Microsoft

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Microsoft Corporation

Type	Public (NASDAQ: MSFT)
Founded	Albuquerque, New Mexico (1975)
Location	Redmond, Washington, USA
Key people	Bill Gates, Founder & Chairman Paul Allen, Founder Steve Ballmer, CEO
Industry	Computer software, Publishing, Research and development, Television, Video games
Products	Microsoft Office, Microsoft Windows, MSNBC, Xbox, (See more products.)
Revenue	$39.8 billion USD (2005)
Employees	59,947 (2005)
Website	www.microsoft.com

Microsoft Corporation (NASDAQ: MSFT) (HKSE: 4338) is the world's largest software company, with global annual sales in the tens of billions of US dollars and more than 55,000 employees in 85 countries and regions. The company's headquarters are in Redmond, Washington, USA. Microsoft develops, manufactures, licenses, and supports a wide range of software products for computing devices. Its most popular products are the Microsoft Windows operating system and the Microsoft Office suite of productivity software, each of which has achieved near ubiquity in the desktop computer market. Microsoft has footholds in other markets, with assets such as the MSNBC cable television network, the MSN Internet portal, and the Microsoft Encarta computer encyclopedia. The company also markets home entertainment products, such as the Xbox and WebTV.

"Micro-soft" (short for microcomputer software) was founded in Albuquerque, New Mexico in 1975 by Bill Gates and Paul Allen, to develop and sell BASIC interpreters for the Altair 8800. After the market saw a flood of IBM PC clones in the mid-1980s, Microsoft used its new position, which it gained in part due to a contract from IBM, to dominate the home computer operating system market with its MS-DOS operating system. The company later released an initial public offering (IPO) in the stock market, which netted several of its employees millions of dollars due to the ensuing rise of the stock price. The price of the stock continued its rise steadily into the early 2000s. In Microsoft Windows, the company was selling what would become the most widely used operating system in the world, which was originally an add-on for their DOS operating system; Microsoft continued to push into multiple markets, such as computer hardware and television. In addition, Microsoft has historically given customer support over Usenet newsgroups and the world wide web, and awards Microsoft MVP status to volunteers who are deemed helpful in assisting the company's customers.

With what is generally described as a developer-centric business culture, Microsoft has become widely known for some of its internal codes of conduct for its employees. One example is the "eat your own dogfood" mantra, which describes the practice of using pre-release products inside the company to test them in an environment geared towards the real world. Microsoft has also become notorious for its business practices—the U.S. Justice Department, among others, has sued Microsoft for antitrust violations and software bundling. In addition, Microsoft has been criticized for the security and ease-of-use of its software. Despite this, Microsoft has won several awards, such as the "1993 Most Innovative Company Operating in the U.S." by Fortune Magazine. The company is on the Fortune 500 list of companies as of 2005.

History

See also: History of Microsoft Windows.

First conceived in 1975 by Bill Gates and Paul Allen, Microsoft has evolved through several stages throughout its history. By 1985, the company was selling the Microsoft Windows operating system and MS-DOS, and had collaborated with IBM to produce OS/2 Warp. By 1992, Microsoft had released an IPO in the stock market and discontinued OS/2 development to focus directly on Windows. By 1995, Windows was the most widely used graphical operating system in the world, and with the introduction of Windows 95, the company became a more consumer-driven company. Microsoft would proceed to enter other business markets, such as publishing and video games, would be sued more than once by the U.S. Justice Department and other governments and companies, and would continue to dominate the operating system market.

1975–84: the founding of Micro-soft

Microsoft staff photo from December 7, 1978.
Top row: Steve Wood (left), Bob Wallace, Jim Lane. Middle row: Bob O'Rear, Bob Greenberg, Marc McDonald, Gordon Letwin. Bottom row: Bill Gates, Andrea Lewis, Marla Wood, Paul Allen.

Days after reading the January 1, 1975, issue of Popular Electronics that demonstrated the Altair 8800, Bill Gates called the creators of the new microcomputer, MITS (Micro Instrumentation and Telemetry Systems), to inform them that he and others had developed a version of the programming language BASIC for the platform. Allen flew to MITS to unveil the new BASIC system. Allen had never handled an Altair, since Gates had carried out all of the product development; however, the demonstration was successful and resulted in a deal with MITS to buy the rights to Allen's and Gates' BASIC for the Altair platform. Having identified a valuable opportunity, Gates left Harvard University to pursue the market and eventually founded "Micro-soft" in Albuquerque, New Mexico. The name Microsoft, without hyphen, was first used in a letter from Gates to Allen on November 29, 1975, and in November 26, 1976 the name became a registered trademark. The company's first international office was founded on November 1, 1978, in Japan, entitled "ASCII Microsoft". On January 1, 1979, the company moved from Albuquerque to a new home in Bellevue, Washington. Steve Ballmer joined the company on June 11, 1980, and would later succeed Bill Gates as CEO. The company restructured on June 25, 1981, to become an incorporated business in its home state of Washington (with a further change of its name to "Microsoft, Inc."). As part of the restructuring, Bill Gates became president of the company and Chairman of the Board, and Paul Allen became Executive Vice President.

