Windows Weekly 348 (Transcript)


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Windows Weekly 348

Leo Laporte: It’s time for Windows Weekly.  We have a CEO!  Habemus CEO.  It’s Satya Nadella.  We’ll talk about him, what this means for Microsoft, what happened to Bill Gates, Steve Ballmer, and a whole lot more.  Windows Weekly is next. 

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Leo: Bandwidth for Windows Weekly, is provided by CacheFly, at cachefly.com.  This is Windows Weekly with Paul Thurrott, and Mary Jo Foley.  Episode 348, recorded February 5, 2014

What Would Satya Do?

Windows Weekly is brought to you by IT Pro TV.  Are you looking to upgrade your IT skills, or prepare for certification?  IT Pro TV offers engaging and informative tutorials.  Stream to your Roku, mobile device, or your computer.  For 50% off the lifetime of your account, go to itpro.tv/ww, and use the code WW50.  And by, ShareFile.  Enhance your workflow, send files of almost any size easily, and securely, with ShareFile from Citrix.  Try ShareFile today for a 30 day free trial.  Go to Sharefile.com, click the microphone, and enter, “Windows”.  And by Audible.com.  To download the free audio book of your choice, go to audible.com/windows.  It’s time for Windows Weekly, the show that covers Microsoft, and all the machinations all the behind the scenes rivalries, the leaks, the scoops, if it happens in Redmond, these two know about it.  Mary Jo Foley of the all about Microsoft site at CDNET, long time Microsoft watcher.  You’re a watcher.

Mary Jo Foley: I am.  I’m a watcher.

Leo: Paul Thurrott is not a watcher.

Paul Thurrott: I’m more of a lurker. 

Leo: He’s a stalker.

Paul: I’m a creepy, in the bushes kind of guy.

Leo: He’s the Supersite for Window’s winsupersite.com, and between the two of you, there is no one who knows more about what is going on in Microsoft.  It happened!  We can stop speculating.  How long did this CEO search take?  6 months?

Mary Jo: 5 or 6 months, yes. 

Leo: Ballmer gave them about a year didn’t he?  He said by the end of next year, so he gave them a year. 

Mary Jo: Yeah.

Leo: But no one wanted it to take a long time I suppose.  You and Paul have observed that it’s bad for moral, nobody wants to do anything because you want to see who it’s going to be. 

Mary Jo: Yeah, plus I’m sure everybody was so sick of the leak stories.  It was like, “Uhh, here is another one.” And should I believe this one, or shouldn’t I believe this one.  So it was great to see that this has finally been laid to rest. 

Paul: But, what is Alan Mulally going to do next?

Leo: [Laughs] May his name never cross by our lips again, or any of those other Paul Maritz.  So let’s deconstruct, first of all, what happened.

Mary Jo: On Tuesday, Microsoft announced at 9am ET that Satya Nadella is going to be the third CEO of Microsoft ever, and his first day was that very day.  He started when they announced it.  No coming up to speed, no interim period, just yup, you’re on. 

Leo: That leads one to believe that he knew for a little while.  Steve had enough time to move the furniture out, Satya had some time to pick out some throw pillows.

Mary Jo: I just read a journal story today that said Steve Ballmer actually moved his stuff out on Monday. 

Leo: They have more time than the President has.  I watched The Butler last night.  It turns out that during the inauguration, staff has two hours to take all of the old stuff out and move the new stuff in.  It’s during the inauguration, that’s it.  President wakes up in the morning, puts on his top-hat rides on his carriage to the inauguration stand, then the staff goes, “Quick!  Get rid of his crap!” 

Paul: You got watch the Mitt documentary, not to get off on a different topic.

Leo: I’ve heard that’s very good.

Paul: But the reason it’s interesting is because the guy runs for president, loses, and then he flies somewhere, drives to his house, then he just walks into the door, locks the door, sits in his chair and looks out the window.

Leo: Oh, I’m not President. 

Paul:  So imagine Steve Ballmer, he woke up this morning, so now what? 

Leo: “I used to hold the reigns of power in my hand, now I’m holding an Xbox controller.” 

Paul: It’s got to be weird though, right?  That’s got to be an awkward transition. 

Mary Jo: He does stay on the board though, which is another interesting tid-bit of this weeks news.  There had been speculation that Steve Ballmer was going to be asked to leave the board, or forced to leave the board, but he is not leaving the board.  He is staying on.  The other very big change was, that Bill Gates is no longer chairman of the board, John Thompson who was the head of the search committee, and a board member is now the chairman of the board at Microsoft.  Bill Gates is now a technical advisor, and founder, obviously of the company, and he is going to be advising Satya Nadella on product and strategy for some unknown period of time. 

Leo: Now, there are two theories about this.  I think that it is very unusual for a CEO to have both prior CEOs on the board overseeing him.  That could be for continuity sake, or it could be because they don’t trust him?  I don’t know.  Ballmer is, as we know, the number one stockholder, and Bill Gates is number two. 

