A Chat with Microsofts OEM Chief

Rodrigo Costa has headed Microsoft's most powerful and profitable unit for the past two years. What's this mystery have to say on negotiation tactics, Linux, SP2 and other hot buttons? Read on.

Not so long ago, Microsoft Corp.s OEM division was seen as the dark heart of the "Evil Empire." During the Department of Justice vs. Microsoft antitrust trial that dragged on throughout much of the 1990s, the business practices of Microsofts OEM unit and its then-chief Joachim Kempin came under tough scrutiny. When the government declared that Microsoft was guilty of abusing its Windows desktop monopoly, the OEM unit was ordered to change its modus operandi.

Since Kempin resigned (or was pushed, as some company watchers claim) from his OEM directorship post in 2000, Microsoft has changed OEM chiefs a few times. First, Richard Roy, head of Microsoft Germany, stepped in to fill Kempins shoes. Next, Richard Fade, the VP in charge of Microsofts desktop applications division, headed the OEM unit for a couple of years, during the tough DOJ sanction-negotiation period. Then, in July of 2002, Rodrigo Costa took the OEM reins.

Costa, a 14-year Microsoft veteran, was Microsofts first employee based in Portugal. He stepped up to become general manager of Microsoft Brazil in 2001, and remained there until his appointment as corporate VP of the OEM division in 2002. (Read Costas full biography here.)

Microsofts relationship with its partners is back in the limelight this week, with the European Union vs. Microsoft antitrust case in the news.

We tried to get Costa to talk about the EU case and the potential effects of the pending remedies, to no avail. He claimed that this topic did not fall under his domain.

Nonetheless, we thought it was an opportune time to publish our e-mail Q&A with Costa. (The original, full version of this Q&A ran in the Dec. 4 and Dec. 6 issues of the Microsoft Watch newsletter.)

/zimages/6/28571.gifEditors note: Since the Q&A, the courts have shot down Microsofts appeal of the EU remedies, and Microsoft has agreed to comply with them. Read more here.

First, lets set the stage. Could you talk about where the OEM division sits in the overall Microsoft org chart? Which products fall under your domain?

The OEM division sits in the Worldwide sales and marketing group at Microsoft. The worldwide sales and marketing group is organized into six different groups: EMEA (Europe/Middle East/Asia), Asia Pacific, China, Japan, Services and OEM. The OEM division has responsibility over all our OEM partners across all geographies. My job is to manage Microsofts relationships with all PC and device manufacturers. We cover all products that can be licensed directly by Microsoft to the OEM community including: all versions of Windows client and Server, Office, Windows Mobile, Windows CE, Works, Exchange, SQL Server, etc.

How many folks are in your organization?

We have close to 400 people in the OEM division, working across all products and regions. Approximately two-thirds focus on sales and marketing activities, and one-third are systems engineers focusing on technical support and pre-sales activities.

Could you talk about your sense of how the OEM division has changed since the U.S. antitrust decision came down and the majority of the states settled? Once the consent decree was drawn up, what changed inside the OEM division, in terms of its day-to-day operations, policies in dealing with OEMs?

I was not working in the OEM Division in the period before the antitrust decision was issued and the settlement agreement was reached so I cant tell you firsthand about how day-to-day operations have changed. I do know that when you are in a business that is subject to a consent decree you have to focus a lot on the legal framework. We pay a lot of attention to the legal training of all OEM division employees. We have a deep understanding of our responsibilities, and we are totally committed to deliver on our consent decree responsibilities. There is no room for failure.

/zimages/6/28571.gifRead the full story on Microsoft Watch: "A Chat With Microsofts OEM Chief."