Microsoft is Dead

April 2007

A few days ago I suddenly realized Microsoft was dead. I was talking
to a young startup founder about how Google was different from
Yahoo. I said that Yahoo had been warped from the start by
their fear of Microsoft. That was why they'd positioned themselves
as a "media company" instead of a technology company. Then I looked
at his face and realized he didn't understand. It was as if I'd
told him how much girls liked Barry Manilow in the mid
80s. Barry who?

Microsoft? He didn't say anything, but I could tell he didn't quite
believe anyone would be frightened of them.

Microsoft cast
a shadow over the software world for almost 20 years
starting in the late 80s.
I can remember when it was IBM before them. I mostly ignored this
shadow. I never used Microsoft software, so it only affected me
indirectly—for example, in the spam I got from botnets. And
because I wasn't paying attention, I didn't notice when the shadow
disappeared.

But it's gone now. I can sense that. No one is even afraid of
Microsoft anymore. They still make a lot of money—so does IBM,
for that matter. But they're not dangerous.

When did Microsoft die, and of what? I know they seemed dangerous
as late as 2001, because I wrote an essay then
about how they were
less dangerous than they seemed. I'd guess they were dead by 2005.
I know when we started Y Combinator we didn't worry about Microsoft
as competition for the startups we funded. In fact, we've never
even invited them to the demo days we organize for startups to
present to investors. We invite Yahoo and Google and some other
Internet companies, but we've never bothered to invite Microsoft.
Nor has anyone there ever even sent us an email. They're in a
different world.

What killed them? Four things, I think, all of them occurring
simultaneously in the mid 2000s.

The most obvious is Google. There can only be one big man in town,
and they're clearly it. Google is the most dangerous company
now by far, in both the good and bad senses of the word. Microsoft
can at best limp along afterward.

When did Google take the lead? There will be a tendency to push
it back to their IPO in August 2004, but they weren't setting the
terms of the debate then. I'd say they took the lead in
2005. Gmail was one of the things that put them over the edge.
Gmail showed they could do more than search.

Gmail also showed how much you could do with web-based software,
if you took advantage of what later came to be called "Ajax." And
that was the second cause of Microsoft's death: everyone can see the
desktop is over. It now seems inevitable that applications will
live on the web—not just email, but everything, right up to
Photoshop. Even Microsoft sees that now.

Ironically, Microsoft unintentionally helped create Ajax. The x
in Ajax is from the XMLHttpRequest object, which lets the browser
communicate with the server in the background while displaying a page.
(Originally the only way to communicate with the server was to
ask for a new page.) XMLHttpRequest was created by Microsoft in the late 90s
because they needed it for Outlook. What they didn't realize was
that it would be useful to a lot of other people too—in fact, to
anyone who wanted to make web apps work like desktop ones.

The other critical component of Ajax is Javascript, the programming
language that runs in the browser. Microsoft saw the danger of
Javascript and tried to keep it broken for as long as they could.
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