6 ms·

The Tech Press Turns on Microsoft's Ballmer

51 points by edw519 16y ago

btilly 16y ago
See http://news.ycombinator.com/item?id=889473 http://news.ycombinator.com/item?id=889473 for previous discussion of Ballmer's deficiencies. I've personally long maintained that a major source of Microsoft's problems are a classic case of being on the wrong side of disruptive innovation. See The Innovator's Dilemma and the (IMO better) follow-up The Innovator's Solution for more. Another has been the legal problems that have caused them to shy away from their past ultra-aggressive tactics. If I'm right that outside problems are a major cause of their downfall, then part of Bill Gates' genius was recognizing the writing on the wall and leaving at the right time to maintain the myth.
- potatolicious 16y ago
  In all likelihood it's a little bit of both external and internal factors. I disagree with the article that seems to want Ballmer's head on a platter for bungling Vista - that was a bad move for sure, but tossing out everyone responsible for that mess seems like tossing out all opportunities to learn from it. Hubris has a lot to do with it, I think. There have been a remarkably large number of instances where Ballmer has said something that betrays the fact that he has no respect for his competition. Everyone's a lame duck competitor compared to the wonderful products of Microsoft... until they completely trounce MS in the marketplace. Then you might hear a half-hearted mea culpa from Ballmer, but after that it's swept under the rug. Maybe it's the job of a corporate CEO to talk big about his own products - but I've seen few other CEOs so openly negative and dismissive of competitors' products, and IMHO this has probably a significant hand in MS's failures at tackling new product lines. His reaction to more-successful competitors seems to be unproductive: note his claims that Google and iPods are not allowed in his house. How can you compete when you are willfully ignorant of your competitors' products?! When someone is leading a market I'm trying to compete for, you bet your ass I'll have my hands all over their product.
petercooper 16y ago
I'd rather eat hot coals than use Windows but at the same time, I am awed by their business sense, and it seems rich to suggest that Ballmer is driving Microsoft into the ground when the profits show the opposite picture. The share price might not have rocketed, but MSFT's net income is up from $5.355bn in 2002, hit $17.68bn in 2008, and even in 2009 was still $14.569bn. For 2000, pre-crash, it was ~$9bn when he took the reins. A 62% increase in net profits from a peak to today's trough is nothing to poo-poo. Call Ballmer whatever you like, but the company, under his direction, is producing giant piles of cash even in these rough times.
- preview 16y ago
  But, it is possible to be profitable (even have increasing profits) but still have problems at the top. See http://steveblank.com/2010/06/07/when-big-companies-are-dead-but-don%E2%80%99t-know-it/ http://steveblank.com/2010/06/07/when-big-companies-are-dead... for some anecdotal evidence.
- btilly 16y ago
  In the last decade Microsoft has grown profit margins without creating new product lines. That is great for current profitability, but not for future revenues. At this point it is only a question of time until free alternatives to core Microsoft products become good enough that people are willing to stop paying the Microsoft tax. The growing popularity of mobile and semi-mobile devices without Microsoft software suggests that this day is coming sooner rather than later. And Microsoft's attempts to increase its profit margins aren't helping any. In short the relative stock prices of Apple and Microsoft is a vote of belief that Apple understands and is inventing the future, while Microsoft has no realistic plan for how to adapt.
  - awa 16y ago
    Xbox is a prime example of a new product line which has become profitable for the company even though critics were out for the division's head when it was loosing money.
    - 16y ago
armandososa 16y ago
Sorry for my stupid question, but I can't understand the quoted phrase "out-to-lunchness". What's that? I don't know, but it sounds pretty derogative.
- btilly 16y ago
  "Out to lunch" is slang for not being mentally present.
- chc 16y ago
  "Out to lunch" is an idiom that basically means "not mentally there." It can refer either to being out of touch with what's happening or just seeming completely insane.
  - armandososa 16y ago
    thanks! I understand now.
deleted 16y ago
[deleted]

