MS is not an innovator, but things may change

[Jose Miguel Pinilla]

I really wish this is the direction MS is moving. It could make a
difference in a few years.

Miguel.

> Fortune, December 8, 1997
>
> Mr. Gates Builds His Brain Trust
>
> Nathan Myhrvold and his CEO want to create the next great research lab.
> If they succeed, Microsoft will have an even tighter grip on the future
> of computing.
>
> Randall E. Stross
>
> Hey! Guess what those wild and crazy Microsoft geeks in Redmond,Wash.,
> are working on now? Statistical physics! Pretty cool, huh?
>
> In the words of Jennifer Tour Chayes, she and her husband, Christian
> Borgs, both statistical physicists who recently joined Microsoft's
> rapidly expanding research group, are looking to "derive the observed
> behavior of gases, liquids, solids, and other states of matter from the
> underlying microscopic world of molecules, atoms, and electrons." One of
> their favorite topics is "independent percolation," a model that
> describes problems ranging from "the distribution of oil in a porous
> medium to the distribution of matter in the galaxy." Of course, "certain
> dependent versions of the percolation model, namely the integer random
> cluster models, are equivalent to the basic models of equilibrium
> statistical mechanics; namely, the Ising and Potts magnets." Got that?
>
> Like you, perhaps, Chayes couldn't imagine what use Microsoft might have
> for her expertise when she was first contacted last May by her old
> Princeton University classmate, Microsoft's chief technology officer,
> Nathan Myhrvold. It's a lot easier to understand why Microsoft would
> invest, say, $1 billion in the Comcast TV-cable company or spend $425
> million to buy WebTV Networks. For the company to drop something like a
> six-figure salary and stock options on Chayes seems a bit far-fetched.
> She's been on the payroll six months and is still not sure when--or
> whether--she'll deliver anything tangible to the company. When she
> recently met CEO Bill Gates, she commended him for investing in research
> that "won't pay off for 100 years."
>
> At a time when corporations across the country are pulling back from
> basic research, Gates and Myhrvold are intent on building one of the
> all-time great research organizations--an R&D dynasty that people will
> mention in the same breath with such legendary idea empires as Bell
> Laboratories, IBM's Thomas J. Watson Laboratory, and Xerox's Palo Alto
> Research Center (PARC). In the past six years, Microsoft has quietly
> assembled 245 of the brightest researchers from around the globe,
> drawing from top universities and corporate rivals. Gates plans to hire
> another 400 researchers in the next three years, and build research
> centers around the world to complement the one in Redmond and another he
> and Myhrvold are setting up in Cambridge, England. The goal is as
> ambitious as you might expect. Says Gates: "The future of computing is
> the computer that talks, listens, sees, and learns. That is what is
> being created at Microsoft Research."
>
> To convey his boss to that future, Myhrvold has populated Bill Labs with
> a lineup of Hall of Famers from the past. Now working there are the
> inventor of the laser printer (Gary Starkweather); the father of the
> VAX, the minicomputer that made Digital Equipment the world's No. 2
> computer company for a time (Gordon Bell); the co-inventor of Ethernet
> and chief designer of the Xerox PARC computer that inspired the
> Macintosh (Chuck Thacker); the graphics genius who co-founded Pixar, the
> company that made Toy Story (Alvy Ray Smith); and the designer of the
> PARC technology behind Microsoft Word (Charles Simonyi). The Seattle
> Mariners have Ken Griffey Jr., Jay Buhner, and Edgar Martinez at the
> heart of their lineup. Not bad. But Microsoft Research is more like
> Murderer's Row, the Babe Ruth-Lou Gehrig-Tony Lazerri New York Yankees,
> of 1927.
>
> Supporting this roster, plus 200 or so bench players like Chayes,
> probably costs Microsoft much less than $100 million a year. That's a
> whole lot less than Gates might spend on another alliance with a cable
> company. This side bet on research, however, may prove to be the gambit
> that distances Microsoft forever from the competition. Of the next four
> biggest independent American software companies--Computer Associates,
> Oracle, Novell, and Sybase--only Novell has a basic research group, and
> it possesses a skeleton staff.
>
> The company that touts itself as Microsoft's archrival, Sun
> Microsystems, does have a lab. Its 100 researchers work on projects
> related to software and hardware, and the contrast with Microsoft is
