Place your bets on research

No reason to sugarcoat the Microsoft quarterly financial report issued this afternoon: it reflected the bad news in the overall economy.  Revenue down, earnings down, profits down. 

What I did find most interesting was the silver lining as Business Week points out in its coverage. Like most of Wall Street apparently (MSFT stock rose in after-hours trading), Business Week was impressed with some of the positive steps taken by the company:

Maybe the most striking news is Microsoft’s crisp cost-cutting. Who knew this Midas of the computer industry knew how to scale back so well? In the quarter, administrative costs fell by more than $1 billion, from $2.3 billion to $913 million. And the company completed its first ever general layoff, of 5,000 people. The company did not cut into its R&D budget, however. Spending there rose from $2 billion to $2.2 billion.”

It’s that last point that I’m focusing on, as it demonstrates that the company is living up to CEO Ballmer’s pledge to increase our annual R&D spending – amid this deep recession – from $8 billion a year to over $9 billion.

At a time when most budgets are hurting, that’s quite an investment.  If you’d like to know what we’re getting for that, check out http://research.microsoft.com, or for the most up-to-date reports, use Twitter to follow @MSFTResearch – this week, the Twitter feed has focused on papers and demonstrations we’re presenting at the 18th International World Wide Web Conference (WWW2009).

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Way Ahead and Far Behind

Today’s Washington Post has a story on its front page: “Staff Finds White House in the Technological Dark Ages.”

Two years after launching the most technologically savvy presidential campaign in history, Obama officials ran smack into the constraints of the federal bureaucracy yesterday, encountering a jumble of disconnected phone lines, old computer software, and security regulations forbidding outside e-mail accounts.”

“What does that mean in 21st-century terms? No Facebook to communicate with supporters. No outside e-mail log-ins. No instant messaging. Hard adjustments for a staff that helped sweep Obama to power through, among other things, relentless online social networking.”  -Washington Post

Some say that whoever has been responsible for information technology in the White House itself should be fired — but then perhaps the change of Administration just took care of that  :-) 

Overall, this situation is familiar to anyone who has worked in what I call “Big-G  IT” or the information technology of a federal government agency. I’ve argued about its challenges and sub-optimality before: see my previous pieces on “Roadmap for Innovation: From the Center to the Edge,” and more specifically “Puncturing Circles of Bureaucracy.”  In that latter piece back in March of 2008, I wrote about the “the defensive perimeters of overwhelming bureaucratic torpor,” and the frustrating reality within much of Big Government: “Federal employees have an entire complex of bizarrely-incented practices and career motivations, which make progress on technology innovation very difficult, not to mention general business-practice transformation as a whole.”

Here’s the truly frustrating, mind-bending part: it isn’t always true!  Other elements of the White House have cutting-edge, world-class technologies operating day in, day out.

Amazon and Microsoft Intersect in the Cloud

So today Werner Vogels, the much admired CTO of Amazon, has a post over at “All Things Distributed” which directly exemplifies his blog’s subtitle (“building scalable and robust distributed systems“).  The post is ”Expanding the Cloud” and describes today’s announcement that Microsoft Windows Server is available on Amazon EC2. As he sums it up, “We can now run the majority of popular software systems in the cloud.”

This means two things.  First, we were able to con cajole convince Amazon essentially to host a beta test for something big, which will indubitably become much, much bigger.

San Francisco’s Wild and Wacky World of Technology

Fact: San Francisco’s municipal IT continues to self-destruct, according to new reports this weekend.  According to an IDG story (San Francisco hunts for mystery device on city network), “With costs related to a rogue network administrator’s hijacking of the city’s network now estimated at $1 million, city officials say they are searching for a mysterious networking device hidden somewhere on the network. The device, referred to as a terminal server in court documents, appears to be a router that was installed to provide remote access to the city’s Fiber WAN network, which connects municipal computer and telecommunication systems throughout the city. City officials haven’t been able to log in to the device, however, because they do not have the username and password. In fact, the city’s Department of Telecommunications and Information Services (DTIS) isn’t even certain where the device is located, court filings state.”

Cuil’s Hockey-Stick Decline

The new Cuil search engine, which was the beneficiary of a lot of buzz just two weeks ago, is not yet showing evidence of viral growth, according to new stats from Hitwise tracking service. Quite the contrary.

