Deep Blue veteran plots Lotus game-plan

So those are the three or four reasons why customers are migrating to our platform and the conclusions that are reached in this report are inconsistent with the realities of the world.

What about their figures claiming that IBM's combined market share will fall from 24 percent to 17 percent over the next four years while Microsoft will experience steady growth to 33 percent share by 2008?
I don't know how they came up with that. In IBM we don't report brand-orientated revenue but after every quarter our CFO reports significant progress in a vertical environment and he chose to report that our base messaging business grew by double digits. So how did we grow double-digit percentages in a declining market? IDC just reported numbers and in 2003 they have us with a bigger market share than Microsoft does in the same market. We have never lost our No.1 position since our acquisition of Lotus in 1995.

What about the general marketing of Workplace -- there is some criticism that you haven't got the message over about Workplace adequately.
We have to make customers happy and give them choice and flexibility. Microsoft gives no choice. I think a choice-based strategy has a better chance to gain share than a strategy that says: 'You must buy my server, my operating system, my directory, my database, my desktop -- you must buy everything we provide or you are a second class citizen, you're ostracised.

But you are confident that you are getting the Workplace message through to customers?
I think the communication eventually gets through when people get comfortable. When I came on board 15 months ago, nine out of the 10 questions that were being asked were -- so what is the migration strategy? Today it is only one out of the 10 questions when I visit the customers. It was the same thing when we first shipped Linux, people were saying 'so, is your AIX dead?'.

How much do people really need a function rich, collaborative email platform such as Workplace given the general move toward outsourced applications? Isn’t it simpler to just outsource the email problem?
By 1990 the outsourcing market was a few million dollars, it is now a few hundred million. There is a general trend towards outsourcing. But email is the same as any business-critical business application and you have to really consider what advantage you will get from outsourcing it.

You have been at IBM for over 20 years now and were around when the company seemed to lose its way in the early to mid 90s. There seems to be a general paranoia in Microsoft to avoid making the same mistakes IBM did -- can you see any parallels in Microsoft's behaviour now and IBM 10 years ago?
Every company goes through this. You want to protect your existing products so much that you don't take advantage of disruptive technology.

One hundred per cent of Microsoft's profits come from the desktop operating system, the rest of them combined lose money. So they have to force an upgrade cycle every few years, and if they don't, where is their profit going to come out? To force the upgrade they have to build Longhorn -- which I call a personal supercomputer: two-way SMP, 16GB of memory, 100GB of disk drive. And they have to upgrade the masses, hundreds of millions of people onto this personal supercomputer -- if they don’t, their stock-price is hurt.

This is a dilemma. If someone does provide technology for the masses, that is good enough, that's very disruptive. Microsoft has to avoid that destructive move and the only way they can do that is to get rid of their cash engine. Just like IBM decided that no matter what the question, the answer is mainframe, Microsoft has decided no matter what the question, the answer is Longhorn.