Microsoft's Financial Future

The economic downturn wreaked havoc on banks, auto makers and millions of mom-and-pop operations. But Microsoft has come through relatively unscathed. Sure, its profits are down, but it still has plenty of them.

But that's not enough for Redmond. Microsoft wants to go back to the days of rising cash. Its plan? Continue to push search, get netbook customers to buy higher-end versions of Window 7, and successfully move to a subscription-based software model. Sounds like a plan to me.

Would you put a high-end version of Windows 7 on a tiny netbook, and what do you think of subscription licensing for software services? Answers can be sent to [email protected].

Posted by Doug Barney on September 11, 20094 comments


Security Third Parties Displeased

Microsoft's relationship with third parties is a bit like a high school romance, full of love, conflict and talking behind each others' backs. In the virtualization space, Microsoft is laying on the charm, trying to woo partners away from VMware. It ain't so pretty in security, an area that's been testy for years.

Now, I happen to be a fan of many of Microsoft's security initiatives; monthly patches, more secure software and a general openness all leave me impressed. But I also respect the third parties who are actually manning the trenches, doing battle with hackers and, increasingly, fighting Microsoft itself. Case in point: Microsoft and third-party bloggers are doing battle through some increasingly emotional blog postings.

Here's a rundown of the issues: Many vendors who discover Microsoft flaws feel they don't get enough credit and, often, not enough response. More specifically, Sophos believes that adding XP Mode to Windows 7 offers a whole new vector of attack, one that hackers understand well. As someone about to install this software, I plan to heed these words and rethink XP Mode.

Are you pleased with how Redmond handles security? Yeas and nays equally welcome at [email protected].

Posted by Doug Barney on September 09, 20092 comments


Patches Execute RCE Flaws

Every Patch Tuesday has the self-same theme: fighting remote code execution flaws. And that makes sense. If a hacker can access a network and run their own malicious software, they can officially call themselves a big-shot (feel free to replace the word "shot" with a more accurate term).

This month, Microsoft fixed a range of RCE problems. First, the JScript engine, which can be exploited through malicious Web pages, is repaired. So is a wireless LAN hole in Windows Server 2008 and Vista. Microsoft also offered a TCP/IP fix that can apply to certain Cisco gear, as well.

Posted by Doug Barney on September 09, 20090 comments


The Ultimate Windows Server?

Many months ago, I spoke with storage and virtualization guru Jon Toigo about the IBM System z, otherwise known as a mainframe. This puppy isn't your father's mainframe; it runs on Power6 processors (a lot of them), the same basic chip that drove Macs for years. The latest System z was touted as being able to operate up to 1,500 virtual machines, so for those seeking green datacenters, that mainframe is pretty darn compelling.

The only problem was IBM didn't announce support for Windows servers. Toigo, though, told me these machines could, in fact, be made to run Windows.

I didn't think about this conversation 'til yesterday, when I read our report on Windows mainframes. While IBM and Microsoft still don't officially support Windows on mainframes, there are a couple of apparently solid emulation tools that let you do just that. However, not being native, these solutions are a bit of a compromise.

Has the role of the mainframe in your shop changed? If so, how? E-mail your answers to [email protected]

Posted by Doug Barney on September 09, 20090 comments


Searching for Enterprise Search

Recently, I've been asking Redmond Report readers to e-mail me about Bing (I'll be in touch soon, I promise).

Now I need more help. Do you use any of Microsoft's enterprise search products, or Google's enterprise search? If so, shoot me an e-mail and tell me what you like and don't like. I'm at [email protected].

Posted by Doug Barney on September 09, 20091 comments


Virtualization's Big Week: The VMware Story

Every year VMware holds its VMworld show, and for the past few it has drawn in excess of 10,000 people. I was there last year and it made Tech-Ed seem small in comparison. This year VMware didn't make a lot of hot announcements. Instead, it reiterated its wish to own the cloud market, both real external clouds and internal enterprise clouds.

