Gates: Longhorn changed to make deadlines

Microsoft on Friday set late 2006 as the deadline for it to ship Longhorn, the next major version of Windows.

But to make that date, it had to delay the full implementation of WinFS, an ambitious file system geared toward letting users search through all of their files at once.

Whether Microsoft makes this latest deadline will likely be one of the dominant issues for the tech industry over the next two years. The operating system was originally expected in 2004, and many have predicted that further delays could dampen PC sales.

Meanwhile, the growing popularity of Linux has begun to nibble at Microsoft's dominance on the desktop, while Google has emerged as a major competitor on the Internet. Will Longhorn be dazzling enough to undercut these trends? The fate of the industry hangs in the balance.

Microsoft Chairman Bill Gates spoke exclusively with CNET News.com on Friday about how Microsoft handles deadlines and new opportunities.

Q: Can you give us a summary of what happened with Longhorn?
A: Windows is the most widely used piece of software in the world, and therefore, the diversity of things people do with it and the benefits to improving it are greater than certainly any piece of software that's ever been done. And we reflect that by having huge R&D investment in Windows.

The PDC (Professional Developers Conference) last year was where we really talked about the vision of Longhorn and all the different pieces. Of course, we had the SP2 work, which, because it was security-focused, we gave the highest priority to. We had the releases we'd always had planned, the Media (a new version of Windows XP Media Center) and Tablet.

And then, Jim (Allchin) and a guy who works for Jim, Brian Valentine, went through with everybody, and asked "OK, where are we? What's the feedback that we've gotten from ISVs (independent software vendors) and people?" And we went through this replanning process that has come out with the plan we're announcing today.

This is the first time we've actually given a date for when we'll ship the Longhorn operating system. It's always risky in a software project, especially one where the compatibility requirements and the scope of the features of what we deliver in versions of Windows are incredibly broad, but we've made enough progress. We've got enough methodology in place that we decided that was the right thing to do.

What are the changes?
We are, as you heard, taking one of the major pillars of Longhorn and changing how we deliver that. Actually, there are changes in all the pillars, but in the case of Indigo and Avalon, it's mainly the addition of the down-level support. All XP users, not just Longhorn users, will be able to download the software. It's not a tiny download, but it's the kind of download that is not unreasonable in today's world.

The plan we have does give up WinFS shipping with Longhorn. And so if you want my basic assessment here, the glass is three-quarters full.

WinFS is where we made the biggest change. We realized that we could do a lot of rich search capabilities in the OS without the full database, taking some of our text technology that's been used by Office, and actually, MSN is doing some nearer-term local-search things, building on that same technology.

Anyway, we decided that we could integrate that and get a lot of the navigational benefits, and that the really deep benefits have to do with database style system unification--bringing the SQL language and all of the XML access stuff together. We were only doing a pretty modest amount of that under the WinFS that was going to ship in the operating system.

And we never had, in the Longhorn plan, WinFS server support. We were clear about that going back all the way to the PDC.

So now, we're doing the search stuff in Longhorn '06, and then we're releasing WinFS off-cycle as a development platform and as sort of an information management shell synchronized with a release of the database server as well.

What's the reaction from the PC makers?
Certainly, we've been in discussions with key partners, both on the ISV side and with companies like Intel and Hewlett-Packard.

Every constituency sees a Windows release through the particular things of interest to it, which are different. So Intel wants great chip support, ultrawideband support, WiMax support, different power-throttling capabilities, multicore--things like that. Anyway, we've been through the plan with them, and this plan is very good in the sense that they're glad to see Longhorn coming into focus, they're glad to see the commitment to the date, and the hardware kind of supports things that they want are in their plans.

What is really causing sort of the rewrite on Longhorn? Is it these sort of demands from the partners, is it the technological difficulties of the project, or is it even personnel and execution issues at Microsoft?
There's no rewrite going on here. WinFS, I'd be the first to say, is very ambitious. Nobody has ever brought together the world of documents, media and structured information in giving you one simple set of verbs that lets you richly find, move around and replicate those things.

Ever since about 15 months ago, when we moved Peter Spiro of our database group to take charge of WinFS, we've made very good progress. What happened here is, as we looked at the new things we wanted to add to WinFS, that would have only been consistent with an '07 schedule--adding the tabular stuff and figuring out a server plan.

So we definitely were faced with a decision that Jim, Peter, Steve (Ballmer) and I were having a lot of dialogue over these last couple of weeks. What was the right thing? Was it to take Longhorn as a whole and get these super-cool additional WinFS features in, knowing that that would push the release out into '07, or was it to come up with a plan that was a bit more clever and really not give up much?

The plan we have does give up WinFS shipping with Longhorn. And so if you want my basic assessment here, the glass is three-quarters full.

The WinFS team, in terms of its progress and performance, is doing very, very good work, but it couldn't take the additional features and make an '06 schedule. That's professional engineering on its part, to stand up and say, "No, if you want us to have those features, we're an '07 deliverable."

