Last week we showed the highlights and 10+ minutes of video footage of an exclusive hour-long TechCrunch interview with Microsoft CEO Steve Ballmer.
Now for the rest of that interview. The video was just a teaser. I spoke with Ballmer for another 50 minutes on the record, doing a deeper dive into five key areas of Microsoft’s product strategy: Big Opportunities, Operating Systems/Browsers, Mobile, Search and Developers.
This post is about big opportunities at Microsoft beyond their dual cash cows of Windows and Office. Microsoft generates around $20 billion a year in pre-tax profit, and spends nearly $10 billion on research and development. When Microsoft thinks about increasing (or sustaining) those profits, they have to think big. And they have to think long term.
Ballmer says he thinks about new business opportunities in three buckets: expanding current businesses (short run), building things from scratch (long run), and big aquisitions (short cuts).
First Bucket (short term): The bulk of new business opportunities in the short term are going to come from things that Microsoft is already working on. Says Ballmer: “Most of what we’re going to move the needle in the next five years relative to 20 billion is going to come from things that we’re already in.”
Second Bucket (long term): It just isn’t realistic, he says, to build new businesses from scratch to big profits (the kind that make a company the size of Microsoft blink) in five years or so. Ten years is a more appropriate horizon for new ideas: “You would be hard pressed to name a start-up company that generated an interesting amount of profit in five years relative to 20 billion. Even the most successful. Google in its first five years, Facebook in its five years.”
Third Bucket (aquisition short cuts): Despite the fact that in the initial interview Ballmer said that total acquisitions of around 15 companies per year would remain roughly steady, he says not to expect any big “needle changing” acquisitions in the near future: “And the only other wild card you can weigh on top that, which we just don’t do much, is large acquisition. So, we have nothing to announce, there’s nothing we’re thinking about, so I’ll put the third bucket aside.”
Ballmer also specifically highlighted seven businesses that he hopes to dramatically build and/or expand over the next few years: PC innovation, Communication/Productivity Tools, Phones, TV, Search, Enterprise Infrastructure and Servers. He also says to expect an explosion of application development over the next five years:
It’s going to come on innovation and growth in the PC market having the number of PCs that are sold continue to grow. That’s important. We can drive that. It’s going to come from innovation in the tools and technologies both at home and at work to help people communicate, collaborate, to be productive. It’s going to come from phones. It’s going to come from the intelligence that powers TVs. That could happen. It probably doesn’t explode unless we can manage to make the device that does that, the PC, that’s the way to get short-term explosion. We’re focused in on that.
Search, we have real opportunity in search in the next five years.
Biggest opportunity that we never talked about is enterprise infrastructure. Most of that goes to the database and mainframe vendors today who are in the business. We’ve got four billion in revenue and yet we’re a small marketshare player.
Servers, there are going to be more new applications written in the next five years than any five-year period of time.
…
So, I take a look and, I’d like to say we’ve got seven big opportunities and everyone of those seven opportunities is going to have to do its fair share to move the needle over the next five years on the 20 billion. We have some other things that in aggregate may not themselves be a large percentage of the 20. But those have to perform, and we’ve got to be investing in some things that can explode in years 5 to 10. I hope I answered your question.
What about new technologies like Azure, Mesh, etc? Ballmer says they’re “dislocators to technology” that overlay all of these opportunities:
I don’t list the cloud because the cloud has kind of overlaid all of those opportunities. We have opportunities by offering cloud infrastructure to enhance the margins we make in our server business, in our communications and collaboration and productivity business, and that’s where things like exchange online, SharePoint online, Windows Azure, they’re not really new value propositions, but they are new potential margin streams and dislocators to technology shifters and some of the existing kind of customer propositions that we invest in.
Ballmer also broke down that huge $9.5 billion/year Microsoft R&D budget. Just $250 million to 300 million per year is invested in pure research, he says. The bulk of it goes into Microsoft’s five key business areas. They have 5,000 people just researching search, for example. Health IT, robotics and energy also have a share of the budget:
Well, if you look at the R&D budget itself, let me break it into four pieces: pure research, that was misreported I think in Business Week recently. But our pure research budget is about $250 to 300 million or something like that. We have what I call an incubations budget – incubations and explorations. These are things we’re not sure turn into products and don’t yet fit in any one of the existing business groups necessarily. Mostly managed by guys like Craig Mundie and Ray Ozzie. That’s another several hundreds of million dollars.
