Running, Jumping, Standing Still

It hasn’t been a month yet and the parachutes are floating at Microsoft. Kevin Johnson’s sudden move to Juniper Networks comes less than 24 hours before the Microsoft analysts meeting. This is the new Microsoft, where Steve Ballmer and Ray Ozzie start running the company. It’s also the beginning of the end for the classic power centers at Microsoft – and not a moment too soon.

In Ballmer’s internal memo, he names names, starting with Apple in a rare acknowledgement that Curpertino is causing some actual pain to the North. Of course, says Ballmer, it’s not PCs where Microsoft outsells 30 to 1. It’s the user experience, the roundtrip between software and hardware that grates. Ballmer says the new plan is to change the relationship with hardware vendors. The same goes for mobile.

OK, how does that work? How do you maintain what Ballmer calls choice without retaining the compromises that come from not controlling the end to end user experience. Answer: by abstracting the differences between devices via a virtualization layer that developers can (must) write to. Yes, it’s the Mesh word.

How do you encourage (force) developers to toe the line? Take a page from Apple’s iPhone and App Store, by mandating control of the application layer via the communications infrastructure. Apple has carefully constrained the enterprise tools by using battery life and its implications to hold off developers until MobileMe has the kinks worked out and provisioning under control. That’s why the Push Notification Service is not coming until September at the earliest.

Even Google has to wait in line with the rest – no Gmail push because if that were available today I would jump immediately. Push Gmail solves the social graph problem by carrying IM notifications over email to set up the conversation, making Track available to any application or set of services without getting in the carriers’ faces. Calendaring and event notification become email triggers, setting off server-side workflow and transaction processing based on rules defined by behavior.

Extrapolate that carrot-stick approach to the Microsoft situation and match the pieces up: Social notification (Mesh) is the carrot and Silverlight is the stick. By separating Windows and Windows Live from all the sucker bets Redmond has been making on search, Ballmer gives Sinofsky and his research and business cohorts room to merge the desktop and Live parts into Windows 7 aka the Live Desktop.

Meanwhile, developers are shown the way to earn money now – by blending social graph and cross-platform rich-enough apps just as Jobs gave iPhone devs Webkit apps to hold them off until the APIs were ready. Don’t think so?

We’ll introduce new approaches that move beyond a white page with 10 blue links to provide customers with a customized view of their world.

Customized how? By mining the user’s social graph. Their world? The behavioral gestures they emit to describe their interests, in a real-time stream of XMPP information that ranks incoming offers based on the signals of the affinity groups housed in Track and Follow clouds. Look at the most viral iPhone apps: Twitterific, Evertone, Jott, Pandora. Tell us what you like, we’ll give you more of that based on who “you” are.

The Microsoft reorg appears to give Sinofsky and the other Windows guys a bump up the org chart, but another way to look at it is that Johnson’s Platform and Services division has actually lost power by being split in two. By contrast, Stephen Elop’s uber Office and Muglia’s Server divisions remain unchanged and therefore more powerful in the overall scheme of things. Online Services gets a new head count in the Senior Leadership team, not drawn for the current hemorrhaging crowd but from somewhere outside the company or perhaps a profitable area internally.

Contrast Microsoft’s out-of-character precipitous move the day before the analyst’s meeting with Facebook’s confident stealing of a page from Google’s book with a revised Facebook Connect and a reward-based developer program. It’s hard not to see Facebook as emulating Apple in precisely the same way Microsoft may be moving toward. Reformulating the out-of-control poke and bite application space as a Web-wide application layer creates a carrot (identity leveraging) and stick (tiered dev status) just like – you betcha, the App Store.

To recap, in less than 30 days since Bill left the building, the Windows guys are tethered to whatever the Live Desktop will become, Ballmer is firmly in charge, and Ozzie is steadily making inroads by standing very still in the center of the Mesh and letting the various Presidents whittle each other down to size.