Microsoft's first operating system was Xenix, released in 1980 and later sold to Santa Cruz Operation. However, the source of the real success for the company was the DOS operating system. On August 12, 1981, after negotiations with Digital Research failed, IBM awarded a contract to Microsoft to provide a version of the CP/M operating system, which was set to be used in the upcoming IBM Personal Computer (PC). However, Microsoft did not have an operating system at the time, so it purchased a CP/M clone called QDOS (Quick and Dirty Operating System) from Tim Paterson of Seattle Computer Products for $50,000, which Microsoft renamed to PC-DOS. Due to potential copyright infringement problems with CP/M, IBM marketed both CP/M and PC-DOS for $250 and $40, respectively, with PC-DOS eventually becoming the standard because of its lower price. Around 1983, in collaboration with numerous companies, Microsoft created a home computer system, MSX, which contained its own version of the DOS operating system, entitled MSX-DOS; this became relatively popular in Japan and Europe. Later, after Compaq successfully cloned the IBM BIOS, the market saw a flood of IBM PC clones. Microsoft was quick to use its position to dominate the home computer operating system market. Microsoft began licensing its operating system for use on non-IBM PC clones, and called this version of the operating system MS-DOS (short for Microsoft Disk Operating System). By marketing MS-DOS aggressively to manufacturers of IBM-PC clones, Microsoft rose from a small player to one of the major software vendors in the home computer industry. Starting on May 2, 1983, with the "Microsoft Mouse", Microsoft entered markets such as computer hardware. This expansion included Microsoft Press, a book publishing division, on November 10 the same year, which debuted with two titles: "Exploring the IBM PC Home Computer" by Peter Norton, and "The Apple Macintosh Book" by Cary Lu.

1985–91: the rise and fall of OS/2

The sign at a main entrance to the Microsoft corporate campus. The Redmond Microsoft campus today includes more than 8 million square feet (750,000 m²) and 28,000 employees.

The Republic of Ireland became home to Microsoft's first international production facility in 1985, and on November 20 Microsoft released its first retail version of Microsoft Windows, originally a graphical extension for its MS-DOS operating system. In August, Microsoft and IBM partnered in the development of a different operating system called OS/2. OS/2 was marketed in connection with a new hardware design proprietary to IBM, the PS/2^[1]. Shortly afterwards on February 16, 1986, Microsoft relocated to Redmond, Washington. Around one month later, on March 13, the company went public with an IPO, raising $61 million at $21.00 per share. By the end of the trading day, the price had risen to $28.00. In 1987, Microsoft eventually released their first version of OS/2 to OEMs^[2]. Continuing its trend of rebranding products from other companies, Microsoft announced SQL Server on January 13, 1988, a relational database management system for companies that was based on technology licensed from Sybase.

In 1989, Microsoft announced at Comdex that the 1991 release of Windows 3.0 would be the last version of Windows. Over the next few years, Microsoft continued to issue statements indicating that OS/2 was the future of computing. On May 16, 1991, Bill Gates announced to Microsoft employees that the OS/2 partnership was over, and that Microsoft would henceforth focus its platform efforts on Windows and the Windows NT kernel. Some people, especially developers who had ignored Windows and committed most of their resources to OS/2, were taken by surprise, and accused Microsoft of deception. The Windows changeover was frequently referred to in the industry as "the head-fake".^[3] In the ensuing years, the popularity of OS/2 declined, and Windows quickly became the favored PC platform. 1991 also marked the founding of Microsoft Research, an organization in Microsoft for researching computer science subjects, and Microsoft Visual Basic, a popular development product for companies and individuals.

1992–95: domination of the corporate market

The Microsoft sign at the entrance of the German Microsoft campus, Konrad-Zuse-Str. 1, Unterschleißheim, Germany. Microsoft became an international company with headquarters in many countries.

During the transition from MS-DOS to Windows, the success of Microsoft's product Microsoft Office allowed the Company to gain ground on application-software competitors, such as WordPerfect and Lotus 1-2-3. Some allege that Microsoft used its inside knowledge of the DOS and Windows kernels and of undocumented Application Programming Interface features to make Office perform better than its competitors, but internal sources at Microsoft later revealed that the Office team did not have access to the Windows source code at the time, and relied on reverse engineering^[4]. Eventually, Microsoft Office became the dominant business suite, with a market share far exceeding that of its competitors. In March 1992, Microsoft released Windows 3.1 along with its first promotional campaign on TV; the software sold over three million copies in its first two months on the market. In October, Windows for Workgroups 3.1 was released with integrated networking capabilities such as peer-to-peer file and printing sharing. In November, Microsoft released the first version of their popular database software Microsoft Access. By 1993, Windows had become the most widely used GUI operating system in the world. Fortune Magazine named Microsoft as the "1993 Most Innovative Company Operating in the U.S.". The year also marked the end of a five-year legal case brought by Apple, dubbed Apple Computer, Inc. v. Microsoft Corp., in which the ruling was in Microsoft's favor. That same year, Microsoft released Windows for Workgroups 3.11, a new version of the consumer line of Windows, and Windows NT 3.1, a server-based operating system with a similar user interface to consumer versions of the operating system, but with an entirely different kernel.

