I just came back from the Microsoft Entrepreneur Advisory Council, a group of local entrepreneurs put up by Microsoft Emerging Business Team to talk about what startups need. I felt humbled by the presence of such great entrepreneurs on the table, me probably being the worst of the bunch.
This is very smart from Microsoft for two reasons: Group dynamic always reveals interesting arguments in favor or against something, and, second, startups are where the future lies.
Not long ago Amazon invited me to the Amazon Start-Up Challenge Award in 2007 (they forgot to invite me for 2008). And I said the following phrase which they event quoted on the Homepage of the Amazon Web Services site:
"...Get the CEO/CTO of small startups and get them engaged and talking. A few of those will become CEO/CTO of Fortune 500 companies and all built on top of Amazon Web Services."
Who would have thought that Microsoft reads my blog and got the message?
One thing became crystal clear on the lunch today: Microsoft is *very* disconnected from the Startup world. The praise and talk about their solution in a way that is un-appealing for Startups. On the other hand, all that rhetoric would work wonderfully with the CIO of a Fortune 500 company.
I think they get that. They get they are the "under dog" on this new web + startup world and that's why they were so interested in what we had to say.
They talked about Silverlight and Azure (which doesn't pronounces the way you think it does). Silverlight is easy to understand because you can simply compare it to Flash, in other words "Silverlight is Microsoft's Flash". Azure on the other hand is not "Microsoft's EC2". I've been following Azure from the sidelines (side note: Mohit Srivastava, founder of Faves, just moved back to Microsoft to work on that project).
I'm very impressed w/ Azure. Although it doesn't seem ready to prime time, it will be shortly and I'm having serious thoughts about moving Sampa entirely into their platform. It's a great response to Amazon EC2, but done in a more "interesting" way. It does seem to be a real "Cloud OS", where the Sun's dream finally comes true ("the network is the computer").
I don't think Amazon has much to fear from Azure since they are competing for a very different crowd, one being the LAMP/Ruby guys, the other the .NET developers.
Silverlight on the other hand has bigger problems. The decision of moving Sampa to Azure is totally under our control. If we think is cost-effective, we do it. The decision to create any part of Sampa in Silverlight is mostly outside of my control. User adoption is the barrier. Consumers get very scared of installing any piece of software on their computer from a website. Even if 90% of people didn't care and install it, it would mean 10% would simply turn back and go away. We can't afford that unless the benefits (read, customer retention) outweighs the fear of installing Silverlight plug-in.
Now, I have a final piece of advice to Microsoft: Don't look for inspiration for innovation on the enterprise. Innovation comes from Startups. Although the enterprise revenue probably is 100x the startup revenue for you, every piece of innovation in computer history came first from a startup (or a developer/researcher thinking like a startup inside a big company). So, stop asking Boeing, US Gov, BofA or GE what they want and start asking BuddyTV, Redfin, Smilebox, Picnik, RescueTime what would they like in terms of development tools, platforms, servers, etc.
Stay tuned for a blog post about Silverlight and the future of the Web.