Steve Ballmer

No one was going to challenge IBM really until the microcomputer, even the minicomputer people. Did DEC really challenge IBM? Not really. It never made a dent.

Yes. And there's these little blips of it, like the GUI, I think, meaningfully reshuffled the DECs. But those are the moments where you can have meaningful new entrants. And otherwise, you kind of have to bide your time and just build your hedges and see.

Yes. And there's these little blips of it, like the GUI, I think, meaningfully reshuffled the DECs. But those are the moments where you can have meaningful new entrants. And otherwise, you kind of have to bide your time and just build your hedges and see.

Related, even if you are the incumbent being disrupted, it is possible to have a very, very large and durable revenue stream that can go on for a very long time. And what I'm referring to in this particular example is despite all of the dethroning that we just talked about, Microsoft would not eclipse IBM in revenue. You mentioned market cap, David, but in revenue until the year 2015. Wow.

Related, even if you are the incumbent being disrupted, it is possible to have a very, very large and durable revenue stream that can go on for a very long time. And what I'm referring to in this particular example is despite all of the dethroning that we just talked about, Microsoft would not eclipse IBM in revenue. You mentioned market cap, David, but in revenue until the year 2015. Wow.

Isn't that nuts?

Isn't that nuts?

But I think that's the point, right? It's like Microsoft's perception by the market. I'm sure they were growing faster. I'm sure they had better gross margins. I'm sure there was a better story there. And so there's multiple that comes out of story. I'm sure there's lots of good reasons why Microsoft became more valuable than IBM very early. But IBM's revenue did not peak until 2012. Wow. What?

But I think that's the point, right? It's like Microsoft's perception by the market. I'm sure they were growing faster. I'm sure they had better gross margins. I'm sure there was a better story there. And so there's multiple that comes out of story. I'm sure there's lots of good reasons why Microsoft became more valuable than IBM very early. But IBM's revenue did not peak until 2012. Wow. What?

It's this like long after public perception moves on, customers still get value from something created by incumbents for a very long time. And I think that's something we often forget about in the sort of buzzy Twitterverse of like, oh, that thing's over. It's like, it might still grow for another 20 years before it's over.

It's this like long after public perception moves on, customers still get value from something created by incumbents for a very long time. And I think that's something we often forget about in the sort of buzzy Twitterverse of like, oh, that thing's over. It's like, it might still grow for another 20 years before it's over.

Yes, that's a good point.

Yes, that's a good point.

What do you got?

What do you got?

Yeah, that totally comes through. I asked Brad, why did Windows 95 work? And, you know, there's lots of structural reasons, but he said we basically did two things. One, we laid out principles for product and then pushed responsibility down. Developers were often their own PMs.

Yeah, that totally comes through. I asked Brad, why did Windows 95 work? And, you know, there's lots of structural reasons, but he said we basically did two things. One, we laid out principles for product and then pushed responsibility down. Developers were often their own PMs.

So there's sort of this idea of once you got the principles, we don't need to write a zillion specs and design something three times and pass it through three functions. Just like, you know, the principles make great software that follows the principles. And two was he said that everyone felt personally responsible for the product, and it really showed.

So there's sort of this idea of once you got the principles, we don't need to write a zillion specs and design something three times and pass it through three functions. Just like, you know, the principles make great software that follows the principles. And two was he said that everyone felt personally responsible for the product, and it really showed.

Yep. Something we touched on a little bit is the benefit of scaling with OEMs. This was sort of the contrast against Apple, where I said Apple was sort of always going to be a niche player by the way that they designed and built and packaged everything themselves. Apple is in many ways like the Amex, where Microsoft is the Visa.