A report card: Microsoft's Ozzie grades his three years of 'disruption'

This week at Microsoft's Professional Developers Conference (PDC), I had my first chance to interview Chief Software Architect Ozzie since he joined Microsoft. I asked him to rate the extent to which Microsoft has delivered on the plan he outlined three years ago today in his infamous memo entitled "The Internet Services Disruption."

Three years ago today, on October 28, 2005, Microsoft's now Chief Software Architect Ray Ozzie issued a missive that put Microsoft employees on notice.

A report card: Microsoft’s Ozzie grades his three years of ‘disruption’
Entitled "The Internet Services Disruption," Ozzie's memo to his direct reports detailed how Microsoft needed to change its products, business models and strategies to stay relevant in the quickly changing Web world. It was the first official document that mentioned the development approach every division at Microsoft has come to embrace: Software plus services.

This week at Microsoft's Professional Developers Conference (PDC), I had my first chance to interview Ozzie since he joined Microsoft. I asked him to rate the extent to which Microsoft has delivered on the plan he outlined three years ago.

(When I reviewed Ozzie's 2005 memo and looked at how closely Microsoft has executed against his ideas, I was surprised about the extent to which Ozzie and his team has stuck to plan. The company has rolled out service complements to many of its software products; introduced several ad-funded pilots; and created a number of hybrid research-product labs to make the company more agile in rolling out new technologies. All of these goals were outlined in Ozzie's 2005 memo.)

Is Ozzie satisfied with Microsoft's progress? Where could the company do more -- and how?

"I know I wanted was to shock people into realizing that there was this new thing happening, and I think we did do that, but I can't remember what my aspirations were in terms of concretely taking advantage of it.

"Overall," Ozzie said, "I'm really pleased actually with the fact that it's come together," Ozzie said. "It's certainly nascent. It's certainly kind of the early days. The stuff is just coming to light. It's a real testament to the culture that even though there's a lot of wrangling that you need to do to get this group to that group to that group, you can end up in a place where people say, 'Okay, I get it. I get the end-to-end thing of what we should be accomplishing, and I'm going to march in line.'"

Ozzie admitted there were some areas, however, where there was room for improvement.

"When I had hoped that things would come together, I think, in my mind I was being a little bit too dreamy about how early I could get some of the key technology elements -- specifically (Live) Mesh and Red Dog (the new "Azure" cloud operating system), into the hands of internal developers. The problem was because they themselves were so complex, the maturity of the things that we've got on them as this point in time is limited. It will be a different story a year from now. But I wouldn't want to hold it for another year.  So, we're getting in the game."

What about search and mobile -- areas where Microsoft has made few inroads against Google and seemingly lost momentum to Apple?

"On the mobile side that's not a maturity thing; that's just an issue where I just think we've -- how shall I say this -- a very dynamic market has resulted in our reevaluation, reflection and reevaluation, and so the plans that I might have shown here (at the PDC) we decided not to show because we just wanted some bake time."

"There's no way three years ago that I could have ever imagined that the entire phone ecosystem would be so shocked by two forces at the same time, one being Apple coming in and (the other being) a change in the operators' openness to an app ecosystem that wasn't managed by them. That was just a game changing thing. Microsoft could not get the operator ecosystem to that level after years of trying."

Windows Mobile 7 will address some of these points, Ozzie said. (Unfortnately, he had no new info to share there as to exactly how it will be suited to a more open phone ecosystem.)

Ozzie gave kudos to the Office Live team as one that has been at the forefront of embracing his ideas and goals.

"I'll tell you one group that doesn't get a lot of press, but I'm really, really proud of it is Office Live," Ozzie said. "Every organization from a change management perspective needs a group that gets it from which lots of great things emerge, and Office Live has been a great change-management entity within the organization in terms of spreading what it's like to run a service, what it's like to take non-service assets like SharePoint that are getting more and more service-like and giving guidance to the teams saying, here's what's important, here's what's not so important, focus on this, etc."

It's worth going back and re-reading Ozzie's 2005 memo if you're interested in Microsoft's general near-term directions. I'm hoping us Microsoft crystal-ball-gazers will see a 2008 update memo from him some time soon.

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