While Ray Ozzie's time at Microsoft is widely regarded with disinterest by those Windows watchers who even remember him, it's clear now that the erstwhile Chief Software Architect was simply rowing against a tide of internal calcification. And if you look at Microsoft's belated move into devices and services with any sense of perspective at all, one fact becomes clear: This is the path the Ray Ozzie first pleaded Microsoft to take almost a decade ago. And the company's senior leadership simply ignored him.
Microsoft's history is full of baloney legends, like "The Internet Tidal Wave" memo from Bill Gates that allegedly caused the company to "turn on a dime" and embrace the Internet (and in the process squash Netscape). But a more complete and less hagiographic telling of that history should also include those signs that Microsoft missed, and in this case, those memos that Microsoft completely and utterly ignored.
Ray Ozzie wrote at least two of them. And each is, in its own way, as prophetic and important as that Internet Tidal Wave memo.
Since most of you probably don't remember Ozzie, here's the ten-second history lesson. Ozzie is a Gates-era tech genius who worked in VisiCalc, the first electronic spreadsheet, with Dan Bricklin and Bob Frankston, and then on Symphony for Lotus. His two most pivotal software projects, however, were Notes, later purchased by Lotus, and Groove, later purchased by Microsoft. Ozzie joined Microsoft with that acquisition in 2005, and in 2006 he become Microsoft's Chief Software Architect, replacing Bill Gates.
Ozzie critics point out that many of the software efforts that he spearheaded while at Microsoft were variations of Groove, a collaboration solution that spans physical locations and online state. And while that's partially fair, that telling also ignores Ozzie's plaintive and increasingly nervous warnings to Microsoft that its reliance on Windows was killing it from within. He left Microsoft in late 2010, having been unsuccessful in getting the company to change its direction. Microsoft, today and belatedly, is making the changes he recommended all along.
Let's look at two of those memos he wrote.
The first, The Internet Services Disruption, is 5,000 words in length and was penned in 2005 before he became Chief Software Architect. To put the timing in perspective, Microsoft had just delivered the Xbox 360 and was still a full year away from shipping Windows Vista.
"We bring these innovations to market at a time of great turbulence and potential change in the industry," he warned in the memo, which was addressed to the company's senior leadership and noted past industry changes. "The environment has changed yet again – this time around services ... The ubiquity of broadband and wireless networking has changed the nature of how people interact, and they’re increasingly drawn toward the simplicity of services and service-enabled software that ‘just works’. Businesses are increasingly considering what services-based economics of scale might do to help them reduce infrastructure costs or deploy solutions as-needed and on subscription basis."
In retrospect, 8 years later, this is all patently clear and obvious. But check out this little nugget:
"It's clear that if we fail to respond [to this change], our business as we know it is at risk. We must respond quickly and decisively."
Microsoft did nothing of the kind.
If you go back and read this memo now, it reads like prophesy. He sees exactly what happened since: The power of the advertising-supported economic model (i.e. Google), the effectiveness of a new delivery and adoption model (the cloud), and the demand for compelling, integrated user experiences that "just work" (Apple).
He then goes on to explain what Microsoft can do to address these changes. That part is almost too painful to read, though Microsoft belatedly embraced a lot of it, such as "device/service fusion" (its entire corporate strategy right now) and a "connected Office" in which PowerPoint could "directly ‘broadcast to the web," which it can now do. His optimism for the future was proven misplaced. But its' interesting how a lot of this stuff did eventually happen.
The second memo, Dawn of a New Day, arrived in October 2010 as Ozzie was leaving the company. By then, he had spent five years failing to convince Microsoft to move "quickly and decisively" to this new future and it shows. But he puts on a brave face.
"The last five years has been a time of great transformation for Microsoft," he claims. "We've turned this services transformation into opportunities that will pay off for years to come." Certainly, there had been changes. Azure happened. Office 365 was on the cusp of happening and its predecessor, Business Productivity Online Suite, was stinking up the joint with no hint of the greatness to come. And yet, competitors like Google and Apple were eating Microsoft's lunch in these new markets.
"Certain of our competitors' products and their rapid advancement and refinement of new usage scenarios have been quite noteworthy," he notes, suggesting that the lack of a "rapid release cycle" at Microsoft was problematic. "Their execution has surpassed our own in mobile experiences, in the seamless fusion of hardware and software and services, and in social networking and myriad new forms of Internet-centric social interaction."
Right. He just said Microsoft was getting killed in devices and services.
He then uttered the words that Microsoft still refuses to acknowledge. These changes are ushering in a "post-PC" era, problematic for Microsoft because the software giant had put all its eggs in that one PC basket.
"The PC-centric/server-centric model has accreted simply immense complexity," he cautioned. "Complexity kills. Complexity sucks the life out of users, developers and IT. Complexity makes products difficult to plan, build, test and use. Complexity introduces security challenges. Complexity causes administrator frustration."
And here's the kicker. Ozzie then beseeched Microsoft to embrace this future and direct it rather than follow others.
"It's important that all of us do precisely what our competitors and customers will ultimately do: close our eyes and form a realistic picture of what a post-PC world might actually look like," he wrote. "Those who can envision a plausible future that’s brighter than today will earn the opportunity to lead."
Indeed they will.
Sadly, Google and Apple did this, not Microsoft. Instead, Microsoft did what it always did and rode Windows' coattails. It couldn't bear to imagine a post-PC world. So it invented a "PC-plus" era and hoped it could move forward with PCs that were also devices, and a desktop Windows version that was also a mobile OS. But instead of pushing the simplicity that Ozzie demanded, it pushed more complexity at users. And with Windows 8, I think, something finally snapped with Microsoft's users.
So in 2005, Ozzie saw the services revolution and in 2010 he saw the devices revolution. In 2012, almost two years after he left the company, Microsoft declared that it would focus on devices and services going forward. Amazing.
Put simply, you need to read both of those memos from beginning to end with an eye on when they were written. And when you do, you will come to an inescapable conclusion: Ray Ozzie was right. And Microsoft's senior leadership did not listen, certainly not at the time, and perhaps not until it was too late.
I feel like someone owes that guy a beer.