It seems as if software is taking longer to bring to market. SP2 kind of grew in scope. Things like Yukon and Whidbey have taken more time. Has software just gotten more complicated to write? What, if anything, does Microsoft need to do as a company to reflect that reality?
Our scheduling and predictability on this project has been better than it was on OS 360 (the mainframe operating system created by IBM). So software has not gotten more complex. Software with this kind of scope of features and compatibility has always been complex. That's the business we're in.

Software has not gotten more complex. Software with this kind of scope of features and compatibility has always been complex. That's the business we're in.

The ongoing dialogue we always have with our customers, ISVs and OEMs (original equipment manufacturers) is always one of two kinds. One is (that) we have a date-driven release. Things that make that date get in. For MSN, most of what it does is date-driven releases. It does very regular releases because of the nature of its market, and it doesn't have the compatibility challenge.

With the operating system, customers want releases to be on the order of, I'd say, two to three years. Hardware exploitation, media, security and wireless expectations mean that you've got to have that release. But it's enough of a challenge, in terms of deployment, testing and other things, that you wouldn't want two major operating-system releases in less than (a) two-year period.

When you've spoken about Longhorn in the past, everyone has kind of talked about it as a big bet. With the change, is Longhorn still a big bet, and is Microsoft as a company still really making those kinds of big bets?
Longhorn is a huge bet, and it brings with it the move more and more to use the .Net managed code. And that's not an overnight thing. We started that before Longhorn, and there's more we're doing after Longhorn, but I think you'll always see Longhorn as the milestone in terms of the mainstream--mainstream acceptance of managed code on the client.

We're pretty unique in what we're doing. The normal kind of thing people talk about in terms of search--we will have that stuff in Longhorn '06. But the big breakthrough, where you get those things brought together, will ship first off-cycle but then come back around and be built into the next OS release.

How do you feel about morale right now at Microsoft, and what do you think this will do? Is Microsoft at a point right now where you think it has to be shaken up and motivated?
I wouldn't say that. People love having the plan laid out in front of them, and the WinFS group, which is taking on these new features and shipping in a different form--I wanted to make sure that it understood why we are doing these things. It's enthused about these things.

I think the most interesting software development--there's a lot more interesting software development than people realize--will still be done by and large here in the United States.

Some things here are cases where there is a clear competitor. If you take our guys who are competing with Google, they understand exactly what they're measured against and how everybody thinks Google walks on water, and they've got to surprise the world.

Then we have other groups, like WinFS, where we're way out in front, and there's nobody to compare ourselves to. Making sure that they see how we're committed to the vision and how we're going to support it and the way we use it with our other products--that's important. I think we're doing a pretty good job of that. I'm talking with the WinFS group next week, and I'll hear what their questions are and make sure that there isn't any doubt about our excitement and commitment.

When it comes to offshoring, what kinds of opportunities are there for you guys in developing OS software? Are there opportunities to do more than just kind of the testing and ancillary work that's being done now?
In terms of our development, we're kind of an interesting mix. We do most of our development here in Redmond. We see that as very efficient for us and not something that will change.

We're also global and have been for a long time. We've got the research lab in Beijing, we've got a development center in India, we've got a smaller group in Israel. Our Business Solutions guys have a big thing in Copenhagen, Denmark, and our Xbox game guys have a big lab in the United Kingdom. We're all over the place, but our big center of gravity, which lets us really do integrated innovation and redraw the boundaries when they need to be done, is here.

I made a tour of college campuses last spring to talk about how computer science jobs are exciting, important jobs and how and lots of them are ones that smart people should aim for. I think the most interesting software development--there's a lot more interesting software development than people realize--will still be done by and large here in the United States.

Now, as you get into things like call centers and stuff like that, I'm not an expert about some of those other activities. I can tell you what Microsoft's up to.

Anyway, none of that has anything to do with Longhorn. Longhorn, you know, is like everything: mostly developed here in Redmond. Some pieces are contributed to by our various research groups and development groups, but the heavy, heavy balance of work is done here.

Finally, you've talked about music in particular as something that Microsoft probably has to do. What, if any opportunities, do you see for Microsoft in the music business? (Microsoft is expected to launch a music download service next week.)
In terms of the music, we'll have some milestones to talk about what we're doing. The simple fact is that we believe in both advertising revenues and e-commerce revenues. And so as you get people online comfortable with spending money, whether it's on music or avatars or the right to send SMS (Short Message System) messages out to their friends who are on the phone, there will be a few--there will be companies that get to critical mass in terms of having those customer relationships and doing e-commerce.

We wouldn't do any one isolated category of sort of online digital buying by itself, because we believe in having essentially a digital payment system at critical mass that works in all the countries. We're investing in the platform to do that, and at some point, we'll apply that to things like music, and so it's part of a broader strategy.

I think that if you asked Yahoo, it'd also say advertising and transaction and subscription revenue--all three of those things are important pillars.