Best Deal of 2007: Microsoft-Facebook?

Much has been written on the terms of the deal between Microsoft and Facebook. The gist of it is this: Microsoft paid Facebook $240M for 1.6% of the company, and the exclusive rights to sell online advertising for the site.

This being the year-end, all pundit types have got their best and worst lists coming out, and this deal seems omnipresent on worst deals of the year lists.

Its not hard to see why this argument is made: "worst" is really a proxy for "stupidly lopsided value creation", and is Facebook remotely worth that much (remember that MySpace went for $500M and YouTube for $1.6B)? It creates an implied valuation on their user base (figure 50M users or so) of, like, $300 a head... that's some big math... hard to see how Microsoft ever really recoups its investment.

But of course, that's to focus on the value with regard to public markets and value cap - the *wrong* metric here. That implied valuation of $15B, is pretty much (forgive my language) bull$#!t because this deal was, in reality, a barter deal.

Let's look at the deal another way, very simply, in terms of cash:

1) Facebook gets a $240M cash infusion while giving up very little control or equity,
2) Microsoft gets a significant destination outside its network in which to build the value of its recent, very large acquistion of aQuantive (4% of the $6B that's already "sunk"),
3) Microsoft has to generate incremental ARPU of only $5 a user *in total* to break even,
4) Facebook is valued at $15B, which means...
5) Facebook is either (depending on where you think this ends): (a) off the market for some time at that price (so no Google, Yahoo, et al spoilers), or (b) tied to Microsoft and hardening/creating value in their online ad platform

Win, win, win, win, win - at least for Microsoft and Facebook: you know, the parties actually doing the deal?

Isn't that the definition of "best"? Lopsided value creation for *both* sides?

Any "investment" dollar$ back from the deal is pure upside for Microsoft. That means that they, more or less, let Facebook fill in the denominator: $240M of $XX - Microsoft doesn''t/didn't *really* care what that number was...

I don't know about you, but it leaves me with a funny taste in my mouth... is this the "revenue exchange" program of the new bubble - a variation of the old: "I'll buy from you if you buy from me and both our revenues go up, but we're not spending any money trick?"

Dunno - but it also smells suspiciously similar to another "equity for exclusivity" deal...

ES4: The Javascript 2.0 Blaze

Updated: Now on Slashdot.

A bit of a flame war going on in the ECMAScript working group (which spices up an otherwise reasonably boring mailing list).

This blog post (from Mozilla Foundation CTO and Javascript creator Brendan Eich) is really only tip of the iceberg - you should follow some of the links from his post, or check out the mailing list archive.

Javascript 2.0, or more formally ECMAScript Edition 4 (or simply ES4) has been in the works for a good, oh.... 8 years now. With the ES4-in-motion work from Adobe (nee Macromedia) in the form of ActionScript 3 (AS3), and the rise of Firefox, Safari, et al. its been getting a serious push to completion over the last year and a half, especially in the face of Microsoft's C#, Silverlight, and (though no one said it directly), I think even Adobe's Flex and AIR.

The battlelines are pretty clearly drawn, with Microsoft and Yahoo on one side, and the Mozilla team, Opera, Adobe (interesting, eh? "Enemy of my Enemy" anyone?), and oh, pretty much everybody else on the other side. Or, as you might first opine from that cast, Evil v. Good.

MS and Yahoo think the language is changing too much, whilst the others think that it needs to in order to be competitive for the larger scale programming projects the web is increasingly requiring.

My opinion? As is usually the case, they're both right - you only have to look at the Flash community's response to ActionScript 3 .

In short: They like it - a lot, but its very different than AS2 development.

And, oh, from an implementor's perspective, AVM1 and AVM2 (which, roughly, correspond to ES3/AS2 and ES4/AS3) are two completely different VMs. Is it possible to make one that does both? Sure... but there's no denying ES4 requires *substantially* more effort and complexity to implement (note I'm *not* making an argument about code size here....)

An so, in a deliciously Shakespearean turn, Doug Crockford of Microsoft of Yahoo asserts (correctly I think) that the issue is fundamentally one of nomenclature.

Of marketing.