We have new businesses, put health for example, we have a fairly significant investment in health IT. There’s some stuff going into robotics, energy. That would be another few hundred million. And then the bulk of our key money is going into our five big business groups that are investing in the kinds of stuff that we talked about. Just take search, order of magnitude, we have 5,000 people working in R&D and search order of magnitude.
Five thousand people, you pay a person fully burdened let’s say 200,000 plus. That’s kind of what the tech industry looks like and you get a billion dollars to spend. But we got five of those things, and so – or bigger than a billion. Not many of them are too much smaller than a billion. You put them all together and then add to the first billion and a half I described and then say get the 9.5 billion bucks. So, the bulk, eight of the 9.5 is invested in the core businesses including the incubations that are going on inside the businesses.
Ballmer ends this portion of the interview by talking about Microsoft’s biggest single research focus – communications collaboration and productivity. He says “And you know, the biggest investment area for us is in communications collaboration and productivity. That would be the single biggest investment area for us.”
The full transcript of this portion of the interview is below.
Transcript:
Mr. ARRINGTON: Last year you generated about $20 billion in pre tax profits.
Mr. BALLMER: That’s right.
Mr. ARRINGTON: It takes a lot to move a needle with Microsoft where you find new businesses in areas you want to expand. What are the new business opportunities that excite you?
Mr. BALLMER: I want to start with my excitement about our existing opportunities.
Mr. ARRINGTON: OK.
Mr. BALLMER: I really do because, if you’re going to – if you want to move the needle for us, there’s two things we have to do. Most of what we’re going to move the needle in the next five years relative to 20 billion is going to come from things that we’re already in. Most of where we’re going to move the needle maybe five to 10 years from now is going to come from things that are new, that we have to go invest in from scratch.
And the only other wild card you can weigh on top that, which we just don’t do much, is large acquisition. So, we have nothing to announce, there’s nothing we’re thinking about, so I’ll put the third bucket aside. But you would be hard pressed to name a start-up company that generated an interesting amount of profit in five years relative to 20 billion. Even the most successful. Google in its first five years, Facebook in its five years. So, there are things we have to be investing for kind of the five to 10 timeframe. But if you look at where things are going to happen and they’re interesting relative to 20 billion you’d mentioned, it’s not at our existing businesses.
It’s going to come on innovation and growth in the PC market having the number of PCs that are sold continue to grow. That’s important. We can drive that. It’s going to come from innovation in the tools and technologies both at home and at work to help people communicate, collaborate, to be productive. It’s going to come from phones. It’s going to come from the intelligence that powers TVs. That could happen. It probably doesn’t explode unless we can manage to make the device that does that, the PC, that’s the way to get short-term explosion. We’re focused in on that.
Search, we have real opportunity in search in the next five years.
Biggest opportunity that we never talked about is enterprise infrastructure. Most of that goes to the database and mainframe vendors today who are in the business. We’ve got four billion revenues and yet we’re a small share player.
Servers, there are going to be more new applications written in the next five years than any five-year period of time.
I don’t list the cloud because the cloud has kind of overlaid all of those opportunities. We have opportunities by offering cloud infrastructure to enhance the margins we make in our server business, in our communications and collaboration and productivity business, and that’s where things like exchange online, SharePoint online, Windows Azure, they’re not really new value propositions, but they are new potential margin streams and dislocators to technology shifters and some of the existing kind of customer propositions that we invest in.
So, I take a look and, I’d like to say we’ve got seven big opportunities and everyone of those seven opportunities is going to have to do its fair share to move the needle over the next five years on the 20 billion. We have some other things that in aggregate may not themselves be a large percentage of the 20. But those have to perform, and we’ve got to be investing in some things that can explode in years 5 to 10. I hope I answered your question.
Mr. ARRINGTON: Oh, yeah, you did. Things sure have changed since your initial mission statement – the computer in every home, every desk running Microsoft software. You’ve moved way beyond that.
Mr. BALLMER: Yes.
Mr. ARRINGTON: Your R&D budget is $10 billion a year, roughly.
Mr. BALLMER: Nine and a half.
Mr. ARRINGTON: $9.5 billion…What do you spend that on?
