The Whole Shebang

If you listened to Steve Ballmer's typically effervescent keynote at Tech Ed last week, you might think so. He extolled the virtues of Microsoft's integrated stack, the company's security efforts, advancements to the platform,it was a spiel delivered with the usual gusto by the Microsoft CEO to several thousand attendees in San Diego.

The message was crafted to illustrate the company's extensive,and expensive,commitment to secure software, battling hackers, product life-cycle management, interoperability. Ballmer cited the upcoming Visual Studio Team Edition's modeling and proactive testing capabilities for enterprises.

So, is Windows Server truly ready to supplant Unix as a mission-critical operating system and is SQL Server ready to replace Oracle or DB2? Well, not really, according to even some of Microsoft's own staunchest supporters speaking privately.

While the Redmond, Wash., software giant has great market share on smaller servers, its numbers fall off drastically once the hardware gets to pricier and more powerful eight-way-class machines. "It is in those markets where Unix migrations and application replatforming" are key targets for Microsoft, said one longtime partner.

With the growing perception that Unix is on its last legs, many companies want to consolidate the number of operating systems they support, and there are two obvious beneficiaries: Linux and Windows Server.

"Most companies already count Windows as a strategic operating system so there's an opportunity there," said the partner. "The question is, does Microsoft have enterprise credibility and the answer is, not yet." To get there, the company must deliver on promises of reliability and manageability and end-to-end service and support, he added.

That's the drum Ballmer beat last week. And not only for operating system and database infrastructure, but for meat-and-potatoes back-end business applications. Referencing the Microsoft Business Solutions push, Ballmer said, "Our design point will not let us do the supply chain for General Motors, but I would say for 99.5 percent of all businesses in the world we will be able to deliver you applications which are the simplest to use, the simplest to install."

That is a tall order for a company still beset by concerns about product security, quality and manageability as well as worries that the news from Tech Ed amounts to yet another set of promises that will take much longer than promised to materialize.

As Microsoft tries to push itself up the software stack from desktops to servers and into (pardon the buzzwords) mission-critical enterprise applications, it still has to prove that its technology can handle the job.

Here are some critical issues Microsoft faces in its enterprise push.

• The company overpromised on Longhorn features that are slip-sliding into the not-so-near future.

• It irked corporate customers with licensing changes and is scurrying to placate them with incremental tweaks.

• Most of its installed base remains on older versions of its products (40 percent of Exchange users are on six-year-old Exchange Server 5.5, for example, according to Microsoft itself).

• The company has become increasingly bureaucratic and political, according to many of its own partners.

• A seemingly rejuvenated IBM is wielding Linux and open-source in a proxy war to keep Microsoft from crawling up from desktops into middleware and servers.

• Microsoft goods wear a big target drawing hack and attempted-hack attacks.

THE CURSE OF THE INSTALLED BASE
Ballmer himself summed up the dark side of Microsoft's desktop dominance in this quest: "We have an installed base of 600 million users. There is no way to snap our fingers,even if we had a perfect release, we couldn't snap our fingers together and get them all migrated to the newest releases. And, in fact, we can't count ever on having a perfect release. We may think it's perfect, but the day we think it's perfect and we don't plan for a bright hacker figuring out a way around it is a bad day," he told Tech Ed attendees.

The sheer size of the base makes it impossible to ensure everyone updates their security and bug fixes. Research firm Gartner estimates that 60 percent of Windows Server customers are still running various Windows NT versions, the last of which, NT 4.0, shipped in the summer of 1996. And Gartner puts the percentage of those on Windows Server 2000 at 30 percent to 35 percent. That would mean the year-old Windows Server 2003 has barely scratched the surface.

Consultant Judith Hurwitz of Hurwitz and Associates says Microsoft is no longer the revolutionary, it is an incumbent and faces its own set of insurgencies. "Remember IBM SAA and AD/Cycle,all these grand schemes to tie stuff together? Well, Microsoft is now in the same position IBM was. It has to lug these millions of users along with it, and that brings a lot of responsibility."

Of course, big partners see gold in those potential upgrades. There are still "many, many NT 4 to Win 2003 migrations. A lot of clients need to do that and the top-of-mind issue is around securing and managing the infrastructure," which is something the latest Windows Server does well, said Franc Gentili, director of the Enterprise Microsoft Services group at Hewlett-Packard, Palo Alto, Calif.

