Ballmer Talks Android – Still Doesn’t Get It

Microsoft boss Steve Ballmer was speaking at the Telstra Investor Day conference in Sydney when the subject turned to Android.  At first his reaction was one that could be construed as somewhat pacifying.

“This is their first phone, they’re not easy.   “Let’s see how they do.”

Ok, fair enough.

Then the discussion moved on to the business model of Google/Android.  This is where Ballmer ended his peaceful tone.

“They (Google) can hire smart guys, hire smart people, blah-de-blah-de-blah…  I don’t really understand their strategy, maybe somebody else does… Turning up to an investor meeting saying, ‘we’ve just launched a mobile operating system with no revenue model, yay!’ – I wouldn’t do that.  …I don’t get the business model.”

Let me put you straight for a second, Steve.  Google has been slowly building over ten years, offering all kinds of things that just don’t make sense on paper.  Look at how much has been given away for free over the last decade, Google’s first decade.  Would you expect them to be worth what they are?

Dude, they are starting to eat your lunch.  And you know it.

To me, Steve just sounds like a guy who knows what his biggest looming threat is, but doesn’t want to admit it.  By saying that Google doesn’t bubble to the top of the list of competitors of Windows Mobile, he just sounds naive.

After messing with Windows Mobile for over 3 years now, I can say that Android is by far a more compelling platform than they ever were.  This is after 2 weeks of being an G1 owner.  I didn’t even get to pick the device it’s running on, and I like it more than anything Microsoft slapped their OS on.

Ballmer and company are going to be losing market share to Android.  And, more importantly, Android will appeal to people who have yet to consider a smartphone.  You can keep going after enterprise users Steve.  Google and the Open Handset Alliance are going after the other 80% of the world.  And they’re not stopping with handsets either.

You guys have been working so hard on desktop versions of Windows for the last few years that you lost sight of where mobile was going.  Here’s the the problem.  You can’t even get desktop right.  Microsoft has been staving off an Apple attack for so long that they let Google in behind the gate.

So, Steve… You’ve lost the battle of search and ads already.  Your market share continues to dwindle in browsers.  Mozilla is up to 20% of the market now on a business model that proably doesn’t make sense to you either.  When you are sitting around wondering how you end up where you are a few years from now, don’t say you didn’t see it coming.  You just chose not to.

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  1. I had to laugh more than once reading this. Excellent report.

    This will hopefully push Micro$$$oft to create a better mobile platform.

    The question is: Will they? (look to Vista vs Mac OS and IE vs Firefox for the answer…)

    If this gets any stronger, and Ballmer doesn’t direct his teams to do anything radical (like get rid of legacy code in Windows for a faster platform or redesign IE from the ground up), its bye-bye Microsoft in the next 10 years. However, Microsoft will need to wisen up soon in order to save themselves. Look at Apple; it was on its deathbed until the iPod. This will push competition to make better and better platforms. Capitalism at its finest!

    Of course, they could just give up.

    I’m done ranting.

  2. Yes, please continue to buy stock, invest in, have your personal retirement pinned to, a man who uses “blah dee blah dee blah” as a substitute for English words…Smart!

    Nov 6, 2008
    Google – $328.04 a share
    Microsoft – $21.00 a share

    …also, The entire United States military dropped Windows as an OS a few years ago, switching to Linux worldwide. Now the contract for all of the Federal government, hundreds and hundreds of thousands of seat licenses, is up for renewal next year…

    Think congress and the new Barack Obama administration are gonna switch to Linux? ( Hint Obama’s web site is running on the LAMP stack ).

    I don’t care who Ballmer thinks he is, losing your largest, most lucrative customer to Open Source has gotta hurt!

  3. I’ve had a few phones and PDA, after a Psion 3 and 5, I’ve then had a Windows CE 1 touch screen, Windows CE 2 with a keyboard, Windows CE3 HP PDA, then I think the xda (mobile phone PDA) more Windows Mobile HP PDAs and then a Windows Smartphone with digital (DAB) radio.

    They kind-of got better over the years, and the WM Smartphone was OK to use, but I have had a G1 since Saturday (in the UK) and it’s just amazing by comparison.

    My boss, an avid Apple fan, could see the the G1 builds on the iPhone and all the Microsoft history and trumps it all.

