Burning the Ships: Intellectual Property and the Transformation of Microsoft

Introduction

Why should anyone care what happens at Microsoft? This was the first question my coauthor David Kline and I asked ourselves when we sat down to consider writing this book in the summer of 2007. Thankfully, among all the questions that we would face over the next year and a half, this one was the easiest to answer.

New technology, after all, is the beating heart of innovation and global economic growth. So when arguably the most powerful technology company on earth engineers a radical 180-degree change in its business strategy and practices—abandoning its single-minded strategy of go-it-alone market conquest in favor of industry collaboration, and opening up its vast technological treasure chest to other companies and individuals—it's hardly surprising that this transformation should have effects far beyond the company itself.

Although Microsoft employs only 95,000 people directly, its influence stretches much deeper into the global economy. Nearly half of the 35 million people employed in the worldwide information technology (IT) sector depend upon Microsoft software or related services for their jobs. This includes 42 percent of information technology employment in the United States, 47 percent of Irish IT employment, and 44 percent of IT employment in Malaysia. And for every dollar of revenue that Microsoft earns, other companies in the global Microsoft "ecosystem" generate $7.79 for themselves. In 2007, in fact, they earned a staggering $400 billion from Microsoft-related ...