Mr. BALLMER: Well, if you look at the R&D budget itself, let me break it into four pieces: pure research, that was misreported I think in Business Week recently. But our pure research budget is about $250 to 300 million or something like that. We have what I call an incubations budget – incubations and explorations. These are things we’re not sure turn into products and don’t yet fit in any one of the existing business groups necessarily. Mostly managed by guys like Craig Mundie and Ray Ozzie. That’s another several hundreds of million dollars. We have new businesses, put health for example, we have a fairly significant investment in health IT. There’s some stuff going into robotics, energy. That would be another few hundred million. And then the bulk of our key money is going into our five big business groups that are investing in the kinds of stuff that we talked about. Just take search, order of magnitude, we have 5,000 people working in R&D and search order of magnitude.
Five thousand people, you pay a person fully burdened let’s say 200,000 plus. That’s kind of what the tech industry looks like and you get a billion dollars to spend. But we got five of those things, and so – or bigger than a billion. Not many of them are too much smaller than a billion. You put them all together and then add to the first billion and a half I described and then say get the 9.5 billion bucks. So, the bulk, eight of the 9.5 is invested in the core businesses including the incubations that are going on inside the businesses.
Mr. ARRINGTON: Ok.
Mr. BALLMER: And you know, the biggest investment area for us is in communications collaboration and productivity. That would be the single biggest investment area for us.
I love Ballmer. Total hero. Thanks for interviewing him.
Developers. Developers. Developers. Developers!
Biggest shocker for me: he said they have 5000 people researching search. That’s not building stuff like Bing, that is RESEARCHING it.
There is something seriously wrong with this picture where on a regular basis, a couple hackers working out of their garage will come out with something more innovative than Microsoft has produced in years. Yet they are throwing so much money at this, not just search but all research.
This would be a really interesting question for someone to answer with some hard research, about how innovation actually happens, because MS is clearly not getting their money’s worth.
Also Michael, how did you get an interview with Ballmer? Doesn’t he know that you make fun of him on a regular basis on this blog?? Maybe nobody told him…
“a couple hackers working out of their garage will come out with something more innovative than Microsoft has produced in years”
Where?
“Where?”
Google, facebook, digg were innovating sites that did not have a billion dollars in research required for the innovation. Everything microsoft does is an attempt to improve on a competitor’s innovation. There is nothing wrong with this, it’s just that their very fabric is based on thsi pronciple going all the way back to Gates improving on DOS (MS-DOS over PC-DOS) and then windows 3.1 trying to improve on the apple OS.
So yeah, we’re talking about search, so Facebook and Digg are not good examples. Google’s search algorithms (largely unchanged since) came out in ‘98, the same year Microsoft started their MSN Search service (which, admittedly had a lot to be desired, but hey, it was 1998).
The “innovation” that Google has brought since its inception has been mainly huge (massively gigantic) efforts in indexing data. So yeah, a bajillion indices later, and Google is sooooper innovative in search.
Microsoft left search basically abandoned until it became clear that Google was making a shitload of money on search advertising. Ballmer himself has admitted that they should’ve started serious work in search a lot earlier, which is the reason why they’re at such a huge disadvantage on the web.
So yeah, my question still stands. Where are those garage hackers coming up with incredible stuff in search?
I’m pretty sure if you look at the cumulative funding of Google, FB and Digg, all have received hundreds of millions, if not billions, of dollars.
As for your ‘fabric’ BS. I can’t even be bothered to go there.
Jeffj, Similarly facebook is “improving on” friendster?? you would like to come out of your logic..
Are you kidding?
You know no startup doing innovation on search?
I think you may be saying ” research that can fetch billions”. That may be true. Not every great innovation makes money immediately.
In fact, most innovations dont make money for the innovator. It takes many years to develop business climate to generate wealth from that.
SO, most of the innovation happens in many places other than in MSFT labs.
MSFT is now going after developers. If they can convert majority of developers into .NET C#, then they can make another 10 billion.
That is the game. That is why SteveB said that it is tools.
Innovation doesn’t happen loudly at a company like MicroSoft. The best ideas are diffuse before they are even released due to pre-release announcements out the wazoo.
And you know this how? Got some facts to back it up?
“You would be hard pressed to name a start-up company that generated an interesting amount of profit in five years relative to 20 billion.”
No, but I can name many start-ups that generated a great amount of SOCIAL VALUE in five years. Ballmer is speaking to the shareholders, and that’s fine because it’s the CEO’s job to boost shareholder profits. But ultimately as a human civilization, would we rather prefer monetary value, or social value?
