COLUMNISTS 
Andrew Grove, former chief executive of Intel, popularised the Silicon Valley motto: “Only the paranoid survive.” In the preface to his book of that title he wrote: “The more successful you are, the more people want a chunk of your business, and then another chunk, and then another, until there is nothing left.”
That sentiment epitomised the behaviour of many technology companies in the late 20th century, from Intel to Oracle and Microsoft. They lived in fear of a technology inflection point that would suddenly strip them of their leadership and benefit an upstart funded by one of the Valley’s venture capital firms.
Under Bill Gates, Microsoft was among the most paranoid of technology companies in defending its hard-won Windows near-monopoly of desktop operating systems and extending its strength into other software niches. Whenever it took its eye off the ball – as it did in the early days of the internet browser – it rapidly fought back.
A better slogan for the internet age is: only the sociable thrive. Companies such as Google, IBM, Sun Microsystems and Salesforce.com no longer try to eradicate competition at all costs. Instead, they believe they will get more by encouraging others to reinforce them by building software and services that fit with their own.
This is the context in which Microsoft last week announced – to jeers from sceptics – that it was folding the hand that it had played against regulators for over a decade. Instead of keeping as much of its software code hidden as possible, the company would publish details of some of it and encourage other companies to use them.
It is no coincidence that Mr Gates, the company’s co-founder and guiding spirit for more than 30 years, steps down this June from full-time work at Microsoft to run his foundation and has handed over his title of chief software architect to Ray Ozzie, an industry veteran who is instinctively more open to collaboration.
The changing of the guard has not placated the European Commission’s antitrust enforcers or Microsoft’s competitors. Thomas Vinje, a lawyer who represents some of them in Europe, called for “a permanent change in Microsoft’s behaviour, not just another announcement”.
I agree with Mr Vinje that the fact that Mr Ozzie says Microsoft is going to do something does not prove that it actually will. But I differ on why. I do not think that Mr Ozzie and his allies are pulling another fake. I believe they want to alter its culture and modus operandi. The question is whether they have the power.
The reason for my doubt is that Microsoft remains Mr Gates’ creation, although he has already handed over the role of chief executive to Steve Ballmer and welcomed on board outsiders including Mr Ozzie. And it will take more than putting thousands of pages of software code on the internet to alter his legacy.
Why even try, you might ask, since the company’s paranoia has brought it enormous success? One reason is that it wants to placate regulators. “We have been through a 10-year fight and I don’t want it to turn into a 100-year war,” says Brad Smith, Microsoft’s general counsel.
Only on Wednesday, it was fined €899m ($1.36bn) by the European Commission for its past failure to license protocols – the code that enables programs to interact with Windows and other Microsoft software – openly and cheaply enough. Its new policy should at least stop it having to pay further fines on the issue.
But regulation is only part of the story. A bigger motivation for Microsoft is that it is in danger of being left behind in the mash-up era. Windows used to have a fair claim to be the only software platform for which it was worth most developers writing applications but their freedom of manoeuvre is now greater.
IBM has countered its past software weakness by supporting open source development of Linux; Google has built rivals to Microsoft’s Word and Outlook programs and is encouraging other companies to work with it on mobile phone software; Sun has even made its Solaris operating software open-source.
Mr Ozzie wants to follow this trend by making it easier for outsiders to write software that works seamlessly with not only Windows but other programs, including its Office suite. Disclosing its protocols is only a start. It also needs to simplify the way it builds software to make it easier for other programs to plug in.
There lies the rub. Like other large companies, Microsoft has an established culture and entrenched interests, notably the product groups in charge of big money-spinners such as Office and Windows. These groups have got into the habit of secrecy, not only with outsiders but even with other parts of the empire.
Thus, the Windows division might have handed out full details of most protocols to the people it knew in the Office group but kept some data secret from other Microsoft developers, and even more hidden from outsiders. Its managers wanted to limit full access to those they trusted to write software that worked cleanly with their own.
Mr Ozzie is trying to blow this up by forcing Microsoft’s developers to disclose information fully, and on an equal basis, to everyone. This may, in turn, force them to write software that is better adapted to the era in which working sociably with others, inside and outside Microsoft, is a competitive necessity.
His statements and now his actions suggest that he is genuine. But taking on three decades of culture and ways of working in a huge corporation is very difficult. Mr Gates may be leaving the building but persuading his paranoid spirit to depart is something else again.
