Editorial

What the hell is "Microsoft's lost decade"?

There has been a lot of conversation the past few weeks about "Microsoft's lost decade" and it really is a baffling thought when you actually take a look at Microsoft's history. The tagline, if you want to call it that, first made its debut over at Vanity Fair with quite a few damning quotes against the company and how it stifled innovation.  We were not there, we don't have our own quotes from an insider who wants to go on record and burn bridges or repair them, so we must take the article at face value.

The gist of that article did have one point that it hammered home, bureaucracy. Having never worked for Microsoft, I can't attest to their internal culture 10 years ago, what I can attest to is the fact that every single large corporation on planet Earth has a metric-ton of red tape (large being defined as top 50 Fortune 500 company) as I have been inside a handful of those companies. Get over it, that's how corporate America works, there is a reason "middle management' exists, they are the red tape. If we didn't have these barriers, every staff level employee would have a direct line of communication to the CEO and most companies would lose focus. It's the way corporations work, why this is surprising to some that Microsoft fell into this bucket, I can't figure that one out.

Also, Microsoft's employee rankings were bashed, but we all know how this goes. I have never met an individual who has loved how their company ranks their employees; each corporation has their own method and considering Microsoft has billions in the bank, 90K plus people working for them, and they have a dozen, yes a dozen, billion dollar companies under their umbrella, I think they might know what they are doing.

Moving on, another story popped up, which was the spur of this rebuttal-style editorial, that struck Microsoft down again. This time, TechCrunch cherry picked Microsoft's history to highlight the company's shortcomings over the last 10 years. To draw a comparison, let's judge Apple by the success of P!NG or the Hi-Fi or base Google's future off of Buzz and Wave, both are an absurd measuring stick.

Microsoft is far from perfect and Ballmer has had his fair share of struggles over ten years but you know what else also happened during those ten years, or "lost decade" revenue tripled, profits went through the roof and Microsoft gave back so much cash to shareholders they would need several boats to deliver it all.

In fact, Microsoft did strike back at this nonsense and it was none other than Frank Shaw that brought back the reality of Microsoft's success. His quote is posted below, in full, from the TechCrunch article:

The comment above could have been a post on it's own as Microsoft's Frank Shaw finally had enough of the noise that has been circling of late about Microsoft. The most ludicrous part about of this is that now is quite possibly the most exciting time to be following Microsoft.

Let's take a look at what Microsoft has coming over the next 12 months: Windows 8, Windows Phone 8, Office, Surface Tablet, a new Xbox announcement is likely, and a few other gems like Halo 4 are locked away in Microsoft's upcoming portfolio to drive revenue. Regardless of what you think of Windows 8 and Windows Phone, it shows that Microsoft has balls and that they are willing to defy marketplace norms to make an impact. If we all sat around and waited for the start button/orb to evolve, Microsoft would have slowly faded as they fell behind; so they did something about it.

What they are doing with Windows 8 is driving the future. If you think Windows 8 is an OS for yesterday, you are missing the picture. Windows 8 is the platform to build tablet/laptop hybrids that move us in the direction away from the "PC" as we know it without losing all the hardcore functionality that we need. Throw Windows 8 on a tablet, it works, it works pretty damn well actually. But I am not following Microsoft blindly, I know that it will be a hard sell. What you have to understand is that Microsoft has to establish a foundation for the future and we all know that Windows 7 is not going anywhere which gives Microsoft a window of opportunity. Microsoft has to make the move to transform Windows to be more touch friendly and now is that time; it's really not that hard to figure this out.

Besides taking time to write this article and proving that we too can photoshop children's novels, Microsoft did not "lose a decade". Microsoft had better than an okay decade, they had a tremendously positive decade. Maybe now we can put to bed that bashing Microsoft is still cool or should we all go back posting our Apple rumors to whore out the hits? Oh and by the way? Apple runs on Microsoft software.

