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| Authored by: sproggit on Wednesday, June 20 2012 @ 06:23 PM EDT |
My first attempt at a Comes transcript. I hope this is what you're after. If
I've failed to get this quite right, do please feel free to correct me
accordingly.
For those that are interested and are running ubuntu, please see here:-
http://ubuntuforums.org/showthread.php%3ft=880471
for a terrific how-to for performing OCR scans of these pdf documents. I was
able to use the pdftotext utility and then the file just needed me to spend a
little time correcting the typos caused by the poor quality original.
Please note that I have preserved all the errors, bad grammar, spelling, the
works...
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<b><u>Teresa Jennings</u></b>
From: Bill Gates
To: Bernard Vergnes; Brad Silverberg; Chris Peters; Jeff Raikes; Jonathan
Lazarus;
Lewis Levin; Mike Brown; Mike Maples; Mike Murray; Paul Maritz; Pete Higgins;
Steve Ballmer
Cc: Bill Neukom; Steven Sinofsky
Subject: Two Companies with Business Focus
Date: Sunday, April 25, 1993 2:10PM
THIS is a very confidential memo.
I have a major concern that our sales force is too focused on our system
products and that we don't really
generate activities based on profit potential. Does our sales investment go
primarily into increasing OFFICE
share? I havent seen many clever ideas for increasing OFFICE share for a long
long time I doubt that our
sales investment (over $1 per year Including everything ) is really focused or
clever. I think we could do a
lot better as suggested by this memo. I am not saying we should split but we can
have the benefits
without splitting or without any major reorganization.
<br>
If we split systems and applications into 2 truly separate companies. What would
be different? I am not
saying we should do this or that I am even considering It but rather I want
people to consider what the
strategies would be.
<br>
First take the system company. It has decided to use OEM sales at low prices as
its totally channel for new
users. The volume it drives thru the oem channel insures that the users it
misses in this channel and its
upgrade products will have high demand so it does not have a retail sales force.
It has 3 very focused and
fairly small (<150 each) sales groups: 1) OEM sales - a lot like what we have
today. 2) ISV evangelism and
3) "Server sellers". Groups 2 & 3 meet directly with very few
customers - no EBC and no account plans.
Any account that is a problem must stem from an ISV that group 2 needs to work
on or something in
group 3. The systems group has a headquarters operation that assembles task
forces to look into segments
of the markets where our products are not dominant. Because there is a fast
moving task force mentality
with a budget and leverage thru outside consultants there have been attack plans
for 4 specific markets
are assembled per year - examples Include; K-12 education, OTP, As/400, and
banking. Once a market is
fixed the group moves on. All of these plans set measurable results for the
various "sales groups" and
these objectives are reviewed. The marketing budget of the systems group is very
small focused on: new
product introductions and the task force goals. AE of the seminars it does are
break even and very
leveraged thru 3rd parties. All of its ISV activities and education out reach
are break even or profitable -
very little course delivery and lots of certification. It does gather an end
user name list for direct mailing
upgrade information. It does not attend a show unless it has a major new product
introduction or a task
force tells it to. The "server seller" group is not vaguely defined
around solution selling - it is defined
around selling servers. It has group events for the people who sell servers all
the time and it is in a clear
feedback loop. Vague words like "client-server" do not confuse this
group. This systems company does has
a VERY small support organization since it pays 3rd parties to handle the surge
of new introductions and
only 30-90 days free support. Because of this it really trains a lot of people
before every new release.
This company does not have an executive briefing center or subsidiary presence
in most countries of the
world. It has determined that platforms standards in countries outside the US,
Europe and Japan will be
set based on what happens in those countries. The server seller group uses a lot
of 3rd party relationships
in various countries. Total headcount outside the US is less than Compaq: 400
people from the 3 sales
force groups. Financial systems for this company are simple. Since the systems
software upgrade business
has such peaks and valleys manufacturing is mostly outside. This company would
have 5 standard
speeches updated regularly - where is our system going, how we connect to other
systems, why our
servers are better, how/why to develop for our platform, how we work with OEMs.
This company is easy
for the press to understand. It is highly profitable since support, sales,
marketing and other overheads are
kept very low. Development cost is its primary expense and it has a task force
on each of the following
topics: tools for developing more efficiently with lot of shared ideas, making
testing less headcount
intensive, how to do a "release" every 12 months on a predictable
basis with every other release being
major [2 hardware design points at all times - today it would be 4megabytes and
16megabytes], getting all
documentation on line, doing all support on line. Most corporate customers have
an annual contract that
lets them get all the upgrades on all of their machines. When products do not
sell the response is not some
sales force thing but rather a focus on getting the product right. This company
does not advertise in the
business press except for alliance announcements or major introductions.