VMware has a strong technical set of offerings here based on years of virtualization expertise. My only concern is that it's a closed, proprietary set of offerings. My inside sources say that it may take years for VMware to open up to other technologies such as Hyper-V. Meanwhile, Microsoft is bending over backwards to woo third parties.

I'm not nearly as smart as VMware CEO Paul Maritz, but I do know that for something as sweeping as cloud computing, IT wants choice and for things to be heterogeneous. Tell me where I'm wrong at [email protected].  

Posted by Doug Barney on September 02, 20091 comments


Virtualization's Big Week: The Microsoft Story

As you know, every year VMware holds its VMworld show, and for the past few Microsoft has crashed the party with a few announcements. This year, Microsoft unveiled Hyper-V Server 2008 R2, a far more enterprise-worthy product than its departmental-oriented predecessor.

Besides Live Migration, which lets a VM easily move from a failing server to one that actually works, R2 has far more capacity. The new tool can address a full terabyte of RAM (I'd like to see the bill for that!) and eight processors, which themselves can be multicore, as I understand it.

While it usually takes two product revs for Microsoft to get things right, Hyper-V is already pretty slick on its second showing. What do you like/dislike about Hyper-V? Send your thoughts -- real, imagined or virtual -- to [email protected].

Posted by Doug Barney on September 02, 20091 comments


Directions on Windows 7

Directions on Microsoft is one of my favorite research firms. In fact, I don't trust many firms or analysts, but Directions on Microsoft I do trust. Nearly all (or maybe all) of its analysts are ex-Microsoft executives.

Analyst Michael Cherry is particularly smart and particularly opinionated. So when Mr. Cherry argues that Windows 7 is a great fit for businesses, I believe him. Cherry's main point is that Windows 7 is a huge improvement over XP and solves the most glaring Vista problems.

I like the Windows 7 release candidate, but have to say that it hangs far more than it should. When my laptop lays itself down to sleep, it often dies before it wakes. That's not good for a human or computer!

Do you have any Windows 7 bugaboos? Send your error reports to [email protected].

Posted by Doug Barney on September 02, 20093 comments


The Great Content Debate

The Associated Press is a venerable news institution that has brought us solid reporting for 163 years. AP syndicates articles, which means newspapers around the world pay to run them, and that money pays for more reporting and AP's staff of over 4,000 employees. It was a nice little virtuous circle -- at least, until Google and the other aggregators came along and began killing off AP's biggest newspaper clients.

While Google has an AP licensing deal, it shows little interest in paying other news organizations, nor does Google have any interest in developing stories on its own. Instead, it wants to pull those stories into Google News and sell its own ads against them. It's kind of like me selling beer out of your refrigerator.

As he sees newspapers collapsing like over-leveraged banks, the head of AP, Bill Singleton, says he'll track who uses its contents and seek compensation.

Google's top geek, Eric Schmidt, has his own self-serving take on the matter. Schmidt argues that "the vast majority of people only want the free model," which is something the papers better get used to. (Wonder if he'd tell a drowning man to get used to water?) He then lectured newspapers to "understand what my readers want," argued that intellectual property rights are not eroding, then tossed out a feeble free speech reference.

Will you miss your favorite newspaper, and is Google good or bad for media? Reports, analysis and bulletins all welcome at [email protected].

For her part, Redmondmag.com Editor Becky Nagel disagrees with me on the aggregators. She wrote the following to me a few months ago after reading this article:

I like how the AP says that the aggregators are relying on "misguided legal theories." The underlying case law for the application of summaries in for-profit publishing was decided years ago when mainly legal book publishers tried to sue other publishers who summarized their findings. They lost.

I think all this is just the AP trying to extend its Google deal (which it was lucky to get in first place) to its customers in an attempt to stay relevant at a time when newspapers are realizing they can share content with each other without paying anyone. Added bonus: It gets to squeeze cash out of the smaller aggregators who can't afford the legal fees to defend themselves.

Even if they could win, the AP isn't helping anyone. The only newspapers who don't want traffic from aggregation sites are the ones that can't get past the old "we can only sell local traffic" mentality -- the ones that are completely failing online. So now they can all go down together, with the AP leading the charge.