Mary Jo: He will be very soon.

Paul: I think this is continuity.  Microsoft is different, Microsoft isn’t XON either, or GM or whatever.  I mean it’s been Bill Gates, Steve Ballmer for 20 years, whatever.  This gives them a transition that’s a little more seamless I think.

Leo: If there is a knock on Satya Nadella, he is a 22-year Microsoft veteran.  He has run many different divisions including all of the important divisions, except for Windows.  He’s done online, he’s done Azure, he’s done Enterprise.

Paul: He worked on Bing too. 

Leo: Yeah, that’s what I meant with online.  In that sense, he is the ultimate insider, but there might be a complaint from some shareholders saying, “Where is the vision?  Where are the new ideas?”  This is kind of same old, same old.

Paul: Where is the consumer?

Leo: Right.  I guess the two schools of thought are, Bill will have actual duties coaching Satya, especially toward consumer and Windows Office, or is this just pure Window dressing? 

Paul: Yes.  [Laughs]

Mary Jo: I bet B.

Leo: Bill Gates is not going to have an office next to Satya’s, and he is not going to sit there and advise him.  That’s not going to happen. 

Mary Jo: Yeah, I don’t think so.

Leo: He’ll call him once a year, maybe twice a year.

Mary Jo:  Here is what Bill Gates actually said, and you’ve got to really parse his words when you hear what his quote was.  He said in a video interview yesterday, “Over a third of my time is available to meet with product groups.”

Paul: So hold on a second, sorry.  We need to focus on just that part.  That is insane.  I just want to be clear, how specific is that?  One third of my, time?  What does that mean? 

Mary Jo: This guys time is organized on an excel spreadsheet.

Paul: So I looked this up, as it turns out, I’m just amazed at how specific that is, because time is not the workday.  I take that to mean his waking hours. 

Leo: One third of his time is spent sleeping, another third of his time is playing Call of Duty.

Paul: [Laughs] No that’s me. 

Leo: Well, that implies that he has three jobs.  One is obviously the Bill & Linda Foundation, that’s one job.  What is the other one?

Paul: I assume what he really means is that is two thirds of his time.  I think that’s what he meant.  But you realize that before this change, the way that he allotted his time was one fifth of his time was spent on Microsoft.  One fifth.  You could do the math and figure out how much more time he’s devoting. 

Leo: Okay, so from one fifth, to one third, let me get out my calculator.  It’s a 32.7% increase.  By the way, I’m being told that I shouldn’t miss a Satya, I should say Sat-ya

Paul: As a comedy, you could watch all four of the introductory videos on Microsoft’s website, and note that every person who says his name, pronounces it differently. 

Mary Jo: That is true. 

Leo: And, by the way, Satya is a nickname!  His real name is longer.

Paul: His real name is, Bob.  [Laughs]

Mary Jo: Well he does have a long name, just like Soma Soma Sagar at Microsoft, his real first name is not Soma. 

Leo: But that’s okay, because in general, Indian names are easy to pronounce. 

Paul: But I’m curious, I actually look at this somewhat cynically.  I think that this Gates thing is really for people to look at and believe that this thing is happening, because people have a romantic notion about Bill Gates.  I look at this is the short-term window dressing.  But I’m just curious of what Mary Jo thinks of this, because I tend to look at this very cynically. 

Mary Jo: I look at it very cynically too.  The reason I look at it cynically is, it’s two fold.  For one, I don’t think Bill Gates ever spent even one fifth of his time at Microsoft after he made the Foundation his full-time job.  I mean the guy is busy.  He’s running all over the world saving peoples lives, right?  Basically, that’s what he’s doing.  I know people say that he was in product meetings sometimes, or he gave an opinion on a strategy, but I don’t know.  I’m really hard pressed to think that he ever gave a fifth of his time and now is going to donate a third.  To me, the word in that statement that he made is, “Over a third of my time is available.”  It doesn’t mean that he is going to spend it on product groups, it means he could hypothetically spend that much. 

Paul: One of the things that emerged about Gates after he stepped down as CEO was that, that first year especially and first months were very difficult for him.  Letting Steve Ballmer actually make the decisions and they butted heads.  It’s hard, right?  When you’ve done this day to day, and you’re the voice and the face of the company, it’s hard.  Can you imagine though, today, what it must be like for Bill Gates to have to go to a meeting at Microsoft?  Seriously.  And someone is saying, “I’m not sure if we should do these right click menus.”  He’s like, “Guys, I’m trying to cure malaria over here!”  It must seem so un-important compared to what he is doing. 

Leo: I’m guessing that is not what they’re going to have Bill Gates do.  I hope not, it’s a waste of his time. 

