I met Royal Farros at Microsoft when he spoke there about what it’s like for a small business to partner with MS. After either competing or partnering with MS for 25 years, Royal sold his company MessageCast to MS in May and is now an MS "evangelist." Well, evangelist or not, he was extremely open in talking to me and we had tons of fun. Too bad I can’t tell you the off-the-record stuff…..

UTR: How is
Microsoft addressing some of the negative image it has within the geek
community?
Royal: They
weren’t transparent before and now they’re aiming for transparency. Actions speak louder than words. We have a lot of MS
bloggers out there–it was about 1,500 three months ago and the number may be over 3,000 now.
MS has never been approachable, and it’s becoming approachable. I’ve been here
for six months and a metamorphosis has happened.

UTR: What do you
think about MS’ image? Is it changing?
Royal: Over the
last few years some anti-MS sentiment was very harsh. I think blogs are
starting to and continue to change the ideas about MS. I wrote on my blog,
“Robert Scoble for president.” So yes, it was missing, the part where we are
transparent. Even though not everyone may agree with MS, people they FEEL
better that Scoble is blogging so openly. I used to go to trade shows; it was
MS on one side, and everyone else on the other side. Now, MS is part of the
club and even one of the companies pushing for more transparency. I had never
experienced MS as part of the club. Today, when you go in to trade show, you no
longer have the MS camp – you have the MS people mingling.

UTR: What’s going
on?
Royal: I can
sense urgency, there wasn’t urgency here! Today they’re walking around with a
sense of purpose. You can tell when someone’s keeping busy vs. actually
working. Here’s a measure of work: I’ve opened the door for the
pizza guy 5 times more often in the past 3 months than in the first three
months I worked here. It’s an occupational hazard; I sit kind of close to
the door.

UTR: So what’s
the urgency?
Royal: MS if
frightfully embarrassed that Vista (Longhorn)is
so late. If they would have had Vista today,
that would help them in so many different areas. On the other hand, look at the
Xbox team. They’ve been on fire. They did something really great. An innovative
product that shipped on time that’s killing the market. MS is at its most
effective and most dangerous when they’re the underdog. They haven’t done that
since Netscape…. So Xbox had something to prove, all the talk was Sony
PlayStation.

UTR: Many anti-MS
folks don’t consider MS innovative. Do you?
Royal: MS is big
and successful in markets. It’s tough to please everyone. I think MS gets a
really bad rap when people think MS is not innovative. In MY OWN experience with
MessageCast – my company that was purchased by MS in May 2005 – we had the
opportunity to create our own platform or work with the big platforms like AOL,
Yahoo or MS. And MS is the one that’s not supposed to be innovative. MS’s
platform was 10 times more robust than the others. When we got acquired, people
tried to say, “Here’s another situation where MS is not innovative and they
have to buy this.” But we couldn’t have had a company if MS hadn’t done the
innovations in this field that they have.

UTR: What is it
about big companies that makes people not like them?

Royal: Look at Google.
They’re starting not to be well liked. It goes with the territory. And now even
Apple is the evil empire when it comes to iPod’s domination. There’s a line
from Daddy Warbucks from Annie: “You don’t have to be nice to the little people
on the way up if you’re not coming down.”

UTR: Bubble or
not?

Royal: I don’t
believe there’s a Bubble 2.0. The assumption of a bubble is that it’s being
artificially inflated and there’s nothing artificial about what’s going on.

UTR: What do you
like about MS?

Royal: I’ve been
working with MS or competing with MS for about 25 years. My company, T/Maker,
had a word processor and beat an MS product in its own category. As a non-MS
person, it never ceases to amaze me over the past 25 years that MS looks at the
market and delivers exactly what that market wants and needs.

UTR: What about
the accusations in federal court?

Royal: MS
aggressive tactics weren’t beyond what a competitor would do. AOL is a
viciously competitive company. And I say this having been a competitor with MS.
MS caught me in a competitive squeeze! We had a $95 product. Apple was harsher
to us than MS. They started building MacWrite 2, MacDraw and FileMaker. To us,
that was more competitively damaging than anything that MS did. CompUSA would
say to us, “We’d love to stock you but if we stock three Apple products, we get
this much incentive so we’re not going to stock you.” Think how bitter we were.
Would I have done the exact same thing to Apple? Yes, it’s competitively
appropriate. One of the benefits/dangers of being an entrepreneur is if you
create something that causes a stir, you’re going to attract the attention of
bigger players. I don’t know how many people have taken it on the chin from MS
like I have!

UTR: How is MS going to make money-selling more software?

