RealTime IT News

Microsoft's Ray Ozzie on the Hot Seat

Two earthquakes shook the Silicon Valley on Thursday. The first, probably noticed only by the roosters and newspaper delivery people awake at the time, measured 4.7 on the Richter scale.

The second, eight hours later, was presumably caused by competitors jumping up and down for joy at the news that Bill Gates was retiring from day-to-day operations at Microsoft, even if not for another two years.

The technological torch will be passed to Ray Ozzie, who has the technical acumen to keep up with the overachieving Gates even if he doesn't have the same mainstream name recognition. Ozzie's elevation to chief software architect comes one year after Microsoft acquired his firm, Groove Networks and caps a remarkable technology career.

In 1982, Ozzie joined Lotus Development, where he was involved in the development of Lotus Symphony and more importantly, Lotus Notes, one of the first major collaboration software packages. IBM bought Lotus in 1995. Notes reportedly has 125 million users worldwide.

Now Ozzie has the task of righting the S.S. Microsoft, which by all accounts is foundering. Windows Vista is approaching Duke Nukem Forever-levels of tardiness; Office remains a harder sell with every version; Internet Explorer 7 has been greeted with yawns as upstart competitor Firefox make inroads; and Google continues to run circles around Microsoft.

One person who knows Ozzie well is Mitchell Kapor, the founder of Lotus who now runs The Open Source Application Foundation. Kapor has nothing but praise for his old friend. "If anybody can lead the effort to reinvent Microsoft technically, Ray is the person to do it," he told internetnews.com.

"I've known Ray for almost 25 years and worked together very closely with him. He has immense integrity, is very collaborative, is brilliantly smart and both visionary in his thinking and very sound technically. So he has a breadth and depth that I don't know anybody else has," said Kapor.

And Microsoft needs a reinvention. Kapor said that when he talks to entrepreneurs and start-up firms, none of them are talking about what Microsoft is doing, they are talking about what Google is doing, and that's not good news for Microsoft, he said.

But while Ozzie is technically in Gates's league, he doesn't have Gates's gravitas. "The most important title Bill Gates he had was not chief software architect, it was he was Bill Gates, and that title is not transferable," said Greg DeMichillie, lead analyst for Directions on Microsoft.

If you ask who should get the chief software architect title, Ozzie is as good a you can get, but he won't necessarily have Gates's moral authority, DeMichillie said. He thinks Microsoft will need this two-year transition before Gates's retirement to see how well Ozzie works out in that role.

However, Dwight Davis, vice president and practice director of Summit Strategies, thinks Ozzie will have a strong standing at Microsoft and has already proven himself. "He clearly deserves credit of late in getting Microsoft engaged in the online services world much more than it had been prior to his arrival," he said. "Microsoft had been remiss in not pushing harder into that space."

Microsoft has claimed for years that its packaged software should go away and be replaced by software as a service, but the company has remained glued to its packaged software channel. "Despite positioning itself to move to that space, it hasn't been a catalyst in moving to [software as a service]," said Davis. "Ozzie can be given credit at getting them off the dime and start making some moves."

But Ozzie is a newcomer to Microsoft, only a little more than a year with the firm, and Microsoft has been a rarity in corporate America in that it largely promotes from within. The company's upper level executive branch is full of lifers. High-profile executives have come and gone quickly, like former SGI CEO Rick Belluzzo, who flamed out after two years as president and COO.

"Microsoft has historically been a very difficult place for executives to come in from the outside and hit the ground running," said DeMichillie, who figured senior VPs Steve Sinofsky or Eric Rudder, both Microsoft veterans, would have gotten the nod instead of Ozzie.

"That's the challenge for people who have been brought in, although it seems he has been given more authority than some other people who have come in and tried to negotiate the territory between Ballmer and Gates," said Davis.

The task ahead of Ozzie, then, is to make Microsoft competitive again, and that can be tough because there is no one problem with Microsoft, DeMichillie points out. He said the the Windows Live strategy looks like a mess, the Windows team keeps over-promising and failing to schedule properly, the Web business has a problem figuring out how to monetize all of its technologies, and the Office group has to convince people to stop using a five-year-old version of Office and buy a new one.

That said, Microsoft is still the world's biggest software company and a force to be reckoned with.

"I've heard Microsoft put on the back burner by people too many times who've come to regret that," said Davis. "I suspect anyone who thinks they have nothing to worry about from Microsoft because of the Gates departure will be sadly mistaken."