Category Archives: Microsoft

What did I say about Microsoft and Google–Microsoft offers $44b for Yahoo

Yesterday I posted about Microsoft’s global reputation at the top of the heap in two of the latest corporate reputation surveys–Edelman and Cision. I commented that Microsoft’s stunning improvement, compared to their serious trashing about five years ago–had more to do with Google’s ascendance than anything else. I suggested that it was the technical literati who understood how serious the Google threat was and this threat rapidly removed the monopoly fears and hatred of the software giant’s power, which resulted in rapidly improved reputation scores. Now Microsoft is trying to buy Yahoo–perhaps the only serious (somewhat) challenger to Google’s hegemony over search and ad related search. Story in NYTimes.

So, what do you think of that? Do Microsoft and Yahoo together make an overwhelming force–so much that Google is now in trouble and that therefore the shift of reputation follows? I doubt it. And that in itself is a credit to Google’s incredible position which is partly related to the founder’s vision of “organizing the world’s information.”

What worries me about Microsoft (as a longtime shareholder I might add) is that the vision was crystal clear before. I even had Bill himself explain it to me on a flight (in coach) to San Jose in 1983. It was to bring the power of computing to the masses. How does the Yahoo purchase help accomplish this mission? Not real clear to me. In fact, if I look at who is accomplishing the Microsoft mission more than Microsoft I would have to say Apple. And with the iphone perhaps even more than with the Macs.

Another measure of corporate image out–the Cision Index

It must be the season to measure corporate reputations. Here is the results of the Cision Index, formerly the Delahaye Index. Microsoft comes out on top as it does in the Edelman Trust Barometer.

The bigger news is the astounding recovering of reputation enjoyed by the US auto industry. Hmmm–let’s see, losing billions, on their backends due to continuous and effective competition, losing market share constantly, but reputation up?

I think Microsoft’s stunning recovery and the automaker’s improvements are related phenomenons. It is the monopoly vs, underdog situation. As I blogged before, Microsoft’s reputation didn’t turn around because of bloggers (they helped) or any massive PR campaign, or even Bill Gates doing his marvelous philanthropy. Google did it. Google demonstrated that Microsoft was vulnerable. Not to the general public because frankly I don’t think most non-tech types understand the clear and present danger that Google represents to the software giant–but the influencers who understand technology get it and their opinion is now showing up big time in the public (see the comments discussion about the Edelman Trust Barometer for differing opinions about the role of influencers).

I don’t think people have gotten to feeling sorry for Microsoft, but their loss of position as a fearful monopoly along with Google’s transcendence have contributed greatly to their reputation. Auto companies? Well, we still like Americans and made in America. We just don’t like big huge powerful monopolies or anthing close to them, particularly when they don’t operate with humility. GM, Ford, Chrysler have been humbled. they are fighting for their lives. They have huge obstacles to overcome–not just Toyota and Honda but their own labor force and the changes in the world that they were slow to adapt to. They now appear weak, vulnerable, but their efforts also seem somewhat heroic.  We want them to win–if not get back to dominance, at least show they can still compete well in a world increasingly dominated by smart people from Europe and Asia.

Perhaps, as a PR person, it would be better for me to conclude that the reversal of fortune of these companies was due somehow to the brilliance of PR strategists and the far thinking of corporate leadership. I think circumstances–often dictated by competitors–can have a lot to do with reputations. It is the smart communicators who understand these dynamics and know how to take full advantage of human psychology as well as changes in the world.

Google, Yahoo, Cisco and Microsoft–Accused of assisting brutal repression

Last night I watched the PBS Frontline documentary “The Tank Man.” It highlighted the story of the Communist government’s brutal ending of the pro-democracy protests in Beijing in 1989, focusing on the gripping image of the lone young man holding up an entire column of tanks. A sub-story within this documentary was the role that Google, Yahoo, Cisco and Microsoft are playing in helping the Chinese government work to limit the access to information of its people–including about the events in Tiananmen Square. More than that, Cisco and Yahoo in particular were accused of actually assisting the Chinese government in tracking down those who violate China’s rules about dissent and free flow of information.