Are you a communist?
are jobs not socially valuable? profits are what pay for jobs and for that matter everything else in the world, so im pretty sure big profits are socially valuable.
Nice. That’s the best reply I’ve ever seen on TC.
you and the metal dude get kudos for making so much damn sense. thanks.
Not quite correct. A profit is what is left after paying salaries, so profits are not “what pay for jobs”.
if there were not profits, you wouldn’t be sitting behind your neat little laptop on a broadband connection, texting your girlfriend, bemoaning big profits.
haha or boyfriend. let’s be pc here folks.
Time to put your social value where your mouth is… on your next job, insist that you’re not paid with money but with social value. Maybe they have such a scheme in Cuba.
i don’t understand your website at all Geoffrey Lee.
Funny, I was thinking the same thing. I may to consult to him on a redesign.
I think there needs to be more focus. It seems that venturing out on too many projects at the same time will lead to a mess. Why not focus on 2 of the seven projects and do them really well instead of doing all and doing a poor job.
Just my two cents
-Becky
Because he believes they can do all of them very well.
Why settle for less?
I always wonder why all those companies strife for more, more and more and never for better or the like.
Fine, they make a ton of cash on what they have. But why do they always have to try to dive into new business areas (where they possibly lose, e.g. XBOX, Zune) instead of investing into areas where they are already in to become better there, grow there or at least stay there.
Window, for example, is strong in the os market, pretty much dominating it, still. Why don’t they try to stabilize that area – not via marketing tricks and other shady activities but by just being good and innovative?
Instead they throw tons of cash into the oven and burn it to get there hands on the search engine market, something they tried for years and always failed, burning endless amounts of money. Mac OS X is getting better and better, Linux is becoming a serious threat now, especially due to Google’s announcement to enter the market – and instead of focusing on this topic and defending there position they waste their resources and money on totally different business areas.
I simply don’t get it.
Shareholders?
It pretty clear to me: It’s Mircosoft’s corporate culture.
If you don’t remind people everyday that it is all about improving the existing businesses – they won’t.
They have 90%+ marketshare in the OS market (95%+ if you look at overseas). How can they stabilize upon that further? Ever heard of the law of diminishing returns?
If you haven’t noticed, Bing is actually consistently gaining marketshare. Mac OS X has been “getting better and better” for years now yet they haven’t made a significant dent (Personally I prefer Mac over Windows but I don’t see Mac gaining a significant marketshare because it plays to a niche market). Every year, the kool-aid drinkers proclaim this the year of Linux…give me a break.
So why is Google going into areas other than their core strength? Shouldn’t they just consolidate their marketshare in search (I mean, their marketshare in search is actually less than Microsoft’s marketshare in OS), rather than putting money in the oven into projects like Gmail…I mean Google is only #3 in email. Why put money into Chrome? It’s only #4 and why even consider putting money into their OS? Windows 7 is looking pretty sweet, Mac OS X is getting better and better and there’s Linux!
Nothing wrong with putting money into alternative ventures to further grow your business.
because they already dominate os, if they just put ever increasing resources into it, it would be quite possibly the worst ROI in history.
they improve it all the time, moving from 95 to 98 to xp to vista will have cost a vast amount of money, not to mention the service packs they bring out.
a few billion to stay where they are, or a few billion to make a company or 2 of the same size as microsoft? its not hard is it?
To someone who doesn’t know much about computers, you would have a bloody hard time explaining what is indeed the difference between 95 – 98 – XP or Vista….and that is because imo there isnt much
Why in hell would anyone try to explain the technical difference in operating systems to someone who doesn’t know much about computers?
Now if you’ll excuse me I have to explain the difference across several decades of vehicle engine technology to someone who doesn’t know much about cars.
Exactly!
Wow — I can’t believe Microsoft was founded in 1974.
Thoralf has a good point — hopefully “7″ lives up to the hype.
Wow! Ballmer really thinks he’s going to be working @ M$ in 5 years? This guy really lives in a fantasy world.
In fairness, Jimbo, it’s more fantasy that you’ll have a job at all in five years that doesn’t involve bags and groceries.
There’re no new ideas expressed by Balmer. An any institution has a certain longevity. Ford and General Motors are dead, and forensic analysis in a few years will prove that, trust me.
An average longevity of software companies will be shorter that longevity of industrial behemoths. Nowadays, for a great idea to become a great company takes less time and less capital.