As part of its strategy to broaden its business, Microsoft released Microsoft Encarta in 1994, the first encyclopedia designed to run on a computer. Microsoft also created the Microsoft Plus product support program for its customers, a service that offered cost savings on Microsoft products. The name of that program was later used for several expansion packs for Windows. The company changed its slogan to "Where do you want to go today?" in that year, as part of an attempt to appeal to nontechnical audiences in a US$100M advertising campaign, which some critics regarded as uninspired. Dreamworks SKG and Microsoft formed a new company, Dreamworks Interactive, to produce interactive and multimedia entertainment properties in 1995. In March, Microsoft released Microsoft Bob, a Windows 3.1 program manager replacement, which is widely considered Microsoft's most unsuccessful product; its unpopularity became the source of many jokes.

Up until 1995, Microsoft was a business-oriented company. However, in August 1995, it released a new version of its flagship software, Microsoft Windows 95, with a completely new user interface, including a novel start button; more than a million copies of Microsoft Windows 95 were sold in the first four days after its release. The new version of Windows was the start of a major transition towards a consumer-oriented company. In September, the Chinese government chose Windows to be the operating system of choice in that country, and entered into an agreement with the Company to standardize a Chinese version of the operating system. Microsoft also released the Microsoft Sidewinder 3D Pro joystick in an attempt to further expand its profile in the computer hardware market.

1995–99: foray into the internet and other venues

The Microsoft Network homepage, currently one of the most visited websites on the internet.

In the mid-90s, Microsoft began to expand its product line into computer networking and the world wide web. On August 24, 1995, it launched a major online service, MSN (Microsoft Network), as a direct competitor to AOL. MSN became an umbrella service for Microsoft's online services, using Microsoft Passport as a universal login system for all of its websites. The company continued to branch out into new markets in 1996, starting with a joint venture with NBC to create a new 24/7 cable news station, MSNBC. The station was launched on July 16th to compete with similar news outlets—in particular, CNN; in the same year, Microsoft launched Slate, an online magazine edited by Michael Kinsley, which offered political and social commentary along with the cartoon Doonesbury. In an attempt to extend its reach in the consumer market, the Company acquired WebTV, which enabled consumers to access the Internet from their television. Microsoft entered the palm computing market in November with Windows CE 1.0, a new built-from-scratch version of their flagship operating system, specifically designed to run on low-memory, low-performance machines, such as handhelds and other palm-sized computers. 1996 saw the release of Windows NT 4.0, which brought the Windows 95 GUI and Windows NT kernel together.

While Microsoft largely failed to participate in the rise of the Internet in the early 1990s, some of the key technologies in which the company had invested to enter the Internet market started to pay off by the mid-90s. One of the most prominent of these was ActiveX, an application programming interface built on the Microsoft Component Object Model (COM); this enabled Microsoft and others to embed controls in many programming languages, including the company's own scripting languages, such as JScript and VBScript. ActiveX included frameworks for documents and server solutions. The company also released the Microsoft SQL Server 6.5, which had built-in support for internet applications. Later in 1997, Microsoft Office 97 as well as Internet Explorer 4.0 were released, marking the beginning of the takeover of the browser market from rival Netscape, and by agreement with Apple, Internet Explorer was bundled with the Apple Macintosh operating system as well as Windows. Windows CE 2.0, the handheld version of Windows, was released this year, which included a host of bug fixes and new features designed to make it more appealing to corporate customers. In October, the Justice Department filed a motion in the Federal District Court in which they stated that Microsoft had violated an agreement signed in 1994, and asked the court to stop the bundling of Internet Explorer with Windows.

In 1998, Microsoft released an update to the consumer version of Windows, Windows 98. Windows 98 came with Internet Explorer 4.0 SP1 (which had Windows Desktop Update bundled), and included new features from Windows 95 OSR 2.x including the FAT32 file system, and new features specifically for Windows 98, such as support for multiple displays. Microsoft also launched its Indian headquarters that year, which would eventually become the company's second largest after its U.S. headquarters. Steve Ballmer was appointed president of Microsoft, and Bill Gates remained as Chair and CEO. Later in 1999, Microsoft Office 2000 was released, along with Internet Explorer 5.0.

2000–05: legal issues, XP, and .NET

Microsoft India Development Center, HITEC_City, Hyderabad. The largest Microsoft campus outside the United States.