Report a problem with article
Previous Story

Could lower Windows sales be a good thing?

Next Story

Microsoft plans big giveaway starting Monday

92 Comments

View more comments

It's really stunning how Microsoft executives continue year after year after year to think that bashing, belittling and otherwise trash talking the competition is going to somehow convince people that their products are superior.

Frank Shaw said, "[we have] social integration in Bing that makes Google's SPY world look as cheesy as it really is..."

After everything that's happened over the years, after example upon example of Ballmer saying similar things that not only came back to bite him (e.g. nobody will ever buy the iPhone), why on *earth* would you not learn that one of your biggest problems in the industry is that people perceive you to be totally blind about the strengths and weaknesses of your own products as they relate to the competitive landscape?

I recently left Microsoft after more than 15 years specifically because this attitude pervades senior management -- it's the attitude Ballmer demands in his leadership team, and it's the attitude that has made Microsoft appear ridiculous to most of the industry... not to mention the attitude that allowed Apple to not just leapfrog Microsoft on innovation, but on revenue.

The Microsoft bluster should have retired many years ago, it's destructive, childish and ineffective. Comments like Frank's are part of the problem, not part of the solution.

RSoames said,
It's really stunning how Microsoft executives continue year after year after year to think that bashing, belittling and otherwise trash talking the competition is going to somehow convince people that their products are superior.

Frank Shaw said, "[we have] social integration in Bing that makes Google's SPY world look as cheesy as it really is..."

After everything that's happened over the years, after example upon example of Ballmer saying similar things that not only came back to bite him (e.g. nobody will ever buy the iPhone), why on *earth* would you not learn that one of your biggest problems in the industry is that people perceive you to be totally blind about the strengths and weaknesses of your own products as they relate to the competitive landscape?

I recently left Microsoft after more than 15 years specifically because this attitude pervades senior management -- it's the attitude Ballmer demands in his leadership team, and it's the attitude that has made Microsoft appear ridiculous to most of the industry... not to mention the attitude that allowed Apple to not just leapfrog Microsoft on innovation, but on revenue.

The Microsoft bluster should have retired many years ago, it's destructive, childish and ineffective. Comments like Frank's are part of the problem, not part of the solution.

No, articles like the one in VF and people lapping that up like it's the absolute truth is the problem.

It is absolutely ridiculous that people would pay $500 for a phone. The only thing Ballmer was wrong about was underestimating the stupidity of consumers.

Edited by bj55555, Jul 21 2012, 5:26pm :

bj55555 said,

No, articles like the one in VF and people lapping that up like it's the absolute truth is the problem.

It is absolutely ridiculous that people would pay $500 for a phone. The only thing Ballmer was wrong about was underestimating the stupidity of consumers.

Listen to yourself. No, seriously: take a step back and listen to yourself, and then try to deconstruct the content of what you're saying.

First of all, there's more than a little truth to the Vanity Fair article: I started at the company in 1996 and worked in a number of divisions, and those threads were present throughout. I left the company on good terms, so I have no sour grapes... but this is not the time for reflexive throat-punching on the part of Microsoft's defenders, it's the time for objective strategy for how to get back on top. Comments like yours will not help that effort.

As far as what you said about the iPhone: I certainly hope your job doesn't involve setting consumer product strategy. Consumers being stupid or not isn't the issue -- the issue is where they spend their money. And bj55555, a majority of my coworkers at Microsoft had iPhones -- Windows Phones were the minority. This has always infuriated Steve, but eventually he gave-up trying to block employees from using iPhones because he knew it was futile.

The issue isn't people "lapping up" the VF article like it was the absolute truth -- the issue is that Microsoft refuses to see *any* truth in the VF article. And until Microsoft acknowledges that this is a problem, the problem won't go away.

RSoames said,

Listen to yourself. No, seriously: take a step back and listen to yourself, and then try to deconstruct the content of what you're saying.

