Bill Gates

as interoperability becomes a thing, as file format standardized, and I can open the same documents on Macs and PCs, it's like, okay, file formats stop being a network economy that accrues only to the operating system.

as interoperability becomes a thing, as file format standardized, and I can open the same documents on Macs and PCs, it's like, okay, file formats stop being a network economy that accrues only to the operating system.

I'm trying to think, are there any other, like if you were an enterprise and become a Microsoft customer and I'm an enterprise and I become a Microsoft customer, do we really benefit from each other being? I don't think so. Yeah, I don't either. That just leaves cornered resource. Yep. No, I don't think they have that meaningfully. No, I don't think so.

I'm trying to think, are there any other, like if you were an enterprise and become a Microsoft customer and I'm an enterprise and I become a Microsoft customer, do we really benefit from each other being? I don't think so. Yeah, I don't either. That just leaves cornered resource. Yep. No, I don't think they have that meaningfully. No, I don't think so.

I guess this power, I mean, the fact that we came up with, they don't really counter position. They have great scale economies. They have a lot of switching costs. And that's kind of it. That's pretty illustrative of why you kind of feel like this is the lost era of Microsoft.

I guess this power, I mean, the fact that we came up with, they don't really counter position. They have great scale economies. They have a lot of switching costs. And that's kind of it. That's pretty illustrative of why you kind of feel like this is the lost era of Microsoft.

Yep. Okay. Playbook?

Yep. Okay. Playbook?

Well, the first one that talks to mind that I want to address a little bit more specifically is this idea of a cultural shift. Because we've mentioned it many times on the episode. Oh, with the DOJ, there was a cultural shift. Oh, with the new leadership, there was a culture shift. But what does it actually mean and how do you go about quantifying that?

Well, the first one that talks to mind that I want to address a little bit more specifically is this idea of a cultural shift. Because we've mentioned it many times on the episode. Oh, with the DOJ, there was a cultural shift. Oh, with the new leadership, there was a culture shift. But what does it actually mean and how do you go about quantifying that?

The thing that I kept hearing in all the research interviews we were doing was that when the stock price was flat and flat for a long time, people became convinced it's just going to stay flat.

The thing that I kept hearing in all the research interviews we were doing was that when the stock price was flat and flat for a long time, people became convinced it's just going to stay flat.

So basically, whatever the cause of that was, it created a zero-sum environment. Nothing I do is going to make the company more valuable, right? So therefore, my value, the only way to grow value accruing to me is to win at the expense of someone else at this company. I'm going to get promoted over them. My product's going to eat their product. My team's going to eat their team.

So basically, whatever the cause of that was, it created a zero-sum environment. Nothing I do is going to make the company more valuable, right? So therefore, my value, the only way to grow value accruing to me is to win at the expense of someone else at this company. I'm going to get promoted over them. My product's going to eat their product. My team's going to eat their team.

I get kudos at the expense of them looking like an idiot. That's the kind of incentive.

I get kudos at the expense of them looking like an idiot. That's the kind of incentive.

Right. And of course, it's amplified by stack ranking, which I don't have a problem with stack ranking generally. But famously at the company, everybody was ranked one to five. Every manager was only allowed so many ones and so many twos. And so...

Right. And of course, it's amplified by stack ranking, which I don't have a problem with stack ranking generally. But famously at the company, everybody was ranked one to five. Every manager was only allowed so many ones and so many twos. And so...

Ultimately, it was an environment where everyone every six or 12 months, sometimes over mid-year check-ins, was kind of being baked off against your immediate peers in your group. And because the company wasn't growing in value, you had to out-compete your friends to win.

Ultimately, it was an environment where everyone every six or 12 months, sometimes over mid-year check-ins, was kind of being baked off against your immediate peers in your group. And because the company wasn't growing in value, you had to out-compete your friends to win.