I’ve read pretty much all of Paul Graham’s essays. I think he’s a wonderful writer and in the past we have often found ourselves debating his views at our bi-weekly geek bookclub @ Talis. One of his most seminal pieces was Hackers and Painters – which every developer should read. So, as you might imagine, I was more than a little intrigued this morning when my FeedReader listed a new essay by Paul with the contentious title: Microsoft is Dead.

Paul argues that Microsoft is no longer frightening, that the company is no longer seen as a threat, no longer casts the shadow it once did over the entire software industry:

I can sense that. No one is even afraid of Microsoft anymore. They still make a lot of money—so does IBM, for that matter. But they’re not dangerous.

Paul attributes this demise, if that’s the right word for it, to four things:

Firstly , Google. Who Paul believes is the most dangerous company now by far, in both good and bad senses of the word – using www.live.com as an example of how Microsoft is limping behind Google, continuously playing catchup.

Secondly, was the release of Gmail and the introduction of AJAX to the masses. Gmail showed how much you could do with web based software – signalling the death knell of the desktop as more and more applications are delivered over the web. Paul describes how Microsoft themselves might have contributed to the rise of AJAX, something I was previously unaware of:

Ironically, Microsoft unintentionally helped create Ajax. The x in Ajax is from the XMLHttpRequest object, which lets the browser communicate with the server in the background while displaying a page. (Originally the only way to communicate with the server was to ask for a new page.) XMLHttpRequest was created by Microsoft in the late 90s because they needed it for Outlook. What they didn’t realize was that it would be useful to a lot of other people too—in fact, to anyone who wanted to make web apps work like desktop ones.

The third cause is the widespread availability of high speed broadband Internet access – which is key to facilitating the delivery of web based applications to end users – which in turn is key to moving users away from the reliance on desktop based tools and applications.

The final nail in the coffin, Paul argues, came from Apple. The company re-defined itself and offered the world a viable alternative to Windows, in OS X. I know from personal experience that although I don’t have a Mac or a PC running native Linux, I do much of my development work in Linux VM Machines – this is partly due to infrastructure policy on our company laptops … which I should hasten to add … just changed 🙂 So when I get my shiny new laptop I can run Linux on it natively Yippee! ( I’d love it even more if I could have one of those 17″ MacBook’s … pretty please Ian if you do I’ll buy you one of these t-shirts!)

I think to a great extent Paul is actually right. But I personally wouldn’t count Microsoft out of the running. Microsoft is still a company that is capable of innovating great things. Just take a look at what’s coming out of their research labs in terms of PhotoSynth and DeepFish – to understand that they are looking to push the envelope in certain areas. Unfortunatly it does appear that these days they are reacting to innovations made by their competitors – www.live.com , and maps.live.com are great examples of two Microsoft products that are essentially late alternatives to Google Web Search, and Google Earth. Instead of leading the way, Microsoft is being forced to change it’s traditional business because others, like Google, are changing the industry around it.

I think Paul is absolutely right when he attributes part of their downfall, as it were, to their complacency as a Monopoly:

I’m glad Microsoft is dead. They were like Nero or Commodus—evil in the way only inherited power can make you. Because remember, the Microsoft monopoly didn’t begin with Microsoft. They got it from IBM. The software business was overhung by a monopoly from about the mid-1950s to about 2005. For practically its whole existence, that is. One of the reasons “Web 2.0” has such an air of euphoria about it is the feeling, conscious or not, that this era of monopoly may finally be over.

It’s been a well known fact for years that Microsoft is propped up by the profit it generates from two product lines … Microsoft Windows, and Microsoft Office. Hell even the XBOX is still making a loss for the company. It’s no accident then, that Google, have released browser based Office applications, in the form of docs.google.com. This service allows people to write and share documents and spreadsheets for free, combined with gmail and several other apps. Google are now positioning themselves as a service provider offering enhanced versions of this service for small businesses for $50 per user, per year. This will no doubt force Microsoft to change – perhaps even releasing a browser based SOA version of its Office Suite. It’s going to be interesting to see how this competition between these two giants pans out. I’m not saying that being the first in this kind of race is always the best, but if you get into a position where your forcing both the industry and your competition to react to you then thats got to be a good thing.

Take the time to read Paul’s essay. It’s not very long, but it does make some excellent points.