The D-Word - Almost Got Me

Paul, you link baiter, you.  After an amazing dinner with amazing company and really outstanding red wine, I happened to catch the ruckus about Paul Graham's Microsoft is Dead essay. I get my news via Hugh.

Right on, Hugh.

Anyway, I read the essay and almost fired up Live Writer to blast Paul outta of the sky with all the predictable billions of dollars of profit, thousands of employees making a living, 100,000 companies living off the eco-system stuff I could muster and ending with STFU.

But I didn't.  Don Dodge did.

While Don was doing that, I was re-reading Paul's stuff to see where the larger point was since using the word "Dead" was so obviously over the top, it had to have been code for "let's see if the smart ones actually read this".

Here are the observations I believe you should take from Paul's essay, Hugh's cartoon, and even Don's STFU smack back to Paul.

1. Being afraid is a good thing, not a bad one.  Making the assumption there is competition (big or small) coming after you as well as worrying about somebody hungrier and smarter than you will keep you on your toes. See Hugh's cartoon.
2. Paul's larger point about influence is right.  Having the Internet, always on, high speed connections opened up a world of possibilities which means that no one large player is going to control it all.  In addition, your opportunities as a entrepreneur are plentiful.  IBM's, Microsoft's and Google's influence are all balanced against a vast market with open source, "free", web service, client based, alternatives for everything. 
3. Dan is wrong that people weren't "afraid" of Microsoft.  Back in the 90s, a change to API or not releasing information about an API could make or break a company. Never mind tons of people made money (and still do), the point was that you had to keep up with the interfaces, had to watch what was coming out of Redmond, and could get seriously screwed, for example, if you relied on an interface which got changed.  Today, that's not as true. Besides the obvious -Microsoft is 1000x more open with information- tons of people are creating product that don't have this level of dependency which lowers the 'fear' of getting tripped up or -even worse- run over by Microsoft. HTTP is 'safe' and doesn't 'scare' anyone.
4. While Paul's literal view about Microsoft buying up the Web 2.0 world is funny/wrong, Microsoft actually agrees with Paul's assessment about getting Web 2.0 companies outside of the Redmond fold.  For the last couple of years, Microsoft has been spending tens of millions of dollars spinning out technology, companies, and employees in a realization that they won't live inside the Redmond machine so spin em out.  Some make TechCrunch, some don't.  The point is, unlike other monster companies that now lay actually dead, Microsoft does get the point about making some types of innovation happen inside the machine while lots of it needs to happen elsewhere.  Message received, Paul.
5. Desktop Apps are not going away, that's just nonsense, but that's not actually what Paul said.  Paul makes the reasonable point that lots and lots of applications can now happen because of AJAX, Javascript, etc.  Where as before, everything was desktop or a Green Screen, today this is no longer the case.
6. Don is right that if making good money now and for some time to come is a definition of 'dead', bring it on.  But as I said at the beginning, I believe Paul was using hot words to make broader points.

Microsoft is doing the right thing by moving into other businesses with products like the Xbox.  There are lots and lots of high growth opportunities for Microsoft and by adapting to the changing world, Microsoft will continue to grow, employee people, make money, send out dividends, and be a magnet for diverse opinions on all matters Redmond.

Happy Easter/Passover, everybody.

Comments

[walter]

What I got from is essay is this ...

"Google, Please buy Snipshot - it's going for a song."

Paul's a smart guy but not smart enough to hide the whiff of desperation in his latest essay.

[Iain]

Hang on a sec Rick, you said yourself that people aren't afraid of Microsoft anymore.
http://ricksegal.typepad.com/pmv/2007/01/fear_and_not_so.html
Your blog entry was the first thing I thought of when I read the Paul Graham post.

[Rick Segal]

Yup, Iain, I did. And in my point 3, I pretty much make the same point. I think 'afraid' of competition in general and worried about what others are doing should be part of the game.

Outlook, Iain, get your cool little applet in Outlook so I can get you a check. :-)

Thanks for stopping by.

[starleads]

microsoft is a co. which has given the internet , the shape we see it. It has been here all along. so it will always have a upper hand in some ways..

[Matt]

I am not going to say that Paul Graham is entirely correct, but MSFT, as a stock, has a very specific time of death:

July 2004
http://finance.yahoo.com/q/bc?t=5y&s=MSFT&l=on&z=l&q=l&c=GOOG%2CAAPL

Moreover, isn't that all that matters?

[Chris]

Microsoft Xbox division makes billions of dollars a year but makes no profits. They tried so hard to get market share and they suceeded. But the truth remains that their gaming division is just not making money. Hasn't yet. Maybe with the xbox 720. hahah