If its not called Javascript, would anyone use it? And if it is, how similar should it be?

Quite frankly, Brendan's probably right in that, whatever justifications the opposition might even believe, there is a bias to keep Javascript "ghetto-ized" to a degree - because of existing investments and strategy considerations.

That doesn't, however, make it wrong to push in that direction.

Personally, I do wish there were less emphasis on the "compiler/VM" split that Java brought into vogue - it seems to be at the the heart of a lot of the design decisions that make AS3 and ES4 feel less "Javascript-y" to me.... but that's both good and bad - ECMAScript 3 is forgiving of errors well past the point of stupidity.

And so, lightweight stuff really is harder, but its also a lot easier to write stuff well...

Vista: 1 year later

Ok, it hasn't really been a year - the Vista launch was "officially" January 30, for consumers, with the actual release tepidly launching 60 days earliers to businesses and developers on November 30.

But its interesting to note the contrast betwixt Vista's reception and Halo 3 (which just launched September 25).

I don't think there's anything wrong, per se, with Vista (other than the ridiculously massive gap between it and the last major OS release from Microsoft) - and there's much to recommend - but, it reaffirms for me that OS'es increasingly won't matter. Note that although Vista projections are down from MS, XP projections are up - the message seemingly that one's just as good as the other.

I don't mean that snidely - as computing has moved from novelty to utility, consumer interest will be be driven by experience, not capability. That is, "What have you done for me lately?", not "What could you do for me lately?" - which explains Halo's, um, halo.

Natural enough, but it probably has some significant implications in how Microsoft will/should think about the future of its platform... generating infrastructure that creates platform lock-in will be increasingly difficult.

Not Steve Jobs

I've been reading the "Fake Steve Jobs" blog for a while... but today's entry (concerning Microsoft's Surface computing device - yes, I'll be buying one) was frikkin' priceless...

An excerpt:
"And what is up with all these stories like this one where the writer gushes about how you can just squeeze photos to make them smaller or stretch them to make them bigger. Golly, can you believe it? Well, yeah, I can, since I introduced this several months ago and I'm going to be shipping a real product that employs this technique in only a few weeks.

This Surface thing is such classic Gates. He copies our idea, but in a frigtarded, impractical way..."

Funny.

Microsoft's good at this...

I'd love to see Microsoft's "best practices" guide on the platform effect - they're good at it (generally). Like the developer entanglement Adobe's attempting with their eco-system, hard to argue that 4 gigs of Silverlight storage and streaming is bad for developers... just check out the community response (from a self proclaimed Adobe "Flex Machine", no less).

Though, these days, this seems more like a Google tactic than a Microsoft one... what does that tell you?

MIX '07 and Ray Ozzie

Ray Ozzie, Chief Software Architect of Microsoft (along with Scott Guthrie, General Manager of the tools group) presented the keynote at MIX '07, 2nd annual Microsoft's Web UI and development conference

The core tenet of Ray's argument is that client side computing is vital to delivering rich experiences. I think he made that case well (and I agree with the rationale), but Ray didn't really address how or why Silverlight specifically and WPF generally was better than browser + DHTML/SVG/Flash/Java, or whatever, in terms of ANY richer function and/or end user benefit.

Specifically, the undertone of the arguments, from both Microsoft and Adobe, is that a single sourced runtime is better for the developer - more consistency across a wider variety of platforms (browsers, OS'es, devices, etc.). And, as a practical matter, its hard to disagree with that - and there's enough that's "open sourced" by the vendors to reduce impedence in the development chain.

Speaking of which (and not to be overlooked), the development chain that Microsoft is putting together is nothing short of phenomenal. If there's a "secret sauce" in Windows continued dominance in the Enterprise (and thus, everywhere else) its through the tools, class libraries, etc.; they continue to define the cutting edge of developer productivity. Perhaps somewhat counter-intuitively, it seems particularly well designed for small teams and becomes an easy way to develop prototypes, and, in turn, go from prototype to production.

Platform success, which I'll define as self-sustaining propagation and increasing barrier to exit, is definitely AADD (All About the Developers, Dummy).

