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Reaching Out to Silicon Valley

Microsoft Tries to Make Friends, Build Softer Image Amid Wary Neighbors

February 17, 2001|ALEX PHAM | TIMES STAFF WRITER

MOUNTAIN VIEW, Calif. — For more than 20 years, Microsoft Corp. has had a presence in Silicon Valley.

In the early days, its small outposts served as little more than brief stopping-off points for company executives before they flew home to headquarters in Redmond, Wash.

But as the technology world shifts its focus away from the personal computers upon which Microsoft built its fortunes to the Internet, Palms and other wireless devices, the software behemoth needs new friends to conquer new markets.

So nowadays, Microsoft is trying to project a more neighborly image in Silicon Valley as it broadens its efforts to strike partnerships with local tech firms. Since opening a gleaming 32-acre campus in Mountain View in late 1999, Microsoft is reaching out to Silicon Valley like never before.

The company started a monthly lecture series, increased its contributions to Bay Area charities, appointed special liaisons to manage relations with potential business partners and local officials and is participating in local forums such as the Churchill Club, which hosts discussions with local technology luminaries.

The outreach has softened Microsoft's image in this high-tech haven. Whether it will yield business deals remains to be seen. Parts of the valley will never fully embrace Microsoft because of the deep scars that remain from its epic battles with some of the region's most-revered home-grown enterprises.

There was the 1980s scuffle with Apple Computer Inc. over whether Microsoft illegally copied Apple's point-and-click user interface. That was followed by the browser wars with Netscape Communications Corp. in the 1990s, which became the heart of the Justice Department's antitrust case against the software giant. And there are the ongoing scrapes with Oracle Corp. and Sun Microsystems Inc., fierce competitors that, behind the scenes, helped the government build its antitrust lawsuit.

"There's this really weird passive-aggressive, dysfunctional relationship between parts of the valley and Microsoft," said Chris DiBona, so-called chief evangelist of Sunnyvale-based VA Linux Systems Inc., which builds custom computer systems running Linux, an operating system that is an alternative to Microsoft's Windows.

"A lot of people here fear them, but they also do business with them or try to get purchased by them."

Indeed, not everyone in Silicon Valley abhors Microsoft. Many companies have built fortunes allying themselves with the software colossus, including semiconductor giant Intel Corp., whose chips work hand in glove with Microsoft's programs. Other companies, from Philips Consumer Electronics in Sunnyvale to Hewlett-Packard in Palo Alto, sell products that work with Microsoft platforms.

But many remain distrustful of the software titan, and signs of such sentiment are everywhere.

Cars driven by engineers who advocate the Linux computer operating system sport bumper stickers urging people to "Boycott Micro$oft." There are also T-shirts that read, "Microsoft is organized crime."

"Around here, it might enhance your image to talk badly about Microsoft," said Andy Jong, owner of Winners Circle Systems, a computer store in Berkeley. "If you feel resentment in Silicon Valley, it's because people here feel a lot of companies here have been driven out of business by Microsoft."

Even among academics in Silicon Valley, there is something of a bias toward non-Windows operating systems, such as Unix and Macintosh, which are deemed more suitable for research purposes. At Stanford University's Gates Building, which houses the school's computer sciences department and is named after Microsoft Chairman Bill Gates, 15% of the machines in the computer labs run Windows. The rest are Unix or Macintosh machines.

Less than three miles north of Microsoft's new campus is the headquarters of Sun Microsystems, whose chief executive, Scott McNealy, makes a hobby of bashing Microsoft in his speeches with David Letterman-style "top 10" lists. Sun also forbids the use of Windows on company computers.

Playing the Jerry Seinfeld role 15 miles away in Redwood Shores is Larry Ellison, Oracle's founder and chief executive and a longtime Gates hater.

Last summer, Ellison eagerly defended his company's role in hiring a private investigator to snoop through the trash of lobbying organizations tied to Microsoft. Ellison, whose $47-billion fortune trails Gates' $60 billion, also ordered his sales force to slash prices, up to millions of dollars, whenever they called on potential customers who had Microsoft mugs on their desks.

It's not all personal, however. Oracle and Sun have used the anti-Microsoft rallying cry as a way to mobilize their own troops.

"You figure out who the bad guy is, and you focus on that," said Larry Yang, who worked for Sun and is now employed by Microsoft's WebTV division in Mountain View. "It's very effective."

For Microsoft workers, the result can sometimes translate to difficulties hiring engineers and awkward moments at parties.

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