Scott Berkun

Does Google 2008 = Microsoft 1998?

This is a question I’ve thought about often (See Google’s ten rules compared to Microsoft). Before I give my answer, if you’re in Seattle you should go listen to Lawrence Lessig give his talk on the subject Friday Nov 2nd at Kane Hall, at the University of Washington.

The short answer is No. In 1998 Microsoft was suffering from the shaky Windows 98 release, was facing a new DOJ lawsuit, and will still engaged in the browser-war with Netscape. I was in my 4th year at MSFT in ‘98, and it was the roughest year for the company I’d seen. The browser war was emotionally brutal, and on the Internet Explorer team we were trying to recover from IE4 (a release few of us were proud of). To outsiders, 1998 was a year of comeuppance for Microsoft.

Looking to next year I don’t see Google headed for seas quite so rocky. Yes, there are threats of major lawsuits with YouTube and search privacy, but those threaten future revenue sources more than current ones. However, like Microsoft in the 90s, the competitive landscape isn’t impressive. Yahoo and Microsoft have are still trailing players in tech-sector mind share.

Most important comparison: By 1998 Microsoft, the 23 year old company, had managed to piss off just about everyone at least once: at least it felt that way when I spoke at conferences. Google, only 8 years old, has a much higher standing in the industry, among competitors and partners, than Microsoft did. But then again, it’s 15 years younger :)

On culture and attitude: Life inside Google feels much like at Microsoft in the mid 1990s. I’ve been to Google several times (Chapter 1 of the Myths of Innovation recounts one visit) and know folks working there. The vibe feels incredibly familiar to my mid-90s MSFT memories: happy, smart, independent people who feel they are empowered to change the world, and who work in a special place, with special rules. And as best I can tell, it’s true. They deserve to feel that way. So in that respect, rock-on Googlers.

But the rub is that in the mid-1990s Microsofties felt the same way about their place in the industry, and their ability to change the world, as the folks at Google seem to today: We have the ball and we are running away with it. I suspect the folks at Atari in 1977 (year of the 2600), Apple in 1985 (and perhaps again now), Netscape in 1994 (year of Mosaic) and dozens of other companies that were once at the top of the world. And they were all prone to the same kinds of self-destructive hubris.

Common mistakes employees of dominant companies make:

1. Believing no one has been at the center of the tech-universe before.
2. Inability to take a non self-centric view of the world.
3. Depending on power and intimidation, more than intelligence and wisdom.
4. Failing to find ways to stay humble & hungry while being dominant.
5. Focusing more on beating rivals than satisfying customers.
6. Underestimating how decisions will be received by the rest of the world.

When I was at Microsoft (‘94-’03), I always felt the company made things so much harder for itself in how employees, executives included, presented themselves to the world. I can’t tell you how many times I saw Microsoft employees embarrassing themselves at conferences, e-mail lists or on newsgroups. And it wasn’t entirely their fault: they were expressing the internal culture to the outside world and the result was predictably disastrous.

The perception of Google today, and in 2008, is at a tipping point. They are quickly rounding out their positions of dominance and the Microsoft comparisons will only get sharper. If they can learn the best lessons from Microsoft’s 1998, it’s about handling pressure with grace, and the wisdom to pay more than token attention to the mistakes above.