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Microsoft's Ballmer tells lurvely partners to stick it to IBM

Software out the yin-yang

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Steve Ballmer has lambasted IBM, Linux and SAP while exhorting thousands of partners to bet their next 10 years on Windows and Microsoft services.

A pumped-up and sweating Ballmer informed Microsoft's Worldwide partner conference on Sunday morning that IBM is a spent competitive challenge that is pushing sub-par software, while he worked the crowd's concerns over IP and patents by talking of so-called "rumors" that Linux violates more than 200 patents.

Highlighting planned advances in Microsoft's search technology, mobile platforms and integration across Microsoft's applications, Ballmer urged partners to target legacy installations of Novell's NetWare, IBM's Lotus Notes and Microsoft's NT 4.0.

Screaming multiple "thank-yous" Ballmer said he loved partners for helping increase Microsoft's revenue and market share during its recently closed fiscal year. Looking ahead Ballmer said: "There is still plenty of NetWare and NT business out there. Let's bring them over."

Microsoft's high-octane chief executive continued: "We have Lotus Notes opportunities coming out the yin-yang. I've never seen [such] a customer base waiting to be plucked."

Ballmer, though, sent a coded message to partners warning them that their trusted platform provider could turn competitor, as Microsoft would continue to enter new markets - as it has done by adding Business Intelligence to SQL Server and buying Great Plains and Navision in business applications - to "extend the footprint" of general purpose products.

"Customers like this notion of being able to do most of their important tasks from within applications that they understand... I don't think that should be an issue for us and the partners in this room," Ballmer told delegates.

Instead, Ballmer said, partners should look to build functionality on top of general-purpose Windows platforms, like Microsoft Business Solutions (MBS). "We see MBS as a horizontal platform which will need thousands of partners to bring vertical experience, solutions and IP... we want and embrace those partners."

Ballmer added that if Microsoft didn't buy companies and help consolidate the market, then someone less likely to partner with small ISVs would step in. "SAP will consolidate that market, and SAP is less interested in ISV partners who write vertical solutions," Ballmer warned.

Having beaten up partners on the need to love Microsoft, Ballmer proceeded to tell companies why they need-not fear the might of IBM or the rising tide of Linux.

During an on-stage Q&A with three specially invited, and prepped, partners, Ballmer was asked by Dimension Data chief executive Brett Dawson how to compete against the combined might of IBM hardware, services and consulting.

"That sounds like the three [blind] mices instead of three musketeers," Ballmer said, padding around the conference stage. "Does IBM have the best software? They don't even have the second best software," he said, adding - incorrectly - that since IBM's $1.25bn sale of its PC business to Lenovo IBM "won't sell you the hardware anymore. "

"IBM's not the compelling value proposition it was 10 years ago. It's important to disabuse the notion it all comes from IBM... the [IBM] value is significantly less today than at any time in my 25 years in the business," said the moist Ballmer.

Turning to Linux, Ballmer focused on patents. Responding to a question on IP, Ballmer - again inaccurately - cited an Open Source Risk Management (OSRM) survey from last summer that highlighted the existence of 287 patents in the Linux kernel. "Rumor is Linux violates 286 patents," Ballmer said before moving on quickly.

Linux vendors had to find ways to launch products that are "appropriately packaged" with IP and indemnification from prosecution, he added.

Ballmer then launched into a description of future opportunities for partners who resell Microsoft's current and planned products and services. He outlined opportunities with the up-coming Longhorn, Office 12, SQL Server 2005 and Visual Studio 2005 and a list of MBS applications.

Ahead of new products, Ballmer told partners they should use existing products like Office 2003 to deliver desktop productivity and collaborative offerings anchored on Window Server 2003, to unseat those legacy NetWare, NT and Notes installations. Just 15 per cent of all PCs currently run Office 2003, two years into its life, Ballmer said.®

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