The footage included testimony from the four companies at Congressional hearings. Cisco stands accused of selling equipment and systems used by the police force to track and prosecute enemies of the state. Yahoo turned over information to the government about the activities of one of its customers that resulted in his arrest and 10 year prison sentence.

When you look at it as presented by the Frontline producers and even more so in my brief explanation, it is chilling and creates an immediate visceral reaction of horror and anger against these companies. And I will tell you that when I saw Cisco’s written statement (they refused to participate in the documentary) I was reminded of I.G Farben. I am working on a book about an American fighter pilot sent to Buchenwald and the I. G. Farben plant was right next to this horrid concentration camp making full use of the slave labor-to-death of the inmates. So many prominent German companies played key roles in supporting a brutal regime including participating in its brutality. Cisco’s explanation and Yahoo’s as well focused on the need to follow the laws of each of the countries they operate in.

They are right of course. But here is one great challenge of globalization. To not participate in the massive opportunity that is China is to relinquish a position of leadership in global business. To participate, means that you have to violate the principles, laws and core values of the customers and regulators who mean the most to you. To say these companies are between a rock and a hard place is understating it.

This, I would consider a smoldering crisis. It could erupt at any time into a full blown flame. As it is, it exists in the blog world and once in a while it emerges into the mainstream media such as PBS. It would not take much for it to burst to a critical reputation crisis for these firms–and based on what was presented Cisco is most at risk. An entrepreneurial activist, the focused engagement of the Freedom Frontier folks, a politician looking for a good cause to run on, a high placed reporter seeing this as a Pulitzer prize opportunity–all very possible and I would guess worrisome to the communication leaders of these organizations.

This challenge also highlights the issues of managing a smoldering crisis. Direct, open conversation and engagement with those (such as me) who are deeply concerned about this and the role they are playing is vitally important. But how do you do that without fanning the flames and inadvertently help the issue burst from the smoke into a full blown crisis?

It will be interesting to watch.

Google, Microsoft and the changes to come

I had the chance yesterday to talk to a fairly high level sales executive with Google. Someone who had earlier worked for the company that Microsoft just purchased for $6 billion–needless to say he was happy with the price paid. But as someone who sells Google’s ad services to some big accounts in this area, he is in the thick of the war brewing between the two giants for all our ad dollars. And it will be a war–with interesting twists and turns that we can’t even imagine now.

I asked him about Google’s strategy of the street level addition to Google Earth and he talked about the potential for stores to take people from the street level into tours of their stores, directing them via Google to find just what they are looking for. Google doesn’t seem terribly worried about monetizing the street level views as they don’t seem concerned about monetizing
Google Earth, but it all adds up to making advertising more direct, more powerful, more effective. The pay per click model is here to stay–more than that, it is  rapidly coming to what all those who buy advertising long for and that is advertising as a fixed cost of the sale. I’ll pay for the ad if I sell the product but not if I don’t.

This has huge implications for all of us in communication and not just those buying advertising. How we connect with each other, how we provide messages, how we shape opinion, how we deliver facts are all related to how the commercial enterprise does its job. I can’t predict exactly how this clash of the monoliths will impact crisis communication or reputation management, but I’m pretty darn certain that it will have a huge impact. Repeat after me: Change is good, change is my friend.

Microsoft the most respected brand–how'd that happen?

I’ve seen several studies in the last couple of years that show that Microsoft (our neighbor here in the Pacific Northwest) is now the most respected brand, or company, or name or whatever. This is truly remarkable and if it is indeed the case, it should be studied by all of us involved in reputation management. Because it was only a few very short years ago that the name was almost universally hated, it had more blog sites attacking it than anyone else, it was always in the news in a most negative fashion. It was accused of being a bully, driving others out of business, doing all kinds of things illegally–mostly related to aggressive business tactics.

