Will Web 2.0 ultimately kill Windows?

In Part 2 of “My Dinner with Allchin” (OK, so it was just a cup of tea), Microsoft Platforms and Services Co-president Jim Allchin touched on a few subjects about which he doesn’t often opine.

Allchin shared his thoughts on Windows Live (which, along with Windows and developer tools also falls under his organization); competition with Google and Apple; and why a client-based version of Windows won’t ever completely disappear, regardless of how successful Web services become.

(Here is Part 1 of my interview with soon-to-be-departing Windows chief Allchin, where he discusses Vista lessons learned.)

As with Part 1, this transcript of my October 18, 2006, interview has been edited for length and clarity.

Q: Today, a couple of years after Microsoft announced its intent to deliver a new version of Windows client and Windows server every two years, do you still believe this is what customers want? Or have you changed your thinking on this, and instead believe people want fewer or smaller incremental updates?

Allchin: Well, I think it's a combination. I believe that always being improving is a huge thing, and, of course, the Internet is the best distribution system ever created, so that gives us an opportunity.

On the other hand, you cannot do a real platform shift without everything being locked and loaded together, you just cannot do it. So I believe you can either call them small or dribble out through the Internet improvements, and then I believe in every once in a while a significant update that takes place, which everybody can get aligned to, the hardware industry, all the different software industries, the online services, everybody can get locked on it.

Q: The idea of the Internet as the distribution vehicle for releases gets me thinking about Windows Live. In your own words, what is Windows Live and where you see it impacting Windows like in the next three to five years? How is it going to change what Windows is and what Windows does?

Allchin: I have to be clear that I have spent my time focused on trying to get Windows out the door and helping (Platforms and Services co-president) Kevin Johnson and the like. (Windows Live) is not where I'm spending my time.

But I think the concept is fairly simple; it's to do an integrated suite of services that have to do with informing people, creating communities with people, and creating manageable, (protected) environments.And how I see Windows fitting with that is Windows is going to continue to be extended with services that can talk to products like Windows Live. And so I think it's an "and" proposition of we've got Windows Live services and we've got Windows; if you use them together, you get something better.

Although there are extremists, in my opinion, who say, oh, the world is going to dumb terminals and everything is in the cloud, and then there are others who believe that all the intelligence is on the client. I believe it's a combination of everything. Almost every person you talk to have their different views of what the future is. A little bit of everything is probably what's going to survive.

Q: Do you think there ever will be a day where the "fat" client operating system goes away?

Allchin: No.

Q: Never? Why not?

Allchin: No. No, I don't believe it at all. I think there's going to be an operating system that's rich and immersive; the answer is yes, totally. Dumbing it down to put everything in the cloud makes no sense to me.

On the other hand, having a completely isolated device that can't talk to services makes no sense to me. So I believe when I can't talk to the Net, I want a completely immersive experience, and when I can talk to the Net, I want the things that are shown to me that come from services to be shown in a great immersive way, and I want to be able to store them and keep them offline. I don't want to necessarily depend on worrying about privacy, my data that may be in somebody's datacenter, and who knows, who knows. My data is not -- personally my data is not in any cloud. It is not.

Clearly, there are lots of benefits if you think, okay, well, I'll just do backups and keep them up there. And eventually over a period of time I think that progress will be made there, but certainly we're not there today, at least for somebody as paranoid as I am.

Q: In your view, what’s Google's Achilles Heel?

Allchin: I think they have several issues that they will face, the first is being able to do integration that's meaningful. They basically have fiefdoms or sort of randomization of IP.

They've got lots of IP, but could they ever pull it together in a coordinated fashion? I think that is something that although their outward appearance is, oh, we're cool because it's random; as somebody who knows what it takes to do fairly complicated engineering efforts, that only goes so far. And even if you're not trying to do one of the large, complicated ones, if you have a whole bunch of small ones that are arguing with each other about what's the right way, that's also destructive.

So there's a management personnel growth thing that they're going to have to fight through. I'm not saying they can't do it. I wouldn't even say it's necessarily an Achilles Heel. But from an outside (perspective), it's a problem.

I would say that, at least so far to me, it looks like they're a one-trick pony, and I think that although they're trying to be “Mr. Ad,” I don't think anybody should be confused about (Google being all about) search. It’s certainly one focused bet, which you could say is either good or bad, but certainly I like to play the odds a little bit more than that.

We (Microsoft) have an "and" strategy. We’ve got a pretty strong client business, we've got a pretty strong server business. We have a pretty strong applications business. We've got a pretty strong entrant, yet to be proven, in terms of entertainment, in terms of games, et cetera, et cetera, and business apps, et cetera. And we can make those things fit together in a good way for customers, whether on the consumer side or the business side.

On our side, we obviously have a huge hill to climb to break into their area, but it is just one focused area.

Q: The same question about Apple. What's Apple's Achilles Heel, in your view?

Allchin: They have the positive that they are a closed company, and they can make it work well together. And they have the negative that they don't have an ecosystem, and they don't have any apps really to speak of. That makes it an easy problem from the app- compat perspective.

So I think from my perspective that's an Achilles Heel, because I think that is hard to gain the skill that you would need if you continue on that space. In an area which is virgin, like the iPod, they have a chance to hold it for a while, but personally I don't think it's sustainable.

I respect them. They're a good company. But in terms of the long term, my strategy if I was at Apple would be different than what their strategy is. And no, I'm not going to cover that.

Q: Awww. Come on!

Allchin: No, I'm not, but my strategy would be different. They're happy with their strategy, but I don't think it's one that will break through fully. So it's both a positive and an issue for them I think.

Q: Are you going to Apple next, then, after you leave Microsoft? 

Allchin: No. (Laughter.)

Q: Now that would be interesting!