    Top good points:

    – keyboard is great for messages
    – address book instant search from the “desktop”
    – pacman
    – gmail address book instant sync
    – satellite map of your current location – instantly
    – usb headset is very clear
    – search everywhere
    – sliding top notification bar

  4. Ballmer claims that there’s no revenue model? No money in it? No, Mr Ballmer, a phone that requires a data plan in place if the user is to be able to use it to anywhere near its full capacity has no potential at all (wonder how much Google gets out of each G1 sale). Like Google won’t be taking a cut from the Market. Google service use (whether you want it to or not) will rise, meaning more interest in advertising. Android is a long term prospect – but there is a bit to be done over the next few months.

    Android can take business from Windows – just look at all of the recent WinMobs that are being praised for hiding Windows away beneath their own UI (all built by HTC – should we be surprised?). Nokia thinks Symbian needn’t worry – well, there was a time when people shrugged that off I expect – plus the Symbian touch UI, well, just no.

    I am concerned that some people are making noises just for the sake of soundbites though – Quickoffice were yapping about it, so why not put it on their website that it’s at least a work in progress (perhaps they are curious as to how much they should charge)?

    Anyone having nagging doubts about what Ballmer says – type in ‘ballmer + developers’ in a search engine – with any luck you’ll get to see the cringe making video where he just chants developers whilst clapping – and his audience just feels caught in the headlights.

  5. I typed that into Youtube: *cringes multiple times violently* or *siezure*

    If he wants developers, then… make EVERYTHING open source.

    But then again, how could he understand the business model? How can free software that anyone can modify be better than his multimillion $$$ projects and his team of 200 or so developers?

    How can he possibly beat a development team of thousands?

    Its worked for Linux, Android, Java (outcome pending), Netbeans, Eclipse, Frets on Fire, OpenOffice, Mozilla, etc.

  6. You all including the author seems to underestimate M$. This company is at its very best when competition is most deadly and you can tell by the major improvements with Windows 7. Tho currently in beta, all the previews I have read suggests that its far better than vista when it comes to performance, no doubt M$ has learn’t their lesson and are listening to users.

    The first Android phone appears to be a winner but don’t count the chickens before they hatch. Fact of the matter is, people are comparing Android to Windows Mobile 6.1 which is well established and saying it’s better when truth be told it’s not. Whenever Android has hundreds of useful applications and lots of support like WM then we can look into which is better. Take note that WM was not built with certain things in mind such as finger touchscreen etc.

    Compare Android to Windows Mobile 7 when it’s out, that would put WM on a more even ground. I believe Windows Mobile 7 will come better than Android latest version at that time, you all may disagree it really doesn’t matter. Some of you may not like WM because of the company or maybe because it’s not open source, frankly I believe WM is open enough, the source code doesn’t need to be out there. Everything Android let developers do WM can do most of that excluding the touch interface so I do not see what all this hype is for. Android just another mobile OS that has potential nothing more nothing less

  7. ballmer doesn’t understand anything unless it has dollar$ attached.

    I think the strategy is clear enough, open source will render Window$ irrelevant on all platforms

    Window$ – great $oftware for the 20th century !

    Window$ 7 deadly sins…

  8. You’re absolutely right, Makki. I was remiss in not considering a Microsoft response through software to Android. But for Android to fail is more in the hands of Google than any competitor – we’ve been told that Android is supposed to run on low powered hardware, which is all well and good, but considering the G1 is running off the same internals as the Touch Diamond, we are still left wondering what the current build will run like once it is exposed to lesser powered devices (I’ll be interested to see what it runs like on the Freerunner for example).

    Right now, Windows hardware is rather desirable – look at the HTC Touch family and the Xperia for just starters – the Xperia in particular is turning out to be surprisingly inexpensive (O2’s current pricing left me hugely surprised), although the HD may prove to be just as startling.

    Apparently, ( are getting the G1 sim free, but at that price, it is in direct competition with Windows products. Just how long is T-Mobile’s exclusive period with Android, please? I’m keen to see what else is in the pipeline.

  9. You are right to the pinch. Microsoft per se doesn’t know what its doing. Its simply trying to have a go at others in order to get things in to place for it self. The just dread an thing called open or any thing with Linux under the hood. As they try to come up with thing like this, what they are gaining is just that they are losing their admirers and at very steady rate.

  10. M$$ has nothing to offer with their WM7 for mobile users: do they have search better than G? Do they have contact sync? A browser: IE sucks – no doubts. G is constantly improving their services for mobile users: I love G rss reader and Gmail. I only need a 20% of functionality of their Word & Excel: G offers online replacements with those 20% I need

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