Yep, all those big companies are dead. Look at IBM, Oracle, Microsoft, Apple. Oh, wait.
What about Coca-Cola? They have been around a while. Saying no company can last is ridiculous. Any company can keep going if the management does its job well.
and don’t forget HP.
their stock’s en route to its 5-year high.
When it comes to Microsoft, Ballmer has more passion, drive, energy and commitment than anyone next to Gates. He is a good play to the post Gates era and has contributed his fair share of ideas (and when he is a little stuck on the ideas, he’ll simply pay for one)!
There is plenty I don’t agree on when it comes to Microsoft… Like the whole, “if we can’t build it, we’ll buy it” rushed acquisition to gobble somebody up strategy. The wasted time and resources on tech they don’t even understand. Then again, with $60 billion in revenue they are in the position to play that game.
To compare Microsoft and other software companies to that of car companies like Ford and GM is completely ridiculous! Companies like Ford and GM dug their own grave. Car companies as a whole should have made the transition long ago to cleaner, more efficient fuel technologies. They chose to innovate everything but that… now look where they are. It is only now we see every car company in the world jumping on the eco-friendly bandwagon, rolling out new models of greener vehicles every time you turn on the television or flip through a magazine.
As for Microsoft… they are not just sitting around only thinking of better ways to innovate just Windows. They are attacking the entire software industry as a whole, while always pushing into new frontiers. That is one thing I will give them credit for. Some call it a monopoly of interests, while I would call it a diversity of innovation. It is innovation like that of Microsoft as well as others that drive overall competitiveness across the masses. That competitiveness is what further fuels new innovation like a perpetual motion cycle. A cycle that has also given us the Facebook’s and Twitter’s of the world, not to mention open source initiatives that aim to directly combat Microsoft head-on.
As it relates to new software/hardware technologies and the way the Internet plays in all of it… To sit here and say that Microsoft and other software companies will be dead or short lived is (need I say it again, “completely ridiculous”). The way I see it… ventures that die off are those that lack innovation, those that are short lived are due to acquisition and those that press on as market leaders will be ones that diversify their own innovations and prosper. Companies like Microsoft, Apple, Cisco, IBM, Oracle, HP, etc…
My two cents
No video? Sad.
Is there a video coming?
Or how about the rest of the transcript? That’s not an hour worth.
5,000 web researchers seems a lot by any standard and they are not producing enough to show for. Some of these companies get so big and hire so many and the productivity is very low. Good luck to them. I would go straight to web area if I were Microsoft and do something there.
“Just take search, order of magnitude, we have 5,000 people working in R&D…”
He said and meant that there are 5,000 people working on search technology. R&D = product development = engineering = working on bing and associated products.
No, not 5,000 people searching the web about search (searching Google and typing in ‘better ways to build a search engine that will beat Google”).
“Microsoft generates around $20 billion a year in pre-tax profit, and spends nearly $10 billion on research and development” Is $20B what’s left after or before expensing R&D?
profit is always revenues – expenses. But they mention the profit and the R&D expense in the same sentence here, because it indicates how much of their yearly profits they invest back into research the next year
$20B would be after R&D.
How about stopping with these paid for interviews with puppets and giving questions and answers sessions with people who really share and create the tools that are provided along with the manipulation?
Did you mean: channel9.msdn.com
Agree with “Good One”. Interview the real innovators. The next real break through, small guys who’ve made created apps or companies who were reborn after creating one, new trends. Enough w/ the MS, Apple, Twitter, Facebook, etc…
Are you serious? That’s all TC ever interviews.
I was pleasantly surprised to see Ballmer’s interview show up here.
What exactly does this means for Office Live? We assume Office Live will continue to be linked to the success of server solutions such as SharePoint technologies.
Great points.
Personally, I think it is refreshing to see tech CEO sit down and talk the way that the rest of the Fortune 500 talks…..about real dollars and how to drive revenue. The reality is that $500 million in potential social networking revenue would get lost on the MSFT P/L, so Ballmer obviously spends little time talking about it.
There are plenty of things to bemoan about MSFT culture etc…but at the end of the day, he is running a massive organization that generates profits as efficiently as any company in recent history. To think that he is going to sit down and opine about the value of $20 million firms that are creating “social value” is naive. His hundreds of department managers get to worry about that stuff.
Except that it took many billions to do what Google did with really less money.
Look for Google Wave.
MSFT lost a key Search team to EBay recently.
