In 2005, Microsoftâs leaders were starting to get worried. Windows and Office were doing well, but the companyâs lead software architect, Ray Ozzie, warned them that an emerging trend threatened Microsoft’s very existence.
“A new business model has emerged in the form of advertising-supported services and software,” warned Ozzie in his famous memo. “This model has the potential to fundamentally impact how we and other developers build, deliver, and monetize innovations.”
Ozzie wanted Microsoft to get ready for the web-based world and cloud computing, fearing the company would otherwise be left behind. In the years after Ozzie’s memo, Google started to build an online competitor to Office with its Google Docs web service that it was selling to businesses and offering free to consumers. But the idea of moving Office to the cloud remained controversial internally. Doing so would upend Microsoftâs traditional method of selling software â and potentially eat into short-term profits in a big way.
âIt was a gutsy call, it wasnât a popular call at Microsoft at that time,â says Rajesh Jha, executive vice president of Microsoftâs experiences and devices group. Steve Ballm …
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