (Non- Government related)
Short and simple….smaller companies are able to adapt easily to change…..larger ones move like turtles…….and eventually trip over themselves………I do not believe it is in Microsoft’s best interest to become so large that they have the potential to eventually collapse in on themselves…..Nor is it in our economies best interest.

Just my thoughts and they are in the best interest of everyone in the US.

Thu, Aug 8, 2002 John Hawaii

I rated this fair only because it was interesting reading, but I did not draw the same conclusion as the author. A "deeper" look into MS shows that it is moving in the opposite direction of a 'breakup'. Microsoft is expanding its lines of business (as the author pointed out), not remaining focused on a core business. Examples such as the presence of geographic dispersion and communications problems between affected areas within the company does not mean it is 'broken up' in any sense, it just represents potentially uncontrolled/unmanaged growth.

Certain things in this article are very true - internal barriers and communication problems do exist and have a negative impact on the implementation and support of their related technologies. However, that has nothing to do with a business breakup as being considered by the DOJ. The author either fails to make a distinction between being "broken" and "breaking up", or else is just using the term as a play on words. Microsoft may be broken as an organization, but is not breaking up in a business perspective. A reasonable reference to the the type of 'breakup' being considered by the DOJ must be validated by the representation of true independence between the business units (i.e. no economic conflict of interest between other business lines and 3rd party competitors). Microsoft attorneys would (hopefully) never use the type of argument in this article to defend a business breakup.

Thu, Aug 8, 2002 Anonymous Anonymous


Thu, Aug 8, 2002 David Wilkerson New Hampshire

Well put. I am deeply involved in Lotus/IBM and find that Microsoft is increasingly similar.

Mon, Jul 29, 2002 Joeri Belgium, Brussels

True, true :-)

Thu, Jul 18, 2002 Rick DC

It's all very true and I'm loving it all the way to the bank. Ironic that this column is in the same issue as the salary survey. Do you suppose there is a correlation?

Thu, Jul 18, 2002 Anonymous Anonymous

How true and still lol :-)

Wed, Jul 17, 2002 Anonymous Anonymous

Unfortunately, you're right, especially about the fact that the right hand doesn't know what the left one is doing. Something about too many cooks in the kitchen. OK, OK, the old cliches are bad enough, but you get my point. And we have the tack of keeping it all playing well together in the same sandbox, (network).

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