Does Rick have a Web 2.0 bug in my office?

I’ve been talking to coworkers about what I learned in Silicon Valley last week and I swear that venture capitalist Rick Segal is listening in. Particularly his second observation. That’s going to be the hardest for Microsoft to compete with because of how we setup our business units internally (and because we hire lots of entrepreneurial people from other companies that think deeply about how to build businesses). We don’t grok Google’s ability to ship stuff that won’t make them any money (or why they’d do that). Like Orkut, or even Google’s Maps (they don’t yet have any advertising on them). Microsoft is up against a brilliant Google strategy — one that’s aimed at disrupting all sorts of things that came before and one that’s aimed at our weaknesses (and at others too, all at the same time). Internally here at Microsoft each team has its own business interests to look after and considers itself accountable to shareholders to show same. We’re very decentralized. Google looks at its business holistically, not part by part like Microsoft does – it is very centralized compared to how Microsoft is run. Google tells its engineers to go and come up with cool services without thinking about monetization strategies — they say they’ll figure that out later. That’s disruptive.

18 thoughts on “Does Rick have a Web 2.0 bug in my office?

  1. Even though Microsoft and Google approach the market differently. I believe they are destined to compete for developers and users, and maybe eventually enterprise customers. I don’t think it will be a battle for a while, yet.

  2. Even though Microsoft and Google approach the market differently. I believe they are destined to compete for developers and users, and maybe eventually enterprise customers. I don’t think it will be a battle for a while, yet.

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  4. I believe Microsoft and Google are destined to compete for the hearts and minds of developers and users, and maybe someday enterprise customers. I don’t think it will be a head to head battle for a while since Microsoft and Google approach the market very differently.

    I am reminded of a quote “In a fight between a grizzly bear and an alligator, the terrain determines the winner”. Meaning, each company has its strength and position in the market. The company that crosses over to fight on the others turf is likely to lose…but probably not die. These giants are too strong and too smart to battle to the death over any one market. It will be a battle for first place versus second place, with each making money in its own way.

    I wrote a blog on this subject today which can be found here. http://dondodge.typepad.com/the_next_big_thing/2005/11/microsoft_vs_go.html

  5. I believe Microsoft and Google are destined to compete for the hearts and minds of developers and users, and maybe someday enterprise customers. I don’t think it will be a head to head battle for a while since Microsoft and Google approach the market very differently.

    I am reminded of a quote “In a fight between a grizzly bear and an alligator, the terrain determines the winner”. Meaning, each company has its strength and position in the market. The company that crosses over to fight on the others turf is likely to lose…but probably not die. These giants are too strong and too smart to battle to the death over any one market. It will be a battle for first place versus second place, with each making money in its own way.

    I wrote a blog on this subject today which can be found here. http://dondodge.typepad.com/the_next_big_thing/2005/11/microsoft_vs_go.html

  6. Google Maps definitely has ads. Go to http://local.google.com and search for a restaurant in your zipcode. Scroll down to the bottom of the results on the left. You’ll see a couple ads tucked in there.

    I’m not 100% sure MSFT should be competing in this space. You run the danger of becoming Sun, a hardware/OS company relegated to an ever-dwindling piece of market share. Focus on providing the best framework for people to create these apps on.

  7. Google Maps definitely has ads. Go to http://local.google.com and search for a restaurant in your zipcode. Scroll down to the bottom of the results on the left. You’ll see a couple ads tucked in there.

    I’m not 100% sure MSFT should be competing in this space. You run the danger of becoming Sun, a hardware/OS company relegated to an ever-dwindling piece of market share. Focus on providing the best framework for people to create these apps on.

  8. Oops, please disregard my closing paragraph and my opening sentence. I’ll blame it on my lack of sleep for not realizing you weren’t taking sides :)

  9. Oops, please disregard my closing paragraph and my opening sentence. I’ll blame it on my lack of sleep for not realizing you weren’t taking sides :)

  10. “We don’t grok Google’s ability to ship stuff that won’t make them any money (or why they’d do that).”

    Wow. I have the complete opposite stance. I would love for every company to take users into consideration before realizing profit/control strategies.

    After reading the Wired article about the conflict of corporate interests with the ROKR phone, I was boiled to the bone. Cellphone carriers want you to use their services and Apple doesn’t want to cannabalize iPod Nano sales. So you get a love/hate control relationship between companies, none of which benefit the user. And from left field, of course, there’s the music labels who want more profit even though its cheaper than ever for them deliver music to the fans. Let us not kid ourselves…variable pricing for iTunes-like services sounds fantastic but the reality is the ratio of higher to lower priced songs will be something terrible, like 20:1.

    One of the reasons I find open source so attractive is the lack of corporate interests/profit before user satisfaction. Sure, open source projects aren’t perfect, but they have great intentions in mind for the user. Myth TV immediately springs to mind when compared to DRM musings in Tivo.

    iTunes is another great example of software putting users before corporate profit. Apple could’ve easily been charging more for downloads by now. Similarly they could’ve also said “iMixes don’t make us money” or “Podcasts won’t make us money”. But they didn’t and I applaud them for introducing services that benefit users, even if it doesn’t translate to profit for them.

    Hrmm…I’m noticing something: Flickr, Del.icio.us, GMail, Google Maps, Google News, Digg.com, iTunes, Firefox. All my favourite tech companies/web sites seeem to have an emphasis of caring for the user and abstracting away the corporate side of things (which, of course, is very important). Isn’t it the old adage of going public = selling out? The potential of losing this user-centered view when becoming a big company is something I fear (like many others I’m sure).

    To be honest, I’m kinda surprised at this post. It’s something I’d expect from Microsoft the Corporation, not Robert Scoble the Human Voice of Microsoft.

  11. “We don’t grok Google’s ability to ship stuff that won’t make them any money (or why they’d do that).”

    Wow. I have the complete opposite stance. I would love for every company to take users into consideration before realizing profit/control strategies.

    After reading the Wired article about the conflict of corporate interests with the ROKR phone, I was boiled to the bone. Cellphone carriers want you to use their services and Apple doesn’t want to cannabalize iPod Nano sales. So you get a love/hate control relationship between companies, none of which benefit the user. And from left field, of course, there’s the music labels who want more profit even though its cheaper than ever for them deliver music to the fans. Let us not kid ourselves…variable pricing for iTunes-like services sounds fantastic but the reality is the ratio of higher to lower priced songs will be something terrible, like 20:1.

    One of the reasons I find open source so attractive is the lack of corporate interests/profit before user satisfaction. Sure, open source projects aren’t perfect, but they have great intentions in mind for the user. Myth TV immediately springs to mind when compared to DRM musings in Tivo.

    iTunes is another great example of software putting users before corporate profit. Apple could’ve easily been charging more for downloads by now. Similarly they could’ve also said “iMixes don’t make us money” or “Podcasts won’t make us money”. But they didn’t and I applaud them for introducing services that benefit users, even if it doesn’t translate to profit for them.

    Hrmm…I’m noticing something: Flickr, Del.icio.us, GMail, Google Maps, Google News, Digg.com, iTunes, Firefox. All my favourite tech companies/web sites seeem to have an emphasis of caring for the user and abstracting away the corporate side of things (which, of course, is very important). Isn’t it the old adage of going public = selling out? The potential of losing this user-centered view when becoming a big company is something I fear (like many others I’m sure).

    To be honest, I’m kinda surprised at this post. It’s something I’d expect from Microsoft the Corporation, not Robert Scoble the Human Voice of Microsoft.

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