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November 09, 2005

Scoble on Google

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Posted by Stowe Boyd

Scoble has peered deeply in to the archaic model of Microsoft, and seen the light: Google.

[from Scobleizer - Microsoft Geek Blogger � The new Robert Scoble Services agenda]

Larry Page told me last week that teams inside Google often try to create projects to copy Microsoft. And he kills them. Why? Cause he knows that he will never get a big audience by copying something we do.

He says that Microsoft is basically running the '80s model of software: target the business buyer, the guy making the decision inside a company about purchasing software. Google is looking at the influentials, the artists, the young and hip: those whoe are inventing the future of software use, and by extension, the future of monetizing software.

One of the things I have turned up in my new series -- The New Visionaries: Rebooting the Web -- is this obsession with getting software into the hands of those most interested in fiddling with it, not business managers trying to make company buys. In particular, Satish Dharmaraj of Zimbra talked about departing from the old software model: making them buy a server license for tens or hundreds of thousands, and them charging 15% per annum for support. He argues that such a model is dead, for all intents and purposes.

Google knows that, and Microsoft doesn't.

Scoble's observations support my contention that Microsoft will be regarded, in the not-too-distant future, as one of the last of the industrial era companies, who struggled mightily to quash the Internet revolution, and lost. The fact that they are now trying to get hip to Web apps is another attempt by them to keep their constituency bottled up. But it won't work, and eventually (a few years down the road?) they will fall, just like IBM, DEC, and Sun fell, trying to hold onto an eclipsed model of business. There is a long tail for Microsoft to ride, but its really unlikely that they can get out in front of this revolution, and they certainly can't stop it.

[pointer from Evelyn Rodriguez to Hugh McLeod to Scoble]

Comments (2) + TrackBacks (0) | Category: Technology


1. Evelyn Rodriguez on November 9, 2005 08:43 PM writes...

A lot of folks made a lot of money on that software license model - and it's still prevalent in enterprise software ( withstanding).

Remember the ASP model? One of the many things - if you don't count the fact that it we were trying to raise 2nd round in fall 2000 - that killed the startup I was at is we needed to integrate with third-party software, things like application servers and CRM systems and ERP systems.

We wanted to bundle the whole package together to offer something end-to-end but NO software company's direct salesfolks would budge on their sacred business model to take the risk on a new model. What?! Pay-as-you-go monthly subscription? Nope, we want our whole $500,000, and 16% each year thereafter thanks.

Our only choice was to code it all ourselves. How times have changed....radically beyond even a monthly sub even Microsoft even is hip to the 'it's free and supported by ads!' biz model.

(Hmm, I wonder where direct salesforces at software companies are today...)

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2. Kip Meacham on November 10, 2005 01:32 PM writes...

These are, to me, the classic seeds of disruption playing out before our eyes. And while no one company will own the future, an oligopoly likely will. I also believe the battle for this space is going to be a bloodbath with many companies being eaten or dying.

While I would NEVER underestimate Microsoft, it will survive this disruption only after MAJOR culture shock as the rank and file work to respond to these memos in carrying out their day jobs. If the 'corporate cultural arteries' are too hard, a massive stroke and ultimately a long, painful death may be the result.

Kip Meacham

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