Friday, 3 April 2015

As Microsoft turns 40, CEO Satya Nadella looks beyond Windows to the cloud

"WHAT are you on? The 'fuck Windows' strategy?" Back in the late 1990s, when Bill Gates was still Microsoft's boss, any employee who had the temerity to suggest something that could possibly weaken the firm's flagship operating system was sure to earn his wrath. Even after Steve Ballmer took over from Mr Gates in 2000, that remained the incontestable law at the company's headquarters in Redmond, in Washington state. Everything Microsoft did had to strengthen Windows, to make it ever more crushingly dominant. Many of the company's best innovations were killed because of this "strategy tax", as it was known internally.
Today the rules are different in Redmond. The new boss who took over last year, Satya Nadella, recoils when he hears the term "strategy tax" and says he now tells his staff simply to "build stuff that people like". Some of the things he has done would surely have been seen by his two predecessors as "fuck Windows" strategies. Office, the company's popular suite of word-processing, spreadsheet and other applications, now runs on mobile devices that use competing operating systems. The company is embracing free, "open-source" software, which it used to regard as anathema. At an event in San Francisco last October Mr Nadella showed a slide that read: "Microsoft loves Linux". In contrast, Mr Ballmer once called the open-source operating system a "cancer".
As Microsoft celebrates its 40th birthday on April 4, its executives and shareholders will be looking back wistfully to their company's lost youth. Born in the year that Captain & Tennille topped the American charts with "Love Will Keep Us Together", by its 20s it had leapt ahead of the stumbling behemoth of information technology, IBM, only to slow in its 30s and be overtaken by its eternal arch-rival, Apple, a company barely a year younger than itself.
Mr Nadella's formula for reinvigorating Microsoft is to move as quickly and as far as possible away from being a Windows-only company to be a global network of giant data centres that provide a broad range of online services for companies and individuals. So far he has done well in beginning to turn round a supertanker of a company, with 123,000 employees and $US87 billion ($114.6 billion) in annual revenues.
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