There was also a Michael Arrington interview with Ray and Scott, which might as well have been conducted by a Microsoft employee. What few interesting questions were asked went basically unanswered, and at least that way there would have been less mumbling.

MIX '07 (and Silverlight)

I'm at MIX '07 in Las Vegas. Come find me if you're there (here).

Also, I should note (based on surprisingly copious amounts of e-mail I received) that I didn't comment on Microsoft's "announcement" of Silverlight at NAB because, well, there's no there there. Silverlight is the new name for what used to be called WPF/e - and the news at NAB was just that: a name change.

The actual technology available was the same February Community Technology Preview that had been available for months. I expect that will change this week, but I was impressed with the vortex of press MS was able to create for their naming ceremony :)

As an aside BubbleMark presents a very simple, very basic, and very artificial performance test (that is, I think the results are STRONGLY un-correlatable to any real world application), but its fun to look at the code for each version.

Updated: Yep - here's the new "1.1" Silverlight build, which includes the cross-platform mini CLR (essentially dot NET lite for Windows and OS X). The distribution size went from 1.1MB to 4.2MB (just a developer build - so no judgement yet). It will be interesting to see what the final size is once Silverlight approaches functional usefulness (its not there yet).

Adobe Flex Open Sourced

Adobe announced today that they're open sourcing the Flex SDK (which includes the compiler, debugger, and Flex ActionScript libraries). It shouldn't come as too big a surprise, considering the recent MPL release of their ActionScript 3 VM to the Mozilla Foundation, Tamarin.

The model, as with Postscript, and, quite frankly, Windows, is the "Platform Effect" - monetizing both the runtime (Postscript/Windows/Flash) and providing rich(er) enterprise level authoring tools and functions (Authoring tools, servers, etc.). Releasing the specifications and "core" tools creates the illusion of freedom in tool chain, while actually delivering vendor lock-in - which isn't necessarily a bad thing for developers if (a) there's runtime ubiquity, and (b) the developer's not on the hook for distribution costs.

And getting developer buy-in (lock-in?) creates a "virtuous cycle" of scale for the platform provider... ultimately why API and specification ownership is so critical in the technology business cycle.

Although I think Adobe's Apollo (which is Flex driven) is still slightly off in its execution of product distribution, overall the company is doing a good job driving a giant truck over the ongoing bungling that is WPF (I mean... Silverlight).

And (naturally) this will impact (squeeze out) smaller players like Laszlo, Haxe, and mtasc more than affect the big players...

Hah.

Guess I wasn't the only one who found the Microsoft ads borderline scam-alicious..... except, minus the "borderline": Microsoft Sued Over Vista Marketing

Scam I am: Microsoft Vista Advertising

My favorite all-time scam: Guy promises to get you into the college of your choice for $5000 - Money back guarantee... if you don't get it, you don't pay.

The scam? The guy does nothing. People who aren't on the edge of making it anyway won't sign up for this... and some percentage of those who do, will get in - on their own. Those that don't, get their money back... and the rest are happy not knowing any details.

Which brings me to today's topic :)

Now... I like Vista. As I've mentioned, its gots its quirks, but is absolutely a great upgrade from XP... But the ads for Vista (and the "Wow starts now" campaign") are just incredibly wrong headed, if not a borderline scam.

Take, for instance, this ad from Microsoft:


Its not that, subjectively, Windows Vista is nicer, but not a "wow" upgrade... (true, but you knows, its an ad, not the truth :)). No, what, um, boggles me is that, as far as I can tell, *all* of the ads centrally showcase a feature (the "3d flip") that not only will the average user NEVER encounter using the product, and never even figure out how to activate should they so choose - its a feature that tested poorly enough in usability that it was, effectively, relegated to a hidden key-combo for demo-ware only usage....

The "wow, really?" starts now.

High Frikkin' Larious

I mentioned this about Vista the other day, but Apple already got the joke.

And decided to share :)

Ouch.

Bill Gates and my bathroom

Update 1: I've been informed (by my wife) that, um, shoving a whole chicken in the garbage disposal is NOT a good idea. Go figure.

