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35 years of Microsoft

The good, the bad, and the ugly of tech's biggest company

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Smartest software bundling

Clearly the smartest software bundling move Microsoft ever made was combining Word, Excel and PowerPoint into Microsoft Office, first for the Mac in 1989 and then for Windows in 1990.

Microsoft Word, which Microsoft originally (internally) called Multi-Tool Word, was released in 1983 for MS-DOS, in 1985 for the Mac and in 1989 for Windows. Excel was launched in 1985 for the Mac and in 1987 for Windows. Also in 1987, Microsoft released PowerPoint for the Mac, essentially a version of an application called Presenter that was created by Forethought, a company Microsoft had purchased that year. In 1990, PowerPoint for Windows was released.

Excel fun fact

When Excel was first developed, Microsoft already had a spreadsheet called MultiPlan, but it was not selling well on the MS-DOS platform. The company decided it needed a much better offering to compete against Lotus 1-2-3, the best-selling spreadsheet program at the time.

Thus, Excel was originally code-named "Odyssey" because it was intended to eat Lotus. (In Homer's The Odyssey, Odysseus' crew members ate the narcotic lotus plant in the Land of the Lotus.)

Microsoft's bundling of Word, Excel and PowerPoint into the Office suite emphasized the company's commitment to business desktop computing. It proved to be a huge success, ultimately leading to the downfall of onetime market-leading applications Lotus 1-2-3 (spreadsheet), WordPerfect (word processor) and Harvard Graphics (presentation program) -- and to a near-monopoly for Microsoft Office in the business world.

Sneakiest software bundling

I'll give the award for sneakiest software bundling, hands-down, to Windows Genuine Advantage (WGA), Microsoft's antipiracy software. WGA warns people when they do not have a paid-for and registered version of Windows, and certain updates can't be installed unless WGA is installed and has verified that the copy of Windows is genuine.

In mid-2006, Microsoft began sending WGA to users' computers along with security updates via Windows Update; the company even labeled the WGA download as "high-priority." Unbeknownst to users, though, the update had nothing to do with security or stability, it was WGA, sneaking onto their hard disks.

As Computerworld's Scot Finnie wrote in July of 2006, "Microsoft is preying upon people's ignorance, and their strong desire to install security updates. It's clearly wrong for Microsoft to use its security updating channel to install software that has no security benefit, and no benefit at all to its customers."

Users were frustrated enough that a lawsuit was filed, although the suit was recently dismissed.

Worst server glitch

As if users weren't annoyed enough about Windows Genuine Advantage, from Aug. 24 to 25, 2007, the antipiracy validation system accused thousands of paying Windows XP and Vista customers of being software pirates. According to Microsoft, the WGA servers went on the fritz, and users were tagged as running non-genuine versions of Windows. Even worse, Vista systems were stripped of important features, such as the Aero interface. The meltdown lasted for 19 hours.

Most embarrassing product glitch

When you use formulas in Excel, you expect them to do the math correctly, after all, what is a spreadsheet for? But in September 2007, an Excel 2007 bug had Microsoft execs red-faced with embarrassment because of an apparent inability to do simple multiplication. In some specific cases, if a formula resulted in the number 65,535 or 65,536, Excel would instead display the result 100,000.

The problem, according to Microsoft, was not that Excel flunked math; it was a display issue. Excel actually performed and stored the calculation properly, the company claimed, but displayed the wrong results. Microsoft fixed the bug, and Excel has known its multiplication tables, and how to display them, ever since.

Smallest annual revenue

In 1975, its first year in business, Microsoft recorded a total income of $16,005, all from the BASIC program it wrote for the MITS Altair 8800 computer. The total did not include $14,405 that Microsoft was still owed for the final quarter of 1975.

Largest annual revenue

In its 2008 fiscal year, Microsoft raked in $60.42 billion in revenue, a whopping 18% increase over what it had earned the previous year.

Worst year-over-year performance

Microsoft has turned a profit every year since its founding, and it enjoyed year-over-year increases in revenue and profits every year ... until 2009. For its 2009 fiscal year, which ended June 30, 2009, the company reported revenue of $58.44 billion, a 3% decline from fiscal year 2008. Its operating income was $20.36 billion, down 9% from 2008; net income was $14.57 billion, down 18%; and earnings per share was $1.62, down 13%.

Most annoying productivity tool

In November 1996, Microsoft launched Office 97, which featured the Office Assistant, an animated character in the form of a paper clip nicknamed Clippy. There were other characters as well, but Clippy was the default and the most annoying.

The Office Assistant was supposed to help people get work done more easily by popping onto the screen and offering tips from the application's Help system related to the task being performed. It was intrusive, intensely annoying and widely reviled.

Even people within Microsoft hated Clippy. Steven Sinofsky, now president of the Windows and Windows Live Division, wrote this in his blog: "the Office Assistant was famously named TFC during development. The 'C' stood for clown. I will let your active imagination figure out what the TF stood for."

In fact, Microsoft used the widespread hatred of Clippy to its advantage by launching an anti-Clippy website as a way to promote Office 97's successor, Office XP, because Office XP had the Office Assistant turned off by default. The site received some 22 million page views, according to USA Today, and allowed users to do things such as shoot rubber bands at the hated animated character.


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