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Summary: As people lose their jobs at Microsoft, the CEO takes a pay rise
MICROSOFT is trying to hide its sharp decline after its profit had fallen by about a third for two consecutive quarters. A lot of Microsoft’s top seniors get rid of their Microsoft shares ahead of the release which may be Microsoft's last hope (Vista 7) and even a Microsoft shareholder cannot help wondering why this happens. He writes:
In recently criticizing Yahoo!’s (YHOO) insiders for dumping $233mm in stock over the last 2 years, when they’ve only bought $103k in shares, I would be remiss if I also didn’t call out 2 other executives for big share dumps last week:
1. Craig Mundie, head of research and strategy for Microsoft (MSFT). Craig decided to sell stock worth $1.7mm recently. Craig has resided over Microsoft’s R&D efforts for the last few years. This group eats up nearly $10 billion annually of Microsoft’s free cash flow. It is the group Microsoft looks for to compete in mobile computing or other areas, rather than buying a leading company such as, say, Research In Motion (RIMM). The R&D group has eaten up about $60 billion of Microsoft’s cash in the last 10 years with not much to show for it. This latest share dump is very disappointing to me as a MSFT shareholder, especially given his group’s performance.
This morning we shed light on the fact that many of Microsoft's products/units are not profitable; they operate at a considerable loss, still. Microsoft is already borrowing money and additional, unannounced layoffs carry on silently.
“Microsoft is already borrowing money and additional, unannounced layoffs carry on silently.”It is not so gloomy at the Ballmer household, though. While Microsoft’s profits dive about 30%, Steve Ballmer sees his wage increasing by 4%. It’s the same with Novell's CEO, Ron Hovsepian, who enjoys massive bonuses. Jessica Mintz at AP added to the second line of her report: “Microsoft CEO Ballmer gets salary bump at start of fiscal 2009, a year in which profit sinks”
Microsoft’s staff is annoyed by Ballmer's behaviour (ignoring the hardships) and Microsoft is now issuing a timely press release to give shareholders the illusion that they are in charge. Many investors are very angry at Ballmer; they want him out. █
“There is such an overvaluation of technology stocks that it is absurd. I would include our stock in that category. It is bad for the long-term worth of the economy.”
Summary: Political acceptance using the company’s image — a debate from within Microsoft
This document is titled “Managing the Microsoft Image for Public and Political Acceptance”. Mike Hall and Bill Gates were sent this by Richard B, whose surname we were unable to determine. Here is the opening paragraph:
The position of Microsoft in the market has grown rapidly; today, it has an impact on the economy, the information infrastructure of business, and the public that is reminiscent of the situation of AT&T in the early nineteen hundreds when telephones had been widely accepted, but not yet become ubiquitous.
This happens to relate to this week’s news. In news of interest, here is Microsoft recruiting people along with oil giant Exxon on campus. Microsoft’s co-founder has also just given more wireless control to AT&T, whose many offences we wrote about here.
Microsoft co-founder Paul Allen has made a deal with AT&T to sell the carrier several licenses for wireless spectrum in the Pacific Northwest, according to Bloomberg. The deal was exposed in government documents, although the agreed price has not been disclosed by either party.
Anyway, Richard carries on by stating:
Peter Drucker has written an account if how AT&T recognized the implications of its position at the time, and how it responded successfully. I would like to recount that story and then suggest how Microsoft’s situation is similar, and how it can and should apply the lessons of our predecessor in order to be equally successful for the long term (25 to 50 years).
“One of the earliest and most answers (to the question ‘what is our business’) was worked out by Theodore N. Vail (1845 – 1920) for the American Telephone and Telegraph Company almost seventy years ago: “Our business is service.” This sounds obvious once it has been said. But first there has to be a realization that a telephone system, being a natural monopoly, was susceptible to nationalization and the privately owned telephone service in a developed and industrialized country was exceptional and needed community support for its survival.
Here is the part which relates to our earlier post about the "Microsoft Hater" label:
Second, there has been the realization that community support could not be obtained by propaganda campaigns or by attacking critics as “un-American” or “socialistic”. It could be obtained only by creating customer satisfaction. This realization meant radical innovations in business policy. It meant constant indoctrination in dedication to service for all employees, and public relations which stressed service.
Kind of like “People-ready”? Or the illusion of “charity”, as illustrated this morning?
Microsoft speaks about “constant indoctrination” and “radical innovations in business policy”. How about “radical innovations” in technology rather than in marketing (“constant indoctrination”)?
