Microsoft’s Set-Top Legacy

ARTICLE: “Bill Gates’ Legacy: Microsoft’s Top 10 Flops,”by Mary Jo Foley, Microsoft Watch, July 16, 2006

We are bombarded with bad news (or good news, depending on your viewpoint) pouring out of Redmond these days. Gates is leaving. Ballmer is staying. The executive suite is emptying. The stock price is falling. VISTA is delayed. Office 2007 is delayed.

As such, it seems almost gratuitous to call to the attention of the world the failures of the world’s software giant. Mary Jo Foley, who makes a good living watching Microsoft, points out that some of Gates’ most visionary efforts have fallen on their faces.

One that she missed was Microsoft Venus, the China-only set-top-box that was going to enable millions of Chinese who had TVs but not PCs to use their televisions to get online. This was one of those ideas that looked really good on paper, but that clearly wasn’t subjected to the kind of critical thinking that should have killed it before it grew.

Microsoft managed to drum up support from Beijing, Shanghai, and Guangzhou, whose city governments offered to cut Internet access fees by 50% for Venus users. Over 30 Chinese companies jumped onto the bandwagon, starting development efforts, including Lenovo (then still called “Legend”) and TCL, who were supposed to have products out by January 2000.

The product died an ignominious death less than a year later, never having made it out of the lab. The high cost of the units (RMB 3,000 apiece), the fact that using them preempted watching TV, the problem with screen resolution that killed WebTV, and political opposition from groups within and around the State Administration for Radio, Film and Television (SARFT) and the Ministry of Information Industries (MII) all contributed. In the end, however, what slaughtered Venus was Microsoft’s failure to understand the sheer scale of the task of creating an ecosystem that would support it. Venus wasn’t too hard for Microsoft. China was.

Interesting. They seem to be figuring China out. Too bad about the software.


About David Wolf

An adviser to corporations and organizations on strategy, communications, and public affairs, David Wolf has been working and living in Beijing since 1995, and now divides his time between China and California. He also serves as a policy and industry analyst focused on innovative and creative industries, a futurist, and an amateur historian.
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