Microsoft is Not a Technology Company

Communist Russia is the only government still running on Microsoft, the central planning apparat being convinced that, if you have to pay for software, it must be worth something
Charles Stross, ‘Lobsters’
newyorker.com
newyorker.com

Steve Ballmer’s prospective retirement from the top job at Microsoft has prompted no small volume of commentary.  Here’s my, admittedly personal, perspective.

In the mid-1980s I was moonlighting as a programmer-analyst at a small software house on the new Cambridge Science Park.  We wrote compilers and such for machines based on the Motorola 68000 series microprocessor architecture (god, that was a beautiful chip; and I have no idea what I mean by that).  At the time our bailiwick was therefore the early Apple Macintosh (we developed for it on the bigger and equally beautiful Lisa workstation), an innovative, ahead-of-its-time and ill-fated PC-and-telephone unit called the OPD (‘one-per-desk’) from the British computer titan ICL, and subsequently even the Sinclair QL.  Kneel before Zod.
Meanwhile an obscure business unit at the arse-end of IBM had developed a clunky and massively overpriced desktop based on the Intel 8086 series processor (as I recall).  It was an ugly but far from incompetent chip.  Anyway, we took a look at this IBM ‘PC’, and at it’s operating system – something ultimately called MS-DOS.  And we laughed out loud.  What a piece of shit.
So we didn’t exactly call that one right.  Sue me.
As is now well known, Microsoft was built on a legal arbitrage.  A peripheral and badly managed outpost of the IBM mainframe empire signed a ruinously naive contract that landed Microsoft an utterly dominant position that persisted for decades, and which continues to hamstring the corporate world to this day (see quote above).
In ‘The Core Competence of the Corporation‘, C K Prahalad and Gary Hamel showed that strategy can be based on a set of unique and deeply embedded capabilities that confer competitive advantage and that could potentially be extended into new product areas.  It’s not unhelpful as a simplifying construct, as long as we don’t try to give it universal application.
Although it sits in the technology sector, Microsoft’s positioning is largely based on that earlier legal arbitrage rather than beautiful design (Apple) or sheer algorithmic brilliance (Google).  From the ‘core competence’ perspective, none of these are really technology companies.  ‘Microsoft’ conjures thoughts of licences, lengthy contracts and corporate deals (‘Microsoft and Nokia – Two Vultures to Make an Eagle‘ may well be a future blog.  Then again maybe not).  Steve Balmer’s likening of open source software to cancer.  Products that look like they’ve been designed by a committee of lawyers.
Alright, you have me, I’m irredeemably biased.  I can’t shake that feeling from three decades ago.  Trouble is, neither can they.
Successful strategy embeds itself very deeply in organisational culture, and thereby powerfully entrenches strategic success.   It’s a virtuous circle.  And organisational culture is the biggest single obstacle to a new, potentially successful strategy.  It’s a vicious circle.
Either way, it’s a circle.  I guess.

Leave a comment

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.

2 thoughts on “Microsoft is Not a Technology Company”