On May 18, 1998, the U.S. Department of Justice and 20 U.S. states filed charges against Microsoft, stating that Microsoft illegally abused its monopoly power in its sales of Windows, in United States v. Microsoft^[5]. However, it was not until April 3, 2000 that a ruling was made that Microsoft had to be split into two companies. However, in June 2001, part of that ruling was overturned by a federal appeals court, and in September the Justice Department decided to seek a settlement with Microsoft instead of trying to split it up. While the trial was underway, on February 17, 2000 Microsoft released Windows 2000, which some consider a significant improvement over previous versions. It provided a similar OS stability to that of its Unix counterparts. Unlike previous consumer-level operating systems, Windows 2000 was built on the Windows NT kernel, rather than the DOS kernel as previous consumer versions of Windows had been. Windows 2000 also provided a DOS emulator that could run most old DOS applications from previous versions of Windows. During the trial, Bill Gates stepped down as CEO and Steve Ballmer became the new CEO, with Bill Gates remaining chairman and Chief Software Architect.

In the same year, Microsoft released a new version of the consumer version of their flagship product, Windows ME, (Millennium Edition). Widely regarded as one of the most unstable operating systems Microsoft had ever produced, its main features were enhanced multimedia capabilities, such as an automated video editor. In June, the company released a new version of its hand-held operating system, Windows CE 3.0. The main change was the new programming APIs of the software. Previous versions of Windows CE supported only a small subset of the WinAPI, the main development library for windows, and with Version 3 of Windows CE, the operating system now supported nearly all of the core functionality of the WinAPI. In 2001, Microsoft released Windows XP, which brought the consumer and business lines of Windows together, combining the kernel of Windows 2000 with features of its consumer line of Windows, and enhancing the DOS emulation capabilities of the OS. Among the new features was an entirely new interface. However, it included the controversial Microsoft Product Activation, a part of that software that required people to register with Microsoft before using the product for the first time, and if they did not the product would cease to function. This would become a hallmark of the Company's other products, including Microsoft Office.

Bill Gates gives a presentation at IT-Forum in Copenhagen in 2004. Bill Gates was the co-founder and first CEO of Microsoft.

In 2003, Microsoft launched the .NET initiative, along with new versions of some of its development products, such as Microsoft Visual Studio. The initiative has been an entirely new development API for Windows programming, and includes a new programming language, C#. Windows Server 2003 was launched, featuring enhanced administration capabilities, such as new user interfaces to server tools. In 2004, the Company released Windows XP Media Center Edition 2005, a version of Windows XP specifically designed for multimedia capabilities, and Windows XP Starter Edition, a version of Windows XP with a smaller feature set designed for entry-level consumers.

In March 2004, the European Union brought legal action against Microsoft for antitrust violations. Eventually Microsoft was fined $613 million, ordered to divulge certain protocols to competitors, and to produce a version of Windows that did not include the Windows Media Player.^[6] Microsoft announced a new version of its MSN search service later in 2005, designed to compete with competitors such as Google.

Product divisions

Microsoft sells a wide range of products, many of them developed internally, such as Microsoft BASIC and Microsoft Word. Others were acquired and rebranded by Microsoft:

• Microsoft Project, a project management package;
• Visio, a charting package;
• FoxPro, a database;
• Links, a golf game;
• Visual SourceSafe, a developer's tool;
• DoubleSpace, a compression tool;
• Virtual PC, software to emulate different version of Windows, which was acquired from Connectix; and
• MS-DOS itself, the basis for the company's success.

Many of these products have undergone continual development by the Company. Internet Explorer is based on code licensed from Spyglass, Inc.; the initial development of the software was performed outside Redmond in Spyglass headquarters.

In April 2002, Microsoft reorganized into seven core business groups—'each an independent financial entity—to delegate all responsibility and more closely track the performance of each unit. On September 20th, 2005, Microsoft announced a rationalization of its original seven business groups to three core divisions: the Windows Client, MSN and Server and Tool groups were merged into the Microsoft Platform Products & Services Division; the Information Worker and Microsoft Business Solutions groups were merged into the Microsoft Business Division; and the Mobile and Embedded Devices and Home and Entertainment groups were merged into the Microsoft Entertainment and Devices Division. ^{[7] [8]}

Microsoft Platform Products & Services Division

One of the logos of Microsoft Windows, the Company's best-known product.

This division produces Microsoft's flagship product, the Windows operating system. It has been produced in many versions, including Windows 3.1, Windows 95, Windows 98, Windows 2000, Windows XP and Windows Server 2003. Almost all IBM compatible personal computers designed for the consumer come with Windows preinstalled. The next planned version of Windows is Windows Vista (code-named Windows Longhorn). The online service MSN, the cable television station MSNBC, and the Microsoft online magazine Slate are all part of this division. Slate was later acquired by The Washington Post on December 21, 2004. At the end of 1997, Microsoft acquired Hotmail, the first and most popular webmail service, which it rebranded as "MSN Hotmail". Later in 1999 Microsoft introduced MSN Messenger, an instant messaging client, to compete with the popular AOL Instant Messenger.