Interesting to see if MSFT buys eBay.
One more comment-
DONT assume that MSFT is NOT looking for a big M&A.
I know they are interested in one big Bay Area company (after it gets out of personal payment business.
Do we not get more than a taste of this interview or have I managed to be blind?
Ballmer sounds like he’s reading from a Business 101 text book. “Blah blah blah business incubations blah blah blah move the needle blah blah blah order of magnitude blah blah blah.”
There’s no meat here, and I can’t understand why he would even spill his guts talking about a bunch of nothing. Does Steve Jobs sit down and spell out Apple’s strategy? No. Why? Because he has ideas he doesn’t want the competition to know about and he profits by not revealing his hand i.e. iPhone/iPod Touch/App Store. Ballmer does the exact opposite to make all the dimwit investors think MSFT is going to bring something huge and profitable to market.
The reality is they are out of ideas. It’s not 1995. Windows and Office are nothing more than dying cash cows. He knows it. That’s why he shows his hand as if he’s about to perform a magic trick. The problem is investors keep waiting for some sort of magic and it never appears. Examples: Zune=fail. Xbox=great video game system but fail in profits. Search=fail. MSNBC=fail. WinMo=fail.
MSFT is dead and dying. If the excuse is they have too many employees then break up the company. If the excuse is they are being sued to death then start acting like a responsible company and stop stealing from others. Ballmer has no more excuses. He needs to start acting like he’s the CEO of MSFT instead of leaning on technology that the market has moved beyond, i.e. PCs that have enough value to drive profits for Windows. Only Apple can make that claim when they command 90% of the $1000 and up PC category. How much money will MSFT make from a $300 PC? That’s what you are basing your future profits on? Fail.
$20 Billion in yearly profit – that is a lot of FAIL.
I remember folks saying in the late nineties that the sky is falling on Microsoft. A decade later and it is still the same, they are copycats, their time is past. If you keep predicting it, given enough time, you will eventually be right. I predict somewhere between now and the year 2134, Microsoft will fall off its perch.
Blad_Rnr, what year do you think the dying and dead Microsoft’s profits will fall below $10 Billion annually?
I can’t believe Ballmer discussed his publicly-owned company’s strategy. Doesn’t he know that only secrecy can bring corporate victory? Example: Apple, no one knows they are developing a tablet PC, it will be a giant surprise and bam-wow! we will be touching screens all over, game set and match.
Should Microsoft buy Apple? I see synergies.
Did you even read what I wrote? I didn’t say MSFT was dead. I said they were dying. They have no new great ideas that will generate huge new profits. Name one if you disagree. Of course they still make a lot of money, but that revenue stream is dropping. And investors want to see something new. Something that will create a new revenue stream. And MSFT has nothing in the pipeline that will do that for them.
Take Windows 7. Might be a great OS. But they will be selling it on $500 PCs. Not $3000 PCs that used to sell 10-15 years ago. And when you have 90% market share, how much growth are you going to have? MSFT needs something beyond Windows and Office that will generate huge profits. Nothing that came out of Ballmer’s mouth suggested anything really new and unique coming out of Redmond. Therefore, he basically said nothing. A bunch of blah blah blah to fill an interview.
Where is the iTunes/iPod/iPhone/App Store-like “next big thing” coming from MSFT? That was my point. There isn’t one.
Mike,
Where is the video for the rest of the interview?
Microsoft will hang on to the PC as long as it can.
How about innovating in Visual Product Search like Startups have done. Pixst has probably dveloped by far the best visual product index which they have shown on Empora.com working in the fashion space, a 75bn industry moving online. http://www.empora.com shows what innovation can do and how search can be simplified if you take a picture as a starting journey. Startup are innovating faster than large corporations and hence will continuesly be acquired.
no vid?
Firstly, I rarely comment on the internet, but this is a great site with some great discussion.
Microsoft may not be the most innovative of all companies, especially compared with the innovations we read about day-to-day on this very site.
They may be a huge oil tanker trudging through an exciting and dynamic sea, but hell, they displace a lot of water, and they generate $20bn profit. For all their failures, imho, with software and search, they’ve always managed to do enough.
We get far too excited about the latest and fastest thinking start-ups, but unless there is a revenue stream, and a management that understand that $1million investment was not just because you’re a smart kid, you’re gonna fail.
Ideas are not always profitable. Profits don’t always generate ideas.