> illuminating. Sun Labs restricts its researchers to tangibles like
> software for electronic commerce and software testing tools.
> Mathematical physics theorists need not apply. Says Sun Labs fellow
> Robert Sproull, an eminent computer architect who worked for many years
> at Xerox PARC: "We are not taking the big risks." CEO Scott McNealy, who
> contends that research centers "tend to be black holes for money," has
> kept the head count at Sun Labs constant over the past seven years, even
> as Sun's annual sales have climbed from $3 billion to $10 billion.
>
> Gates is betting that approach is shortsighted. He and Myhrvold believe
> Microsoft stands a far better chance of taking the lead in technologies
> that will shape computing's future. And, says Myhrvold, focusing on the
> future can spin off products right now. (See "What's the Return on
> Research?")
>
> If Microsoft Research does put Gates' imprint on the future, it will be
> an unlikely triumph. When Gates and Myhrvold created the unit in 1991,
> Microsoft was anything but the purveyor of soup-to-nuts software
> offerings we see today. Microsoft was the software industry's plumber.
> It derived most of its $1.8 billion in 1991 revenues from lowly MS-DOS;
> Windows had not taken off. Early in 1992, industry newsletter
> SoftlLetter predicted Gates & Co. had little future in applications
> software. Instead, wrote the editors, "Lotus will dominate Windows
> spreadsheets, WordPerfect will still be top dog in word processing, and
> Borland will prevail in databases." That such a company would aspire to
> own a research organization akin to IBM's or AT&T's--i.e., a lab that
> produced mind-blowing research and great products--seemed laughably
> audacious. Yet Gates had always wanted a research division. "Even in the
> late 1970s," he says, "we were watching the work being done at Xerox
> PARC and talking about when we would be able to have a research group
> like that."
>
> Assigning Myhrvold was perfect, if obvious, casting. Myhrvold's mother
> says Nathan told her at age 2 that he wanted to become a scientist. He
> graduated from high school at age 14, from UCLA at 19 with a bachelor's
> degree and a master's in geophysics, and from Princeton at 23 with a
> Ph.D. in mathematical and theoretical physics and a master's in
> mathematical economics. He once described his primary research interest
> as that portion of time when the universe was "about 10 -33[exponent] of
> a centimeter, up to when it was about the size of a grapefruit. After
> that, it's all sort of history as far as I'm concerned."
>
> He left a fellowship under Stephen Hawking at Cambridge University to
> try his hand as a software entrepreneur. Microsoft bought the business
> in 1986; by 1991, Myhrvold was running Microsoft's advanced development
> unit. He says its job was "doing things others agree are theoretically
> possible but have not been built before." Given a shot at organizing
> basic research--"attempting to do something only the investigator thinks
> is possible"--he jumped.
>
> Myhrvold prepared a long memo for the board of directors, asking for $10
> million a year to get started. In the remarkably prescient document, he
> argued that the personal computer industry had kept itself busy for
> years finding ways for little computers to mimic the functions and take
> over the jobs of big ones. But few such problems remained. Myhrvold
> wanted Microsoft to be at the forefront of the next generation of
> software by, for instance, making computers much more user-friendly--a
> quality mainframes never needed. "The only way to get access to the
> strategic technology is to do it yourself," he wrote.
>
> Acknowledging that IBM, Xerox, and especially Apple had little new
> software to show for their investments in basic research, he outlined a
> structure to help Microsoft avoid the same fate. For starters, Microsoft
> Research would focus exclusively on software, and only on those areas
> that would so obviously benefit the business that Microsoft could not
> afford to leave them to academic researchers or other companies to
> pioneer. The first hire would be a research director, someone with
> enough prestige to wow prospective researchers, and with the management
> skills to run an organization that would total 60 people by the end of
> the third year.
>
> Myhrvold and the director would then hire the best and the brightest,
> encouraging them to continue the research that had attracted Microsoft.
> Ideally, there would be groups of five to ten researchers, each group
> tackling some aspect of key issues Microsoft wanted to address.