First of all, there's more than a little truth to the Vanity Fair article: I started at the company in 1996 and worked in a number of divisions, and those threads were present throughout. I left the company on good terms, so I have no sour grapes... but this is not the time for reflexive throat-punching on the part of Microsoft's defenders, it's the time for objective strategy for how to get back on top. Comments like yours will not help that effort.

As far as what you said about the iPhone: I certainly hope your job doesn't involve setting consumer product strategy. Consumers being stupid or not isn't the issue -- the issue is where they spend their money. And bj55555, a majority of my coworkers at Microsoft had iPhones -- Windows Phones were the minority. This has always infuriated Steve, but eventually he gave-up trying to block employees from using iPhones because he knew it was futile.

The issue isn't people "lapping up" the VF article like it was the absolute truth -- the issue is that Microsoft refuses to see *any* truth in the VF article. And until Microsoft acknowledges that this is a problem, the problem won't go away.

I don't give a flying **** if Microsoft ends up on top. The last thing I want is for Microsoft to be able to sock away another $10, $20 billion to top Apple.

What I want is for people to stop deifying companies like Apple, Google, and, yes, Microsoft and enriching them to the detriment of other companies. It's absolutely unhealthy. To characterize Microsoft as having failed in a period in which it stockpiled almost as much as the US Treasury currently holds is ludicrous. Articles like this cause these companies to engage in a "my dick is bigger than yours" battle, and that is not good for anybody.

So let me say this in the most honest way possible. I don't give a **** who you worked for or what insight you have. The original VF article is misguided, and there are far more important things to be critical of.

bj55555 said,

I don't give a flying **** if Microsoft ends up on top. The last thing I want is for Microsoft to be able to sock away another $10, $20 billion to top Apple.

What I want is for people to stop deifying companies like Apple, Google, and, yes, Microsoft and enriching them to the detriment of other companies. It's absolutely unhealthy. To characterize Microsoft as having failed in a period in which it stockpiled almost as much as the US Treasury currently holds is ludicrous. Articles like this cause these companies to engage in a "my dick is bigger than yours" battle, and that is not good for anybody.

So let me say this in the most honest way possible. I don't give a **** who you worked for or what insight you have. The original VF article is misguided, and there are far more important things to be critical of.

Sorry, I didn't realize you weren't interested in the actual topic at hand. Do feel free to carry on with the off-topic rant you're pursuing.

RSoames said,

Sorry, I didn't realize you weren't interested in the actual topic at hand. Do feel free to carry on with the off-topic rant you're pursuing.

No, it's highly related to the topic. The point is that the standard by which a company is considered a success has reached ludicrous levels.

The only thing you're interested in is telling us how "in the know" you are because you worked for Microsoft. Congrats on your past work experience. Would you like a biscuit?

bj55555 said,

No, articles like the one in VF and people lapping that up like it's the absolute truth is the problem.

It is absolutely ridiculous that people would pay $500 for a phone. The only thing Ballmer was wrong about was underestimating the stupidity of consumers.

Ballmer was right about the iPhone. After selling to a few hardcore customers, Apple had to slash price and issue store credits along with an apology from Steve Jobs to the few suckers who went out and bought the overpriced iPhone at launch.

http://www.apple.com/hotnews/openiphoneletter/

Why do Microsoft haters have such a selective memory about iPhone and Ballmer? Ballmer was right when he said nobody would buy a $600 phone.

To all iPhone customers:

I have received hundreds of emails from iPhone customers who are upset about Apple dropping the price of iPhone by $200 two months after it went on sale. After reading every one of these emails, I have some observations and conclusions.

First, I am sure that we are making the correct decision to lower the price of the 8GB iPhone from $599 to $399, and that now is the right time to do it.
...
We want to do the right thing for our valued iPhone customers. We apologize for disappointing some of you, and we are doing our best to live up to your high expectations of Apple.

Steve Jobs
Apple CEO

Why does it seems like some people's memory goes SERVPRO every time Apple screws up?