THE LINUX THREAT
Microsoft's anti-Linux rhetoric is not endearing it to customers either. Although, as a spokesman points out, company executives no longer liken Linux/open-source to "cancer," the kumbaya interoperability message Microsoft is pushing with Sun Microsystems is not being applied to Linux.

A Microsoft source notes that the vendor is not obliged to make things easy for Linux. When Microsoft was coming into the server game against NetWare, Novell didn't "break their pick trying to make it easier for us."

But like it or not, Linux is already in most enterprise accounts. Four out of six users on a Microsoft-sponsored Tech Ed panel admitted they run Linux, but only when questioned on the issue. One said after the event that interoperability between Microsoft and Unix or Linux environments is a huge priority.

A desktop administrator for a large pharmaceutical company said his IT bosses are Unix bigots who are morphing steadily into Linux bigots. "They even want to deploy Linux desktops," he said in apparent disbelief. He does not think the desktops will go the Linux route but is convinced that more and more servers will go that way.

Meanwhile, Microsoft is doing its best to portray Linux as not really such an inexpensive alternative, pointing out, as if it were not obvious, that IBM is not supporting Linux out of the goodness of its heart. Microsoft is clearly hoping that IBM's backing will cost Linux street cred in the open-source world.

Integrators say Microsoft is playing its cards right by turning to the channel in its battle here. "The real differentiator of Microsoft over open-source in the enterprise is the partner community," said Peter Samson, vice president and general manager of Blue Bell, Pa.-based Unisys' Enterprise Server Market Development Systems and Technology division. "They recognize that they won't get deeper inroads in big companies without working through partners, whether they're integrators or ISVs," he said.

Dana Gardner, analyst at the Yankee Group, said, however, that "ongoing concerns about security, uncertainty about the true value of the Software Assurance program, and the gaping chasm of time until next major versions of products have given many customers pause. But more importantly, it opens an opportunity for Microsoft's competitors,including open-source approaches,to step up, present their solutions, and be heard."

CULTURE WARS
Others point to other similarities between Microsoft and the old IBM, and they're not flattering. "Microsoft has become arrogant and political," said one Boston-area Microsoft partner. "They all think they're geniuses," he grumbled, adding that some people at the top may fit that description but most of those in the trenches are "ordinary at best."

The simple fact is, for better or worse, Microsoft is huge now and with size comes fiefdoms. The problem is that with Microsoft intoning its "integrated innovation" message every chance it gets, it must get those groups to actually work together and not,as has happened in the past,sabotage each other. Going from clandestine but bitter turf wars to proactive collaboration is not easy.

One longtime insider said it's increasingly difficult to track who's doing what and where at the company. "Hey, I'm in the same business and had to read the org chart three times to understand it," he said of a recent reshuffling. "The company is maturing quickly, we're huge, but we're not very good at processes. We chafe against them, and a mature company has to have them."

Even many detractors give Microsoft good marks for bulking up security. Window Server 2003, the first product to ship out of the company's Trustworthy Computing initiative, is well regarded. The upcoming Windows XP Service Pack 2 will be the next fruit of this labor. And yet, even Microsoft's most outspoken allies concede that corporate customers still harbor concerns about security. "In reality, Microsoft is ready for the biggest enterprises, but there is a perception problem," said Andrew Brust, president of Progressive Systems Consulting, a New York Microsoft partner.

That perception is certainly powerful enough to worry IT decision makers who might want to go with a Microsoft solution but worry how they'll rationalize that decision to their bosses if their network is attacked and disabled.

PRODUCT QUALITY AND LICENSING WOES
Security aside, many Microsoft users still report that their systems are less stable and reliable than alternatives. The company says that Windows Server 2003 and upcoming Longhorn releases will fix remaining issues. But Microsoft's tendency to promise more than it can realistically deliver has devolved into a "wait until the next release" refrain that is increasingly hard to swallow.

"The Unix guys in our shop make fun of us because we're always rebooting servers," said Chris Ferrer, a Windows network administrator at Sepracor, a Marlborough, Mass., pharmaceutical company that is running mostly on Windows Server 2000.

Software Assurance and maintenance woes continue to afflict Microsoft, although Unisys' Samson said the decision last week to extend service on mainstream business products to a minimum of 10 years is a good step. That and the addition of an interim Windows Server release before Longhorn, or R2, is helping on the whole licensing issue, he said.

Microsoft is recognizing the opportunity in the enterprise and is taking the steps to get there, Samson said.