> Researchers would not be micromanaged; rather, they would be encouraged
> to interact with one another. "It's a little like conducting a dinner
> party," Myhrvold explains today. "[You don't] interrupt the
> conversations and tell people what they should be saying and thinking.
> If you pick the right people to convene, more and better things happen
> than you could have planned."
>
> The board gave the okay. Myhrvold anticipated that bringing in the first
> hires might be tough--in the memo, he worried that Microsoft risked
> being perceived as a "bunch of hackers writing for toy PCs." But he
> persuaded Carnegie Mellon's Rick Rashid, the mastermind of a
> state-of-the-art operating system called Mach, to sign on as director.
> Rashid, in turn, went after Dan Ling, an IBM research manager with
> several patents to his credit, as his deputy. Even though Rashid and
> Ling had been undergraduate roommates at Stanford, it took Rashid six
> months to recruit Ling.
>
> After that slow start, Microsoft has succeeded in winning the best
> talent. To university researchers bored with the insularity of the ivory
> tower and the perpetual quest for grants, and to corporate researchers
> fleeing downsizing and growing pressures to develop products, what was
> once the land of DOS now more resembles Oz. Microsoft Research is full
> of stars from academe and refugees from bedraggled competitors like
> Apple, Silicon Graphics, and Digital Equipment, all drawn by Myhrvold's
> offer of research freedom and Gates' stock options. Microsoft has
> absorbed whole teams, like a trio of natural-language experts from IBM.
> On campuses, the company has proved so voracious a recruiter that after
> Princeton University graphics wizard Michael Cohen signed on, a Stanford
> colleague E-mailed him a rueful note: "Last one in academe, turn out the
> lights." Jim Morris, chair of Carnegie Mellon's computer science
> department, laments that Microsoft has lured five of its faculty in the
> past five years. "It gives colleges an Excedrin headache," he says.
>
> Myhrvold now has 245 propeller-heads--a concentration of, say, 40,000 IQ
> points--onboard. The researchers are attacking a spectrum of problems
> that range from the mundane (creating better tools for software
> developers) to the futuristic if obvious (a post-Windows NT operating
> system code-named Millennium, that is self-configuring, self-adjusting,
> and fault-tolerant and lives in the network) to the simply weird
> (helping computers read the emotion behind your facial expressions so
> they can deduce what you'll need next). Almost all of the researchers
> work in Building No. 9 on the Redmond campus--just around the corner
> from Gates' own office.
>
> Six years into the project, Myhrvold seems to have achieved his goal of
> hosting an IQs-on-steroids dinner party. Even the most arcane projects
> are spawning useful ideas. Take statistical physics. Gates balked last
> year when Myhrvold urged him to hire Chayes and Borgs--"This is the only
> proposal which made me think twice," Gates says. But researchers in
> another group--cryptography--quickly latched on to the couple (whose
> group is called simply theory) after they arrived on campus. The
> cryptographers thought that Chayes' and Borgs' statistical insights into
> phase transitions--they have studied the shifts that occur when, say, a
> liquid turns into a gas--might help them devise cryptographic sequences
> that at certain points change, producing coded messages and passwords
> that truly are unbreakable. Now, as cryptography and theory pursue their
> separate studies, they consult to see where their work intersects.
>
> If you woke me out of a sound sleep and asked, 'What are you?' " says
> Myhrvold, "it is unlikely that I would blurt out 'manager.' " Still,
> it's his 1991 organization plan that allows for the dinner-party
> atmosphere. And it's his careful planning that so far has allowed
> Microsoft Research to work well with the company's product managers, who
> are always looking for the next product to push out the door. Says
> Cohen, who manages the graphics group: "It's part of your job. When you
> have something that's good, you look for people within the company to
> productize."
>
> Two years ago, researcher David Kurlander developed a program that
> transforms the typed comments of people "chatting" with one another
> across the Internet into an interactive, real-time comic strip. Called
> Comic Chat, it creates a comic-book-style avatar for each person
> chatting. The typed words appear in bubbles over the character's head.
> Best of all, the character's facial expressions change according to the
