Can Microsoft Grow Up?

By Peter Galli  |  Posted 2004-04-12 Print this article Print

Microsoft CEO Steve Ballmer expects to usher Microsoft into its next phase of life: trusted partner. Enterprise execs say they keep looking for signs of increased quality and security in the company's software.

SEATTLE—Microsoft Corp. is growing up. At least thats what CEO Steve Ballmer wants current and potential customers to know. After years of serving the enterprise, Microsoft is now hoping to play a new role—as a trusted and responsible partner to the IT industry.

"Somebody asked me the other day what phase of life we were now at—old and stodgy?" the 48-year-old Ballmer told eWEEK editors in an interview here last week. "And I said no. We have come out of our adolescence and are now in our adult prime. We have come out of that jerky, adolescent, awkward phase. Thats kind of how I might characterize where I feel like we are trying to be now relative to our customers."

Ballmer said the companys almost-$2-billion settlement and interoperability strategy with Sun Microsystems Inc. were some of the first steps the company needed to take in its new journey. The challenge it faces now, according to some big customers and industry observers, is articulating the message and then convincing customers of its sincerity.

"Some of their business practices will never change, unless they are forced to do so legally," said David Robert, systems manager for a global consulting and engineering company in Cambridge, Mass. "They seem to always feel they are in the right, no matter what they are doing."

Jack Beckman, an application programming manager in Southfield, Mich., agreed. "Sure they can change, but only if they think that it is in their best interests," Beckman said.

Microsofts repositioning effort has two fundamental components to it. The first is the need to resolve and/or settle as many outstanding legal issues as possible to free the company to carry out its vision. This strategy was behind the companys surprise settlement announcement April 2 with archrival Sun, of Santa Clara, Calif. "But why do that? Only to have a framework to go forward," Ballmer said.

The other repositioning priority centers on the security of the companys products, an area that has been under enormous scrutiny inside and outside Microsoft. The company has made security such a priority over the past year that resources have been moved to the issue and away from some new-product development.

"We have, in some senses, taken a hit in Longhorn [the next version of Windows, due in late 2006 at the earliest], a hit in features rather than a hit in schedule," Ballmer said. "I want to try to have some schedule discussions in order to make sure we absolutely prioritize the work we needed to do in security, because thats the thing we need to do."

Ballmer added that the current environment is different from other critical junctures in Microsofts past, such as during the browser wars. At that time, in the mid-1990s, the focus was on developing the next feature, not about whether it was secure enough. "Thats not the environment in which we live today," he said.

Next Page: Security is Worry Number One

Peter Galli has been a financial/technology reporter for 12 years at leading publications in South Africa, the UK and the US. He has been Investment Editor of South Africa's Business Day Newspaper, the sister publication of the Financial Times of London.

He was also Group Financial Communications Manager for First National Bank, the second largest banking group in South Africa before moving on to become Executive News Editor of Business Report, the largest daily financial newspaper in South Africa, owned by the global Independent Newspapers group.

He was responsible for a national reporting team of 20 based in four bureaus. He also edited and contributed to its weekly technology page, and launched a financial and technology radio service supplying daily news bulletins to the national broadcaster, the South African Broadcasting Corporation, which were then distributed to some 50 radio stations across the country.

He was then transferred to San Francisco as Business Report's U.S. Correspondent to cover Silicon Valley, trade and finance between the US, Europe and emerging markets like South Africa. After serving that role for more than two years, he joined eWeek as a Senior Editor, covering software platforms in August 2000.

He has comprehensively covered Microsoft and its Windows and .Net platforms, as well as the many legal challenges it has faced. He has also focused on Sun Microsystems and its Solaris operating environment, Java and Unix offerings. He covers developments in the open source community, particularly around the Linux kernel and the effects it will have on the enterprise.

He has written extensively about new products for the Linux and Unix platforms, the development of open standards and critically looked at the potential Linux has to offer an alternative operating system and platform to Windows, .Net and Unix-based solutions like Solaris.

His interviews with senior industry executives include Microsoft CEO Steve Ballmer, Linus Torvalds, the original developer of the Linux operating system, Sun CEO Scot McNealy, and Bill Zeitler, a senior vice president at IBM.

For numerous examples of his writing you can search under his name at the eWEEK Website at


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