Royal: They’ve
never known how they could increase their revenues by 10 times, but always can
find a way to double. If MS sells a few more Offices, eh, so what? They own the
whole shebang. So MS looked at the market and saw that we’re not actually competing
against Google and Google is not competing against us, we’re both competing
against traditional advertising. And that market is a $400 billion! Online ads last
year were about two percent of the market, about 40 percent of which was all Google.
So we’ve only scratched the surface of this number. The Google-style advertising
is so much more effective and compelling then anything traditional. It’s less
risky, performance-based, and you get immediate results. If people don’t click
on it, I don’t pay for it. But if the TV is off and you’re not watching it, I’m
still paying for that ad.

UTR: Do you have
experience with buying ads?

Royal: We used to
advertise for my companies and we did a blend of TV, print, radio – one year I
spent about $5 million. I wouldn’t spend a dime of it that way today.

UTR: So the
future is online adversiting?

Royal: I recently
spoke with Mary Meeker from Morgan Stanley – she said online advertising will
take 15 percent of the total ad money spent in the whole world falling off a
log. So the advertising market online will be $60-$90 billion split between
three companies – Yahoo, MS, Google. Even if you say Google owns 40 percent of
the market and Yahoo and MS keeps the rest, so this is wide open virgin
territory. All the companies get fat. Once you throw interactive TV on there,
now you go to close to half the advertising spent, so that comes out to $200-$300
billion/year split three ways. MS figured out how to double its profits. So
that’s why I see an enthusiastic step in MS and enthusiasm is infectious.

I met Royal Farros at Microsoft when he spoke there about what it’s like for a small business to partner with MS. After either competing or partnering with MS for 25 years, Royal sold his company MessageCast to MS in May and is now an MS "evangelist." Well, evangelist or not, he was extremely open in talking to me and we had tons of fun. Too bad I can’t tell you the off-the-record stuff…..

UTR: How is
Microsoft addressing some of the negative image it has within the geek
community?
Royal: They
weren’t transparent before and now they’re aiming for transparency. Actions speak louder than words. We have a lot of MS
bloggers out there–it was about 1,500 three months ago and the number may be over 3,000 now.
MS has never been approachable, and it’s becoming approachable. I’ve been here
for six months and a metamorphosis has happened.

UTR: What do you
think about MS’ image? Is it changing?
Royal: Over the
last few years some anti-MS sentiment was very harsh. I think blogs are
starting to and continue to change the ideas about MS. I wrote on my blog,
“Robert Scoble for president.” So yes, it was missing, the part where we are
transparent. Even though not everyone may agree with MS, people they FEEL
better that Scoble is blogging so openly. I used to go to trade shows; it was
MS on one side, and everyone else on the other side. Now, MS is part of the
club and even one of the companies pushing for more transparency. I had never
experienced MS as part of the club. Today, when you go in to trade show, you no
longer have the MS camp – you have the MS people mingling.

UTR: What’s going
on?
Royal: I can
sense urgency, there wasn’t urgency here! Today they’re walking around with a
sense of purpose. You can tell when someone’s keeping busy vs. actually
working. Here’s a measure of work: I’ve opened the door for the
pizza guy 5 times more often in the past 3 months than in the first three
months I worked here. It’s an occupational hazard; I sit kind of close to
the door.

UTR: So what’s
the urgency?
Royal: MS if
frightfully embarrassed that Vista (Longhorn)is
so late. If they would have had Vista today,
that would help them in so many different areas. On the other hand, look at the
Xbox team. They’ve been on fire. They did something really great. An innovative
product that shipped on time that’s killing the market. MS is at its most
effective and most dangerous when they’re the underdog. They haven’t done that
since Netscape…. So Xbox had something to prove, all the talk was Sony
PlayStation.

UTR: Many anti-MS
folks don’t consider MS innovative. Do you?
Royal: MS is big
and successful in markets. It’s tough to please everyone. I think MS gets a
really bad rap when people think MS is not innovative. In MY OWN experience with
MessageCast – my company that was purchased by MS in May 2005 – we had the
opportunity to create our own platform or work with the big platforms like AOL,
Yahoo or MS. And MS is the one that’s not supposed to be innovative. MS’s
platform was 10 times more robust than the others. When we got acquired, people
tried to say, “Here’s another situation where MS is not innovative and they
have to buy this.” But we couldn’t have had a company if MS hadn’t done the
innovations in this field that they have.

UTR: What is it
about big companies that makes people not like them?