Edited by Avatar Roku, Jul 22 2012, 7:07am :

"The only thing you're interested in is telling us how "in the know" you are because you worked for Microsoft. Congrats on your past work experience. Would you like a biscuit?"

Actually, I'm interested in refuting people who try to talk about how way off base the Vanity Fair article is who have never worked at Microsoft and who have never spoken to anyone involved directly -- those of you on the outside are only capable of speculation. Those of us who worked there can actually have a meaningful conversation about Microsoft's culture.

RSoames said,
"The only thing you're interested in is telling us how "in the know" you are because you worked for Microsoft. Congrats on your past work experience. Would you like a biscuit?"

Actually, I'm interested in refuting people who try to talk about how way off base the Vanity Fair article is who have never worked at Microsoft and who have never spoken to anyone involved directly -- those of you on the outside are only capable of speculation. Those of us who worked there can actually have a meaningful conversation about Microsoft's culture.

Those of us on the outside have a greater perspective on what really matters. I'm sorry that your stock options ended up being worth **** as you watched with green-eyed envy what AAPL did. Boo ****ing hoo. You had a good job and probably a decent salary. Go cry me a river. All the people that once worked for companies that went out of business in the last 10 years aren't buying any bull**** about Microsoft's "lost decade". If this lost decade was a failure, I only wished Microsoft was a greater failure this past decade and hope for the worse for Apple, Google, and Microsoft in the coming decade.

Rather than criticizing Microsoft for falling behind Apple, I want people to look at Microsoft and say "My god, how could we been so stupid to have allowed a single company to make so much ****ing money?" and then in turn look at Apple and Google and say "My god, how could we have been so stupid to have allowed 2 more Microsofts to come into existence?"

When people pay $500 for a phone and decide to forego seeing a doctor because they can no longer afford to do so, then we all pay the price in the end for that stupid decision. We need to question whether or not so many god damn people clamoring to buy a $500 phone is a good thing rather than question why Microsoft can't sell just as many $500 phones as Apple does.

bj55555 said,

Those of us on the outside have a greater perspective on what really matters. I'm sorry that your stock options ended up being worth **** as you watched with green-eyed envy what AAPL did. Boo ****ing hoo. You had a good job and probably a decent salary. Go cry me a river. All the people that once worked for companies that went out of business in the last 10 years aren't buying any bull**** about Microsoft's "lost decade". If this lost decade was a failure, I only wished Microsoft was a greater failure this past decade and hope for the worse for Apple, Google, and Microsoft in the coming decade.

Rather than criticizing Microsoft for falling behind Apple, I want people to look at Microsoft and say "My god, how could we been so stupid to have allowed a single company to make so much ****ing money?" and then in turn look at Apple and Google and say "My god, how could we have been so stupid to have allowed 2 more Microsofts to come into existence?"

When people pay $500 for a phone and decide to forego seeing a doctor because they can no longer afford to do so, then we all pay the price in the end for that stupid decision. We need to question whether or not so many god damn people clamoring to buy a $500 phone is a good thing rather than question why Microsoft can't sell just as many $500 phones as Apple does.

You seem to be upset about the state of consumer behavior moreso than anything else. I don't understand what you're even advocating other than a hope that people will somehow one day realize that commodity fetishism is dumb and that there are other things in life than buying a popular brand. Well... that's kind of outside the scope of a technology discussion.

You also don't seem to understand my position at all -- I left Microsoft after many years a happy and very comfortable person, having made a nice sum of money over the years, and we parted on good terms because I just didn't like what the culture had become. I have another job that's very nice now, and the transition was smooth. You keep saying things like "I'm sorry that your stock options ended up being worth **** as you watched with green-eyed envy what AAPL did. Boo ****ing hoo. You had a good job and probably a decent salary. Go cry me a river." Uh... go talk to someone who thinks they had a bad deal and try that line of attack. I had a fine deal with Microsoft and can't complain about anything.

