Can Microsoft catch the teen spirit?

That's the task handed to Tammy Savage, head of a new Microsoft unit targeting the teens and young adults who grew up on the Internet. A beta of the group's first product is due next week.

8 min read
How does Microsoft spell hip? N-E-T-G-E-N.

About 18 months ago, the software titan set Tammy Savage to the task of creating a new software division that would develop software for the group of teenagers and young adults that grew up using the Internet.

Right away, 33-year-old Savage, who is general manager for Microsoft's NetGen division, realized this group, ranging in age between 13 and 24, used radically different means of socializing, finding information or even buying and selling goods than any other generation before it. They met friends online in chat rooms as easily as local malls or scoured eBay for hot deals rather than hitting the thrift store or discount store down the block.

Savage and her team of 12 recent college graduates set out to understand their social habits and how technology and the Internet had become a part of their lifestyle. The group plans to release a beta, or testing version, of its first product, Threedegrees, sometime next week. The new product, an instant messenger for creating and interacting with social groups, will be the first test of Microsoft's understanding of NetGeners. Features include instant messaging for entire groups of up to 10 people; Winks, animation that can be sent to the entire group; Musicmix, for listening to music from a common source; and photo sharing, among others. If successful, Threedegrees could radically change how Microsoft develops software for the Net Generation.

CNET News.com spoke with Savage about the NetGen group and the development of Threedegrees.

How long has the NetGen group been around at Microsoft?
The kids that are working for me have been working for me for about 18 months. They all started in the summer, right after graduation. But I've been on this project for about the last three years in a variety of forms. About 18 months ago, we started getting concrete about the products we're going to build and getting into the 'we're going to build and ship a product' phase.

How many people in your group?
There's a dozen.

You're getting ready to release Threedegrees. Will this be the first of many products from your division?
It's definitely a starting point for us...There are obvious ways we can build on it, and that's just a start.

Why this product?
The thinking behind the product is based on our understanding of what this customer is. Basically our belief is that this customer wants to socialize instead of communicate. They want to do things together and get things done--and they really want to meet new people. We really wanted to have a different set of skills that would allow them to meet new people online in a way I, for instance, cannot. They have a way of vouching for each other as friends, figuring out who to trust and not trust. I think that once you break their trust, it's almost impossible to get it back.

One of the things that is really new about this project is the customer that we're targeting.

Those things, because they grew up with the Internet, allow them to meet new people in a way that people who didn't grow up with the Internet can't. Those are the experiences those customers want. In order to make that happen, you have to have a platform where groups can form, and the people that you care about are at the center of the activities. What we believe is the most important thing in people's lives are their relationships, the people that they care about. The computing experience should reflect that. People should be at the heart of the computing experience versus the other way around. That's really the way the Internet works to do the activities, the things you want to get done. That's the focus.

What age group do you expect to use Threedegrees?
We say the NetGen target age is 13 to 24. But I think you'll see the product will have broad applicability. At least for people who use instant messaging, I think you're going to see they're interested, too.

Why the name Threedegrees? It reminds me of Microsoft's enterprise ad campaign about one degree of separation.
It's actually a play on six degrees of separation. You're closer than you think. Our team is really small and really scrappy. We didn't go out and spend $1 million on branding. We basically sat around one day and said, "Why is this meaningful to us?" And that's why it's meaningful to us. It's a beta. It's the team's answer, and so that's what we're going out with.

How different is the approach to developing Threedegrees versus other Microsoft products, and how might that approach permeate into other future products?
We spent a lot of time up front understanding the customer. Then we moved to prototyping. We eventually got to the stage where we actually got to the technology. But figuring out how to build the technology was the last thing we did. There are challenges with that. What it did for us was give us a clear focus on what the customer wants, what those end-user experiences (are) and then what is technically possible and what's not technically possible right now. Does that make sense?