Microsoft Visual Studio is the company's set of programming tools and compilers. The software product is GUI-oriented and links easily with the Windows APIs, but must be specially configured if used with non-Microsoft libraries. The current version is Visual Studio .NET 2003, named after the .NET initiative, a Microsoft marketing initiative covering a number of technologies. Microsoft's definition of .NET continues to evolve. As of 2004, .NET aims to ease the development of Microsoft Windows-based applications that use the Internet, by deploying a new Microsoft communications system, Indigo. This will address some issues previously introduced by Microsoft's DLL design, which made it difficult to manage, install multiple versions of complex software packages on the same system (see DLL-hell), and provide a more consistent development platform for all Windows applications (see Common Language Infrastructure. In addition, the Company established a set of certification programs to recognize individuals who have expertise in its software and solutions. Similar to offerings from Cisco, Sun Microsystems, Novell, IBM, and Oracle, these tests are designed to identify a minimal set of proficiencies in a specific role; this includes developers ("Microsoft Certified Solution Developer"), system/network analysts ("Microsoft Certified Systems Engineer"), trainers ("Microsoft Certified Trainers") and administrators ("Microsoft Certified Systems Administrator").

Microsoft offers a suite of server software, entitled Windows Server System. Windows Server 2003, an operating system for network servers, is the core of the Windows Server System line. Another server product, Systems Management Server, is a collection of tools providing remote-control abilities, patch management, software distribution, and a hardware/software inventory. Other server products include:

• SQL Server, a relational database management system;
• Exchange Server, for certain business-oriented e-mail features;
• Small Business Server, for messaging and other small business-oriented features; and
• BizTalk Server, for employee integration assistance and other functions.

Microsoft Business Division

Front entrance to building 17 on the main campus of the Company's Redmond campus

The Microsoft Business Division produces Microsoft Office, which is the company's line of office software. The software product includes:

• Word, a word processor;
• Access, a personal relational database application;
• Excel, a spreadsheet program;
• Outlook, Windows-only groupware, frequently used with the Exchange server;
• PowerPoint, presentation software; and

Microsoft FrontPage, a WYSIWYG HTML editor.

With the release of Office 2003, a number of other products were brought under the Office banner, including Microsoft Visio, Microsoft Project, Microsoft MapPoint, Microsoft InfoPath, Microsoft Publisher and Microsoft OneNote.

The division focuses on developing financial and business management software for companies. These products include products formerly produced by the Business Solutions Group, which was created in April 2001 with the acquisition of Great Plains. Subsequently, Navision was acquired to provide a similar entry into the European market, resulting in the planned release of Microsoft Navision 4.0 during the week of 18 October 2004. The group markets Axapta and Solomon, catering to similar markets, which is scheduled to be combined with the Navision and Great Plains lines into a common platform called Microsoft Dynamics.

Microsoft Entertainment and Devices Division

The Microsoft Xbox, Microsoft's entry into the gaming console market.

Microsoft has attempted to expand the Windows brand into many other markets, with products such as Windows CE for PDAs and its "Windows powered" Smartphone products. Microsoft initially entered the mobile market through Windows CE for handheld devices, which today has developed into Windows Mobile 5. The focus of the operating system is on devices where the OS may not directly be visible to the end user, in particular, appliances and cars. The company produces MSN TV, formerly WebTV, a television-based internet appliance. Microsoft used to sell a set-top Digital Video Recorder (DVR) called the UltimateTV, which allowed users to record up to 35 hours of television programming from a direct-to-home satellite television provider DirecTV. This was the main competition in the UK for bSKYb's SKY + service, owned by Rupert Murdoch. UltimateTV has since been discontinued, with DirecTV instead opting to market DVRs from TiVo Inc.

The division includes consumer and Macintosh software, along with computer hardware and entertainment software. Microsoft sells computer games that run on Windows PCs, including titles such as Age of Empires and the Microsoft Flight Simulator series. It produces a line of reference works that include encyclopedias and atlases, under the name Encarta. Microsoft Zone hosts free premium and retail games where players can compete against each other and in tournaments. Microsoft entered the multi-billion-dollar game console market dominated by Sony and Nintendo in late 2001, with the release of the Xbox. As of 2005, the console ranks second to Sony's PlayStation 2 and ahead of Nintendo's GameCube in market share in the United States (although behind the two worldwide). The console shipped 22 million units compared with competitor PlayStation 2 at 90 million units, and the company took a 4 billion dollar loss due to the console ^[9][10]. Microsoft develops and publishes its own video games for this console, with the help of its Microsoft Game Studios subsidiary, in addition to "third party" Xbox video-game publishers such as Electronic Arts and Activision, who pay a license fee to publish games for the system. The next scheduled version of the Xbox is the Xbox 360. Microsoft markets a number of computing-related hardware products, including mice, keyboards, joysticks, and gamepads, along with other game controllers, the production of which is outsourced in most cases. The division houses Microsoft's Macintosh Business Unit, the largest developer of Macintosh software outside Apple itself; it produces such software as Microsoft Office for the Mac (sometimes called "Macintosh Office"), which includes Entourage, a Macintosh-specific application not available in the Windows version of Microsoft Office.