51 points by edw519 16y ago

See http://news.ycombinator.com/item?id=889473 http://news.ycombinator.com/item?id=889473 for previous discussion of Ballmer's deficiencies. I've personally long maintained that a major source of Microsoft's problems are a classic case of being on the wrong side of disruptive innovation. See The Innovator's Dilemma and the (IMO better) follow-up The Innovator's Solution for more. Another has been the legal problems that have caused them to shy away from their past ultra-aggressive tactics. If I'm right that outside problems are a major cause of their downfall, then part of Bill Gates' genius was recognizing the writing on the wall and leaving at the right time to maintain the myth.

potatolicious 16y ago
In all likelihood it's a little bit of both external and internal factors. I disagree with the article that seems to want Ballmer's head on a platter for bungling Vista - that was a bad move for sure, but tossing out everyone responsible for that mess seems like tossing out all opportunities to learn from it. Hubris has a lot to do with it, I think. There have been a remarkably large number of instances where Ballmer has said something that betrays the fact that he has no respect for his competition. Everyone's a lame duck competitor compared to the wonderful products of Microsoft... until they completely trounce MS in the marketplace. Then you might hear a half-hearted mea culpa from Ballmer, but after that it's swept under the rug. Maybe it's the job of a corporate CEO to talk big about his own products - but I've seen few other CEOs so openly negative and dismissive of competitors' products, and IMHO this has probably a significant hand in MS's failures at tackling new product lines. His reaction to more-successful competitors seems to be unproductive: note his claims that Google and iPods are not allowed in his house. How can you compete when you are willfully ignorant of your competitors' products?! When someone is leading a market I'm trying to compete for, you bet your ass I'll have my hands all over their product.

petercooper 16y ago

I'd rather eat hot coals than use Windows but at the same time, I am awed by their business sense, and it seems rich to suggest that Ballmer is driving Microsoft into the ground when the profits show the opposite picture. The share price might not have rocketed, but MSFT's net income is up from $5.355bn in 2002, hit $17.68bn in 2008, and even in 2009 was still $14.569bn. For 2000, pre-crash, it was ~$9bn when he took the reins. A 62% increase in net profits from a peak to today's trough is nothing to poo-poo. Call Ballmer whatever you like, but the company, under his direction, is producing giant piles of cash even in these rough times.

preview 16y ago
But, it is possible to be profitable (even have increasing profits) but still have problems at the top. See http://steveblank.com/2010/06/07/when-big-companies-are-dead-but-don%E2%80%99t-know-it/ http://steveblank.com/2010/06/07/when-big-companies-are-dead... for some anecdotal evidence.
btilly 16y ago
In the last decade Microsoft has grown profit margins without creating new product lines. That is great for current profitability, but not for future revenues. At this point it is only a question of time until free alternatives to core Microsoft products become good enough that people are willing to stop paying the Microsoft tax. The growing popularity of mobile and semi-mobile devices without Microsoft software suggests that this day is coming sooner rather than later. And Microsoft's attempts to increase its profit margins aren't helping any. In short the relative stock prices of Apple and Microsoft is a vote of belief that Apple understands and is inventing the future, while Microsoft has no realistic plan for how to adapt.
- awa 16y ago
  Xbox is a prime example of a new product line which has become profitable for the company even though critics were out for the division's head when it was loosing money.
  - 16y ago

armandososa 16y ago

Sorry for my stupid question, but I can't understand the quoted phrase "out-to-lunchness". What's that? I don't know, but it sounds pretty derogative.

btilly 16y ago
"Out to lunch" is slang for not being mentally present.
chc 16y ago
"Out to lunch" is an idiom that basically means "not mentally there." It can refer either to being out of touch with what's happening or just seeming completely insane.
- armandososa 16y ago
  thanks! I understand now.

deleted 16y ago

[deleted]