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Remember Wily Coyote? He's the Roadrunner's nemesis, chasing him out off the cliff's edge. Then there's that exquisite moment where he stands on thin air, about to realize he's got nothing. That's Microsoft, folks.

IMing with Dan Farber, who's up in Redmond for the SMBusiness Summit, he disagrees, saying the crash won't happen right now, given how slow customers change. From the GooChat:

MS is banking on that....and this major push... going after the mid-market (which means no small do it yourself and not enterprise with lots of resources, but the giant middle that is a little of both) will be an attempt to leverage the fact that most of those businesses have Office and the way to win them over is to deliver simple solutions that leverage Office (including the servers)....make Office the hub for CRM, collaboration, dashboards, etc....connecting to other systems as needed by providing the familiar Office environment.

All of which makes perfect sense... in 2001. Back then, the world was divided up between Exchange and Domino, Outlook and Notes. Salesforce was a twinkle in Marc Benioff's eye, and Hailstorm was the view through Mark Lukovsky's rose-colored glasses. Back then, Mark told me:

It's a mistake to think of HailStorm as just a consumer service. HailStorm is a service for individuals, but we really don't care whether you're wearing your hat as an individual or your hat as a business entity. Most of the scenarios we've talked about to date have been focused on consumers. But, in fact, most of the technology in your life probably does dual duty. If you think about your PC at home, it probably gets used for home and work purposes. Your cell phone probably gets used for home and work purposes. So, you're already part of multiple networks of technology, and HailStorm can very easily span those two things.

 Of course, Lucovsky got the scenario right and the politics worng. Allchin killed the project but not the idea, which slowly escaped into the wild as Microsoft failed to stem the exodus down the coast toward Silicon Valley. As Dare Obasanjo so succinctly puts it (how does he stay unfired?):

The decisions that Microsoft has made over the past couple of years from abandoning feature work in Internet Explorer until Firefox became popular to a lot of the original intentions around the 3 pillars of Longhorn (Avalon, WinFS & Indigo) are the actions of a company that is more interested in protecting its market share than one that is trying to improve the lives of its customers by building great software.

The market share Allchin was protecting from Hailstorm was Office. No wonder Steve Ballmer went nuts last November when Lukovsky walked in tell him he was jumping to Google. But what did Steve have to offer Mark by way of deflecting the Google offer. Don't worry, we were just kidding. Hailstorm it is, we'll fire Raikes instead.

What Google had to offer was Gmail, a huge server farm, and a burgeoning software-as-a-service architecture in waiting. Gmail neatly sidestepped the Passport rathole that pulled Hailstorm under, and Skype reassured some of us that we weren't trading one monoculture for another. And in a few hours Steve Jobs will cut to the chase with an iPod phone that will trigger the last push (with or without the carriers) to a muni WiFi/EV-DO mesh network.

What does Microsoft do? According to John Battelle, court documents show Redmond trying to pin a Netscape tail on the Google donkey, attacking them in search to cut off their air supply. But it's too late for that--Google has moved past search to put Office in a hammerlock. With Gtalk, Google sends a very loud message: we don't have to win in order for Microsoft to lose. Leveraging Jabber isolates Windows one more time, leaving the OS just another UI on which to host a Firefox-served cross-platform application layer.

My in-laws bought my daughter an $800 Windows desktop system. She's used to her Mac laptop, so instead of using the Office Standard edition (times out in 60 days), I booted the Mac, shared Internet access through the Ethernet port, used the Mac's Mail app to register a Gmail account, and logged on from the PC. I set up Gmail to stuff her personal email account into outgoing Gmail's From field, and set up the laptop to pull Gmail POP3 to Mail for an offline store. Goodbye Office.

What, you say, no word processor? Well, I could have her download Open Office, but for now I just have her write in Gmail and use its spellcheck, then paste into whatever blog app I set her up with, probably Flickr so she can mix in images. So far I'm resisting Google Desktop due to its lack of a Mac counterpart, but its notes engine is very promising. Then there's Web Clips, which lets us flow RSS feeds into the store. Add it up, it's read/write with a bootstrapped offline model while we wait for EV-DO. Game over.

Game over for what? says Farber. For business users? It's Office 97 in reverse, Dan. Over, around, through IT. No calendar? Hack iCal on the Mac with Automator to send alerts to Gmail and SMS to cell. Collaboration? Use RSS out and Web Clips in for document review, IM chat storage, even enclosure staging. Lukovsky: [I]t's a mistake to think that HailStorm is not also focused on individuals in a business context.

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