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Gary Edwards

Can C.E.O. Satya Nadella Save Microsoft? | Vanity Fair - 0 views

  • he new world of computing is a radical break from the past. That’s because of the growth of mobile devices and cloud computing. In the old world, corporations owned and ran Windows P.C.’s and Window servers in their own facilities, with the necessary software installed on them. Everyone used Windows, so everything was developed for Windows. It was a virtuous circle for Microsoft.
  • Now the processing power is in the cloud, and very sophisticated applications, from e-mail to tools you need to run a business, can be run by logging onto a Web site, not from pre-installed software. In addition, the way we work (and play) has shifted from P.C.’s to mobile devices—where Android and Apple’s iOS each outsell Windows by more than 10 to 1. Why develop software to run on Windows if no one is using Windows? Why use Windows if nothing you want can run on it? The virtuous circle has turned vicious.
  • Part of why Microsoft failed with devices is that competitors upended its business model. Google doesn’t charge for the operating system. That’s because Google makes its money on search. Apple can charge high prices because of the beauty and elegance of its devices, where the software and hardware are integrated in one gorgeous package. Meanwhile, Microsoft continued to force outside manufacturers, whose products simply weren’t as compelling as Apple’s, to pay for a license for Windows. And it didn’t allow Office to be used on non-Windows phones and tablets. “The whole philosophy of the company was Windows first,” says Heather Bellini, an analyst at Goldman Sachs. Of course it was: that’s how Microsoft had always made its money.
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  • Right now, Windows itself is fragmented: applications developed for one Windows device, say a P.C., don’t even necessarily work on another Windows device. And if Microsoft develops a new killer application, it almost has to be released for Android and Apple phones, given their market dominance, thereby strengthening those eco-systems, too.
  • At its core, Azure uses Windows server technology. That helps existing Windows applications run seamlessly on Azure. Technologists sometimes call what Microsoft has done a “hybrid cloud” because companies can use Azure alongside their pre-existing on-site Windows servers. At the same time, Nadella also to some extent has embraced open-source software—free code that doesn’t require a license from Microsoft—so that someone could develop something using non-Microsoft technology, and it would run on Azure. That broadens Azure’s appeal.
  • “In some ways the way people think about Bill and Steve is almost a Rorschach test.” For those who romanticize the Gates era, Microsoft’s current predicament will always be Ballmer’s fault. For others, it’s not so clear. “He left Steve holding a big bag of shit,” the former executive says of Gates. In the year Ballmer officially took over, Microsoft was found to be a predatory monopolist by the U.S. government and was ordered to split into two; the cost of that to Gates and his company can never be calculated. In addition, the dotcom bubble had burst, causing Microsoft stock to collapse, which resulted in a simmering tension between longtime employees, whom the company had made rich, and newer ones, who had missed the gravy train.
  • Nadella lived this dilemma because his job at Microsoft included figuring out the cloud-based future while maintaining the highly profitable Windows server business. And so he did a bunch of things that were totally un-Microsoft-like. He went to talk to start-ups to find out why they weren’t using Microsoft. He put massive research-and-development dollars behind Azure, a cloud-based platform that Microsoft had developed in Skunk Works fashion, which by definition took resources away from the highly profitable existing business.
  • They even have a catchphrase: “Re-inventing productivity.”
  • Microsoft’s historical reluctance to open Windows and Office is why it was such a big deal when in late March, less than two months after becoming C.E.O., Nadella announced that Microsoft would offer Office for Apple’s iPad. A team at the company had been working on it for about a year. Ballmer says he would have released it eventually, but Nadella did it immediately. Nadella also announced that Windows would be free for devices smaller than nine inches, meaning phones and small tablets. “Now that we have 30 million users on the iPad using it, that is 30 million people who never used Office before [on an iPad,]” he says. “And to me that’s what really drives us.” These are small moves in some ways, and yet they are also big. “It’s the first time I have listened to a senior Microsoft executive admit that they are behind,” says one institutional investor. “The fact that they are giving away Windows, their bread and butter for 25 years—it is quite a fundamental change.”