I'm not the only one who thinks this is heading to folly. There's a great follow-up blog post by The New York Times' Saul Hansell who sums up the entire situation perfectly in his first sentence: "If The Associated Press could completely win its war on search engines and news aggregators, it's hard to see that the news association or the newspaper companies that own it would be even the slightest bit better off."

And finally, one more kernel of information: Media moguls such as Rupert Murdoch are now promising to charge for content. So who's right and who's wrong? Write me (free, of course) and express your thoughts at [email protected].

Posted by Doug Barney on August 31, 200910 comments


We're Flying This Hotmail Account to Cuba

So you think your Web e-mail account is safe? Wrong. An increasing number of users, including some Redmond Report readers, are reporting that hackers are breaking into their accounts and using them to mail out worm-laden messages -- to their contacts! Most hackers use brute-force methods to crack your password, and then they're off and running.

Two Redmond Report readers reported such attacks. In one case, Microsoft was very responsive. The other got ignored like Bill Gates at a high school dance.

What's your worst hacker story? Shoot details (worm-free, of course) to [email protected].

Posted by Doug Barney on August 31, 20092 comments


Virtual Machine Manager R2

System Center Virtual Machine Manager 2008 R2 (SCVMM 2008 R2) evaluation version -- whew, what a mouthful -- arrived this week.

Rambling name notwithstanding, it must work fairly well because System Center products remain a bright spot in Microsoft's recently slumping financials. IT pros can give SCVMM 2008 R2 a spin for 180 days and see if they want to buy it when the complete product rolls out in October. The new R2 can even manage virtual machines running on VMware vSphere 4.0 -- imagine that.

Posted by Kurt Mackie on August 28, 20091 comments


PC Partners Backing Microsoft in i4i Case

Two of Microsoft's PC manufacturing partners are supporting Redmond's appeal of a final judgment against it in a patent dispute with Toronto-based i4i LP.

Dell and HP both filed amicus curiae documents with the U.S. Court of Appeals for the Federal Circuit on Monday. Their briefs support Microsoft's appeal in the case which, as Doug covered last week, involves i4i's "custom XML" technology, found to be used with Microsoft Word's .XML, .DOCX and .DOCM document formats. Microsoft will have to stop selling copies of Word that use the technology by Oct. 10.

Both Dell and HP argue that their PC businesses will suffer if Microsoft must comply with the final judgment of the District Court. The PC manufacturers ship Word on the computers they sell, and a disruption in Word sales will affect their operations, the companies contend -- particularly with regard to testing and loading images of the software.

"If Microsoft is required to ship a revised version of Word in Dell's computers, a change would need to be made to Dell's images," Dell's brief states. "Making such a change would require extensive time- and resource-consuming re-testing."

If the appeal isn't granted, the court should push out the compliance deadline 120 days from the appeals court's ruling, both equipment manufacturers argue.

Microsoft critic Groklaw suggested that while end users wouldn't be adversely affected by the loss of Word sales, Microsoft's partners might be.

"End users aren't particularly going to be affected, because i4i told the court it won't go after users for prior infringement, only future, but vendor partners of Microsoft certainly could be affected," Groklaw explained. "I guess they could install OpenOffice.org instead of Word. Hey. Why not?"

Speculation has it that Microsoft will have a patch available before Oct. 10 that will meet the district court's conditions. With Windows 7 slated for an Oct. 22 public release on new PCs, computer makers could still feel the crunch. Oral arguments for the appeal are slated to start on Sept. 23.

And if you're interested, a Microsoft spokesperson provided Redmond Report with Dell's and HP's amicus curiae briefs (though they were censored to remove "confidential information"). The briefs have an almost cookie-cutter similarity in structure and content. You can read Dell's brief here while the HP brief is available here.

Would you buy a new PC without Word? Are PC manufacturers really facing hardship here? Send your answers to [email protected].

Posted by Kurt Mackie on August 28, 200911 comments