Update 2: Bwa-ha-ha - my diabolical plan (humour-by- association) appears to be working (You're welcome Carl!). We now return you to your (ir)regularly scheduled post.

What the heck do they make garbage disposals from? Those things are nigh indestructible. I shoved pretty much a whole (leftover) chicken down my sink last night, along with various other food-ish substances, and that thing just kept chugging along.

And that was just last night. I wonder if that's what all the people who used to make samurai swords are doing now...

And speaking of funny (see what I did just there?), if you're not reading Scott Adams' blog, you should. Much has been made of Bill Gates' prognistications in SciAm last month, about robots and home automation, but I thoroughly enjoyed Scott's take. He puts pretty much the same concepts into more, um, relatable territory: the bathroom.

Scott Adams, of course, is the author of Dilbert, but his blog (and especially his book, the Religion War) are to Dilbert as Office Space is to Beavis and Butthead - all they share is the author (Mike Judge in the latter case) and a skewed world view. I enjoy all four, but in very different ways.

Plus, I'm just hoping you'll think *I'm* funnier when you read Scott's blog; humour-by-association, or something.

And (ironically for this post), Scott Adams is also a (serious) proponent of the Bill-Gates-for-President movement. Its a strangely compelling argument: "For my president I want a mixture of Mother Teresa, Carl Sagan, Warren Buffet, and Darth Vader."

Indeed.

Just keep him away from my toilet...

December WPF/E CTP: First Impressions

Updated: Some more details about WPFE and texture sampling issues.

So.... not bad.

I've been playing with the Microsoft WPF/E CTP a little over the last week-ish (its a slow time of year), and I thought I'd post some early thoughts. These are mostly a ramble - no particular point that I'm making, and it might not be entirely coherent.

Rendering
Appears to be a pure software rendering pipe (that is, there appears to be no Hardware acceleration in this CTP). Good antialiasing quality - appears to 4X oversampled in the y-direction and analytical in the X. As with GDI plus, I think they botched the texture sampling rules. Its a little better than GDI plus was, but still wrong (IMHO) for resolution independent UI - which of course, is a big part of the goal. Macromedia got this right (at least, starting with Flash 8). Although its a software rendering pipeline, it also looks like WPE/E employs a front-to-back display (or some form of overdraw prevention, at least), and performance is pretty decent - though I haven't stress tested complex shapes or the like yet (Updated: I tried, and failed, to load the simplest benchmark - must be a point limit, though I couldn't find any documentation/info on that).

And no 3D support.

Interactivity
No controls (buttons, menus, text edits, etc.) are present in this CTP - you get events, and you get shapes and images (textures), so... hard to say much about this yet. Startup time for the WPF/E plug-in appears good - the header of theWPFblog (appropriately) is WPF/E, for example, and loads nicely/quickly - WAAAAAY better than .NET 3.0/XBAP (e.g. try this sample).

Still, I think the packaging streaming model, although goofy in Flash, makes it much easier for developers to explicitly control and manage assets loading. It will be interesting to see how important this becomes in the real world for building larger scale applications - I think Microsoft is at major experience deficit in this one key area.

Animation is a bit odd still, and the property/element "." syntax rules still throw me a bit...

Samples/SDK
Documentation and SDK - really nice.
Samples? Laaaaaame.
Pretty much most of them could have been built trivially in Flash, or even DHTML. Even the Page-turn example is mostly about clever content (for example, the shading is a part of the ARTWORK). Not one example shows the expressiveness potential of the runtime. Most of these HTML samples are more inspirational. I realize this is just the first CTP - but *ONE* killer sample would have been nice.

Overall
The language is nice and expressive - its pretty easy to get started and build "rich" interactive content. If you're starting from scratch, much easier than Flash, Flex, or DHTML even. The browser integration and support for multiple platform (browser and OS) right out of the gate is a good move. CLR integration (and the release of the mini-CLR) is the big "FUD" thing we're all waiting for, I think. The code-behind model really leverages the excellent "first class" host DOM integration. Plug-in size and updating may be an issue, but its early enough that I'll reserve judgment on that. Currently, the IE control is 1.1 MB - the other variants (browser and OS) are quite a bit bigger.