Royal: Look at Google.
They’re starting not to be well liked. It goes with the territory. And now even
Apple is the evil empire when it comes to iPod’s domination. There’s a line
from Daddy Warbucks from Annie: “You don’t have to be nice to the little people
on the way up if you’re not coming down.”

UTR: Bubble or
not?

Royal: I don’t
believe there’s a Bubble 2.0. The assumption of a bubble is that it’s being
artificially inflated and there’s nothing artificial about what’s going on.

UTR: What do you
like about MS?

Royal: I’ve been
working with MS or competing with MS for about 25 years. My company, T/Maker,
had a word processor and beat an MS product in its own category. As a non-MS
person, it never ceases to amaze me over the past 25 years that MS looks at the
market and delivers exactly what that market wants and needs.

UTR: What about
the accusations in federal court?

Royal: MS
aggressive tactics weren’t beyond what a competitor would do. AOL is a
viciously competitive company. And I say this having been a competitor with MS.
MS caught me in a competitive squeeze! We had a $95 product. Apple was harsher
to us than MS. They started building MacWrite 2, MacDraw and FileMaker. To us,
that was more competitively damaging than anything that MS did. CompUSA would
say to us, “We’d love to stock you but if we stock three Apple products, we get
this much incentive so we’re not going to stock you.” Think how bitter we were.
Would I have done the exact same thing to Apple? Yes, it’s competitively
appropriate. One of the benefits/dangers of being an entrepreneur is if you
create something that causes a stir, you’re going to attract the attention of
bigger players. I don’t know how many people have taken it on the chin from MS
like I have!

UTR: How is MS going to make money-selling more software?

Royal: They’ve
never known how they could increase their revenues by 10 times, but always can
find a way to double. If MS sells a few more Offices, eh, so what? They own the
whole shebang. So MS looked at the market and saw that we’re not actually competing
against Google and Google is not competing against us, we’re both competing
against traditional advertising. And that market is a $400 billion! Online ads last
year were about two percent of the market, about 40 percent of which was all Google.
So we’ve only scratched the surface of this number. The Google-style advertising
is so much more effective and compelling then anything traditional. It’s less
risky, performance-based, and you get immediate results. If people don’t click
on it, I don’t pay for it. But if the TV is off and you’re not watching it, I’m
still paying for that ad.

UTR: Do you have
experience with buying ads?

Royal: We used to
advertise for my companies and we did a blend of TV, print, radio – one year I
spent about $5 million. I wouldn’t spend a dime of it that way today.

UTR: So the
future is online adversiting?

Royal: I recently
spoke with Mary Meeker from Morgan Stanley – she said online advertising will
take 15 percent of the total ad money spent in the whole world falling off a
log. So the advertising market online will be $60-$90 billion split between
three companies – Yahoo, MS, Google. Even if you say Google owns 40 percent of
the market and Yahoo and MS keeps the rest, so this is wide open virgin
territory. All the companies get fat. Once you throw interactive TV on there,
now you go to close to half the advertising spent, so that comes out to $200-$300
billion/year split three ways. MS figured out how to double its profits. So
that’s why I see an enthusiastic step in MS and enthusiasm is infectious.

I met Royal Farros at Microsoft when he spoke there about what it’s like for a small business to partner with MS. After either competing or partnering with MS for 25 years, Royal sold his company MessageCast to MS in May and is now an MS "evangelist." Well, evangelist or not, he was extremely open in talking to me and we had tons of fun. Too bad I can’t tell you the off-the-record stuff…..

UTR: How is
Microsoft addressing some of the negative image it has within the geek
community?
Royal: They
weren’t transparent before and now they’re aiming for transparency. Actions speak louder than words. We have a lot of MS
bloggers out there–it was about 1,500 three months ago and the number may be over 3,000 now.
MS has never been approachable, and it’s becoming approachable. I’ve been here
for six months and a metamorphosis has happened.

UTR: What do you
think about MS’ image? Is it changing?
Royal: Over the
last few years some anti-MS sentiment was very harsh. I think blogs are
starting to and continue to change the ideas about MS. I wrote on my blog,
“Robert Scoble for president.” So yes, it was missing, the part where we are
transparent. Even though not everyone may agree with MS, people they FEEL
better that Scoble is blogging so openly. I used to go to trade shows; it was
MS on one side, and everyone else on the other side. Now, MS is part of the
club and even one of the companies pushing for more transparency. I had never
experienced MS as part of the club. Today, when you go in to trade show, you no
longer have the MS camp – you have the MS people mingling.