In fact, in the last few days Cuil has only ranked 34th among all search engines surveyed. 

Admittedly, it’s very early, too early to dismiss them (StartupMeme.com says “Cuil made a fool of itself“).  

Cuil has a cushion of VC funding to pursue the long slog. 

But they’ll never get better press and more media attention than they did over the last 10 days, and despite that I’d venture to say that Cuil’s carving its way into the wrong end of a “long tail.” 

Hey, folks at Cuil: you’re holding the hockey stick the wrong way!

 

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Invisibility, Mind-Control, Great Coffee, and a New OS

http://www.MojaveExperiment.com

Lots of interest and blogoshere commentary beginning about “The Mojave Experiment.”

The reaction is reminiscent of one of those Obama or McCain provocative ads posted online, generating far more attention and buzz than the attention they get on the natural by being broadcast.

Sure, it’s a sales pitch, and pretty narrowly geeky at that (thanks GoogleFight!).

But at least it’s an innovative one – as the Wall Street Journal puts it today, “Give Microsoft people credit: They did it with humor, and they weren’t afraid to air the negative stuff.”

Healthcare: It’s the Data, Stupid

Fact: Today’s L.A. Times has a startling report: “A stunning number of people who work in healthcare settings lack paid sick time — as many as 75% of all home health aides, for example… Federal data indicate that as many as 29% of all workers in the ‘healthcare and social assistance’ job sector lack paid sick days. Healthcare employees who work while ill may end up hurting the people they are hired to help….”

Analysis: Mark Twain said the only two sure things in life were death and taxes.  So it’s no surprise that the two presidential campaigns are focusing on healthcare and the economy, since people are universally affected in personal ways.  Forget taxes for today, I’m interested in technology’s role in healthcare, which is growing, and there’s no more potentially game-changing facet of that than the role of data. 

Tech (and Web 2.0) in Russia

FACT: The RedOrbit tech-news site this week covered the European research and consulting firm GoalEurope’s release of its “Rating of Russian Web 2.0 Companies” (by Natasha Starkell, GoalEurope, June 12, 2008).  According to the research report, “We have looked at each of the 378 websites to provide an extensive coverage of the Russian Web 2.0 space.” The report includes a characterization of the top websites across categories like news sites, blogs, social networks, photo/video sharing, Question/Answering sites, bookmarking, music, search engines, RSS feeds, online file storage and sharing, and other specialized sites, and a full ranking by Alexa-generated usage statistics.  Get the full pdf report here - and see the excerpted Top 10 list below.

EU says, Costs of Open Source Outweigh the Benefits?

FACT: According to a Reuters story today, “The European Commission, a thorn in Microsoft’s side for its antitrust campaigns against the software giant, is falling short in its own internal attempt to promote more competition in the technology sector. The European Union executive has so far not followed its own policy that it purchase office software and operating systems with open standards as well as Microsoft products.”

In the money quote, according to the Reuters story, the EU’s director of IT solutions ”said in an interview arranged by a spokeswoman for Commissioner Siim Kallas, who oversees procurement, that studies showed the costs of moving to open source outweighed the benefits.” 

 

Web Security and New Media in Politics

FACT: The Obama presidential campaign has been lauded for innovative uses of the Web and social media, particularly for fundraising and volunteer recruitment.  But as PC World has just reported, “Two months after their Web site was hacked, the organizers of Barack Obama’s presidential campaign are looking for a network security expert to help lock down their Web site…. Security experts said this is the first time they can remember seeing a Web security job advertised for a political campaign.”

ANALYSIS:  I wrote before about my experience in 1994-95 helping build one of the Internet’s first political campaign websites – I designed the content and wrote much of it, for Mayor Frank Jordan of San Francisco.  (The pages were literally built and posted by mayoral son Thomas Jordan, by the way, who was then a college student at UC-Berkeley; he went on to great things at Pixar.)   At the time, with such a simple site, we didn’t have to worry much about security – or so we thought, and luckily the worst scandal in those early years involved domain-squatting by certain rival campaigns.

As PC World points out, though, “Obama’s Web site, built by Facebook cofounder Chris Hughes, has been the model of Web 2.0 campaigning, using social-networking techniques to raise funds and build a broad base of active, Internet-savvy supporters. But security experts have long warned that powerful Web site features also open new avenues for attack.”