Last week Microsoft seemed to wake up from a long hibernation and announced:
Maybe Sergey Brin was right to be unnerved.
Tactically, this PR blitz looks like a stick to wave at Yahoo management and shareholders. I would be a tad unnerved to be negotiating with this guy!
The Microsoft vs Google slugfest is one of the better spectator sports around. It is like Sumo wrestling, but then some smaller guys like Yahoo, AOL, Amazon, Ask occasionally jump in the ring saying “hey, look at me, I am big too”. Whack. Oops, the big sumo boys did not mean to hurt you. As with any good match, we have passionate supporters on both sides and lots of really heavy betting action.
What’s been missing recently is the big moves by Microsoft. Bill Gates was pretty deliberate about his succession. First he hands over the biz stuff to Ballmer; squeeze every last drop out of that cash cow please. Then he brought in Ray Ozzie, his cerebral equal and somebody the developers can relate to.
With no big moves, I wondered if Ozzie was being shackled by the Innovators Dilemma and could not move fast enough to meet the emerging battle for the big cloud services.
However these latest moves indicate that Microsoft is thinking and not just roaring. There were also some quiet 'below the radar' deals last week, that were pretty significant if you look at where they could go. Acquiring Credentica is a big move in the online ID game and that is a big game that still needs leadership.
So I decided to research what Microsoft has acquired recently. Somebody has already done the hard work and put it onto Wikipedia. I don’t know if it is accurate; if you see any big gaps, you can go edit the Wikipedia entry (as well as commenting here of course). The number of acquisitions tells a story of a pretty hungry beast:
2000 - 7
2001 - 4
2002 - 4
2003 - 4
2004 - 4
2005 - 14 (including Groove, which brought in Ray Ozzie)
2006 - 19
2007 - 15
2008 - 5 (up to Feb 27th, does not have Credentica)
Many of these deals are quite small by Microsoft standards. They are buying R&D. It clearly takes them a long time to take cool R&D and scale it to the level that is needed to be meaningful for Microsoft. That is good news for start-ups looking to exit. When the big guys need every ounce of competitive advantage for their fights, small guys can benefit.