Business culture

Photo of Microsoft's RedWest campus.

Microsoft has often been described as having a developer-centric business culture. A great deal of time and money is spent each year on recruiting young university-trained software developers who meet very exacting criteria, and on keeping them in the company. For example, while many software companies often place an entry-level software developer in a cubicle desk within a large office space filled with other cubicles, Microsoft assigns a private or semiprivate closed office to every developer or pair of developers. In addition, key decision makers at every level are either developers or former developers. In a sense, the software developers at Microsoft are considered the "stars" of the company in the same way that the sales staff at IBM are considered the "stars" of their company. This culture is reflected in their hiring process—the "Microsoft Interview" is notorious for off-the-wall questions such as "Why is a manhole cover round?" and is a process often mimicked in other organizations. Note that, although they were once ubiquitous, recently fewer interviewers have been using these types of questions. Within Microsoft the expression "eating our own dog food" is used to describe the policy of using the latest Microsoft products inside the company in an effort to test them in "real-world" situations. Only prerelease and beta versions of products are considered dog food. This is usually shortened to just "dog food" and is used as noun, verb, and adjective. For fun, Microsoft also hosts the Microsoft Puzzle Hunt, an annual puzzle hunt (a live puzzle game where teams compete to solve a series of puzzles) held at the Redmond campus. It is a spin-off of the MIT Mystery Hunt.

In an ever changing world, Microsoft expects its employees to be comfortable with ambiguity. They may not, for example, know with any degree of certainty when a product will ship, what it will be called, or what features will be included. The business culture expects agile thinkers to rapidly adjust to dramatic changes. Microsoft also fosters a general attitude of long-term strategic wariness in its managers, who are expected to be ready for any challenge from the competition or the market. In this frame of mind, being the largest software company in the world is not seen as a form of safety or a guarantee of future success. For instance, future competitors could rise from other industries, or computer hardware companies could try to become less dependent on Microsoft, or consumers could decide not to upgrade their software as often. Microsoft requires its managers to maintain vigilance and sustain a dynamic expansion in new markets.

User culture

Technical reference for developers and articles for various Microsoft magazines such as Microsoft Systems Journal (or MSJ) is available through Microsoft's MSDN site, short for Microsoft Developer Network. MSDN also offers subscriptions for companies and individuals, and the more expensive subscriptions usually offer access to pre-release beta versions of Microsoft software. In recent years, Microsoft launched a community site for developers and users, entitled Channel9, which provides many modern features such as a wiki and an internet forum.

Most free technical support available through Microsoft is provided through online Usenet newsgroups (in the early days it was also provided on Compuserve). There are several of these newsgroups for nearly every product Microsoft provides, and often they are monitored by Microsoft employees. People who are helpful on the newsgroups can be elected by other peers or Microsoft employees for Microsoft Most Valuable Professional (MVP) status, which entitles people to a sort of special social status, in addition to possibilities for awards and other benefits.

Corporate affairs

Corporate structure

The company is run by its Board of Directors, which consists of ten people, made up of mostly company outsiders (as is customary for publicly traded companies). Both Bill Gates, the Chief Software Architect of the company, and Steve Ballmer, the CEO, are on the board. The ten board members are elected every year at the annual shareholders' meeting, and those who do not get a majority of votes must submit a resignation to the board, which will subsequently choose whether or not to accept the resignation. There are five committees within the board which have oversight over more specific matters. These committees include the Audit Committee, which handles accounting issues with the company including auditing and reporting; the Compensation Committee, which approves compensation for the CEO and other employees of the company; the Finance Committee, which handles financial matters such as proposing mergers and acquisitions; the Governance and Nominating Committee, which handles various corporate matters including nomination of the board; and the Antitrust Compliance Committee, which attempts to prevent company practices from violating antitrust laws.

There are several other aspects to the corporate structure of Microsoft. For worldwide matters there is the Executive Team, made up of sixteen company officers across the globe, which is charged with various duties including making sure employees understand Microsoft's culture of business. The sixteen officers of the Executive Team include the Chairman and Chief Software Architect, the CEO, the General Counsel and Secretary, the CFO, senior and group vice presidents from the business units, the CEO of the Europe, the Middle East and Africa regions; and the heads of Worldwide Sales, Marketing and Services; Human Resources; and Corporate Marketing. In addition to the Executive Team there is also the Corporate Staff Council, which handles all major staff functions of the company, including approving corporate policies. The Corporate Staff Council is made up of employees from the Law and Corporate Affairs, Finance, Human Resources, Corporate Marketing, and Advanced Strategy and Policy groups at Microsoft. Other Executive Officers include the Presidents and Vice Presidents of the various product divisions, leaders of the marketing section, and the CTO, among others.

