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Comment by WisNorCan | Hacker News Reader

It's probably a good thing that Microsoft did not follow the advice:

> They can't hire smart people anymore, but they could buy as many as they wanted.

> Buy all the good "Web 2.0" startups. They could get substantially all of them for less than they'd have to pay for Facebook.

> Put them all in a building in Silicon Valley, surrounded by lead shielding to protect them from any contact with Redmond.

Instead, Microsoft did the exact opposite. They picked Satya Nadella who had worked there since 1992. He has driven the innovation right out of Redmond, WA with no lead shielding required.

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This highlights the magical thinking we can suffer from in Silicon Valley where we believe we’re inherently better at solving problems here. It sounds like what Paul was saying is good ideas can no longer come from Redmond and the best they can do is buy a chunk of Silicon Valley and hope to ride on whatever success that nets them.

Agree. Two of three largest companies in the world are now in the Seattle area with both Microsoft (#1) and Amazon (#3) thriving. Apple (#2), Google (#4) and Facebook (#5) are in the Bay Area.

I don't know about Apple but Facebook and Google have pretty big offices in Seattle as well, along with many other startups (Uber, Airbnb, Stripe, etc.)

It seems the play these days is to have the best of both worlds.

Companies at that level generally have offices in big cities all over the world. In Toronto we have Airbnb, Uber, Google, etc offices for example. I think the important thing in this context is where the HQ is.

And Microsoft and Amazon both have big offices in Silicon Valley. Bing is (was? it looks like the site is now under reconstruction) based out of their Mountain View complex that's almost literally across the street from the Googleplex, while A9 (Amazon's search subsidiary) has a big office in Palo Alto.

This is almost entirely not true.

Under Satya, Microsoft went on a shopping spree. They bought a ton of startups: Minecraft, Github, Skype, Sunrise, LinkedIn (tnx comments!), Yammer ... and along with those it bought a mapping company, a multitude of ad/marketing companies, educational startups, AI startups...etc, etc. Those are just the ones we know about.

Update: here's a list of all MS acquisitions. It's rather lengthly. https://en.wikipedia.org/wiki/List_of_mergers_and_acquisitio...

Did you know they almost bought Twitch.tv, but Amazon had more money?

And as far as locking them in the same building, that's not exactly operationally efficient in 2018. But they seemed to have done their best at either merging the products right away, or letting the team run on their own.

So, they did pretty well, according to the plan.

Not to mention LinkedIn :)

Microsoft acquired Skype in 2011, before the 2014 Ballmer/Nadella change-over. Also, Minecraft isn't exactly a start-up, but more of a celebrity among gaming projects, ranking closer to an endorsement/sponsorship deal.

Hmm...

1) Skype was purchased by Ballmer.

2) Most of the ad tech companies were also purchased by Ballmer.

3) Minecraft and Skype are not Bay Area companies

4) LinkedIn was a public company when Microsoft acquired them. So it seems like a stretch to call them a startup.

5) And finally it looks like Microsoft has done acquisitions throughout their existence. In fact, they acquired as many companies in 2007 as they did in 2018 and more in 2007 than 2017.

https://en.wikipedia.org/wiki/List_of_mergers_and_acquisitio...

It doesn't seem like "buy lots of Bay Area Web 2.0 companies to infuse new talent" is the secret ingredient. Yahoo was the company that probably closest executed the strategy. That didn't go well as we all know.

The other key part of that idea is the “lead shield” from the dinosaur parent company, and we know from many accounts that being integrated into the Yahoo culture is what killed their acquisitions.

Man, I worked at aQuantive when it got bought for $6B by Ballmer. They took a $6B write down within a few years. They should have kept their money in the services part of that business instead of the second-rate ad tech.

It sounded like Paul wanted them to become a second Oracle.

And look where ORCL is in relation to M$FT.

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