[in a major simplification I am skipping the tools business altogether in this
analysis. It is focused on the
Page 62
MS 5043537
CONFIDENTIAL
mass of developers and has a very small sales force]
Now lets take the applications business. Its primary focus is high market share
in primary categories by
selling OFFICE. This company also does not hove an Executive briefing center
since it focuses on design
wins for OFFICE that are commonly done at lower levels. It only works with
retail outlets when it can get a
specific competitive advantage by doing so. It has high enough share that It
doesnt have to work with
people to get stocking or to talk about normal course of business issues. The
reduction is retail outlets has
allowed it to be very focused. Its products are popular enough that retailers
like Egghead participate in all
major initiatives. Walking into a store this company has spent time with shows a
noticeable difference. This
company wakes up every day and says " how do we avoid people thinking of
our produce and the
competitions as interchangable? All of its marketing and technical work focus
around this goal. When this
companies executives give speeches they start with exciting concepts but they
quickly focus on the
competitive advantage. It is amazing how many exciting demonstrations this
company can give of its
upcoming products. This company is not held back by puritanical views about
showing the future since by
the time something is shipping it is old news and now covered and the
competition can already
demonstrate many of the same features in that time frame. A few zingers are kept
under the covers until
shipment for 2 reasons; a) to spread out the news so that both the early reveal
innovations and the ones at
shipment get coverage and b) so that a few things competition does not imitate.
This company has also
gone to a 12-24 month cycle for its products showing brilliance in tying its
work to the exciting work the
systems company is doing. This company has managed to convince the systems
company to ship applets
using exactly the same file forms and command structure as the ones in the
major applications so it is
natural for people to use these applications. It is amazing the great
presentations this company gives
about: support issues and how the new product responds to those, exaples of
users working with
advanced features and the future of the categories.[note: I still cant get
decent slides out of our
applications group]. This company does not have account coverage on a regular
basis at all. They spend
time with accounts when there is an opportunity to get them to switch. For
example they have a huge
focus on companies that have no moved their standards up to Windows. This
company loves showing
customers how we read the competitions files and are a superset of them. This
company understands the
economics of its competitors. This company knows the research that will affect
Its products. The support
policies of this company are tuned for one thing: competitive advantage. It does
not spend money on
support things that cannot be proven by credible 3rd parties to be worthwhile
things. This company has
subset products to use for OEM deal but it also has a presentation for the press
or oems saying how hard
bundle deals are not that great for the customer. This company also has a
reduced presence in the field
since people dont bother it with lots of random questions - only questions about
its products. It is easy to
have a sales force know all the answers to the top questions about these
products. When a product does
not sell the focus is on getting the product right rather than spending more
marketing money on it. This
company does not advertise in the business press except for a major alliance of
product introduction. The
company relishes getting backing unique to it because it ts thinking
competitively. This company has the
same kind of "vertical" approach as the systems company however these
is somewhat more permanent
staff because once you win in a category it doesnt stay won as easily as
systems. This company knows
which market segments it is strong in and which ones it is weak in.
page 63 MS 5043538
CONFIDENTIAL
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| Authored by: Anonymous on Thursday, June 21 2012 @ 05:41 PM EDT |
http://groklaw.net/pdf/iowa/www.iowaconsumercase.org/011607/1000/PX01413.pdf
<p>
PLAINTIFF's EXHIBIT 1413<br />
Comes v. Microsoft
</p>
<p>
From bradsi Thu Aug 27 08:40:39 1992<br />
To: cameronm jonl mikemap paulma<br />
Subject: undoc api's<br />
Date: Thu Aug 27 08:40:38 1992<br />
Status: RO
</p>
<p>
we can doc the api's we know the apps group (and other
isv's) use.
this is a good practice. though it's not as
stragihtforward
as it appears, since some of the calls depend on context
and an understanding
of the source, which is explained in detail in mail i
forwarded from
david d'souza.
</p>
<p>
the biggest advantage our apps group has is access to the
operating
systems source. as long as this continues, the issue will
never
go away.
</p>
<p>
in fact, jimall has long been assuming that the apps group
did not
have source access. he has been telling isv's this, too.
when
i told him yesterday that this was not the case, he had
that
"oh <em>[Ed: language]</em>" look on his face.
</p>
<p>
the apps group does not need access to the source. it's a
matter
that they have grown accustomed to it. the fact that
other companies
have been able to product world-class windows products
(eg. Borland
Quattro Pro, Paradox, Lotus Ami Pro 3.0, Freelance, etc)
is proof.