Stock

When the company debuted its IPO in March 12, 1986, the stock price was $22. By the close of the first trading day, the stock had closed at twenty-eight dollars, or 97c, compared with the time period after the company's first nine splits. The initial close and ensuing rise in subsequent years made several Microsoft employees millions. The stock price peaked in 1999 at around 119 dollars (60,928 dollars adjusting for splits). While the company has had nine stock splits, the first of which was in September 18, 1987, the company did not start offering a dividend until January 16, 2003. The dividend for the 2003 fiscal year was eight cents per share, followed by a dividend of sixteen cents per share the subsequent year. The company switched from quarterly to yearly dividends in 2005, for eight cents a share per quarter with a special one-time payout of three dollars per share for the second quarter of the fiscal year.

Around 2002 the stock price began a slow descent that continued through 2005. The company had its ninth split on February 2, 2003, in what could have been an attempt to arouse interest in the stock, but the price continued to stagnate regardless. On the September 23, 2005, episode of CNBC's Mad Money, the host of the show, Jim Cramer, called Microsoft's stock "the most hated stock on Wall Street".

Diversity

Microsoft received a 86% rating in the 2004 Corporate Equality Index from the Human Rights Campaign relating to its policies concerning LGBT (lesbian, gay, bisexual and transsexual) employees. According to the Human Rights Campaign, this was in line with the industry standard ^[11]. Through the work of the Gay and Lesbian Employees at Microsoft (GLEAM) group and Diversity, Microsoft added gender expression to its antidiscrimination policies in April 2005, and the Human Rights Campaign upgraded Microsoft's Corporate Equality Index rating to 100%, putting it among the most progressive companies in the world^[12]. Microsoft also received criticism from the Human Rights Campaign and many others in April 2005 for withdrawing support for Washington's H.B. 1515 bill that would extend the state's current antidiscrimination laws to people with alternate sexual orientations^[13]. However, under harsh criticism from both outside and inside the company's walls, Microsoft eventually supported the bill again in May 2005 ^[14].

Even though it hires many domestic American workers, Microsoft generally goes up to the annual limit in hiring foreign workers with H1B visas. Bill Gates has criticized Congress for the cap on the H1B visas, which he claims makes it difficult to hire employees for the company. Proponents of the cap cite economic and security reasons for the current law.^[15] Microsoft was also named one of the 100 Best Companies for Working Mothers in 2004 by Working Mother magazine.

Logo

Microsoft logo, mid-1980s

In 1987, Microsoft adopted its current logo, the so-called "Pacman Logo" designed by Scott Baker. According to the March 1987 Computer Reseller News Magazine, "The new logo, in Helvetica italic typeface, has a slash between the o and s to emphasize the "soft" part of the name and convey motion and speed." Employees ran a campaign to save the old logo, which was green, in all uppercase, and featured a fanciful letter O nicknamed the blibbet, but it was nevertheless discarded.

Criticism

The blue screen of death from the Windows 9x series, a screen encountered when Windows cannot (or is in danger of being unable to) recover from a system error. While not as common on modern Windows operating systems with the Windows NT kernel such as Windows XP, the blue screen of death is often used to criticize the stability of Microsoft Windows.

Main article: Common criticisms of Microsoft

Microsoft has been the focus of much controversy in the computer industry, especially since the 1980s, most critically for its business tactics, which some perceive as unfair and anticompetitive. Some describe Microsoft's business tactics as "embrace, extend and extinguish", in which Microsoft initially embraces and extends a competing standard or product, only to later extinguish it through such actions as writing their own incompatible version of the software or standard. Microsoft has also been called a "velvet sweatshop" in reference to the company working its employees to the point where it might be bad for their health. The first instance of the term in reference to Microsoft originated from a Seattle Times article in 1989, and later became used to describe the company by some of Microsoft's own employees. ^[16][17]

Some also accuse Microsoft of allowing the user interface of its products to become inconsistent and overly complicated, requiring interactive "wizards" to function as an extra layer between the user and the interface. The security of Microsoft products (such as Internet Explorer) is also questioned by some as being overly vulnerable to computer viruses and malicious attacks. In addition, proponents of free software are engaged with Microsoft in a debate over the Total cost of ownership (TCO) of its products, as some perceive Microsoft software as more expensive to purchase, use and maintain than competitors' software. Microsoft has also been criticized for its end user license agreements, which some believe are too restrictive, and for its use of Digital Rights Management that places restrictions on digital media content, which some believe leads to a loss of their rights.

