Microsoft's reality problem

Just when Microsoft thought it couldn't get worse, ex-VP Dick Brass has taken a sockful of manure and beaten his former employer with it.

In a New York Times opinion piece titled “Microsoft's Creative Destruction,” the recovering Redmondite dissects why a company like Apple can introduce technology like the iPad to huzzahs, while Microsoft's efforts to create a tablet PC over the years have earned it nothing but guffaws. He writes:

Microsoft has become a clumsy, uncompetitive innovator. Its products are lampooned, often unfairly but sometimes with good reason. Its image has never recovered from the antitrust prosecution of the 1990s. Its marketing has been inept for years; remember the 2008 ad in which Bill Gates was somehow persuaded to literally wiggle his behind at the camera?

While Apple continues to gain market share in many products, Microsoft has lost share in Web browsers, high-end laptops and smartphones. Despite billions in investment, its Xbox line is still at best an equal contender in the game console business. It first ignored and then stumbled in personal music players until that business was locked up by Apple….Perhaps worst of all, Microsoft is no longer considered the cool or cutting-edge place to work. There has been a steady exit of its best and brightest.

The biggest enemies to innovation? The internecine political struggles between different groups at Microsoft, who'd poison the work of another group just to maintain an advantage. Sure, the company has clocked hundreds of billions in profits, so it must be doing something right, but in Brass's analogy, Microsoft is GM, and Windows and Office are SUVs: hugely profitable in their day, but dinosaurs sinking into the tar pits soon after (a pretty good analogy, methinks).

Needless to say, Microsoft felt compelled to respond, via its Flack du Flacks, Frank Shaw:

At the highest level, we think about innovation in relation to its ability to have a positive impact in the world. For Microsoft, it is not sufficient to simply have a good idea, or a great idea, or even a cool idea. We measure our work by its broad impact…. for a company whose products touch vast numbers of people, what matters is innovation at scale, not just innovation at speed.

In other words: What really matters is that a billion people use your products, even if they mostly suck. Which means that, despite getting beaten like a pair of bongos in every new market it has entered over the last decade, Microsoft still hasn't woken up and smelled the Starbucks.

It's not surprising. I remember sitting in a conference room with a couple of bright Micro-geeks more than 10 years ago. This was around the time Bill Gates had his sudden inexplicable memory lapses on the stand during one of Microsoft's various antitrust trials, and when companies as conservative as Compaq were volunteering information about how Microsoft had strong-armed it into dropping the Netscape browser from its line of Presario PCs.