Is Microsoft like the renewed IBM?

In 2007 I wrote a blog that posed the question whether Microsoft was becoming like the old IBM. I used a number of cases that made Microsoft look like the IBM of the late 1980s and early 1990s – before IBM’s near demise and subsequent revival.

Now I see a blog post by James Governor who reckons Microsoft’s new CEO Satya Nadella is like IBM’s saviour Lou Gertner.

CEO Satya Nadella is increasingly looking like Microsoft’s Louis Gerstner – that is, an executive who can look at things from the customer perspective, with a truly outside-in view, and drive the cultural change needed to revitalise a company from the ground up. Nadella has a relaxed, confident demeanor that makes you want to lean in and engage, and now by extension, so does Microsoft. In terms of its corporate evolution Microsoft currently looks like IBM in the late 1990s, supporting whatever environments customers choose, but with Azure playing the role of Global Services, and the key customer being the modern software developer rather than the CIO. In other news Microsoft’s timing is pretty much perfect.

In the end time will tell, but I do believe Governor might be right.

 

Other companies becoming like IBM

technologyA number of years ago I wrote a blog post about the possibility of Microsoft turning into the ‘old’ IBM. Now it seems there are other similarities, but another company looks to be doing the same thing. Looking back at what I wrote in 2007, a few points now seem strangely familiar.

  • reliance on a monopoly cash-cow; IBM with mainframe hardware and operating systems, Microsoft with Windows and Office
  • branching out into all sorts of different systems and applications; being good in some areas and terrible in others, but still continued in the terrible areas
  • being a symbol of conventionality; Microsoft is now even old-fashioned to the millennial crowd
  • thinking that they might take over the world; in their heyday there were concerns that they might get too much influence, how quickly that fear can change

Nearly eight years later I think the points I made above confirm Microsoft has become like IBM, even as far as experiencing a downturn in business as new competitors and business models emerge.

Something else though has appeared that makes them similar to my mind – a knight in shining armour coming to the rescue. In the IBM story it was Lou Gerstner who saved IBM from a serious predicament. For Microsoft, it’s new CEO Satya Nadella’s change of business model. Nadella has introduced a number of initiatives which indicate a significant change in attitude, a recent one being the acquisition of email app Accompli; who would have thought that Microsoft would support other email platforms.

There’s another vendor whose business model has changed from what it set out originally, Oracle. Starting out purely in the enterprise software arena, in the last few years the number of acquisitions and the broadening of focus make it look like another IBM. But in this case, it’s because Oracle wants to own the whole stack. In comparing Digital Equipment Corp and Oracle, I commented in 2009:

There was a belief about Digital that it became too difficult to manage so many different technologies, and that contributed to the company’s demise. So I can’t help wondering how Oracle will manage.

Oracle seems to be doing OK. So far. Although Larry Ellison stepped down as CEO earlier this year, I bet he is still in control. The test will come when he leaves the company completely.

So perhaps it will have to wait another seven years before I can write again about how tech companies become like IBM.

Update: Gartner’s Merv Adrian published a quadrant-style picture that shows where Microsoft products are on the Gartner Magic Quadrant. Look at the range of products, and those that are not in the leader quadrant.

Is Windows 8 to Microsoft like OS/2 was to IBM?

Back in 2007 I wrote a blog that asked “Is Microsoft like ‘old’ IBM?” That was in the days when the mighty Redmond software factory seemed unable to do wrong. At the end of the blog, I asked:

I wonder how long Microsoft’s good times will last?

I thought it would last much longer than it has. Microsoft is now looking distinctly less mighty and infallible than it used to, that is because it missed the new markets of smartphone operating systems and tablets until they were well established by other companies.

Now I am beginning to wonder whether Microsoft is tracing the same steps with Windows 8 as IBM did in the 1980s when it released the OS/2 operating system?

Remember, IBM brought out OS/2 to try and win back its PC operating system market share from the growing Windows operating system. By that time, IBM had also lost its dominance of the PC hardware market, and it tried to counter that by introducing the PS/2. Both these initiatives followed the tried-and-trusted IBM approach to dominate a market with its own proprietary products.

What do I see now? Microsoft losing the Windows-based PC hardware platform to tablets and smartphones running Android or iOS, and struggling to become significant in the smartphone operating system. What does Microsoft do? Bring out Windows 8 as a touch–oriented operating system, to run on PCs, tablets, and smartphones.

Some people are already writing off Windows 8 as a failure; and a respectable tech journalist has commented:

… consumers don’t appear to be warming to Windows 8 …

Recent statistics paint a stark picture of the health of the PC industry: in April, analyst firm Gartner said that 79,2m PCs were shipped in the first quarter of 2013, an 11,2% decline over the same quarter in 2012 and the first time the number had fallen below 80m since the second quarter of 2009.

The same journalist observed:

 The problem Microsoft faces is far deeper than a simple change in the formula of its software. The entire structure of the computer industry has changed.

Doesn’t that sound like the situation IBM faced in the 1980s and 1990s when the computing paradigm changed from mainframes to PCs?

As I also wrote at the time:

IBM went from being a great tech-oriented company to one run by bean counters; the more I deal as a partner with Microsoft the more I feel that way about them as well.

I believe that still to be true. However, they obviously do have some good techies as the recent Xbox One announcement has shown.

IBM managed to change its fortunes under the leadership of Lou Gerstner. I hope Microsoft do the same.