Microsoft continues to defend some sort of a communist vision, wherein Microsoft ought to be at the centre of computing for the betterment of society. Their real reason for bringing up the subject is that even back 1991 — well before the USDOJ vs Microsoft case — the FTC called Microsoft “anticompetitive” and actually took action:
Win32 is an alternative standard architecture defined by Microsoft. It is our challenge to alternative standards, and we stand a chance of making it stick because of our dominance in the market. The biggest obstacles to making this happen are probably political rather then technical or business related. This standard is only one of a series we contemplate which lead to a new component architecture and true IAYF.
The recent FTC probe of Microsoft is a symptom of this coming challenge. The probe may fail, and I’m sure there is no basis for it. But it should be interpreted as the warning shot of a war that we will lose if we don’t recognize the danger and take actions now.
The recent letter from Senator Metzenbaum (from OHIO of all places) telling the FTC to pursue this case vigorously because Microsoft clearly has been ‘anticompetitive’ is an example of the kind of political forces that will rise against us as our success and dominance increase, unless we turn this feeling and win support.
Microsoft wants to be treated as though it is a privileged “chosen one” which controls the ‘standards’ and eliminates competition in platforms, supposedly for the benefit of ISVs (current accounts seem to suggest otherwise). It’s very selfish and egocentric, especially given the fact that by this stage, Microsoft had committed crime to get where it was.
We must make it clear that our business is providing the framework and standards for building apps and integrating them into a common framework where they work well together and get the benefits of synergy. We must make it clear that what we do is for the benefit of the majority of ISVs and businesses, and thus for the country, and that it is in their interest to help us succeed. We must set this as our goal.
To accept this goal means to provide leadership for apps other ways besides delivering software such as Windows. We must do other (perhaps less profitable) tasks which contribute to the same goal.
For example, we should take the lead in establishing a common approach to UI and to interoperability (of which OLE is only a part). Our efforts to date are focussed too much on our own apps, and only incidentally on the rest of the industry. We want to own these standards, so we should not participate in standards groups. Rather, we should call ‘to me’ to the industry and set a standard that works now and is for everyone’s benefit. We are large enough that this can work.
Here is the part about “evangelism” and such things:
We should develop spokespeople who can establish themselves as effective advocates for the enablement of a large software industry build on wide standards.
Here is one part about using the education system/s to indoctrinate people while young, having them become mere clients of Microsoft.
We should become actively involved in education in order to enable people to use software – i.e. we should solve the usability problem by attacking both ends of the problem (UI complexity and user experience). We might do this through local schools, teachers, colleges where they prepare teachers for local schools, through universities, etc.
Microsoft then talks about influence in government:
A significant investment is required to do this task effectively. It should be done by a separate group and not by product groups that make their numbers by delivering specific apps. The group should have sufficient talent and experience to deal with engineers in MS and other companies, to deal with the press, with business people, and with politicians.
They should be committed to enabling applications to reach ever wider markets and providing more value by working together. We are too big to treat our business as strictly business – it is a matter of public affairs.
Finally it says:
If we are successful, we will be asked/encouraged/led to extend the reach of our architecture to mainframe and mini computer platforms. Our architecture will achieve the goal that IBM set for SAA. The difference will be that we own it.
Summary: The SC34 Bellevue Plenary Report is leaked to reveal what ISO had in mind when hosting a meeting in Microsoft’s own turf
ON SATURDAY we wrote about how Microsoft had put ODF under more control outside OASIS. Trips to Seattle tend to have this effect. Someone has just leaked to us the official SC34 Bellevue Plenary Report (there is also Seattle in there), which ought to have been public information had ISO actually been as transparent as it should be. Maybe it is already available somewhere, but we failed to find it.
ISO’s take on software patents is different from that of OASIS, so the report is passed around with this observation:
OPEN ISSUE: What is the IP status of Defect Reports and other communications submitted to OASIS via the TC liaison member? OASIS generally operates a slightly different IP policy to JTC 1. (Rob Weir to report back)
Microsoft has XML patents that are land mines and weapons of FUD. We wrote about this in:
Here is another reason for concern:
NB experts will be encouraged to participate in the responsible SC 34 WG, and to bring their ideas for amendment/revision to the WG, so that these can be discussed with the OASIS ODF TC and any agreed technical work can then be initiated in the ODF TC and worked on jointly by ODF TC and SC 34 experts, including the NB experts.
