ActiveX: Microsoft's misfire

After more than a year of relentless hype and repositioning, Microsoft's (MSFT) ActiveX is standing still.

The term, once synonymous with the company's entire Internet campaign, is being relegated to the role of bit player--the victim of sloppy marketing, customer confusion, and aggressive tactics from Java-touting competitors. And, according to industry analysts and its own executives, Microsoft has only itself to blame.

The initiative's fate is a classic illustration of how quickly fortunes can rise and fall in the unforgiving business of high technology, even when its owner is the most powerful software company in the world. The plight of ActiveX has also served as a testament to the power of perception and how easily things can unravel when a company loses control over the image of its product.

"One of the things we have done poorly is the

naming and renaming [of this technology], and we have confused people," said Tod Nielsen, Microsoft's general manager of platform marketing and developer relations. "We are trying to fix a problem we created, and it will take us some time to do it."

In a key step toward controlling that damage, Microsoft has anointed another technology to take the place of ActiveX, at least in the eyes of a skeptical marketplace. Now, the new buzz word is "COM," for Component Object Model, the company's Lego-like blueprint for linking pieces of software and a crucial part of the company's high-margin server packages. (See related story)

"It is a conscious decision by Microsoft to talk more about COM and less about ActiveX," said Gregory Leake, a lead product manager for the company's Visual Studio development tool package. "There has been a lot of confusion in the marketplace. ActiveX has been more tied to controls, while COM is the foundation for ActiveX. ActiveX got distorted, in a sense."

The industry is littered with evidence of a major initiative gone awry. Microsoft's plan to drive adoption of ActiveX through an industry consortium, the Open Group, is all but dead. An Open Group offshoot established in late 1996, the Active Group, also has been virtually abandoned

'Ac•tive•X n  First used to describe all of Microsoft's component technology for the Internet, it is now used to refer only to the controls built to work with the COM model. The company came up with the ActiveX name in 1996 for its slimmed-down, Internet-ready controls used in client-side software and browser applications.

by Microsoft, which has established internal divisions to handle COM marketing instead. That effort came under fire by competitors for not making more of the underlying Windows architecture open to developers.

Aside from industry support and market perception, Microsoft also faced disturbing issues that cut to the heart of the technology itself: ActiveX failed to take hold with developers building wide-scale commercial applications, analysts say, because of security concerns and slow download times for its controls. (See related story)

Microsoft executives are quick to point out that ActiveX controls will survive, at least in name, to describe Microsoft-specific COM components used mostly for internal business applications on corporate intranets.

With the release of Windows NT 5.0, Microsoft's flagship operating system, and a raft of COM-based server technologies coming later this year, the company is putting all of its marketing muscle behind COM, Nielsen said.

He admitted that ActiveX has not been well understood by developers to date. "Our intent is to simplify the messages we have presented to the developer community," Nielsen added. "Some made sense; some did not."

Microsoft christened ActiveX in 1996 as the name for slimmed-down, Internet-ready controls used in client-side software and in Web browser-based applications. ActiveX controls grew out of Microsoft's Visual Basic development tool, which uses portable software controls called Visual Basic Extensions, or VBXs. The company reworked an existing specification for OLE (Object Linking and Embedding) controls, which were designed to work with COM, and launched ActiveX controls for building Internet and intranet applications.

Then, later that year, Microsoft "got overzealous with ActiveX," said Dave Kelly, vice president of research services at the Hurwitz Group. "When it branded everything with ActiveX, it was a somewhat hasty decision to use the name anywhere they could stick it. Now it's trying to stop the backlash from the Java crowd and make [ActiveX] less of a target."

ActiveX also drew direct comparisons to Java--much to Microsoft's dismay--as a means for building Web applications. But, because ActiveX is closely tied to the company's Windows applications, few commercial developers backed it for wide-scale Web systems. "On the Net, [ActiveX] has not seen significant widespread adoption," Neilsen noted. "It has limited reach, since it only runs on Windows machines."

Microsoft now says dynamic HTML and scripting are the best ways to build mass-distributed Web applications.

Along those lines, most developers and software makers also see ActiveX in a much more limited role. "I think most people are coming to realize that ActiveX is appropriate only for intranet applications," said Dennis Moore, vice president of the Apptivity Product Unit of Progress Software.

Nielsen said the plan to decommission ActiveX was hatched last fall in San Diego at a company-sponsored developer conference. Although the company never flatly stated its intent to give ActiveX the hook, the signs were everywhere: The technology was conspicuously absent from discussions involving top Microsoft executives, including CEO Bill Gates himself.

Behind the scenes, company brass questioned the wisdom of past marketing schemes. "In September, we thought about blowing away ActiveX and just calling it all COM," Nielsen said. "But there are 6,000 ActiveX developers out there, so we came to this decision [to downplay ActiveX]."

While the underlying COM technology remains largely unchanged, the company's marketing department is now working overtime to come up with new acronyms and packaging for a basic technology--Object Linking and Embedding--that has remained the same for years.

Microsoft is now moving on to its next marketing front: Windows DNA (Distributed interNet Applications), DNS (Digital Nervous System), and COM+, a new version of COM intended to make building COM applications easier and less time-consuming.

"The DNA push is an attempt to take a more architectural, and less hasty, view of what Microsoft is doing and to talk more about Microsoft technologies in a distributed world," Kelly said.

DNA is an applications architecture, according to Microsoft, intended to be more of a suggested method for building distributed applications. DNS is Gates's oft-mentioned, ill-defined analogy between the human nervous system and the electronic decision-making systems at large companies.

But DNA and DNS may just end up being additions to the alphabet soup that has signified past COM marketing efforts. "They have really struggled from a branding standpoint on ActiveX," said Dwight Davis, an analyst with Summit Strategies. "With DNA and DNS, they are going crazy with acronyms."

In the long run, the ActiveX debacle is unlikely to hurt the company, no matter how popular Java becomes, according to Davis. Simply because it is Microsoft, it has the unique advantage of being able to bungle its marketing message and still control the majority of the corporate developer market.

"Java will do relatively well," Davis said. "But don't for a minute think it will blow COM out of the water."  

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