VARs Question Big M's Focus

Usually a venue for major product announcements, last week's Tech Ed 2005 in Orlando, Fla., left some partners disappointed. At the conference, Microsoft said it now expects to launch the long-delayed SQL Server 2005 database and Visual Studio 2005 toolset in November, although some observers still question whether the products will be generally available then.

Chronic delays to core products lead some to say that the company's attempt to penetrate all markets is hurting its key Windows and infrastructure businesses. They're starting to think the unthinkable: Could it be that not even the Big M can be all things to all people? Some partners say their own businesses are being held up by Microsoft's grand plans.

"This issue has been a longtime problem for Microsoft and stems from a jack-of-all-trades mentality, wherein the product teams see all the potential offshoots of applications and solutions that can tie into a core Windows environment and they try to simultaneously tackle them all," said Paul Freeman, CEO of Irvine, Calif.-based Coast Solutions Group, a network of service partners. "Obviously, this kind of aggressive development and release cycle can't be supported successfully year after year, product after product."

One East Coast infrastructure partner summed it up: Microsoft is indomitable when it sets its eye on a specific goal—be it Research In Motion's BlackBerry or Netscape's browser. But right now, he said, the company is "extremely unfocused."

And now the company is obsessed with Google's threat in desktop search and other areas.

As Linux advances both in technology and installed base, observers said Microsoft must prioritize platform deliveries over newfangled server applications.

Aside from the security-focused Service Pack 2, for example, the Windows client has not had a major makeover since 2001 and won't until next year's Longhorn.

Microsoft's ambitions are now so huge as to be untenable, the infrastructure partner said. After a false start in collaboration with Exchange, Microsoft is going after that market again with SharePoint and/or Groove. And now it also wants analysis, ERP, CRM applications, he said.

The now-chronic delays of Microsoft's database and development platforms also weigh heavily on ISVs, whose own products—and revenue streams—depend on their shipment, originally expected in 2004.

"It's a problem," said one East Coast ISV who requested anonymity. "Every beta changes, and anyone can run [Visual Studio] on a GoLive license, but I have to hold back my [products until] they deliver."

During his keynote last week, Microsoft CEO Steve Ballmer asked developers to be patient a bit longer. "Please bear with us," he said. "We know these [products] will be worth the wait when we can get there."

Some VARs said the company should follow the advice it gives partners and focus on its core competencies—platform and infrastructure. "Microsoft is in a tough position because they have been so dominant. Many customers have adopted Microsoft as their software integrator for all solutions," said Bob Stalick, CEO of Internosis, Greenbelt, Md.

But Microsoft executives denied that its bread-and-butter businesses are simply Windows and infrastructure. "Our core competency is software," said Bob Muglia, senior vice president of Microsoft's Windows Server division. He did acknowledge that sewing together the back end is not as simple as connecting Office applications. "The biggest challenge we have is integrating all of these technologies," he said.

As of now, Microsoft is trying to manage cross-integration of more than 20 different client and server platforms. The underbelly of its "integrated innovation" push is that a glitch in one product will ripple throughout the rest of the line.