> tenor of the chatter's words--type in "Bill, you naughty megalomaniac!"
> for example, and your character might scowl and appear to scream. When
> the Internet product group got wind of Kurlander's research, they
> grabbed it--and him. For the past 18 months he's been working in the
> product group, enjoying what he calls "a sabbatical" from research. And
> his work? It's now called Microsoft Chat 2.0 and is available from
> www.microsoft.com.
>
> "We didn't want a situation like Xerox [PARC], where the research was
> decoupled from product design," says Gates. "[We want] people who are
> supersmart but also have a desire to see their work in use." So when
> Rashid and Myhrvold look for new hires, they seek out eggheads who don't
> want their life's work confined to prestigious scholarly journals.
>
> That kind of practicality appealed to Eric Horvitz, Jack Breese, and
> David Heckerman. In 1992 they were co-founders of a startup called
> Knowledge Industries in Palo Alto. They were tinkering with artificial
> intelligence programs that might help diagnose diseases--or disorders in
> everything from copiers to the space shuttle. Then Myhrvold came
> calling. Says Horvitz: "We were offered the opportunity to bring our
> stuff to millions of people." The trio licensed their technology to
> Microsoft, moved to Redmond, and started the company's decision theory
> and adaptive systems group. Ignore the daunting name; Horvitz and
> company have created some smart applications that you may have already
> used.
>
> Most artificial intelligence researchers have relied on "rules based"
> models. To oversimplify, they've tried to teach computers to solve
> problems in a step-by-step, linear way. "Printer won't print? Then try
> solution A. Still doesn't work? Then you must want B. Still doesn't
> work?..." Such an approach sometimes succeeds--often, however, it's the
> digital equivalent of getting a nitwit on the line when you call
> customer service.
>
> Horvitz and his cohorts trashed "rules based" models, opting instead for
> a modular approach in which the computer asks the user a series of
> questions, cross-checks the answers with its data on previous solutions,
> narrows down the universe of possibilities, and suggests what it thinks
> is the most probable and least expensive solution--in less than a
> second. To get a sense of how, and whether, this works, check out the
> Troubleshooting Wizard on Microsoft's technical-support Web page at
> support.microsoft.com/support. (Hint: Click on "More Search Options,"
> and then on "Natural Language search" before you try anything too
> demanding.) You'll tap into the same software Microsoft's
> technical-support staffers consult when you call in. According to a very
> satisfied Breese, more than 600,000 Web visitors used the software in
> August--hundreds of thousands more than might have ever used anything
> created by his old company. As Myhrvold is quick to point out, that's
> 600,000 customers Microsoft has served who otherwise would have required
> more expensive human intervention.
>
> The Troubleshooting Wizard is a primitive example of how Research is
> trying to create "the computer that talks, listens, sees, and learns."
> More far-reaching are the efforts of the natural language and speech
> recognition groups to get computers to understand the way we write and
> speak. Steve Richardson, George Heidorn, and Karen Jensen are IBM
> veterans who fled Armonk for Redmond six years ago when Big Blue cut
> their funding. The three have spent their professional lives in a quest
> to make machines understand language. In Microsoftian terms, they're way
> old farts: Richardson is 44 years old, while Heidorn and Jensen are both
> 59.
>
> Nevertheless, the trio's 22-person group is doing some of the coolest
> stuff in Redmond. One of its creations is MindNet, a linguistic database
> constructed with the contents of two dictionaries. With a built-in
> parser that breaks down the grammar of every sentence you write faster
> than your seventh-grade English teacher, MindNet automatically finds
> links between words that are similar in meaning. Using MindNet, a
> computer "knows" that in the sentence "We were watching the comet with a
> large telescope," "telescope" is linked to "watching," not to "comet."
> So far, the program recognizes seven million links between different
> kinds of words; now the researchers are going to pour in the contents of
> a couple of encyclopedias, giving the program a new set of smarts.
>
> Gates explains that one possible use for all this is more accurate
> searching on the World Wide Web. Myhrvold points to the natural language
