Ten Reasons why Microsoft Will Eventually be a Holding Company

February 11, 2010

1. No one wants the products they make today.

2. They have $8 billion in the bank.

3. Most of the good talent has already left (Ray Ozzie – I haven’t heard from you, why not?).

4. Their ex-executives are starting to explain what makes the company so dysfunctional.

5. They don’t do service 1% as well as IBM does.

6. They don’t do data centers 1% as well as Google does.

7. They still don’t get netbooks.

8. Health Vault and Almaga are great examples of divisions that will lead the way forward. See below.

9. They can’t see the semantic web coming, and they don’t have the culture to embrace the openness it requires.

10. The online data locker will render their products obsolete in a single stroke (except Health Vault).

Health Vault is a cloud-based storage for consumer health data. Microsoft has great people working on this project, and they really want to help people consolidate their data. They don’t have much funding and they don’t yet have much traction, but they are taking a long-term approach. Ideally, consumers would magically be able to transfer all their health data into their health vaults and then, also magically, the data would go into some standard format all systems can work with. Then, the information would be under the consumer’s control and she could give access to anyone, any time, however she liked. Sounds like part of the personal data locker, doesn’t it? Unfortunately, it’s not that easy. Health data comes in practically as many formats as there are companies that generate it. Furthermore, people may have no records of things like past operations, but they still want to capture as much as they can. They have chosen to be as forgiving as possible, hoping to get any and every scrap of data, even if it’s fuzzy or wrong. As you would know if you read my book, Pull, most insurance codes in patient records are wrong, on purpose. Because doctors game the system to help patients and themselves get as much money as possible.

Another good purchase was Almaga. As described in SuperFreakonomics, Almaga is a universal back-office records system for hospitals and health-care service providers. Once again, Almaga has taken the approach of accepting all possible formats and trying to unify them into a single semantic database, becoming a hub for moving data in and out. It’s a huge job because of all the different formats. Eventually, we hope systems like this help reduce semantic dispersion and lead to more common formats among all systems. But at the moment, it’s the right approach. The system has to be very forgiving and get some things wrong in the hopes that most data will translate. Again, because most insurance codes are incorrect, they have to watch for real problems that could hurt patients. The system already ties into Microsoft Health vault, offering exchange of data with patients themselves. Rather than having a lot of plenary sessions and data summits, Almaga’s all-inclusive approach is probably the best way to get the ball rolling. And they have the results to show that it’s worth the investment. It may not be fully semantic, but it’s much better than the islands of information and walled gardens we have elsewhere in health informatics.

Make no mistake – Microsoft will be a serious player in the future, because SarBox prevents companies from going public, and Microsoft’s $8 billion is bigger than any private equity or VC fund. If they gave me 5% of that, I’d put them in serious position to challenge Google in the race for the online data locker and the future of work, play, and life online. But it would be as a portfolio with integrated knowledge sharing, not as some kind of unified technology platform.

One Response to “Ten Reasons why Microsoft Will Eventually be a Holding Company”

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1. MS demise? « ronjea's Blog | February 20, 2010 at 4:53 am

   [...] Ten Reasons why Microsoft Will Eventually be a Holding Company points to Microsoft’s Creative Destruction. [...]