UTR: What’s going
on?
Royal: I can
sense urgency, there wasn’t urgency here! Today they’re walking around with a
sense of purpose. You can tell when someone’s keeping busy vs. actually
working. Here’s a measure of work: I’ve opened the door for the
pizza guy 5 times more often in the past 3 months than in the first three
months I worked here. It’s an occupational hazard; I sit kind of close to
the door.

UTR: So what’s
the urgency?
Royal: MS if
frightfully embarrassed that Vista (Longhorn)is
so late. If they would have had Vista today,
that would help them in so many different areas. On the other hand, look at the
Xbox team. They’ve been on fire. They did something really great. An innovative
product that shipped on time that’s killing the market. MS is at its most
effective and most dangerous when they’re the underdog. They haven’t done that
since Netscape…. So Xbox had something to prove, all the talk was Sony
PlayStation.

UTR: Many anti-MS
folks don’t consider MS innovative. Do you?
Royal: MS is big
and successful in markets. It’s tough to please everyone. I think MS gets a
really bad rap when people think MS is not innovative. In MY OWN experience with
MessageCast – my company that was purchased by MS in May 2005 – we had the
opportunity to create our own platform or work with the big platforms like AOL,
Yahoo or MS. And MS is the one that’s not supposed to be innovative. MS’s
platform was 10 times more robust than the others. When we got acquired, people
tried to say, “Here’s another situation where MS is not innovative and they
have to buy this.” But we couldn’t have had a company if MS hadn’t done the
innovations in this field that they have.

UTR: What is it
about big companies that makes people not like them?

Royal: Look at Google.
They’re starting not to be well liked. It goes with the territory. And now even
Apple is the evil empire when it comes to iPod’s domination. There’s a line
from Daddy Warbucks from Annie: “You don’t have to be nice to the little people
on the way up if you’re not coming down.”

UTR: Bubble or
not?

Royal: I don’t
believe there’s a Bubble 2.0. The assumption of a bubble is that it’s being
artificially inflated and there’s nothing artificial about what’s going on.

UTR: What do you
like about MS?

Royal: I’ve been
working with MS or competing with MS for about 25 years. My company, T/Maker,
had a word processor and beat an MS product in its own category. As a non-MS
person, it never ceases to amaze me over the past 25 years that MS looks at the
market and delivers exactly what that market wants and needs.

UTR: What about
the accusations in federal court?

Royal: MS
aggressive tactics weren’t beyond what a competitor would do. AOL is a
viciously competitive company. And I say this having been a competitor with MS.
MS caught me in a competitive squeeze! We had a $95 product. Apple was harsher
to us than MS. They started building MacWrite 2, MacDraw and FileMaker. To us,
that was more competitively damaging than anything that MS did. CompUSA would
say to us, “We’d love to stock you but if we stock three Apple products, we get
this much incentive so we’re not going to stock you.” Think how bitter we were.
Would I have done the exact same thing to Apple? Yes, it’s competitively
appropriate. One of the benefits/dangers of being an entrepreneur is if you
create something that causes a stir, you’re going to attract the attention of
bigger players. I don’t know how many people have taken it on the chin from MS
like I have!

UTR: How is MS going to make money-selling more software?

Royal: They’ve
never known how they could increase their revenues by 10 times, but always can
find a way to double. If MS sells a few more Offices, eh, so what? They own the
whole shebang. So MS looked at the market and saw that we’re not actually competing
against Google and Google is not competing against us, we’re both competing
against traditional advertising. And that market is a $400 billion! Online ads last
year were about two percent of the market, about 40 percent of which was all Google.
So we’ve only scratched the surface of this number. The Google-style advertising
is so much more effective and compelling then anything traditional. It’s less
risky, performance-based, and you get immediate results. If people don’t click
on it, I don’t pay for it. But if the TV is off and you’re not watching it, I’m
still paying for that ad.

UTR: Do you have
experience with buying ads?

Royal: We used to
advertise for my companies and we did a blend of TV, print, radio – one year I
spent about $5 million. I wouldn’t spend a dime of it that way today.

UTR: So the
future is online adversiting?

Royal: I recently
spoke with Mary Meeker from Morgan Stanley – she said online advertising will
take 15 percent of the total ad money spent in the whole world falling off a
log. So the advertising market online will be $60-$90 billion split between
three companies – Yahoo, MS, Google. Even if you say Google owns 40 percent of
the market and Yahoo and MS keeps the rest, so this is wide open virgin
territory. All the companies get fat. Once you throw interactive TV on there,
now you go to close to half the advertising spent, so that comes out to $200-$300
billion/year split three ways. MS figured out how to double its profits. So
that’s why I see an enthusiastic step in MS and enthusiasm is infectious.