> group as an example of the way that near-term benefits shake loose from
> long-term research. The grammar-analyzing function that the team cobbled
> together worked so well that the Microsoft Word product group integrated
> it in Word 97, replacing a grammar checker the company had licensed.
> According to Myhrvold, that saved millions of dollars in royalties.
>
> The charter of Microsoft's speech technology group, which has been run
> since 1993 by Xuedong Huang, a Carnegie Mellon veteran, is to help PCs
> understand the spoken word. Microsoft doesn't yet offer its own speech
> recognition program: Huang says that even though the group has made
> great strides in the past year, a computer running Microsoft's best
> prototype gets only 93% of the words right when addressed by a
> businessperson with no special training. Huang's goal is to combine his
> best technology with MindNet, thus creating a thinking machine that
> understands, and that can act on, a user's every spoken word.
>
> Sounds great. But IBM and two smaller companies called Dragon Systems
> and Kurzweil have already wowed reviewers with simple speech recognition
> systems that allow users to dictate documents and direct applications by
> voice command. These inexpensive programs (all three offer versions for
> under $100) are expected to be popular items at Christmas.
>
> Believe it or not, Huang is likely to keep his head. First of all, Gates
> seems to accept that investing in research is a long-term play. Second,
> Gates has got the just-in-case option: Just in case you can't invent it
> fast enough, buy it. After all, if you're Bill Gates, you can afford it.
> In August, Microsoft paid $45 million for a minority position in
> speech-recognition software company Lernout & Hauspie. Besides getting
> access to Lernout's technology, Gates will get a slice of this
> Christmas' sales after all--Lernout bought Kurzweil earlier this year.
>
> Indeed, it is the background presence of Microsoft's cash that gives
> Microsoft Research the aura of something invincible. The company pays
> Myhrvold's senior researchers salaries in the low six figures, about
> what they might have earned in academia. It also, of course, gives them
> plenty of stock options. The researchers swear--they just swear--that
> options have nothing to do with their decision to come to Redmond. "What
> draws us here is intellectual curiosity," says Steven Shafer, another
> researcher who left Carnegie Mellon. "We take a risk--the stock market
> could crash." Adds Myhrvold, with a perfectly straight face: "Academics
> aren't familiar with stock options."
>
> Still, it can't hurt to know what's possible should you abandon Ann
> Arbor for the siren call of Redmond. "I can honestly say stock options
> had zero influence on my coming here," says Cohen, the ex-Princetonian,
> "[but] it's great to win the lottery." Rick Rashid joined Microsoft in
> 1991; four years later he made $2 million on options. In May, Myhrvold
> himself sold 900,000 shares obtained through options, for a tidy profit
> of $104 million.
>
> Numbers like those help explain why few academics expect Microsoft to
> have trouble expanding beyond 600 researchers over the next three years.
> Myhrvold is bending over backward to make sure Microsoft Research stays
> attractive in other ways dear to researchers' hearts. While it
> interferes with his dinner-party idea, he and Gates realize that at
> least some geniuses don't want to move to rainy Redmond. For these, he
> is willing to set up satellite offices. That's what won over Gordon
> Bell, the dean of the minicomputer, and Jim Gray, a legendary designer
> of databases. With five others, they work out of a smallish office in
> San Francisco. Bell offers advice on research projects--he's
> particularly enamored of a Microsoft effort to make videocameras a
> standard PC component--and doubles as Gates' Silicon Valley spy. He was
> the one who suggested that Microsoft purchase WebTV Networks, which is
> still based in Palo Alto.
>
> With the opening of its Cambridge University facility last summer,
> Microsoft launched a global recruiting effort. It will spend $80 million
> over the next five years building and staffing the lab, and has promised
> to pump $16 million in venture capital into tech companies in the area.
> Says Myhrvold: "The reason to locate a lab someplace else is to draw on
> a source of people that you would otherwise not be able to hire.
> Research is about getting great people--no other aspect matters as much
> as that." For years, he and Gates had pursued Chuck Thacker, who, while
