Microsoft prepares new assaults

11 July 2005 Microsoft CEO Steve Ballmer yesterday rallied his company’s global army of business partners, promising them a “year of opportunity, and many more years of opportunity” as Microsoft prepares to enter a period of significant new product and service launches.

During a rousing closing keynote address to Microsoft’s Worldwide Partner Conference in Minneapolis, Ballmer gave notice that competitors could expect no quarter as Microsoft readies itself to assault new markets, and the established customer bases of old rivals.

Ballmer’s optimism is based on a product launch schedule which kicked off earlier this year with significant enhancements to Microsoft Business Solution (MBS) products such as the Axapta ERP suite. These will be followed later this year by the release of SQL Server 2005 (formerly code-named Yukon), the next version of the company’s key client productivity suite, Office 12, and culminating later next year in Longhorn, its next major release of the Windows operating system.

Office 12 and Longhorn are expected to consolidate Microsoft’s leadership in markets where it has traditionally been strong, but the real interest is in other areas: Microsoft has much more aggressive plans for these markets – and that will serve as a warning to its competitors.

In its MBS unit, the ongoing consolidation of its various ERP and CRM offerings is already driving significant growth in the mid-size business sector. And according to corporate VP of server and tool marketing, Andy Lees, the commercial launch of Yukon later in 2005 will see Microsoft go “head-to-head” with Oracle in the enterprise database market. Indeed, Lees delighted his audience by promising a generous incentive scheme to entice Oracle users to migrate to SQL Server 2005.


It is not just Oracle that Microsoft has in its sights. Mike Sievert, corporate VP of Windows product marketing and a management, said that with Longhorn still months away the case for Linux on the desktop is already running out of steam. “The discussion has stated to turn” Sievert said. “Linux is not growing [on the desktop], Linux is on only 2.4% of PC shipments, and 80% switch back to Windows” he claimed. “People are giving up, they are decommitting to Linux.”

Perhaps the rival with most to fear from Microsoft’s renewed aggression is IBM. Asked who he sees as Microsoft’s chief competitor, Ballmer said that “historically, it’s IBM, IBM, IBM.”

“In my 25 years in the computer industry, IBM’s product line is the weakest I’ve ever seen it,” he added.

Ballmer said that the reputation for quality that once attached to IBM’s hardware manufacturing no longer had real value, and he was equally scathing about the reputation of IBM’s global services business. “Our partner base is the biggest services organisation in the world, by far” said Ballmer.

He continued to play to his partner audience, telling them: “There is no deal that we should not be able to win against [IBM] today.”

IBM may begin to discover the truth of this remark if it does not move swiftly to reinforce its relationships with established customers of Lotus Notes. On Saturday, Microsoft’s corporate VP of enterprise products Simon Witts announced that Microsoft is ready to pay a “bounty” to any partner who captures an IBM Notes account, and Ballmer later reinforced this message. “I have never seen a customer base so ripe to be plucked – large account by large account” he said.

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Ben Rossi

Ben was Vitesse Media's editorial director, leading content creation and editorial strategy across all Vitesse products, including its market-leading B2B and consumer magazines, websites, research and...

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