See also

• General
  • Actimates
  • Avalanche (P2P)
  • DirectX
  • Professional Developers Conference
  • Shared source
  • Studies related to Microsoft

• Internet-related
  • MSN Spaces
  • The Code Room

• Lists
  • List of assets owned by Microsoft Corporation
  • List of Microsoft software applications
  • List of Microsoft topics

References

• Intro and Infobox
  • Fast Facts about Microsoft.  URL accessed on 1 October, 2005.
  • Global Citizenship at Microsoft.  URL accessed on 13 October, 2005.
• Product divisions
  • Microsoft 2005 Annual Report.  URL accessed on 1 October, 2005.
• History
  • Windows history(at pc museam).  URL accessed on August 5, 2005.
  • Windows vs. Macintosh.  URL accessed on August 5, 2005.
  • Microsoft history at the History of Computing Project.  URL accessed on August 11, 2005.
  • Microsoft history at the History of Computing Project (Part 2).  URL accessed on August 11, 2005.
  • Key Events In Microsoft History.  URL accessed on 1 October, 2005. (DOC format)
  • Clark, Jim with Owen Edwards. Netscape Time: The Making of the Billion Dollar Start-up That Took on Microsoft. New York, Saint martin's Press, 1999
  • Cusumano, Michael A.; Selby, Richard W. Microsoft Secrets: How the World's Most Powerful Software Company Creates Technology, Shapes Markets and Manages People. New York: Free Press, 1995.
  • comp.sys.msx FAQ.  URL accessed on 14 October 2005, 2005.
• Business culture
  • Charles, John. "Indecent proposal? Doing Business With Microsoft". IEEE Software. January/February 1998. pp. 113-117.
  • Edstrom, Jennifer; Eller, Marlin. Barbarians Led by Bill Gates: Microsoft from inside: How the World's Richest Corporation Wields its Power. N.Y. Holt, 1998.
  • Moody, Fred. I Sing the Body Electronic: A Year With Microsoft on the Multimedia Frontier. New York: Viking, 1995.
  • Microsoft tests its own 'dog food'.  URL accessed on 9 October, 2005.
  • Microsoft's Top 10 New Year's Resolutions for IT Organizations.  URL accessed on 9 October, 2005.
  • List of Microsoft Puzzle Hunts.  URL accessed on 14 October 2005, 2005.
• Stock
  • Yahoo MSFT stock chart.  URL accessed on 9 October, 2005.
  • Corps Law Blog:The Greatest IPO Ever.  URL accessed on 9 October, 2005.
  • Microsoft stock FAQ.  URL accessed on 9 October, 2005.
  • Microsoft stock price spreadsheet from Microsoft investor relations.  URL accessed on 9 October, 2005. (Microsoft Excel format)
  • MSN Money MSFT chart with dividend and split info.  URL accessed on 9 October, 2005.
  • Microsoft dividend FAQ.  URL accessed on 9 October, 2005.
• Coporate Structure
  • Microsoft Corporation Corporate Governance Guidelines.  URL accessed on 9 October, 2005.
  • Microsoft 2005 Annual Report.  URL accessed on 1 October, 2005. (DOC format)
  • Microsoft 2004 Citizenship Report.  URL accessed on 9 October, 2005.
  • Microsoft 2005 Proxy Statement.  URL accessed on 9 October, 2005.

Footnotes

1. ^  Techworld Article:OS/2 users must look elsewhere.  URL accessed on August 5, 2005.
2. ^  Microsoft OS/2 announcement.  URL accessed on August 5, 2005.
3. ^  GrokLaw:The Novell Antitrust Complaint in text.  URL accessed on October 9, 2005.
4. ^  Chen, Raymond: “What about BOZOSLIVEHERE and TABTHETEXTOUTFORWIMPS?”, The Old New Thing, 16 October 2003.
5. ^  United States v. Microsoft.  URL accessed on August 5, 2005. homepage at the United States Department of Justice
6. ^  Text of the European Union ruling against Microsoft.  URL accessed on August 5, 2005. (PDF format - from the official EU website)
7. ^  Microsoft product groups.  URL accessed on August 5, 2005.
8. ^  September 20th 2005 group reorganization.  URL accessed on September 26, 2005.
9. ^  Xbox surpasses five million console milestone in Europe.  URL accessed on October 18, 2005.
10. ^  Microsoft's midlife crisis.  URL accessed on October 18, 2005.
11. ^  HRC Corporate Equality Index for 2004.  URL accessed on August 11, 2005. (PDF format)
12. ^  HRC Corporate Equality Index for 2005.  URL accessed on October 13, 2005. (PDF format)
13. ^  HRC: Microsoft withdraws support for H.B. 1515.  URL accessed on August 11, 2005.
14. ^  HRC: Microsoft renews support for H.B. 1515.  URL accessed on August 11, 2005.
15. ^  Mark, Paul: “Gates Rakes Congress on H1B Visa Cap”, Various, 27 April 2005.
16. ^  Andrews, Paul: “A 'Velvet Sweatshop' or a High-Tech Heaven?”, The Seattle Times, 23 April 1989.
17. ^  Editor's note, MSJ August 1997.  URL accessed on September 27, 2005.

External links

• Microsoft
  • Microsoft - 'Official website'
• Microsoft political donations
• General
  • Yahoo! Finance - 'Microsoft Corporation Company Profile'
  • CNN - 'Microsoft CEO before the US Congress (includes audio)'
  • Yahoo! News - 'Video of Microsoft Antitrust case'

• Miscellaneous
  • Google Special Search: Microsoft - "Search Microsoft-related pages"