4. That SC 34 request OASIS to forward to SC 34 all necessary contributions to enable a subdivision of the project to align with ODF v1.1.
There is also this:
Recommendation to SC 34 Plenary
1. That SC 34 establish a new Working Group as follows:
Title: OpenDocument Format
Scope and Terms of reference: All SC 34 projects and activities relating to the maintenance of ISO/IEC 26300 OpenDocument Format.
Collaboration with the OASIS ODF TC in the maintenance of and other work exclusively related to ISO/IEC 26300, in accordance with the joint maintenance principles and procedures agreed by OASIS and JTC 1 (documents N 1148 and N 1149). This includes all projects and activities related to ISO/IEC 26300 previously carried out by WG 1 and Ad Hoc Group 3.
Summary: US Bank dumps Microsoft Sharepoint, moves to Lotus instead
Sharepoint is about Microsoft lock-in, which Novell helps promote. Microsoft’s “insider friends” (as Microsoft itself calls them) use Sharepoint as a sort of prison facility for former UNIX/Linux shops to run out of options. Some major banks in Europe are reported to have run into huge disasters (downtimes lasting days) due to Sharepoint. It’s a really bad — albeit hyped-up — product.
US Bank, a company that’s no smaller than Microsoft, has just decided to dump Sharepoint. Could this be the beginning of a trend?
One of the largest banks in the United States will stop writing checks for Microsoft Sharepoint and standardize on the IBM Lotus platform instead.
The trouble here is that this bank merely swaps ‘masters’. It will be a prisoner of IBM rather than Microsoft’s. “There can’t be too many banks that fell for the Microsoft ideology,” argues our reader, “but apparently there are some. I wonder when these other banks will learn that ideology does not trump profitability and also dump Microsoft for Lotus or one of these:
“[The partnership with Microsoft is] going very well insofar as we originally agreed to co-operate on three distinct projects and now we’re working on nine projects and there’s a good list of 19 other projects that we plan to co-operate on.”
Summary: Microsoft and its little helpers at Novell carry on promoting .NET while stereotypical words are used to slap down critics
NOW that Miguel de Icaza is at CodePlex, it has become abundantly clear that he is willing to sidle with a company which attacks GNU/Linux with patents [1, 2, 3, 4, 5, 6]. Novell can spin it as much as it wants, but people have learned Microsoft’s inherent behaviour time after time for decades. Nothing has changed. As CRN has just put it, “Open source community sceptical over vendor’s [Microsoft's] open source aims.”
Microsoft has failed to destroy Free software with slurs and aggression alone, so now it is trying to recruit other companies that will do the “dirty work” while Microsoft pretends to have befriended “Open Source”. It’s a classic mechanism for diffusing opposition — become so immersed in it, to the point where you become your own pseudo-opposition. That, for instance, is what Microsoft did to its longtime rivals such as Corel and Novell.
To make matters worse, as this discussion about Miguel de Icaza’s role at CodePlex puts it:
Generally, anyone who recognizes the pernicious nature of Microsoft’s corporate behavior is dismissed as a “Microsoft hater”. Of course, too few realize that discrediting by name-calling is the technique of those bankrupt of rational arguments. As a deplorable result, it is lingua franca of modern political discourse, ala Fox News.
We have already explained and shown that people who do not care about FOSS enter the FOSS world only to curse those who really believe in FOSS. We also have entire long posts debating the “Microsoft hater” label [1, 2]*. Microsoft does more than anyone else to deserve a certain type of treatment, so it's not a Microsoft-exclusive issue.
“Critics of Microsoft are conveniently dismissed as irrational haters.”The “Microsoft hater” label is far from dead. Nick Eaton, who writes for the blog whose purpose is mostly to praise Microsoft, opens one of his latest posts with “For those of you who hate Microsoft…”
See? Critics of Microsoft are conveniently dismissed as irrational haters. As if not agreeing with crime can actually make the skeptic inherently evil. The logic here goes like, “it’s not Microsoft that’s evil, it’s those who ‘hate’ it who are evil.”
Here is just a sample of Microsoft sins. This is the company that Novell and Miguel are helping, most recently by creating iphone MonoTouch, which is about extending Microsoft's ever-abusive monopoly.
.NET developers will now be able to build iPhone and iPod Touch apps with Novell’s new MonoTouch framework. The catch is it doesn’t come cheap.