Because it does, I have to ask the question again. Historically, it seems that technology has been developed for the sake of technology and then is put on the market with the expectation people will buy it.
Across the industry I think there are lots of examples of that. But there are examples of products that started from a customer perspective. I am laser clear about this product. It started with the customer. Every decision we make is about the customer. The reason we're getting to the beta now is because we need customer feedback so we can get it right.

The other thing I would say, to be clear, is that at Microsoft we do a good job of understanding customers and using that information to feed product development. But one of the things that is really new about this project is the customer that we're targeting.

That was the point of my question. How is this product development different and how might it affect other products since the customer set grew up using the Internet?
The implication is that our learning doesn't just apply to the communications and entertainment categories. Understanding this customer and how they use the Internet applies to all the businesses that Microsoft has--and not just tomorrow, but today. These people are in the work force today. They are not tomorrow's customer. So one of our (key) priorities as a group is to take the learning about the customer and infuse it across Microsoft. We do a lot of work with other product groups. So our impact is broader than the specific beta that people are going to see.

These people are in the work force today. They are not tomorrow's customer.
How much of Threedegrees builds on what's already in Windows XP, such as Windows Messenger?
The thing it builds on most is MSN Messenger. You have to use MSN Messenger 5. One way it's been referred to is "extreme instant messaging." A few people have called it that, at least internally. No one has called it that externally. I think that's the thing people in this age group really gravitate to is the communications tool, really socializing through the instant messenger. This really builds on that experience.

What are you looking for in this beta?
The goal of our beta is completely about learning. This is a really new experience, and we want to get this in front of customers. We want to learn from them how they like the actual experience, what they like or what they want changed. That's the whole point of getting the beta out. We want to continue the Dialogue we started with customers in a broader way.

Why did you choose the features that you did?
The core thing for us in the beginning was to get groups formed and have activities they can do. Winks is an activity where they can basically wink at someone across the room, but do it virtually. Flirt with them. You can send photos, do group IM together and listen to music with your friends. We wanted things that paralleled our customers' priorities, which was hanging out with your friends and having fun. Music a lot of times is the background for the fun that you have. We see lots of opportunities for other types of activities. There's no shortage of ideas. At this point, it's about prioritizing those ideas. The send photos feature is going to help us understand how customers want to share photos together and how to prioritize that experience.

How unusual is it to offer group IM?
I don't think it's so unusual as it's required for this audience. The thing the application does that isn't common is that you can have up to 10 members. That group always exists. So when you start an IM, all 10 people are automatically in that conversation. Is that earth shattering? Absolutely not. It's just a requirement. It's the basis for socializing, and these other things build off of IM.

Can you participate in more than one group at a time.

In other words, I could have three groups going with 10 members each and have conversations going in all three at the same time?
Yes, you can. In fact, the people on my team, using it internally right now, have a dozen groups on their desktop. They have different things going on with different groups. The one thing I will clarify is that you can only have one music session going at a time. The model that we used is the party model throughout development. Let's use the dinner party model. I'm 33, so I understand it. About the quantity of people you can fit around the dinner table, that's the number you can have in your Musicmix. It's not uncommon for someone to bring a new CD of a new band they've heard. That's a very common way for people to learn about new music, through their friends. In fact, word of mouth for music adoption is the most popular way for music to be adopted. So someone brings their CD, and when they leave the party they take their CD home with them. That is exactly the model we used. The playlist can't be longer than 60 songs, which is equivalent to the 6-CD changer you have in your living room.

In terms of sharing music, is that Windows Media Audio only or can people use MP3 and other formats too?
It's actually listening to music together--a little clarification there. You can contribute WMA files, MP3 or WAV files to the Musicmix session that you can listen to together.

In testing internally, have you seen Threedegrees used beyond socializing? This would seem like a good application for collaboration.
People immediately see the uses beyond the communications and entertainment space. If you're working in a small workgroup, there are ways that you want to work. So there is potential.

Is Threedegrees peer to peer?
It's built upon the Windows Peer-to Peer update (which will be released next week). The other technology it's built upon is Windows XP and Service Pack 1. Then there's MSN Messenger 5. The other thing that's required is broadband access.