  • And whoever does the best job of building the right software experiences to give both organizations and individuals time back so that they can get more out of their time, that’s the core of this company—that’s the soul. That’s what Bill started this company with. That’s the Office franchise. That’s the Windows franchise. We have to re-invent them. . . . That’s where this notion of re-inventing productivity comes from.”
  • Ballmer might be a complicated character, but he has nothing on Gates, whose contradictions have long fascinated Microsoft-watchers. He is someone who has no problem humiliating individuals—he might not even notice—but who genuinely cares deeply about entire populations and is deeply loyal. He is generous in the biggest ways imaginable, and yet in small things, like picking up a lunch tab, he can be shockingly cheap. He can’t make small talk and can come across as totally lacking in E.Q. “The rules of human life that allow you to get along are not complicated,” says one person who knows Gates. “He could write a book on it, but he can’t do it!”
  • At the Microsoft board meeting in late June 2013, Ballmer announced he had a handshake deal with Nokia’s management to buy the company, pending the Microsoft board’s approval, according to a source close to the events. Ballmer thought he had it and left before the post-board-meeting dinner to attend his son’s middle-school graduation. When he came back the next day, he found that the board had pulled a coup: they informed him they weren’t doing the deal, and it wasn’t up for discussion. For Ballmer, it seems, the unforgivable thing was that Gates had been part of the coup, which Ballmer saw as the ultimate betrayal.
  • what is scarce in all of this abundance is human attention
  • And the original idea of having great software people and broad software products and Office being the primary tool that people look to across all these devices, that’ s as true today and as strong as ever.”
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  • But he combines that with flashes of insight and humor that leave some wondering whether he can’t do it or simply chooses not to, or both. His most pronounced characteristic shouldn’t be simply labeled a competitive streak, because it is really a fierce, deep need to win. The dislike it bred among his peers in the industry is well known—“Silicon Bully” was the title of an infamous magazine story about him. And yet he left Microsoft for the philanthropic world, where there was no one to bully, only intractable problems to solve.
  • “The Irrelevance of Microsoft” is actually the title of a blog post by an analyst named Benedict Evans, who works at the Silicon Valley venture-capital firm Andreessen Horowitz. On his blog, Evans pointed out that Microsoft’s share of all computing devices that we use to connect to the Internet, including P.C.’s, phones, and tablets, has plunged from 90 percent in 2009 to just around 20 percent today. This staggering drop occurred not because Microsoft lost ground in personal computers, on which its software still dominates, but rather because it has failed to adapt its products to smartphones, where all the growth is, and tablets.
  • The board told Ballmer they wanted him to stay, he says, and they did eventually agree to a slightly different version of the deal. In September, Microsoft announced it was buying Nokia’s devices-and-services business for $7.2 billion. Why? The board finally realized the downside: without Nokia, Microsoft was effectively done in the smartphone business. But, for Ballmer, the damage was done, in more ways than one. He now says it became clear to him that despite the lack of a new C.E.O. he couldn’t stay. Cultural change, he decided, required a change at the top, and, he says,“there was too much water under the bridge with this board.” The feeling was mutual. As a source close to Microsoft says, no one, including Gates, tried to stop him from quitting.
  • in Wall Street’s eyes, Nadella can do no wrong. Microsoft’s stock has risen 30 percent since he became C.E.O., increasing its market value by $87 billion. “It’s interesting with Satya,” says one person who observes him with investors. “He is not a business guy or a financial analyst, but he finds a common language with investors, and in his short tenure, they leave going, Wow.” But the honeymoon is the easy part.
  • “He was so publicly and so early in life defined as the brilliant guy,” says a person who has observed him. “Anything that threatens that, he becomes narcissistic and defensive.” Or as another person puts it, “He throws hissy fits when he doesn’t get his way.”
