He hasn't mellowed. During the course of a 30-minute sit-down with editors from CNET News.com at the TechEd conference in Orlando, Fla., Ballmer was his vintage self, variously pounding on the table or bellowing answers to drive home sundry points with, ahem, extra emphasis. What has changed is how Microsoft's CEO and his sales troops deliver the message.
Instead of offering up a constant stream of speeds-and-feeds, product features and ship dates, Microsoft's brass now prefers to discuss how IT pros can save money or how they can use technology to make employees more productive.
That's a key shift. Microsoft's customers update their software less frequently than they did a few years ago. Meanwhile, they tend to be more concerned about controlling expenses and making better use of existing infrastructure.
Q. This morning, you talked about IT as a good profession and talked about industry enthusiasm returning to IT. Why do you feel you need to do that? Do you feel you need to rally the troops?
Ballmer: You guys like to write articles about how budgets are down, and outsourcing is going on, and blah, blah, blah. Somebody's got to stand up and say, the future's so bright you gotta wear shades! I'm being a bit casual about it, but there are plenty of places where you can read about how IT is at the end of its rope, budgets are being cut--and there's plenty you can read about outsourcing. The truth of the matter is that if you are in IT in the U.S. right now, that's a very good choice to make. I think we all know that fewer students are choosing to major in computer science...Well, who should be the No. 1 evangelists that these are good career choices? People in the business today.
If people in the field today don't feel good about their career choices, it's not a good thing for us, it's not a good thing for the industry, and in my opinion, it's not a good thing for future graduates. So you could say it sounds funny for me to be up there being a cheerleader...but it gives me the chance to say we have a lot of innovation coming.
Has IT spending picked up in recent months?
Ballmer: I think the industry has picked up amazingly. I'm a realist. Spending is (going to grow slowly), not (quickly)...It's like any other investment--it's got costs and it's got benefits and the two have to justify each other. We went through a period where almost nothing really needed to be justified. And then we went through a period where, in my opinion, people were under-investing in new projects. And now we are back on a sane curve, where good investment with a good cost profile and a good return gets funded, and things that are silly don't get funded. What more can you ask for? You know, I don't think blanket optimism amongst the businesspeople and the user community is in the best interest of our industry either.
We're coming up on the 10th anniversary of Windows 95's launch. You said that event generated the most excitement of any Microsoft product launch. Can you recapture some of that excitement with Longhorn?
Ballmer: I think Longhorn is going to be the biggest release we have done since Windows 95. It's going to be a big thing, but I don't think we should have expectations that we will have people lined up at midnight to buy a copy, necessarily, despite the fact that Longhorn is a huge deal. I think it's bigger than anything else we've ever done--except Win95.
In a sense, technically, it's much bigger than Windows 95. But with Windows 95, you kind of had an alignment of the sun, the moon and the stars, right? There was no Internet to speak of yet. All of the action was still on the client. Win95 was a merger of MS-DOS and Windows, which in itself was a big event. There was something in it for hardware makers, there was something in it for software makers. There was kind of an alignment of events that made the launch much bigger than the product itself--things outside of Microsoft's control, things that we were the beneficiaries of. I'm not sure all of the stars will align for Longhorn, but it's a huge release and it will drive the consumer market.
So what is the buzz in the industry now? Is there something that Longhorn can ride?
Ballmer: I think it's still around the Internet and intelligence at the edge of the Internet. We'll certainly ride that--and search and visualization and finding things. Digital entertainment, finding things you are interested in, and processing at the edge of the Internet. Longhorn is squarely in the middle of those trends.
What about for business buyers? What's your elevator pitch to those customers? Why should they buy Longhorn?
Ballmer: The dynamic is that the end user gets excited about it because they use it at home. And all business decision makers and IT people are end users. It's very rare when you find these organizations that don't have the latest releases. But all of their senior people would be without those releases at home.
It's sort of like a flywheel that you have to set in motion. You have to get the end users excited. The end users are excited by the new shell, the new visualization capabilities, the new organization and searching capabilities--those should excite end users. The new user interface--kind of sexy, kind of cool. The media enhancements should excite end users.
Then, the IT guys are the gatekeepers. Are they going to get excited or do they see a problem? Just look at what we have done for security and manageability. Those things are potentially exciting. Business decision makers want application compatibility. There's got to be something there for everybody. That's what sort of cranks the flywheel.
But getting that flywheel cranking means you're relying on that consumer pull-through, right?
Ballmer: If you look at Windows XP or any major Windows phenomenon, the first major step is to get all consumer PCs to come with that version of Windows, and I don't think Longhorn will be any different.
Has Microsoft changed the way it sells its software? Do you spend less time discussing features?
Ballmer: We're certainly not about talking about products and their features. In our case, you need to be able to say, here's the higher-
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