Daily Archives: June 28, 2006

Microsoft Shuffles More Executives; No Drama this Time

Now that’s more like it.

Unlike the sudden and unexplained departure of Martin Taylor, which was an atypical personnel move for Microsoft in every conceivable respect, the announcement of several executive reassignments that surfaced this evening makes a lot of sense and doesn’t deviate from the written and unwritten rules of the corporate-communications textbook to which Microsoft’s corporate-image guardians rigidly adhere.

Arrivederci for Avici?

There’s a lot of talk on a Light Reading discussion board that router vendor Avici Systems Inc. is on the verge of losing AT&T/SBC’s future patronage as a customer. Considering that AT&T accounted for 94 percent of Avici’s revenue last year, losing that account also is likely to translate into a slow, painful corporate death, even though Avici does have some cash to burn through before it would have to close shop.

As the telecommunications market consolidates, the same fate is being visited upon purveyors of telecommunications equipment. Avici’s market share isn’t significant enough to draw a buyer, and its technology has fallen behind that of market leaders Cisco and Juniper in recent years. There’s no reason to think a white-knight buyer will save the company.

Like many router startups funded by VCs, Avici’s was hunting the great white whale of networking, Cisco Systems. Only Juniper and Avici have been able to make any sort of dent in Cisco’s business, and now Avici looks to be heading for the industry scrap heap. Unlike countless others, however, Avici at least sold products to customer, generated revenue, and even managed an IPO. It accomplished more than most, but now the end is in sight.

Symantec CEO Says Microsoft No Worry

Almost invariably, published interviews with high-technology CEOs are disappointing. They’re disappointing because the CEOs increasingly are being groomed by PR people and “media trainers” to repeat well-worn cliches and meaningless platitudes, and they’re also disappointing because CEOs rarely tell the truth in public, primarily on the advice of their aforementioned PR handlers and image consultants.

A good example is an interview with Symantec CEO John Thompson that can be found today on InfoWorld’s website. When asked whether he and Symantec are concerned about competing with Microsoft in the consumer and enterprise computer-security markets, Thompson says the following:

“I’m not worried about Microsoft at all. Let’s be clear about that. If anything my focus is on making sure we can deliver the level of innovation and the level of visibility or of capabilities that we always have. And to the extent that Microsoft plays fairly, there is a level playing field and I don’t worry about Microsoft. If they do something that is unfair, clearly we will be watching and I’m sure others will as well.”

Microsoft is synonymous with a lot of things in the software and technology industry. Security is not one of them. And they’ve got a long way to go to demonstrate not only capability, but to deliver and build a reputation of being able to support a vast array of users in that regard.”

First of all, Thompson must be concerned about Microsoft. If he weren’t concerned about Microsoft, Symantec’s board of directors would be wheeling his chair out of the boardroom like steroid-enhanced sprinters.

Come on, John. You’re obviously worried about Microsoft. The Veritas merger, controversial to this day in some quarters, was all about diversifying revenue so as not to be financially cratered by Microsoft’s relentless, iterative advance on Symantec’s core business. Everybody knows that Microsoft, now that it has bought most of the functional pieces and gotten lethally serious about security, will keep pounding on doors and working the channel until it gets its fair share of the market spoils. Some of that share will be taken from Symantec. It’s inevitable, like the sun rising in the east and setting in the west.

Contrary to what Thompson suggests, Microsoft need not have the best products on the market to achieve its security-sector objectives. All it needs is the right pricing, a product that is well integrated with Microsoft application environments, and solutions that are “good enough” competitively to hold its own their own against competing products that will, in most cases, be more expensive. Who’s going to punish Microsoft for helping to drive lower prices and greater competition in the overpriced security market? Consumers and businesses won’t be running to the barricades — or to the feds — to defend the security oligopoly, that’s for sure.

Aside from the blather about not being concerned about Microsoft’s incursion into security software, Thompson says Symantec will follow the competitive example that Intuit established in doing battle with the Redmond behemoth. What? Thompson can’t’ believe that, can he? Intuit is and was a vendor of financial and tax-preparation software and related services. Symantec is a vendor of security and storage infrastructure. Other than its size and marketing prowess, Microsoft didn’t have inherent advantages over Intuit in the market for financial and tax-preparation software. Microsoft’s mandate in that market was neither clear nor authoritative.

In security, though, Microsoft’s mandate is clear and it is compelling. This is a job Microsoft should have done in the first place. Microsoft sells operating systems, it sells application software, it sells messaging (email, IM, voice, video) software, it sells web servers, it sells databases. It should have provided adequate security for these products a long time ago. It has belatedly recognized its responsibility to provide security for its own application environments.

Symantec, like McAfee, made a lot of money from Microsoft’s dereliction of duty with respect to security. Those days coming to an end. Microsoft recognizes that the provision of security for its own products is not something it can or should leave for other vendors to address. John Thompson should be concerned about that, and he’s not being honest with us if he says otherwise.