  • round three-quarters of Microsoft’s profits come from the two fabulously successful products on which the company was built: the Windows operating system, which essentially makes personal computers run, and Office, the suite of applications that includes Word, Excel, and PowerPoint. Financially speaking, Microsoft is still extraordinarily powerful. In the last 12 months the company reported sales of $86.83 billion and earnings of $22.07 billion; it has $85.7 billion of cash on its balance sheet. But the company is facing a confluence of threats that is all the more staggering given Microsoft’s sheer size. Competitors such as Google and Apple have upended Microsoft’s business model, making it unclear where Windows will fit in the world, and even challenging Office. In the Valley, there are two sayings that everyone regards as truth. One is that profits follow relevance. The other is that there’s a difference between strategic position and financial position. “It’s easy to be in denial and think the financials reflect the current reality,” says a close observer of technology firms. “They do not.”
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    Awesome article describing the history of Microsoft as seen through the lives of it's three CEO's: Bill Gates, Steve Ballmer and Satya Nadella
Gonzalo San Gil, PhD.

A World Without Linux Would Mean a World Without Our Favorite Movies - 0 views

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    "World Without Linux Episode Ep. 4: Avatar Reimagined OK guys, the fourth episode of the World Without Linux animated series created by Amelia Lorenz, a beautiful and talented graphic artist working for Disney, has just been published online on Linux Foundation's YouTube channel."
Paul Merrell

Cy Vance's Proposal to Backdoor Encrypted Devices Is Riddled With Vulnerabilities | Jus... - 0 views

  • Less than a week after the attacks in Paris — while the public and policymakers were still reeling, and the investigation had barely gotten off the ground — Cy Vance, Manhattan’s District Attorney, released a policy paper calling for legislation requiring companies to provide the government with backdoor access to their smartphones and other mobile devices. This is the first concrete proposal of this type since September 2014, when FBI Director James Comey reignited the “Crypto Wars” in response to Apple’s and Google’s decisions to use default encryption on their smartphones. Though Comey seized on Apple’s and Google’s decisions to encrypt their devices by default, his concerns are primarily related to end-to-end encryption, which protects communications that are in transit. Vance’s proposal, on the other hand, is only concerned with device encryption, which protects data stored on phones. It is still unclear whether encryption played any role in the Paris attacks, though we do know that the attackers were using unencrypted SMS text messages on the night of the attack, and that some of them were even known to intelligence agencies and had previously been under surveillance. But regardless of whether encryption was used at some point during the planning of the attacks, as I lay out below, prohibiting companies from selling encrypted devices would not prevent criminals or terrorists from being able to access unbreakable encryption. Vance’s primary complaint is that Apple’s and Google’s decisions to provide their customers with more secure devices through encryption interferes with criminal investigations. He claims encryption prevents law enforcement from accessing stored data like iMessages, photos and videos, Internet search histories, and third party app data. He makes several arguments to justify his proposal to build backdoors into encrypted smartphones, but none of them hold water.
  • Before addressing the major privacy, security, and implementation concerns that his proposal raises, it is worth noting that while an increase in use of fully encrypted devices could interfere with some law enforcement investigations, it will help prevent far more crimes — especially smartphone theft, and the consequent potential for identity theft. According to Consumer Reports, in 2014 there were more than two million victims of smartphone theft, and nearly two-thirds of all smartphone users either took no steps to secure their phones or their data or failed to implement passcode access for their phones. Default encryption could reduce instances of theft because perpetrators would no longer be able to break into the phone to steal the data.