All in all... a decent first CTP - looking forward to more... and some clearing up of the massive general confusion about how WPF, .NET 3.0, XBAP and WPF/E are supposed to fit. Everything I've seen so far seems to be after-the-fact rationalizing of internal competition and overlap.

WPF/E CTP now available

The application runtime arms race is off.

Adobe's Apollo is due early next year, as is a more functional (read: useful) XULRunner from the Mozilla foundation. But first out of the gates is Microsoft with their cross platform web content runtime framework: you can now try out WPF/E. Read more here.

At least from a "promise" perspective, WPF/E more squarely what Avalon - now WPF in Vista - or even ChromeEffects (for you old-timers) was going to offer, but, significantly, this is cross-platform from the get-go. The "E" is for "Everywhere". And just to prove it, the CTP is available for Windows and Mac OS X (well, Safari on OS X anyway).

I'll post some thoughts later this week after playing with it. As I've mentioned before, the evolution is towards general purpose computing technologies to make rich application distribution instantly ubiquitous. There are some significant and interesting technology choices that imply certain classes of applications and uses... more on this in the future. Confusingly, WPF will ALSO run in your browser and enable web applications but only on Windows, and its, uh, somehow different than WPF/E, and, uh, richer (?) somehow... though neither is a subset of the other... yeeeeahhh.... quick over there! Linux is eating your IP!!!! .....

Of course, still an open question is what "rich" really means and if people really care at all ... :)

My (biased) guess is that it does, but our current generation of applications and infrastructure (not to mention imagination) just isn't there yet. After the fact, I think we'll go "of course!" (iPod anyone?)

(and oh, btw, this was the idea with Boxely and the OCP, too, but... cie la vie :))

Vista v1, Office 2007, anda preview of Vista v2 UI - lucky us!

Vista launches today, and so does (officially at least) the new version of MS Office. I have to say, from all appearances, the UI changes for Office look to be a gutsy, necessary, and successful revamp for the Office franchise. I often say "you can't lead by following..." (which is dumb, but you know what I mean :)) - and I have to hand it to Microsoft; the changes don't feel arbitrary (for the most part) and at a minimum have created the kind of buzz for Office we haven't seen in probably nearly a decade.

Again, sounds dumb to say, but change doesn't mean "well really kind of the same"... so, kudos - to both Vista and Office launching (well, sorta), on the same day no less. Both products genuinely are a major achievement that balance familiarity with forward movement pretty well. I don't love the real estate compromise(s), but I'll get over it - it does bring forward a LOT I didn't tend to remember to use in the Office Suite.

Interesting in all of this is MS's attempt to proactively control the IP surrounding the product's "look and feel" with their Office UI licensing program - I particularly like how they're willing to "share their invesment". Thanks guys! (*cough* zune *cough*)

I also particularly like the last answer in this interview with the PM for MS Office:

"A: Historically, most of the more substantial UI breakthroughs have happened in Office and later moved to Windows. We continue to talk to the Windows team about what aspects (of the new Office UI) would make sense for them."

That guy MUST have read How to Win Friends and Influence People :P
(kidding! - we knew what he meant... at least, I'm sure the Window team does :D)

Vista Week

Updated: Yeah. What he said.

Microsoft officially launches Vista to businesses Novemeber 30 (Thursday). Pretty big news, considering the length of time since it was first previewed and number of reboots of what Vista is (heh :)). Its been 5(ish) years since the last major OS upgrade from Microsoft and though I think this will be a better upgrade than the technogeeks expect, there's no way it will live up to the hype.

Bottom line: its way overdue, so its going to be hard to be impressed.

That's OK though, in the scheme of things, but... can someone tell me what "release to businesses" means exactly? From what I can tell, there'll be nothing at retail; I guess people (IT folk that is) will be expected to download it from MSDN?

Its a shame - this OS launch strategy is really turning the Vista release into a limp whimper. Perhaps that's on purpose (worred about negative press?), but I don't think so - I think Microsoft is schizophrenic about what to do now (big-picture), and its coloring what, warts and all, ought to be a major event for them.