Ballmer regrets not aping Apple sooner

In his first public appearance since retiring last month, the former CEO admits Microsoft 'didn't put the hardware and the software together soon enough'

In his first public appearance since he stepped down as Microsoft CEO, Steve Ballmer again acknowledged that the company missed the boat on mobile. But this time he put a different spin on his answer, evoking the business model of Microsoft's arch rival, Apple.

"The thing I regret is that we didn't put the hardware and the software together soon enough," Ballmer said, referring to smartphones specifically, but mobile in general.

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Putting hardware and software together is Apple's business model, begun decades ago with the Mac then continued with the iPhone in 2007 and the iPad in 2010, that relies on the company creating both, controlling both from first to last.

Microsoft only picked up the hardware-software bug, at least in a major way, with its Xbox line. In general computing, however, it didn't make a move until mid-2012, when it unexpectedly announced the Surface line of tablets, which it said it had designed, had manufactured and would start selling later that year, when Windows 8 debuted.

Since then, the company has put down $7.4 billion for Nokia's handset business and to license a large patent portfolio. When that deal closes, probably within weeks, Microsoft will have added smartphones to its hardware-software strategy.

That means Microsoft is seven years behind Apple, and four years behind Samsung, the South Korean behemoth that has raked in billions in revenue from its Android-powered phones and tablets.

In more general terms Tuesday, Ballmer also copped to a lost decade. "If you look at things in the last 10 years, I think it's probably fair to say that there are things that did not go as well as we intended them to," said Ballmer to a packed crowd of students at the Said Business School, University of Oxford. His hour-long Q&A was later posted on YouTube.

"We would have a stronger position in the phone market today if I could redo, for example, the last 10 years," Ballmer added.

Yesterday's no-details mulligan on mobile was not Ballmer's first. In August, he implied that it was Windows Vista -- the operating system that was three years late to market -- that led to a failure to capitalize on the shift to mobile.

"I would say probably the thing I regret most is the, what shall I call it, the loopedy-loo that we did that was sort of Longhorn to Vista," Ballmer told long-time Microsoft watcher Mary Jo Foley of ZDNet. "I would say that's probably the thing I regret most. And, you know, there are side effects of that when you tie up a big team to do something that doesn't prove out to be as valuable."

Vista, which was released to retail in early 2007, has been judged a failure, one of Microsoft's few in the operating system market, and to its detriment, Windows 8 has increasingly been compared to Vista.

A month later Ballmer was more specific at his final meeting with Wall Street analysts on Microsoft's campus. "If there's one thing I guess you would say I regret, I regret that there was a period in the early 2000s when we were so focused on what we had to do around Windows, that we weren't able to redeploy talent to the new device form factor called the phone," Ballmer said then. "The time we missed was about the time we were working away on what became Vista, and I wish we'd probably had our resources slightly differently deployed, let me say, during the early 2000s. It would have been better for Windows and probably better for our success in other form factors."

But Ballmer, notoriously pugnacious and passionate about the company he worked at for 34 years, led as CEO for nearly 14, argued Tuesday that the failure to strike a home run in smartphones or tablets did not mean that Microsoft itself was a failure, or that it could not regain its glory days.

"Microsoft is well enough capitalized that if we don't succeed, our job isn't to give up and go home, it's to try to continue the initiative, but catch the next wave of rapid innovation," Ballmer said. He questioned whether the future of 10 years would include the devices now in use, citing wearables as one alternative.

"The question is what do you do when you get behind? Do you say what did we do wrong and how do we make sure we build assets that let us seize things going forward?" Ballmer asked, answering his question by rattling off Surface, Windows Phone and the pending acquisition of Nokia.

He gave little hint of what he would do from the Microsoft board, of which he is still a member, other than the classic responsibilities. "I'm available to help if the company needs me in any way," Ballmer said. "And I'm certainly there to provide appropriate governance and guidance to the leadership team. But I'm a very interested board member. I own 4 percent of Microsoft. I care a lot about my child. And my investment."

Some outsiders have argued that with Ballmer and co-founder Bill Gates still on the board, CEO Sayta Nadella will be on a short leash, with the two previous CEOs watching over his shoulder.

Ballmer also took shots at Microsoft's rivals, waving off Apple as a company that was "quote, cool, unquote" that has "had a good run lately," and in tablets, only commercialized the idea that others, including Microsoft, had originated. He also damned with faint praise Facebook for its $19 billion acquisition of WhatsApp. "It is a fad? Probably not," Ballmer said of the messaging space.

What he plans to do now that he's retired, however, was still up in the air, Ballmer said. Other than golfing.

"I can play just about any golf course on the planet, and I get a real kick out of that, I have to say," Ballmer said to a question about the "best perk of being immensely wealthy and powerful." Forbes said this week that Ballmer's net worth was approximately $19.3 billion.

Gregg Keizer covers Microsoft, security issues, Apple, Web browsers and general technology breaking news for Computerworld. Follow Gregg on Twitter at @gkeizer, or subscribe to Gregg's RSS feed . His email address is gkeizer@computerworld.com. gkeizer@computerworld.com.

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This story, "Ballmer regrets not aping Apple sooner" was originally published by Computerworld.

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