  • Vance argues that creating a weakness in encryption to allow law enforcement to access data stored on devices does not raise serious concerns for security and privacy, since in order to exploit the vulnerability one would need access to the actual device. He considers this an acceptable risk, claiming it would not be the same as creating a widespread vulnerability in encryption protecting communications in transit (like emails), and that it would be cheap and easy for companies to implement. But Vance seems to be underestimating the risks involved with his plan. It is increasingly important that smartphones and other devices are protected by the strongest encryption possible. Our devices and the apps on them contain astonishing amounts of personal information, so much that an unprecedented level of harm could be caused if a smartphone or device with an exploitable vulnerability is stolen, not least in the forms of identity fraud and credit card theft. We bank on our phones, and have access to credit card payments with services like Apple Pay. Our contact lists are stored on our phones, including phone numbers, emails, social media accounts, and addresses. Passwords are often stored on people’s phones. And phones and apps are often full of personal details about their lives, from food diaries to logs of favorite places to personal photographs. Symantec conducted a study, where the company spread 50 “lost” phones in public to see what people who picked up the phones would do with them. The company found that 95 percent of those people tried to access the phone, and while nearly 90 percent tried to access private information stored on the phone or in other private accounts such as banking services and email, only 50 percent attempted contacting the owner.
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  • Vance attempts to downplay this serious risk by asserting that anyone can use the “Find My Phone” or Android Device Manager services that allow owners to delete the data on their phones if stolen. However, this does not stand up to scrutiny. These services are effective only when an owner realizes their phone is missing and can take swift action on another computer or device. This delay ensures some period of vulnerability. Encryption, on the other hand, protects everyone immediately and always. Additionally, Vance argues that it is safer to build backdoors into encrypted devices than it is to do so for encrypted communications in transit. It is true that there is a difference in the threats posed by the two types of encryption backdoors that are being debated. However, some manner of widespread vulnerability will inevitably result from a backdoor to encrypted devices. Indeed, the NSA and GCHQ reportedly hacked into a database to obtain cell phone SIM card encryption keys in order defeat the security protecting users’ communications and activities and to conduct surveillance. Clearly, the reality is that the threat of such a breach, whether from a hacker or a nation state actor, is very real. Even if companies go the extra mile and create a different means of access for every phone, such as a separate access key for each phone, significant vulnerabilities will be created. It would still be possible for a malicious actor to gain access to the database containing those keys, which would enable them to defeat the encryption on any smartphone they took possession of. Additionally, the cost of implementation and maintenance of such a complex system could be high.
  • Privacy is another concern that Vance dismisses too easily. Despite Vance’s arguments otherwise, building backdoors into device encryption undermines privacy. Our government does not impose a similar requirement in any other context. Police can enter homes with warrants, but there is no requirement that people record their conversations and interactions just in case they someday become useful in an investigation. The conversations that we once had through disposable letters and in-person conversations now happen over the Internet and on phones. Just because the medium has changed does not mean our right to privacy has.
  • In addition to his weak reasoning for why it would be feasible to create backdoors to encrypted devices without creating undue security risks or harming privacy, Vance makes several flawed policy-based arguments in favor of his proposal. He argues that criminals benefit from devices that are protected by strong encryption. That may be true, but strong encryption is also a critical tool used by billions of average people around the world every day to protect their transactions, communications, and private information. Lawyers, doctors, and journalists rely on encryption to protect their clients, patients, and sources. Government officials, from the President to the directors of the NSA and FBI, and members of Congress, depend on strong encryption for cybersecurity and data security. There are far more innocent Americans who benefit from strong encryption than there are criminals who exploit it. Encryption is also essential to our economy. Device manufacturers could suffer major economic losses if they are prohibited from competing with foreign manufacturers who offer more secure devices. Encryption also protects major companies from corporate and nation-state espionage. As more daily business activities are done on smartphones and other devices, they may now hold highly proprietary or sensitive information. Those devices could be targeted even more than they are now if all that has to be done to access that information is to steal an employee’s smartphone and exploit a vulnerability the manufacturer was required to create.
