Zune, Microsoft and Corporate Culture

Friday, September 15, 2006 | 06:39 AM

What do you think of the new Zune?

That question led to fascinating discussion about Microsoft on Thursday. What they do, how they work, brainstorm, etc. It also covered how Microsoft develops new products (notice I didn't say innovate).

Zuneofficial_1 A few quick thoughts on the Zune: The coolest thing is its owners ability to zap songs back and forth via a Wi-Fi connection -- but those songs expire after "three plays or three days, whichever comes first," which is kinda poor. The 3 inch screen versus the 2.5 inch on the iPod also looks pretty nice. Other than that, its not a particularly compelling piece of hardware.

Brown? How long til that gets cancelled? 

We don't know the price yet, but I expect it to be in the $249 - 349 range, and a function of how much MSFT is willing to lose/subsidize each unit.

What I found most fascinating about "This Week in Microsoft" were the 3 separate products that leaked out over the past few days:

• The Zune iPod challenger (in classic "steal the other guys thunder" following Apple's event)

Soapbox: The Microsoft YouTube Clone;

Live: The Microsoft Google challenger;

Let's get a few things straight about Mister Softee. First, forget all the chatter coming from Redmond about innovation. They are now and have always been uttery shameless copycats. They do not innovate; They do not create cool products; They are boring code writing cubicle dwelling drones -- and that's what they should be.

The second thing you need to know about Microsoft: They print money like they were a branch of the U.S. Treasury Department.

That is the bottom line for investors, and the cash ain't coming from all these other products attempting to recapture lighting in a bottle. Its Windows 1st, Office 2nd, and then a big 4 way tie for SQL, Hardware (mouses etc.) Server SW, and then everything else. All these other products -- including Xbox, hotmail, MSN, etc. -- are what happens when you have more money than God and still want to be one of the cool kids.

And, they'd probably get just as much criticism if they didn't make all these attempts at imitating other successful innovators. Otherwise, they would just be a mature company milking their monopoly products until the next paradigm shift came along.

Understand my complaint about Redmond: I don't begudge them these many attempts to stay relevant and hip, to keep pressing buttons until they find the next thing that works. Hey, after you become one of the most successful firms in the history of Capitalism, it becomes hard to repeat that performance every quarter.

I'm just tired of the bullshit about all their terrific innovations (Spare me the techno-babble about multithreading processors or dynamic ram usage).

To understand how Microsoft got to be the "innovator" it is today, you need to have some background into the psychology of its leadership. My favorite example comes via Robert Cringely

If there is a reason, it has to come from the competitive nature of Bill Gates as Microsoft's spiritual and ethical leader. Everything is a competition to Bill, and every competition has a winner and a loser. Microsoft people have always been encouraged to see the game, not the consequences, and to win the game even if winning this way makes no sense.

Let me give an example of this behavior. In the early days of Microsoft, one of the popular games was to see how late the boys could leave work for the airport and still make their flights. These weren't people who were habitually late, they were playing a game. The eventual winner was Bill Gates, of course, but to win he had to abandon his car [a new Porsche 911] at the departures curb.

Tht pretty much says it all. They are competitive to a fault -- its in their DNA. Its also why they have been such a vast money machine. But please: Spare us the sanctimonious garbage about Microsoft the innovator, and keep the focus on Microsoft the moneymaker.

Here's some more recent ideas out of the innovation factory:

Soapbox: The next YouTube?
Msnsoapboxshot

 

MSN Live: Where ever did they get the idea for that interface?
Live

Sources:

Microsoft Unveils Zune Player to Compete With iPod
Dina Bass
Bloomberg, September 14, 2006 12:31 EDT
http://www.bloomberg.com/apps/news?pid=20601087&sid=aCeGV6Hgd97Q&refer=home

Microsoft YouTube Clone Coming
Michael Arrington
techcrunch, September 9 2006
http://www.techcrunch.com/2006/09/09/microsoft-youtube-clone-coming/

Microsoft's Google-killer arrives with a 'whuh?'
Andrew Orlowski
The Register Friday 12th November 2004 12:01 GMT
http://www.theregister.co.uk/2004/11/12/microsofts_google_killer_arrives/

Why Microsoft Keeps Getting Sued
Robert X. Cringely JUNE 20, 2002
http://www.pbs.org/cringely/pulpit/pulpit20020620.html

Interview: J Allard, Microsoft Corporate Vice President
Ryan Block
Engadget, Sep 14th 2006 1:58PM
http://www.engadget.com/2006/09/14/
the-engadget-interview-j-allard-microsoft-corporate-vice-presi/

Microsoft Zune Gets Officially Announced
Jason Chen
Gizmodo, September 14, 2006
http://gizmodo.com/gadgets/portable-media/
microsoft-zune-gets-officially-announced-200641.php

Zune in uphill fight against Apple's iPod
Rex Crum
MarketWatch, 2:46 PM ET Sep 14, 2006
http://tinyurl.com/hxdpg

Friday, September 15, 2006 | 06:39 AM | Permalink | Comments (30) | TrackBack (0)
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Comments

What I am eager to know is whether or not the song sharing feature will have the 3-day 3-listen limitations on songs that were NOT purchased from the Zune marketplace. While making these restrictions part of the DRM structure for songs that Microsoft itself is selling seems to be a necessity to get the RIAA on board, (there are also sharing restrictions on songs purchased from iTunes), I don't think consumers will respond well to not being able to send friends mp3s they ripped themselves.

I'm not trying to go wading in the weeds of copyright law, I'm just saying that when people can quite easily email each other unencumbered mp3s from CDs that they have purchased, many will view it as a hassle that they cannot just do the same with their Zunes.

Posted by: Charles | Sep 15, 2006 9:37:28 AM

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