Microsoft Angles to Keep Software Developers Loyal
Microsoft Corp. said Monday that it will spend $2 billion in the next three years to provide training and new tools to its legion of independent software developers, a move designed in part to keep them from defecting to competitors.
Chairman Bill Gates also unveiled several new software products that help make it easier for developers to create Microsoft’s much-anticipated new applications for the Internet and connect them to different software programs.
“This is a real commitment on our part,” Gates said in his opening speech at Tech-Ed 2000, a lavish annual conference devoted to the care, feeding and education of the thousands of third-party developers who write applications for the Windows operating system.
A spokesman for Iowa state Atty. Gen. Tom Miller, who is leading the management of the government’s antitrust litigation against Microsoft, said that the government is “watching with interest” the software giant’s new Web initiative, known as Next Generation Windows Services, but has no immediate plans to block the effort. The company plans to unveil details of the new strategy later this month.
With a federal judge poised to break up the world’s largest software company this week, and the Internet spawning new competitors to the Windows monopoly, Microsoft finds itself at a digital crossroads. Even its loyal developers are up for grabs, as competitors such as Sun Microsystems, IBM, Linux and Oracle are offering competing Internet programs.
But it’s going to take more than money and new products to keep the software developer community happy. Despite its legal troubles and increased competition, Microsoft must convince programmers that it is still business as usual, said Michael Gartenberg, a financial analyst for the Gartner Group.
“This is clearly going to be a difficult challenge,” Gartenberg said. “Microsoft has demonstrated a surprising nimbleness to overcome challenges in the past and it’s going to require the same effort if it’s going to adapt to the new changes in the market and to the legal battle.”
Microsoft appeared to have spared no expense to make the 14,000 developers attending the conference feel wanted.
Entertainment, courtesy of Microsoft, includes a big bash at Universal’s Islands of Adventure theme park, a “GeekFest” at the House of Blues and nightly “jam sessions” where programmers can play music and let their hair down.
In an e-mail designed to chase away the dark legal cloud hanging over the Washington-based company, Microsoft acknowledged the “gloomy times here in Redmond,” its depressed stock price and a Justice Department that “says we’re mean.” But that’s OK, the e-mail said, because “we managed to score money for GeekFest 2000!!!!”
Such wooing has worked well for Microsoft in the past. More than 1 million developers are members of Microsoft’s Developers Network, and nearly 4 million programmers worldwide write applications for the Windows operating system. But Microsoft will have to work harder to keep them.
“I think Microsoft is more vulnerable than it has been in five years,” said George Dunphy, a programmer for Cyberplex, a Web applications designer in Toronto, Canada. “Windows still has its huge share, but there is a real move in the developer community toward Linux and Java.”
Dunphy said he plans to stay with Microsoft for the time being, but will continue to weigh ever-increasing offers from its competitors.
Meanwhile, he and others will be scrutinizing the first of Microsoft’s new Internet service offerings, including new developer tools known as Visual Studio 6.0 and BizTalk Orchestration both designed to make it easier to build Windows Web applications.
Those new technologies are part of Microsoft’s Windows DNA 2000 platform, which includes several different server applications designed to be the new back office companion to Microsoft’s new Internet strategy, which it plans to unveil June 22.
*
* COUNTERMOVE AT TRIAL
The U.S. stood behind major demands it made of Microsoft as an antitrust settlement. C3