  • Vance also suggests that the US would be justified in creating such a requirement since other Western nations are contemplating requiring encryption backdoors as well. Regardless of whether other countries are debating similar proposals, we cannot afford a race to the bottom on cybersecurity. Heads of the intelligence community regularly warn that cybersecurity is the top threat to our national security. Strong encryption is our best defense against cyber threats, and following in the footsteps of other countries by weakening that critical tool would do incalculable harm. Furthermore, even if the US or other countries did implement such a proposal, criminals could gain access to devices with strong encryption through the black market. Thus, only innocent people would be negatively affected, and some of those innocent people might even become criminals simply by trying to protect their privacy by securing their data and devices. Finally, Vance argues that David Kaye, UN Special Rapporteur for Freedom of Expression and Opinion, supported the idea that court-ordered decryption doesn’t violate human rights, provided certain criteria are met, in his report on the topic. However, in the context of Vance’s proposal, this seems to conflate the concepts of court-ordered decryption and of government-mandated encryption backdoors. The Kaye report was unequivocal about the importance of encryption for free speech and human rights. The report concluded that:
  • States should promote strong encryption and anonymity. National laws should recognize that individuals are free to protect the privacy of their digital communications by using encryption technology and tools that allow anonymity online. … States should not restrict encryption and anonymity, which facilitate and often enable the rights to freedom of opinion and expression. Blanket prohibitions fail to be necessary and proportionate. States should avoid all measures that weaken the security that individuals may enjoy online, such as backdoors, weak encryption standards and key escrows. Additionally, the group of intelligence experts that was hand-picked by the President to issue a report and recommendations on surveillance and technology, concluded that: [R]egarding encryption, the U.S. Government should: (1) fully support and not undermine efforts to create encryption standards; (2) not in any way subvert, undermine, weaken, or make vulnerable generally available commercial software; and (3) increase the use of encryption and urge US companies to do so, in order to better protect data in transit, at rest, in the cloud, and in other storage.
  • The clear consensus among human rights experts and several high-ranking intelligence experts, including the former directors of the NSA, Office of the Director of National Intelligence, and DHS, is that mandating encryption backdoors is dangerous. Unaddressed Concerns: Preventing Encrypted Devices from Entering the US and the Slippery Slope In addition to the significant faults in Vance’s arguments in favor of his proposal, he fails to address the question of how such a restriction would be effectively implemented. There is no effective mechanism for preventing code from becoming available for download online, even if it is illegal. One critical issue the Vance proposal fails to address is how the government would prevent, or even identify, encrypted smartphones when individuals bring them into the United States. DHS would have to train customs agents to search the contents of every person’s phone in order to identify whether it is encrypted, and then confiscate the phones that are. Legal and policy considerations aside, this kind of policy is, at the very least, impractical. Preventing strong encryption from entering the US is not like preventing guns or drugs from entering the country — encrypted phones aren’t immediately obvious as is contraband. Millions of people use encrypted devices, and tens of millions more devices are shipped to and sold in the US each year.
  • Finally, there is a real concern that if Vance’s proposal were accepted, it would be the first step down a slippery slope. Right now, his proposal only calls for access to smartphones and devices running mobile operating systems. While this policy in and of itself would cover a number of commonplace devices, it may eventually be expanded to cover laptop and desktop computers, as well as communications in transit. The expansion of this kind of policy is even more worrisome when taking into account the speed at which technology evolves and becomes widely adopted. Ten years ago, the iPhone did not even exist. Who is to say what technology will be commonplace in 10 or 20 years that is not even around today. There is a very real question about how far law enforcement will go to gain access to information. Things that once seemed like merely science fiction, such as wearable technology and artificial intelligence that could be implanted in and work with the human nervous system, are now available. If and when there comes a time when our “smart phone” is not really a device at all, but is rather an implant, surely we would not grant law enforcement access to our minds.
  • Policymakers should dismiss Vance’s proposal to prohibit the use of strong encryption to protect our smartphones and devices in order to ensure law enforcement access. Undermining encryption, regardless of whether it is protecting data in transit or at rest, would take us down a dangerous and harmful path. Instead, law enforcement and the intelligence community should be working to alter their skills and tactics in a fast-evolving technological world so that they are not so dependent on information that will increasingly be protected by encryption.
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