Microsoft: Enterprise Target Elusive

Microsoft Corp. last week rolled out a bevy of senior executives to sell the company and its vision to a group of financial analysts and press at its Redmond, Wash., campus.

But beneath all the fluff and strong marketing language, executives stressed the companys renewed commitment to achieving solid profit growth, the necessary refocusing of the company to achieve this goal and the need to break further ground in the enterprise. Microsoft President and Chief Operating Officer Rick Belluzzo conceded that the company needed to change, not just in terms of products and technology but also across all aspects of its business.

Leading its list of priorities is energizing the PC, which would extend its core business into the enterprise.

“We are focusing on reaching out and building revenue with the products we have and turning this to revenue growth,” Belluzzo said. “We are also making investments and initiatives in a big way, evaluating all aspects of our business and disinvesting where necessary to refocus our vision.”

This is an “exciting period of transformation for Microsoft across our business as we grow our core base and continue to work to grow new businesses. But execution is key over the next 18 months,” Belluzzo said.

CEO Steve Ballmer talked up the potential of the companys new business strategy. While one part of Microsofts business is dependent on PC sales growth, the company has diversified in other areas. Its enterprise business is now “material,” while other areas are still growing, Ballmer said.

Eric Rudder, vice president of technical strategy, also stressed how the company is changing its focus and concentrating increasingly on providing customer solutions rather than just the technology with which to do this.

XML (Extensible Markup Language) Web services and its .Net platform are the vehicles Microsoft will use to achieve new solutions, and at the core of those is the Windows .Net server as well as other BackOffice components such as SQL Server, Rudder said.

“In fiscal 2002, Microsoft is committed to moving from being a business parts provider to becoming a true end-to-end enterprise player,” Rudder said. “To do that, we need to provide vertical and horizontal solutions.”

Jean Bosman, an analyst for International Data Corp., of Framingham, Mass., who attended the event, told eWeek that what she found interesting was Microsofts clear repositioning of the PC as “essentially the home server. Bill Gates and Rick Belluzzo, in particular, also acknowledged, repeatedly, that it would take a while for Microsoft to become as big in the enterprise space as it is on the PC side.”