You're a champion for the small company and you seem to be anti-big company -- which is great. You'd like to change consumer behavior so that everyone wants to give the little guy a chance and so everyone will rally to prevent any one company from dominating a market -- good luck with that, Captain.

Windows 8 is what is going to bring MS down.. They will lose billions on that crap.. Windows 8 will be one of the biggest fails the OS market has ever seen.

Jason_Coffey said,
Windows 8 is what is going to bring MS down.. They will lose billions on that crap.. Windows 8 will be one of the biggest fails the OS market has ever seen.

Why?

Jason_Coffey said,
Windows 8 is what is going to bring MS down.. They will lose billions on that crap.. Windows 8 will be one of the biggest fails the OS market has ever seen.

I'l wager right now that Windows 8 will sell hundreds of millions of copies and make billions of dollars for Microsoft. But I could be wrong.

Nick K said,

I'l wager right now that Windows 8 will sell hundreds of millions of copies and make billions of dollars for Microsoft. But I could be wrong.

so wrong.

Jason_Coffey said,
Windows 8 is what is going to bring MS down.. They will lose billions on that crap.. Windows 8 will be one of the biggest fails the OS market has ever seen.

Careful. You risk deletion on this site if you dare say anything negative about Windows 8.

Time for a few home truths. Yes, the past decade has been a watershed for Microsoft. It's seen a change in CEO and a loss in marketshare in its operating system business. But lets put things in perspective.

Windows Phone 7 is one of the most innovative pieces of software ever produced. Microsoft along with Palm pioneered the SmartPhone a decade ago. Apple refreshed the category 5 years ago. Now Microsoft are hitting the ground running with their next generation. Yet all they get is criticism. Windows 8 won't run on last-generation Windows 7 hardware, and Microsoft takes flak. How many people recall that Apple totally abandoned their own customer hardware base too? Not once, but 4 times.

You couldn't run Mac software on an Apple II, so all those who bought Apple IIs were orphaned. Then Apple dumped the Mac's 68000 chip for the PowerPC. All those customers who bought 68000s were orphaned. Then, unbelievably, Apple dumped the PowerPC and moved to Intel. More orphans. Finally, to complete the flush, Apple dumped their MacOS operating system and replaced it with OSX. Yet, on the back of these flip-flops, Apple are perceived as being customer-friendly. Staggering.

Meanwhile, Mac has roughly the same market share in PCs as WP7 has in SmartPhones. Yet on these numbers, Apple's a success and WP7 is a failure.

There are somewhere around 75 million Macs in use in the world. That's all. There are roughly the same number as Xboxes. Is Xbox now the world's second most popular computing platform?

Apple's iPad is eating into PC sales. But is it? The most recent global sales figures showed that PC sales only grew by 0.1%. It's amazing that PCs grew at all in the face of the global economic crisis. Annual sales for PCs are currently running around 350 million per year - and all but 3% of them run Windows. Of the top selling PC companies, Apple didn't even make the list. They're included in "Other". The good news for Apple is that if they continue growing at this rate it will only be another 84 years before they're out of the Other category.

Now look at the debate that's raging. Should I keep Windows 7 or move to Windows 8. Or even stick with XP? Nobody is seriously suggesting moving to Mac - particularly for business use. And where's Google Chrome, that Windows-killing rascal, gone to these days? Dead on arrival.

What we're seeing is an old Microsoft strategy. Get people talking about which Microsoft product to use and squeeze the life out of the competition. Remember Lotus? Microsoft squeezed them between Excel at the top end and Works at the low end. They were the world's biggest software company in their day. Now they're an asterisk at the bottom of IBM's Balance Sheet.

It's the next decade that'll be interesting. Microsoft has finally found it it can do something that neither Apple nor Google can do well - it's called software. If this is the result of a lost decade, I'll have a dozen.

Major Plonquer said,
....

Well said.

