Ballmer: MS needs to be a better partner

Microsoft has learned from its ongoing antitrust case that it must improve the way it relates to its partners and competitors, company Chief Executive Officer Steve Ballmer said Wednesday at Gartner Inc.'s Symposium/ITxpo here.

"We need to do a better job and reach out to our partners and make sure we are a good partner to those who partner with us," Ballmer said during a keynote talk. The U.S. Department of Justice (DOJ) and 18 state attorneys general are plaintiffs in the federal antitrust case. A U.S. District Court judge will soon determine what remedies should be imposed on Microsoft, which was found to be maintaining an illegal monopoly in the operating system market.

Microsoft was humbled when it saw companies it partners closely with opt not to speak "openly and fervently on our behalf," during the antitrust litigation, he said.

Cooperation is key to survival in the IT industry and Microsoft has learned from the antitrust experience that it must be a "better part of the ecosystem," Ballmer said.

To that end, Ballmer met with Oracle Corp.'s CEO Larry Ellison -- a Microsoft nemesis -- to discuss product compatibility in the database space, he said. He has also met recently with IBM Corp. officials.

"We have to be viewed more positively by the industry," he said.

Despite this pledge, the session left little doubt that bad blood continues to exist between Microsoft and Sun Microsystems Inc., with whom it has sparred in courts in recent years, mostly regarding the use of Sun's Java language and associated platform.

For example, Ballmer didn't mince words when asked about Sun's Liberty Alliance Project, an initiative led by Sun to compete against Microsoft's Passport online authentication service.

"The Sun thing has zero probability of mattering to the world," he said.

After referring several times to the project as "crazy," Ballmer joked: "And that's my nonemotional view."

Every time Microsoft launches an initiative, Sun initially opposes it, and two weeks later comes out with its own proposed version, he said. If Microsoft ever said it would build a hole, Sun would oppose it and later say it will build a better hole "but in the moon although we have no tools to get there ... and we'll call it J-Hole," Ballmer said, drawing laughs from the audience.

"The Liberty project is another J-Hole," he said.

On another Sun-related topic, Ballmer reiterated that Microsoft will not include its Java Virtual Machine in its Windows XP operating system because it can't continue to develop it, part of an out-of-court settlement agreement reached with Sun in January. But Microsoft would be happy to include the JVM in Windows XP if Sun softened its stance on the issue and committed to go easy on legal action, Ballmer added.

Attendees at Tuesday's keynotes witnessed the cool, assured precision of Hewlett-Packard Co. Chairman and CEO Carly Fiorina and the affable, low-key professorial approach of Intel Corp.'s Craig Barrett. Ballmer gave them a different taste of CEO behavior on Wednesday: intense, emotional and loud, with a hearty dose of ironic and self-deprecating humor and an unbridled car-salesman-like enthusiasm.

"Don't bleed me dry here," he pleaded at one point with the two Gartner analysts who led the discussion by asking him questions on stage.

Asked about the rising interest in IT security issues in light of the Sept. 11 terrorist attacks and the continuing effects of malicious code distributed via the Internet, Ballmer said Microsoft is readying some new and improved security products for release before the end of the year. Those will include a security tool kit that will make it easier for users to deploy security patches, he said.

Regarding markets in which Microsoft would like to do better, Ballmer mentioned the enterprise data center space, specifically the database segment, in which Oracle continues to rule.

High-growth areas in the software sector include PC software, user interface design, security, and the conjunction of XML (Extensible Markup Language) and Web services, which he described as akin to "throwing all the cards in the air."

On the issue of pricing, which got Microsoft in hot water recently with many enterprise customers who don't like the company's new licensing plan, Ballmer said Microsoft listens to client feedback, which in the case of the controversial pricing plan, has led the company to push back the enrollment deadline.

Ballmer also acknowledged that innovation in its Office suite has been hampered by the product's success -- it has a dominant market-share position in the office software productivity sector -- because too many changes tend to upset users. To that end, Microsoft has adopted a policy of introducing fundamental changes in the operating system and then introducing them in applications, he said. Users can expect to see a significant improvement in Office's user interface and a tighter integration among the Office applications "two Windows releases from now," he said.

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