</p>
<p>
s to (a) doc the api's we know
apps group is using, and (b) give the apps group the same
access
to source we give to other isvs. [ie, in certain limited
circumstances.] if we don't do (b), the issue will never
die
</p>
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| Authored by: foulis on Thursday, June 21 2012 @ 09:01 PM EDT |
<p
align=right><b>PLAINTIFF'S<br>EXHIBIT<br></b><u>
;1387</u><br>Comes v. Microsoft</p>
From kraigb Fri Aug 7 16:09:29 1992<br>
X-MSMail-Message-ID: 6FA51A83<br>
X-MSMail-Conversation-ID: 5CCED14B<br>
X-MSMail-Parent-message-ID: 67D85E8B<br>
X-MSMail-WiseRemark: Microsoft Mail -- 3.0.729<br>
To: drg<br>
Date: Fri, 7 Aug 92 16:08:46 PDT<br>
Subject: FW: The Sparta Religion<br>
Status: RO</p>
Received through a long indirection....</p>
From: briansh<br>
From: mikeli<br>
From: johnlu<br>
Subject: The Sparta Religion<br>
Date: Wednesday, August 05, 1992 12:01</p>
I've been chatting with a few of you in the halls, and it has come to my
attention that many of you (or at least some of you) don't fully understand what
Sparta is all about -- why are we doing it, what are we trying to achieve, who
is our competition. Not surprising, since you haven't lived in the networking
business for the last 4 years the way some of us have. So, I thought I'd lay out
a little of the motivation behind Sparta, and the business imperatives that
Sparta is trying to address.</p>
<br>
Let's start at the very beginning. Why are we even in the networking business?
Well, the fact is, there is no such thing as the "networking"
business. There is just the systems business. Customers don't make independent
decisions about networks vs client OSes -- these decisions are inextricably
intertwined. If you don't have a serious networking story, then you can't sell
your OS at all. And if your network doesn't support the right client OSes, then
you can't sell your network. Customers are looking for complete system solutions
for their businesses and their business problems, partial stories are
interesting.</p>
This is why MS "blew up" the NBU a year or so ago -- we finally
admitted and recognized that there was no such thing as a separate business,
networking had to be integrated into each of our operating systems businesses.
Thus a bunch of people spun off to NT land, a bunch to Cairo land, and a bunch
right here to good old PSG land.</p>
So, MS is in the networking business because it is just part of our systems
business. The next big question is -- who are our competitors in the systems
business? IBM and Apple are perhaps some obvious choices, but our biggest
competitor is actually Novell. Novell is a 100% systems software company. Their
revenues are larger than the revenues of the systems division here at Mother
Microsoft; they have more people in the systems business than do we; they are
growing faster than our systems business.</p>
These numbers scare the pants off me, and they scare people like Billg and
Steveb and Mikemap too. And if those numbers aren't scary enough, consider
further some of Novell's actions and words:
<blockquote><ul><li>They have purchased and are aggressively
marketing DR-DOS, going after our #1 most profitable product.</li>
<li>They are investing big time in Univel, so as to have a competitive
workstation OS to compete with
NT.</li></ul></blockquote></p>
<p align=right>MS 5031401<br>CONFIDENTIAL<br><br>MS-PCA
1115448<br>CONFIDENTIAL</p>
<p align=right>DEFENDENT'S<BR>EXHIBIT<BR>6622</p>
<hr>
<br>
<blockquote><ul><li>Their chairman (Ray Noorda) and top design
gurus (Kyle Powell, Drew Majors) have said repeatedly in the press that MS
doesn't know how to build OSes, that everything we have done has been a hack,
whereas Novell does know how to build OSes. The internal name for LAN Man at
Novell is "LAN
Boy".</li></ul></blockquote></p>
Why is Novell this belligerent towards us? Because they understand the dynamic
that I laid out before -- there is no separate network business, there is just a
systems business, and Novell intends to dominate this business. They already own
all the networking parts of the business, to grow further they need to push into
the client OS business, so that is what they are doing.</p>
Now, the really scary thing is that Novell may have a stronger inherent position
than MS in the systems business. If you read market research reports, they will
tell you that customers are far more willing to change to a new supplier of
client OS products than they are to change their networking vendors. Networking
is just too central to their business, and problems can cause too much
disruption. Novell understands this very well and has a bunch of ads out now
that pick up the old IBM theme of "You won't ever get fired for buying
IBM" -- the ads encourage customers first and foremost to think about
network (and thereby Novell) compatibility when they buy something.</p>
And make no mistake, Novell is very good at what they do. They have a great
marketing and sales engine. Their senior technical people are pretty good. They
understand their customers well. They are a tough, tough competitor.</p>
So, our big competitor in the systems business is Novell, and they are very
tough and very well positioned.</p>
MS first started to try to take Novell on by attacking them head on with LAN
Man. Boy did we learn a lot. We got the tar beat our of us. We invested a
boatload of money and made very little headway. We tried to compete on their
terms, defining the network business and our products the same way Novell did,
and we got whupped.</p>
OK, so we learned our lesson. We can't win in the systems business by taking on
our competitor on their terms. We have to find a way to win that leverages our
strengths, which is our position in the desktop OS and desktop app
business.</p>
And thus was born Sparta. The notion that caused this project to start up was
that we would re-enter the networking business from our position of strength,
the desktop OS. We would build networking into the desktop OS and just give it
away - after all, we didn't care if we made a lot of money on networking,
because we weren't making any money at all in networking anyway.</p>
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