Last week at the Web 2.0 Expo one of the keynotes was an interview between Tim O’Reilly and Stephen Elop from the Microsoft business division. Elop was formerly with Macromedia but was headhunted by Steve Ballmer to join the “evil empire” (Elop’s words, not mine).
Much of Elop’s interview was based around a discussion about Microsoft’s Software + Services strategy and why Elop believes “cloud only” isn’t the right way to go. He brought out the traditional Microsoft line that the iPhone’s success validates S+S (see Krish’s post for more on this). Personally I find it a little disingenuous to have Microsoft discuss the Pohone as validation of something they are doing, after all it was CEO Ballmer who was famously dismissive of the iPhone upon its release (see below for posterity’s sake).
Elop used a similar rationale to dismiss Google apps and justify their own approach with regards Microsoft Office as S+S. He commented that Google apps is fine for those who are happy with “bolding, underlining, italics and footnotes” but that most people would require the richer functionality that a fully featured office app (presumably Microsoft Office) can bring. O’Reilly quite rightly pointed out the “feature-itis” that MS Office has.
Elop pointed out that for Microsoft, the fundamental threat isn’t from bolding and underlining – it’s from themselves if they don’t continue to innovate – I find it a little hard to reconcile this statement with what Elop and Ballmer have said in the past about innovative offerings like the iPhone and Google apps.
Check out the entire video below;
This is interesting given a recent post that Paul published, in which he pointed out why he believed that the execution of the S+S strategy, on a channel level, is poor. Specifically;
- MS is artificially stopping the cannibalisation of users in terms of service provision
- Licensing is still by CPU and Virtual machine
- MS will bill end companies directly – carving out much of the channel partner’s roles
- MS is creating a 12 month upgrade moratorium – this is SaaS – upgrades should be a thing of the past.
All in all S+S seems more like a marketing ploy that is primarily intended at protecting the status quo rather than actively innovating. If this is the case then Elop needs to remember what he himself articulated as the biggest threat to Microsoft.