I’d like crisisblogger readers to share their thoughts. Here are a few possible explanations:

– Microsoft communications became much more transparent, particularly with their blog policy that enabled thousands of employees to openly blog about the company (this is Robert Scoble’s primary explanation)

– Bill Gates left the CEO position and others, particularly Steve Ballmer became much more visible

– Bill Gates became one of history’s greatest philanthropists

– Their products stopped sucking (I’m writing on a Mac–what do you think I think)

– Their business practices changed, they became less mean and aggressive

– All the lawsuits made them a victim of aggressive prosecutors and lawyers

– press coverage went through the cycle of build up, tear down and now build up again

My opinion? All of these had some minimal impact, the biggest thing that changed was Google. The simple principle is that we all hate a monopoly and we deeply distrust anyone with unchecked power. Power corrupts… Google demonstrated that there was someone to check the power of Microsoft, someone to challenge their market position and even someone who could make them look vulnerable. We love vulnerable.

If this is the case, what does this mean for crisis managers and reputation managers? That the environment you operate in may have more to do with reputation than anything you can do or say. This is critically important because I see lots of evidence everyday that people are not really studying or understanding the reputation environment they operate in. One company that seems to understand this is Toyota. This remarkably successful manufacturing machine has overtaken GM in the US and is overtaking it in the world as the world’s biggest car company. Of course, for profitability they overtook them a long, long time ago. They are nervous as heck about getting to such a strong position. They are not a monopoly for sure, but they have good reason to be fearful of the “ginormous successful global giant” label in this environment. You can see evidence of their thinking all around–promoting US manufacturing plants to the US market–they are sellling their plants more than their cars these days. And branding new lines not with the Toyota name but introducing other names like Scion.

Despite this, I predict a growing “I hate Toyota” movement. It’s just in the air we breathe.

Can Google be beat?

Anyone who uses the Internet uses search engines a lot. Google has rocketed to the top of the world based primarily on its search engine, plus some smart ways to leverage that through ad revenue, etc. But, can search get better. I just looked at a beta of www.medstory.com and my answer is yes. It’s going to get a lot better. While medstory is set up primarily for health related searches, the basic concept is applicable to any number of subjects. Obviously, Microsoft thinks medstory’s search methods are valuable because according to this article in today’s Media Post, Microsoft has purchased the technology and sees it as a key part of its strategy to win the search wars. Ah, isn’t competition wonderful.

Microsoft's review laptop fiasco

Seems the marketing and PR world just keeps stumbling on itself on how to deal with bloggers. I see all these PR seminars on how to “pitch” bloggers like you pitch MSM reporters. Well, bloggers aren’t like most MSM where the rules of what is right, above board and ethical have been pretty well worked out.

Apparently, Microsoft and AMD sent a bunch of laptops to bloggers for them to review. Their PR agency is Edelman and Edelman is positioning itself at the forefront of online PR strategies–at some pretty high cost I would say. Robert Scoble weighed in and said this was great as long as the bloggers divulged they got a free laptop out of the review. Joelonsoftware vigorously disagreed. He may be right.

Apparently Microsoft and AMD got some feedback that by doing so they were clumsily trying to influence how those products are reviewed (let’s see, sending products for review to publications has been a pretty well established practice I believe). But they forgot how self-righteous, ethically pure, and petulant many of the bloggers can be. So when Microsoft decided they had made a mistake by offering such a bennie to the bloggers they tried to backtrack and suggest that the bloggers shouldn’t keep the laptops after all. Now they are finding out just how petty and angry some of these bloggers can be. Here’s a dandy.

A lesson to be learned by all those PR types trying to figure out how to deal with bloggers. My suggestion: use kid gloves. They can be a touchy bunch. And a word to Edelman–pioneers have to take a few arrows.