I'm sad my company is a line item for IBM's balance sheet.
And to answer the $40 dollar question. Yes, upgrade to Win8.
Or from Microsoft's perspective, the $67.1B dollar question.....

Edited by deadonthefloor, Jul 22 2012, 2:01am :

How true. It is apparent that after Windows-7 and Office 2010, Microsoft seems to have lost its focus. Trying to be everything to everyone never works out well. Why they put their future with the consumer marketplace, rather than the business marketplace is a good question. Technology can easily from from business to consumer, but rarely the other way--two totally separate needs and requirements.

TsarNikky said,
How true. It is apparent that after Windows-7 and Office 2010, Microsoft seems to have lost its focus. Trying to be everything to everyone never works out well. Why they put their future with the consumer marketplace, rather than the business marketplace is a good question. Technology can easily from from business to consumer, but rarely the other way--two totally separate needs and requirements.

lol the same thing was said BEFORE windows 7 and office 2010 just for the record lol. in fact, with every product, the "pundits" claim MSFT lost its way and yet time after time, they outsell their doubters.

neonspark said,
MSFT is doing great but they let android and iOS take root. BIG mistake. This is enough reason for Ballmer to go.

I suspect that Android was acutally a proxy of Microsoft through Google. Remember that Microsoft announced plans to setup shop in the Silicon Valley long before Google went iPO... I suspect that Microsoft was a silent investor in the Google startup. Microsoft had long talked baout monetizing the Internet through advertising long before Google came up. Microsoft thought it could smother Netscape and Yahoo as well as Excite and Alta Vista withotu stirring up much trouble . MIcrosoft was wrong so it set up Google as a puppet of Microsoft .

neonspark said,
MSFT is doing great but they let android and iOS take root. BIG mistake. This is enough reason for Ballmer to go.

The article, aside from mixing fact with opinion, seems a bit far-fetched. Having consulted to MS for 6+ years, I can attest to the following facts in the high-tech industry.
From 2000 through 2010/2011, MS was operating under a DOJ "supervision". If anybody thinks the DOJ doesn't play hardball and it's better to be safe than sorry, please let us all know how nice the DOJ can be.
MS may have a peer-ranking system in place; let's asume that's a fact.
MS may or may not have lost creativity. I believe not, but that is my opinion. They had hits and misses, but looking back with 20-20 hindsight and announcing "how could they have missed this" is just dreaming. We seem to forget that when the smart phones came out in 2005-2006, their success was far from a sure thing. It may be obvious now, but it wasn't then.
MS may have a peer-ranking system in place. I know lots of high-tech companies who also have such a system in place, and they are very creative. There is no proven or known correlation between peer-ranking and creativity. To state there may be, is simply conjecture and opinion on the part of the writer.

The so called Lost Decade was spawned by massive anti trust charges by countless competitors like Netscape, and even Apple itself. Microsoft's back was riddled with arrows so numerous that Microsoft finally stumbled . Actually, I suspect that Google was spun off and went IPO by Microsoft. I am also positive that IBM also played a role in the anti trust beat up of Microsoft.. Microsoft continued to supply Office to Apple during its darkest years. Remember that Microsoft was very close to become the first trillion dollar stock back in 2000. Microsoft could have become a computer monopolist by now.. For better or worse, it never happened.. Billy Gates decided to give away his money to good causes... Good for him!

I have a gut feeling that Microsoft will eventually buy HP or Dell that is if PCs is here to stay like IBM's mainframes still are. Maybe this is what it will take to bury IBM to get it over with. Microsoft might look at Intel to make sure that X86 will stick around for a long time to come. or whatever in the plans Intel has in the future that will assure the future of PCS for decades to come.. I never buy the argument that hand held or arm held computers will eliminate PCs entirely. I wonder what will become of Oracle as a database company... Maybe Oracle will destroy Microsoft 's Access??? I would never underestimate Oracle..

Commenting is disabled on this article.