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Dana Dana Blankenhorn has been a business journalist for over 25 years and has covered the online world professionally since 1985. He founded the "Interactive Age Daily" for CMP Media, and has written for the Chicago Tribune, Advertising Age, and dozens of other publications over the years.
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September 21, 2005

What? I'm Retirement Age?

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Posted by Dana Blankenhorn

jim_allchin.pngWell, nearly, judging from the latest re-org news coming out of Microsoft.

The retiree in this case is Jim Allchin (right), who has been the Windows guru there for years. What struck me was his age, 53.

I'm going to be 51 in January. And I'm launching a start-up.

Seriously, Microsoft is going through the middle-aged crazies, and the solution is in many ways typical. That is, push decision-making down the stack, toward younger managers. Let a hundred flowers bloom and all that.

The other big headline in here is that Ray Ozzie, the former Lotus executive who joined Microsoft last year as a chief technical officer, is being given line responsibilities for what's called the "software-based services" strategy.

Unfortunately, Microsoft's middle-aged trouble goes a little deeper than that.

ray ozzie.jpgThe problem is that Microsoft thinks in terms of computers and software licenses, always. One PC, one copy of Windows, one copy of Office, updated every year or so, and everything else is gravy.

But when the "upgrade" became broadband, this changed, in the minds of consumers. We are less willing to play the GM-like "planned obsolescence" game than we were. I still run Office 97, and have no plans to upgrade. I have reluctantly gone through a new set of PCs here over the last few years, but I paid maybe $3,000 for four of them, including one laptop which cost nearly $1,500 by itself.

I'm no longer in the mood for what Microsoft has to offer, whether that's security, or Vista, or any other bloatware.

So to me Ray Ozzie is the key man. He has to produce services worth paying for, services that work for consumers, not just businesses, because that's how you get the volumes needed to replace the old business model.

Ray Ozzie was born in 1955.

Hey, I was born in 1955.

There's life in this old boy yet.

Comments (1) + TrackBacks (0) | Category: Business Strategy | Investment | Software | fun stuff | marketing


1. Jesse Kopelman on September 21, 2005 06:23 PM writes...

In a sense, Microsoft faces the same issue as the music industry. In many ways getting the newest version of office/windows is a luxury as opposed to a necessity -- just like buying more music when you already have hundreds of albums or thousands of songs. When you are selling luxury goods at full price, you will naturally have a small audience. But, both Microsoft and the music industry are used to having very large audiences. The would like to blame piracy for this declining audience, but the truth is that the majority of the people willing to buy their luxury goods do buy them and the majority of pirates wouldn't buyt them even if there were no alternative. Both Microsoft and the music industy are faced with the same issue; come out with compelling new products or accept that you are no longer in growth mode and focus on operational efficiencies.

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