September 25, 2000
Microsoft, in Turnaround, Courts
Large-Server Software Business
By REBECCA BUCKMAN
Staff Reporter of THE WALL STREET JOURNAL
REDMOND, Wash. -- "Harry Potter and the Goblet of Fire" was a trial
by fire for a product that Microsoft Corp. desperately needs to succeed.
Last summer, Microsoft engineers made a gamble by distributing a test
version of a new database to Barnes & Noble.com Inc. the weekend
before the latest Potter book came out. The software smoothly handled the
Web site's huge spike in book orders and paid a dividend to Microsoft,
too: By testing the product early with a big customer, Microsoft could
identify and fix more bugs in the software before bringing it to market the
next month.
Such tactics are crucial for Microsoft, which is
trying to convince more companies like Barnes
& Noble.com that its software for large server
systems can finally handle the massive computing jobs now dominated by
Oracle Corp., Sun Microsystems Inc. and International Business Machines
Corp. Microsoft will talk up many of its server products at a splashy media
event in San Francisco Tuesday.
That software is the result of a long-running campaign at Microsoft to
shuck its inbred ways and hire older outsiders to help it attack the new,
more competitive market. The company -- whose brainy employees built
the world's dominant brand of desktop software for consumers -- wound
up turning to an eclectic group of industry veterans for the new project
because they understood the special rigors of the largest servers that run
busy Web sites and operations at Fortune 100 companies. The immigrants
include an alumnus of Microsoft arch-rival Oracle.
Serving Up Competitors
Microsoft has looked to competing companies to hire engineers for its server
softwarebusinesses. Key hires in recent years:
Name
Position
Previously at
Chris Atkinson
VP, .NET Developer
Solutions
Digital Equipment
Paul Flessner
Senior VP, .NET Enterprise
Servers
Baxter Healthcare
Hal Berenson
General manager, SQL Server
Digital Equipment
Peter Spiro
Distinguished engineer
Digital Equipment
Dave Reed
General manager
CenterLine Software
Phil Bernstein
Senior researcher
Digital Equipment
Pat Helland
Software architect
Tandem Computers
Dave Thompson
VP, Server product group
Digital Equipment
Bill Baker
General manager
Oracle
Source: The company
For many of them, arriving at Microsoft produced culture shock: Vice
President Chris Atkinson, formerly with Digital Equipment Corp., recalls
joining the company in 1992 and getting a complaint from a customer
about a glitch in Microsoft's Word program. When he rushed to the
support desk to find out when technicians could design a fix for the client
-- a large British bank -- he was surprised when they told him the bug
would be corrected in the next version of Word.
"I said, 'When will that be?' " Mr. Atkinson recalls. "They said, 'About a
year.' "
These days, Microsoft seems far more attuned to the customer service big
companies demand -- the kind its competitors have been providing for
years. Computer vendors who sell Microsoft's new Data Center version of
its Windows 2000 operating system, for instance, must commit to having a
technician on site for customers within four hours of a service call, Mr.
Atkinson says.
Along with Data Center, Microsoft has recently released SQL Server
2000, its new database software that competes head-to-head with
Oracle's product, and Exchange 2000, which manages Internet messaging.
At Tuesday's event in San Francisco, Microsoft Chief Executive Steve
Ballmer also is expected to highlight soon-to-be-released server software
such as the company's new Commerce Server, which helps companies
manage business Web sites, and the much-touted BizTalk server, whose
release has been delayed and still isn't expected for months.
Microsoft will derive about 20% of its revenue from server software this
fiscal year. And it is counting on the products to offset slowing growth in its
more traditional Office and Windows businesses, analysts say.
All the corporate-server products are based on Microsoft's new,
Windows 2000 operating system, which officials say is far more reliable
than previous software. Companies "just want it to work," says Paul
Flessner, the Microsoft vice-president now in charge of its server efforts.
"You've got to hire guys who get that. It's not, 'Oh, look at this cool
feature.' It's a lot of blocking and tackling."
Mr. Flessner has done that, helping to pull in hundreds of people with
experience at other corporate-software companies, such as Oracle and
IBM, since he joined Microsoft from a hospital-supply company six years
ago. Many of the engineers now leading product development also worked
at Digital Equipment Corp. and Tandem Computers Inc., both of which
were bought by Compaq Computer Corp.
Microsoft's progress remains steady, but industry analysts say the
company still has a ways to go. The new server products make Microsoft
"a more compelling competitor…but I don't think Microsoft yet has
the credibility at the high end of the market," says Melissa Eisenstat, an
analyst at CIBC World Markets. "It doesn't happen overnight."
Agrees Anil Gadre, vice president and general manager of Sun's Solaris
software business. "Time in the game also matters. ... Their story,
apparently, is, 'We're catching up.' " |