* The “Microsoft Hater” label seems to have been extended to the “Novell Hater” label, which some people now use to dismiss critics of the Novell/Microsoft deal. These labels bear a connotation that is intriguing because particular nations adopt similar daemonisation labels like “anti-Soviet” (a serious crime at the time) or “unamerican”, whereas in a nation like Sweden there is no analogous label as it would be preposterous and somewhat outlandish/foreign. These labels can be introduced and phased into society’s vocabulary through gradual indoctrination, e.g. imagery, strong words, and stereotypes. Peer pressure is then a policing force.
Summary: Microsoft’s deal with Yahoo! is escalated for more regulators to scrutinise; the Microsoft Department of Justice (MSDOJ) blocks Google’s book deal
SEVERAL days ago we showed that Microsoft was unable to get its deal with Yahoo! approved before leaping a hurdle in the United States [1, 2, 3], not just in Europe. The issues are being studied both in the US and in Europe, whose regulators work independently on this.
This is being handled by the Microsoft-influenced MSDOJ [1, 2, 3, 4, 5, 6, 7, 8], which allegedly worked at Microsoft’s behest to block the Yahoo!-Google deal and also ignored Google’s complaints about Microsoft misconduct. Here is the MSDOJ blocking Google’s book deal and demanding a rewrite. The Register has the specifics:
The US Department of Justice has advised a federal court to reject Google’s $125m book-scanning settlement with American authors and publishers, citing concerns over class action, copyright, and antitrust law.
A week or so ago we made a comparison between what Microsoft did to Borland and what it’s currently doing to Yahoo! (see details at the bottom). One person sent us the following response:
[I] read your article (Comes Antitrust: How Microsoft Schemed to Destroy Borland (Like It Did Yahoo!)) and i think you should consider the Corel’s move in the Microsoft strategy to destroy Borland… their Linux projects merge, their split, etc. all the Inprise turbulence that Borland experienced is totally related. the Borland market share was at $ 21 or so in mid 2000 before the dotCOM crisis (check nasdaq.com historical charts), thats interesting to observe too. it finally has been sold last year to MicroFocus by $ 1,5 or so per share… thats totally absurd. what happended? the hurricane Bill heh. im a software developer working with Borland tools since early 90s and posted about all this subject many times in many forums in past years with no echo at all. you did a really good job puting the world to talk about this M$ abuse. i think you can build a book with this investigation.
Google has told the US Federal Communication Commission that Apple rejected the Google Voice and Google Lattitude apps it submitted to the iTunes App Store – though Apple says otherwise.
Apple and Google also compete in phones (Google uses Linux in Android) and as Palm has already learned, Apple plays hardball and even uses patents against Linux-powered products. █
More on Yahoo:
Summary: Microsoft continues to lag behind in portable devices, which will further extend the losses
BACK in August we wrote about Microsoft’s utter failure when it comes to gadgets [1, 2]. Microsoft refuses to give up and even those to whom it gives Vista 7 laptops are underwhelmed by the Zune HD, which their IDG colleagues say has “No Reason To Live”. Yes, even familiar friends of Microsoft don’t believe in it, so why does Microsoft carry on trying? There is serious loss of money in Zune land and Microsoft does similarly poorly at mobile platforms, which are related to the Zune (originally a Windows Mobile gadget from Toshiba).
Windows Mobile is now being dumped by Palm, which moved exclusively to WebOS/Linux [1, 2, 3]. Here is another new article from IDG, claiming that Microsoft’s mobile browser (Internet Explorer) is far behind the competition, calling it “one of the most underwhelming browsers available on smartphones today.” To quote in context:
Internet Explorer Mobile (formerly known as Pocket Internet Explorer) has been on Windows Mobile devices for a long time now–and it shows. Based on a proprietary layout engine that Microsoft designed from scratch, the current Internet Explorer Mobile is one of the most underwhelming browsers available on smartphones today.
Some people live with their heads in the sand. Windows Mobile is seemingly being promoted by loyal fans like Joe Wilcox (formerly of Microsoft Watch), who also does the obligatory ‘Apple comparison’ to draw a crowd. Windows Mobile, just like Zune, has been a total disaster (financially, not just as measured in terms of market share).
There is relevance here other than the fact that Linux gains at Microsoft’s expense. It shows that Microsoft is a lot more fragile than people are led to believe, especially because few of its products are actually profitable. Microsoft knows how to hide this. █
“If you can’t make it good, at least make it look good.”
–Bill Gates, Microsoft
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