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Has Microsoft Morphed from “Hungry/Nimble” Startup to “Fat/Stupid” Behemoth?

by Randall on July 20, 2009 · 0 comments

Posted in: Business Strategy,Management,Randall Howard,Software,Startups

Bunny: Don’t you think you’d better go? The tortoise has the lead.
Max Hare: Say, I’ve lots of time to play. My middle name is speed.
SOURCE: Tortoise and the Hare, Walt Disney/United Artists, 1935

Credit: pbworks.com

Credit: pbworks.com

While I typically leave reviews of even major new products to others, my personal experience in the much heralded Windows 7 Beta to launch process provides  some interesting observations on the difference between large and small companhies in early adopter customer engagement.

Having bought an early Asus eeePC netbook almost 2 years ago and finding that early product both intriguing yet frustrating, I purchased the newly launched HP 2140 HD netbook when it launched in late June. This is a well engineering product that has clearly crossed the useability threshhold for uber mobility.

Like most netbooks, it comes standard with Windows XP Home. This was just fine because I, like the majority of Windows desktop users, wisely passed on the miasma that is also known as Windows Vista.

However, having heard some reports that the Windows 7 Beta was showing some promise and recognizing that running an operating system originally launched in 2003 wasn’t a viable long term strategy, I decided to upgrade to the Windows 7 Beta (now Release Candidate).

Overall, apart from the bugs inherent in any Beta,

  • problems with Bluetooth headsets that worked flawlessly under XP,
  • weird security messages when I renamed my user name to correct a typo,

the system has a clean modern design, seems to perform well and certainly is in no way like the Vista fiasco.

Sadly, Microsoft, I quickly learned, made a choice to not provide any upgrade path from XP to Windows 7. Yes, you heard right. In spite of the fact that the majority of users sagely gave Windows Vista the miss, Microsoft chose to provide a seamless upgrade path only for Vista users. While Microsoft perhaps feels that Windows XP is now an obsolete product, remember that most netbook companies are still shipping XP, so XP is truly a current system that people continue to buy. What did this mean to my early adopter experience with Windows 7?

  1. Microsoft documentation proposed a work around called Easy Transfer which really was just a file copy, to another machine or drive, but that process did nothing to smooth the upgrade transition.
  2. Unbelievably, all of my Windows XP applications, settings, configuration, etc. were completely wiped out by the Windows 7 install.
  3. As I mentioned above, things (such as my Bluetooth headset support) that worked before ceased to work properly.
  4. My Outlook Address Book can no longer be accessed, making email composition challenging, because somehow installing Windows 7 RC corrupted my Outlook profile/configuration.
  5. And the list goes on, but this should give you the flavour. What should have been 30 minutes to one hour procedure has turned into weeks of tweaking and general frustration.

Even Nimble Startups Risk Aging into Fat and Stupid Behemoths

So, as one who works with young and hungry startups, I look at this decision through a management decision making lens. Would a startup chose to cause such pain and grief to the majority of their installed base? Not a chance!

However, I have noticed that somehow, and inexorably, nimble startups eventually ossify into larger and more mature enterprises. And the decision making becomes more about risk and ROI and less about the customer. Is this what’s happening at Microsoft?

The history at Microsoft is interesting. Bill Gates, from the earliest days, was paranoid about being eclipsed by the greater resources of companies like IBM. Today, as the desktop operating system become more irrelevant, Microsoft’s paranoia is aimed at other firms like Google, which interesting announced their own OS for Netbooks last week. Perhaps the transition from Bill Gates to Steve Ballmer at the helm, there is less acute customer focus? In any case, no startup would ever even conceive of disenfranchising a customer base so completely.

What do market statistics show us about the size of Microsoft’s problem? A Decmber 2008 report from OneStat indicates that for Operating Systems, Windows Vista has managed a mere 21% compared to Windows XP having a powerful 72% share which is 3 to 4 times larger. The fact the XP is good enough for most customers is a real problem for Microsoft, representing among other things, significant loss of revenue (and relevance).

Is an individual user’s frustrating experience something Microsoft should be looking at? Absolutely. Consider CNET’s recent discussion of respected analyst Garnter’s assertion that Vista probably has put Microsoft into its first major set of layoffs ever: Gartner: Blame Vista for Microsoft Layoffs. This excerpt says it all:

“”Windows Vista didn’t do well. Based on our data, a lot of clients are skipping Windows Vista,” said Neil McDonald, an analyst at Gartner. Indeed, nearly every other major analyst firm found a similar lack of Vista adoption, with Forrester Research likening the (operating system) to the failed New Coke.”

Even a big and market leader like Coke learned from their mistakes. Will Microsoft return to its roots and see the light with Windows 7?

About Randall

Randall Howard is a serial entrepreneur and long term technologist with a passion for social innovation.

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