> at Xerox PARC, designed the Alto computer. A commercial flop, the Alto
> was the first personal computer that offered users an intuitive
> graphical interface--in many ways, it was the model for the Macintosh.
> Thacker didn't want to move from Palo Alto to Seattle--but once
> Microsoft decided to open up shop in England, he quickly signed on so
> that he could work with Roger Needham, a renowned Cambridge University
> scientist who is heading up Microsoft's British lab. Myhrvold says he
> and Gates are looking at sites in Europe and Asia as possible future
> campuses for Microsoft Research.
>
> Their ambition couldn't be more at odds with the direction of most U.S.
> companies. In a recent paper entitled "The End of Unfettered Research,"
> Andrew Odlyzko, a researcher at AT&T Labs (the piece of Bell Labs that
> didn't go to Lucent), dispassionately describes the state of basic
> research in the U.S. Unfettered research, he writes, is "almost totally
> gone from industrial and government laboratories, and is under pressure
> even in academia." According to a recent survey by the National Science
> Foundation, U.S. corporate spending on basic research, running around $6
> billion a year during the 1990s, has declined as a percentage of
> revenues.
>
> Reining in corporate spending on basic research isn't necessarily a bad
> thing. For decades IBM was the exemplar of doing well by doing good work
> in the lab; its researchers around the world, including those at the
> Thomas J. Watson Laboratory near New York City, invented the scanning
> tunneling microscope, Josephson junction circuits, high-temperature
> superconductors, and a host of computing innovations like the hard disk
> drive and SQL, the leading database language.
>
> When CEO Lou Gerstner arrived in 1993, he cut R&D spending by $1
> billion. Basic research projects that had no clear relation to products
> were decimated. Nevertheless, Big Blue research has continued to excel.
> This year IBM announced a method for using copper as a conductor on
> computer chips, while the researchers' prize supercomputer, Deep Blue,
> conquered chess champion Gary Kasparov.
>
> So far, Microsoft Research has invented nothing comparable--a grammar
> checker and a better help desk don't exactly match up with a revolution
> in chip technology. Still, Myhrvold argues that Microsoft has an edge
> over IBM, since Big Blue must spread its research over both hardware and
> software. "If you look at their historical ability to effect products, I
> think you would find that IBM's record in using things from research in
> software is nowhere near as good as in hardware," he says. "I don't mean
> to insult IBM's software people. It's not their fault. They are further
> removed from the software market than we are."
>
> For the moment, Microsoft seems to be beating IBM on the recruiting
> field. Jean-Claude Latombe, chairman of computer sciences at Stanford,
> says that when his graduates consider potential corporate employers,
> "everything I hear is that Microsoft is the most attractive."
>
> In part, that's because while others are cutting back, Microsoft is
> spending more and more on Bill Labs. Says Gates: "The board has always
> supported my R&D plans. They recently had a presentation from Research,
> and their main feedback was simply that we should do more." When
> Myhrvold is asked whether there is any scenario under which he can
> envision Gates' pulling the plug on basic research, he responds,
> "Alzheimer's." He adds: "You're asking an odd question. Bill isn't going
> to pull the plug on research any more than he will pull the plug on
> Microsoft." And what of the fact that by pushing so hard on research
> Microsoft is moving in the opposite direction from much of corporate
> America? "It means we're either really smart or really stupid," Myhrvold
> says. "Whenever you're greatly at odds with the rest of the world, one
> of those two things is true."
>
> Nobody's ever accused Microsoft of being really stupid.
>
>

[Tony Juricic]

Jose Miguel Pinilla <j...@Stanford.edu> wrote

> I really wish this is the direction MS is moving. It could make a
> difference in a few years.
>

> > Fortune, December 8, 1997
> >
> > Mr. Gates Builds His Brain Trust

> > [cut]

Hmmm, yes, I see that many articles from last SIGGRAPH
Proceedings come from Microsoft employees.

They started recruiting Computer Graphics experts at least
4 years ago.

Whether it means, among other things, that we will soon see
3D file system browser on Windows platforms ( sources of one
such browser Silicon Graphics didn't want to give me to play with -
it is proprietary stuff) is yet to be seen.

Tony