Feeds

Former exec and start-ups criticize 'Byzantine' Microsoft

Beware the next IBM

The Power of One Brief: Top reasons to choose HP BladeSystem

An ex-Microsoft executive turned venture capitalist has joined start-ups in warning about the Byzantine nature of doing business with the Microsoft empire.

Sam Jadallah, Mohr Davidow Ventures general manager, told an audience of Silicon Valley entrepreneurs they should "stay focused" when dealing with Microsoft which, he said, has become the new IBM.

Jadallah, who left Microsoft in 1999 after 12 years to become a VC, said: "From the outside it's Byzantine to figure out 'how do I work with Microsoft?' It's much like Microsoft working with IBM. We'd show up with one employee... and meet 12 from IBM, and think 'what do they do all day?' Microsoft is now in that same position."

Microsoft has been criticized for becoming increasingly bureaucratized during the five years since Steve Ballmer took over as chief executive, and moving away from the chaos of early years that produced Microsoft's first, landmark technologies.

The defection of Microsoft's China Labs chief Kai Fu Lee to Google recently highlighted growing inefficiencies in Microsoft's structure, with Lee claiming the increasingly unwieldy corporate structure amused even China's Communist Party. Conscious of its growing middle-age spread, Microsoft re-organized in September, collapsing seven business units into three for greater efficiency and to drive increased integration across Microsoft's products and services.

At stake is a lucrative partner-based business. Microsoft said Tuesday that partners stand to make between $7 and $8 in revenue for every $1 made by Microsoft, while 96 per cent of Microsoft's revenue comes from partners.

Start-ups attending an insider's guide partnering with Microsoft at the company's Mountain View, California, campus on Tuesday though were critical, pointing to a split between Microsoft's product and field operations as a major structural problem in their ability to connect with Microsoft and go to market.

Guy Maisnik, president and chief executive of AtHoc, said: "The number-one challenge was to penetrate the field groups. It took relentless patience."

Start-ups also complained about frequent corporate restructuring making it harder to keep up with field contacts. IIan Shmargad, vice president of strategic alliances for Identify Software, said, "After you have developed a relationship and hope and think that you have some coaches there, they are gone."

Shmargad cautioned it took "a lot of time and effort to invest on multiple fronts" to ensure you always have "other angles". He called this a time consuming process, which is not always "scalable" for start-ups whose time is stretched.

Other complaints centered on the difficulty start-ups faced getting to work with account-level sales staff and hurdles encountered by competitive Microsoft staffers who believe Microsoft is developing its own "similar" technology.

John Powers, Digipede president and CEO, suggested dangling the competitive carrot, saying one-way to get Microsoft's attention is to demonstrate products that help Microsoft compete with IBM or Linux. "When you can lay things out like that, the light bulbs go on very quickly," Powers said.

Jadallah called on partners to understand Microsoft's top priorities, as outlined by Ballmer each August at the company's worldwide sales meeting. "If you understand those and get in front of [the priorities], if you can get in front of the parade, you can feel the attention and get corporate attention," he said. ®

The Essential Guide to IT Transformation

More from The Register

next story
Secure microkernel that uses maths to be 'bug free' goes open source
Hacker-repelling, drone-protecting code will soon be yours to tweak as you see fit
NO MORE ALL CAPS and other pleasures of Visual Studio 14
Unpicking a packed preview that breaks down ASP.NET
KDE releases ice-cream coloured Plasma 5 just in time for summer
Melty but refreshing - popular rival to Mint's Cinnamon's still a work in progress
Leaked Windows Phone 8.1 Update specs tease details of Nokia's next mobes
New screen sizes, dual SIMs, voice over LTE, and more
Put down that Oracle database patch: It could cost $23,000 per CPU
On-by-default INMEMORY tech a boon for developers ... as long as they can afford it
Another day, another Firefox: Version 31 is upon us ALREADY
Web devs, Mozilla really wants you to like this one
Google shows off new Chrome OS look
Athena springs full-grown from Chromium project's head
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Application security programs and practises
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Securing Web Applications Made Simple and Scalable
Learn how automated security testing can provide a simple and scalable way to protect your web applications.