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Microsoft's Billion-Dollar Missed Smart Grid Opportunity By Jesse Berst Jul 15, 2010 - 1:11:45 PM
. Elsewhere on Smart Grid News, we discuss Cisco’s home energy management plans and the good news and bad news about Cisco’s Smart Grid strategy for utilities. Cisco expects the Smart Grid to contribute $1 billion to its annual revenues before the end of the decade. It has that chance because Microsoft wasn’t smart enough or nimble enough to take advantage itself.
Roughly five years ago, I did a small bit of consulting to Microsoft. I explained to them the importance of getting in front of the emerging Smart Grid market. I explained the value -- to them and to the sector -- of creating an end-to-end platform with open APIs and backend services that utilities and others could use as the foundation for innovative new energy applications. I’m sure the company heard similar suggestions from other advisors.
The next-generation grid could have been built, at least in part, on top of Microsoft standards, servers and devices. Back then, Microsoft still had many advantages that made it an obvious candidate to create an innovation platform and operating system for the grid. But the grid initiative had only a single lonely champion inside Microsoft, and he was unable to convince those higher up.
Instead, Cisco stepped into that role, and Microsoft’s technology is increasingly irrelevant. The Cisco home energy management platform uses Linux for its home energy controller and Cisco cloud services for its core applications. They talk to Cisco-certified devices over a Cisco-managed network running on Cisco routers and gear.
Microsoft hasn’t missed out entirely. True to its corporate strategy (Apple and Google -- Anything They Can Do, We Can Do Later), it has followed Google into the home energy presentment space. And it continues to sell servers and Windows to anyone who will buy them, utilities included.
But Microsoft’s position as a provider of old-school, back office technology is a far cry from the spot it could have occupied. Its products, standards and APIs could have been embedded into every part of the electric power value chain.
Twenty years ago, Microsoft relentlessly ridiculed IBM as a stultified has-been. Over the next two decades, Microsoft took on the worst of the old IBM’s faults. It gradually transformed itself into a smug bureaucracy that sneers even as more nimble rivals snatch away all the new stuff.
During that same time, IBM morphed into a fast-reacting leader in services and became one of the first Smart Grid pioneers. Meanwhile, Cisco grew into a genuine platform provider. Oracle built and bought a suite of utility and Smart Grid applications. And Google turned into the digital centerpiece of customers’ lives, even in energy.
Even after a rocket’s launch engines cut out, momentum allows it to climb for a while before dropping back. To reach escape velocity, it must kick in the boosters. The Smart Grid could have boosted Microsoft into a new market. Instead, Microsoft continues to rely on its legacy businesses to fuel growth.
How much is still left in that tank? Use the comment form to give your opinion
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