I’ve always thought of Microsoft’s Steve Ballmer (currently the 33rd richest man in the universe, according to this year’s list in Forbes, which places him ahead of such luminaries as Paul Allen and George Soros) as the Harvard MBA version of the quintessential middle-aged Angry White Guy. Strip him of his education, breeding and wealth, and stick him in a belly hugging T-shirt and a Billy Bob cap, and the result might be a techno-teabagger ready to “take out” the likes of Steve “Hussein” Jobs and Sergei “Hussein” Brin.
Is Ballmer the angry brain behind Microsoft’s latest broadside against its rivals? Microsoft Corp. has filed suit against Motorola Inc., alleging that the cellphone maker is infringing on nine patents in handsets powered by Google’s Android system. Motorola formerly used Microsoft’s Windows Mobile system for their handsets, but they have since bet the farm on Google’s Android open architecture, which Google gives away for free, and which is quickly gaining ground in the marketplace.
Of course, Steve Ballmer takes issue with at least part of that latter statement. “It’s not like Android’s free,” he recently told The Wall Street Journal. “You do have to license patents.” Which seems to be another way of saying, “If you run Android in your cellphones, we’re going to sue your ass.”
Microsoft has struggled in the cellphone marketplace, especially since the introduction of Apple’s game-changing iPhone nearly four years ago. Four years is an eternity in the cellphone marketplace, and much has changed in that time. But not Microsoft. They’re still playing the catch-up game, which is their usual modus operandi.
While Microsoft might be the behemoth that swallowed Redmond, WA, and their Windows OS might be the cash cow that keeps on giving, they have never been ahead of the curve when it comes to product innovation. Their earliest success, the DOS operating system, was actually something they acquired (orginally QDOS, for Quick and Dirty Operating System), and retooled for the originaly IBM PC.
Since then, they have followed a basic formula: find a market where someone else has already staked a claim, and either buy them out or bully them out of the business, by using Windows dominance as leverage.
Windows, of course, was, on its surface, a copy of Apple’s GUI product, but then Apple had ripped the concept from Xerox, so the answer to who was copying whom is somewhat academic. But Apple was able to find a commercial application for the GUI concept, and Microsoft soon followed.
But success in the cellphone market has been elusive. Microsoft made a tentative stab at reinventing their approach to the cellphone marketplace earlier this year with the release of the Kin, which took several years and over a billion dollars to develop. The result? The Kin was discontinued after only six weeks of laggard sales.
The Kin was an attempt to meld mobile and social networking technologies, and if that sounds redundant, well, I guess that’s because it was. The Kin was shaped like a bar of soap, and if you bought one, you probably felt as though you’d just bent over to pick up a real bar of soap in a prison shower.
But the behemoth that ate Redmond isn’t giving up on mobile. They’re releasing a new Windows Mobile 7 smart phone. Go to Microsoft’s Windows Phone website, and you’ll see the slogan, “What you love about your PC, made for your phone.” Are they kidding?
Their new product boasts of enhanced inter-connectivity to other platforms, which seems to be another way of saying that Microsoft will use the mobile version of Windows to hawk their other products, such as Zune, Bing and Xbox. Surprise. This type of bundling, after all, was one of the main benefits they derived from the PC version of Windows.
Microsoft has high hopes on the success of Windows Phone 7 (and they couldn’t have come up with a catchier name?), but unless you come up with an innovative product that alters the direction of the marketplace, you’re not going to gobble up your competitors’ market share.
Which brings me back to legal skirmishes. Clearly, Ballmer and Company aren’t entirely convinced that innovation alone will launch them into an alpha-dog position in the mobile pack. So they’ve resorted to the time-honored stratagem of trying to crush their rivals in the courtroom, rather than in the marketplace.
And if you don’t think that Steve Ballmer, MBA, AWG, has some personal spleen to vent in this matter, be advised that according to a recent proxy report that was filed this week, for the fiscal year ending on June 30, Ballmer received an annual cash bonus of only $670,000.
Yes, I said “only,” as that amount is only half of what he potentially might have gotten. Not that Ballmer needs the dough. His personal wealth has been estimated at $14.5 billion. In other words, he could have personally financed the development of the Kin 14 times, and still have walked away with $500 million.
But an annual bonus is a CEO’s report card, as determined by the board of directors. A 50% bonus is, at best, a C grade, which my father always told me was “a gentleman’s failure.” No wonder Ballmer is PO’d.
See the video below for the WSJ’s take on the Windows Phone 7.