Microsoft delays aspirations to be gatekeeper of the virtual enterprise

2000-01-25

The IT industry is rife with stories of companies trying to emulate previous world-shaking innovations, with varying levels of success. Lotus tried to follow 1-2-3 with Notes, mainframe IBM brought the personal computer to the masses. The continued need to innovate is driven by a desire to stay in the game and to appease shareholders, whose skill at abandoning faltering companies would put ship-rats to shame. Microsoft has made repeated forays outside its traditional PC market space with varying levels of success. In media streaming, it is beginning to look like the company may dominate, through a recently brokered arrangement with Liquid Audio. Elsewhere the future is not so certain - examples like MSN and CE serve to illustrate how Microsoft may possess the goose that lays the golden eggs, but not the underlying technology.

A test case is coming round with the now-delayed launch of BizTalk Server, Microsoft’s long-promised engine for XML-based eBusiness communications. The product is over six months late in delivering to beta testers, with the probable launch date being autumn 2000. The reason, say observers, is that the competition is already ahead of the game. According to a recent report on Cnet news, the missing link is the connection with business processes. This is the ability to link the communications required between organisations with the higher-level business logic, for example ordering a product or handling a customer request. Products from HP and Vitria, for example, already support such a linkage. It could be argued that Microsoft’s competition is looking through the right end of the telescope by building business logic before trying to automate it. The bottom-up approach used by BizTalk Server is not a good starting point with which to handle the myriad complexities of modern business. Microsoft insiders claim that the BizTalk architecture is changing to take this into account – the question is now, whether the competition can capitalise on the delays which ensue. One point in Microsoft’s favour is its ownership of Visio, the de facto tool for business process modelling among many business analysts – it remains to be seen how the company will exploit this advantage, for example by providing a Visio interface to BizTalk.

For Microsoft, its aims for BizTalk are far more than just sales figures for a business communications tool. This represents the battle for the gates [sic] of CyberSpace – in the virtual enterprise, business success will be built upon communications and it is likely that a single company will end up the de-facto standard. The playing filed is currently empty, but soon corporate IT shopping lists will include the item “XML-based business communications facility”. Microsoft would very much like to replace this phrase with “BizTalk Server” in much the same way that Hoover and Coke have done in the past.

Microsoft has ridden the PC revolution with enormous skill and dexterity, becoming one of the world's most powerful companies in the process. Even now, it seems unlikely that the dream will fade - the PC is moving into the machine room and Windows 2000 looks set to buoy up the share price for some time yet. However, outside the kingdom where the PC holds sway Microsoft’s less successful ventures should serve to keep the company firmly on the ground. Ballmer and “innovator” Gates are not gods, but mortal men who are no better at predicting the future than anyone else. There are no guarantees, particularly for a company which may see itself divided into three or more parts before the end of the year.

(First published 25 January 2000)