Paul: I’m thinking they’re going to have Ballmer do it, because that would be unseemly.  Because seriously, that would be weird.  Mary Jo has talked in the past about her interview with Steve Ballmer.  He talked about how consumer, and business are intertwined.  I think that a lot of us on the outside look at that and say, “What?  Yeah, sort of.  I’m not really clear on how that works.”  I think that that’s where Satya Nadella Needs help, is understanding that theory because that is a big part of Microsoft.  He has never worked on anything, almost, that bridges that gap. 

Leo: I’m thinking that he is going to be as important for Satya Nadella as Bill Clinton was for Barak Obama.  When Satya says, “Bill, where do they keep the sugar and coffee bar?”  And he will call Bill.  Now, I’m be facetious, but it will be things like that.

Paul: You don’t think it will be big box things? 

Leo: I think it will be things like, very high level.  He’s been there for 22 years, he’s seen it all.  So he doesn’t have to ask about that stuff.  I bet there is politics involved.  Part of it is that he can go to the board and say, “I spoke with Bill, and we both agree…” And Bill is sitting right there nodding.

Paul: Yeah, I bet that will help push things through.  I wonder if being CEO of Microsoft isn’t a bit like being the President, in the sense that you have these high ideas and ideals going into the job, but then you get in there and they tell you, “So here is the truth.”  Then you find out what really is going on, and how all these things intertwine and everything. 

Leo: I think that would be the case if it was Alan Mulally, but that’s not the case for Nadella.  He knows.

Paul: I don’t know.  Does he?  Mary Jo might agree with this.  When you hear from people from Microsoft, they tend to be insular to what they’re working on, not out of choice, but because that’s how the company’s organized.  They often don’t know the details of what’s happening. 

Mary Jo: And in the past, before they did the one Microsoft re-org, a lot of times they purposefully weren’t telling each other what they were working on because there was rivalry between the two teams, and now they’re trying to fix that.

Paul: Yeah, that is true. 

Mary Jo: But, another reason I think this whole Gates thing happened, in addition to just the comfort level, and people say, “It’s Bill Gates, of course it’s going to be a great thing that he’s helping.”

Leo: It’s a public facing thing. 

Mary Jo: it’s a public facing thing, and if the board had decided that they needed to remove Gates as the chairman, you have to let the guy save space, right?  How do you let the guy save space?  You let him save space by letting him be the technically advisor. 

Leo: Okay, I’ve only served on one board.  It was a board of a non profit.  The only thing the chairman does is lead the meeting, and then enforce Roberts rules of order.  Is the roll of chairman of the board at Microsoft that much more important than any individual board member?  He only has one vote, he doesn’t get two votes. 

Paul: That’s interesting actually.

Leo: It’s honorary, he probably gets paid more, but is the roll of chairman that much more significant than any other board member?

Mary Jo: Probably not.

Leo: It’s important in the sense that you run the agenda, so that can be meaningful.  But you’ve got Bill and Steve sitting in the room.  Gates is de facto chairman.  He founded the freaking company! 

Paul: It’s worth noting that Nadella is also a board member.  Three of the board members are previous CEOs of the company.  That has to be unusual. 

Mary Jo: Something we all need to keep in mind too about the Microsoft board is, there is going to be another member joining next month.  This is also playing into this whole thing.  If you’re Steve, and Bill, and Satya, and John Thompson, who all say they want Microsoft to stay in tact and not sell off parts of the company, when the new board member from Valueact, Mason Morfit joins…

Leo: Are they going to add another seat?  Because right now they only have ten people.

Mary Jo: Yeah, they’re going to add another seat.  So, if you’re Microsoft, and you want to push your agenda of one Microsoft and don’t sell parts of the company off, what do you do?  You stack the board deck in your favor, right?  So you put as many of the pro-one Microsoft people on there as you can before this guy shows up. 

Leo: So maybe there will be other seats changed.  You look at the other people, and it’s pure formality that former CFO at JP Morgan, President of Harvey Mudd College, former vice-chairman of Bank of America, former chairman of the board of BMW…

Paul: Mary is right, they’re stacking the board so this guy doesn’t do anything stupid. 

Leo: That makes sense. 

Paul: There is no one else who has a track record. 

Leo: Yeah, he’s a jerk, I’m sure.  [Laughs]  Even the name of his company sounds jerky. 

Paul: He just walked his way to the Microsoft board of Directors, of course he’s a jerk, he’s a world class jerk.  It’s amazing to me. 

Leo: I shouldn’t say things like that.

Paul: He’s clearly a jerk.  He would have to be a jerk. 

Leo: They’re activist investors.

Mary Jo: Right, what they want to do is what’s best for the shareholder. 

Leo: Which means quarterly results, which means dividends.

Mary Jo: Right, which means if you can get money by selling off Xbox, let’s do it, who cares what it means to the strategy long term? 

Paul: Not to defend that choice per se, but I will note that I think that a lot of people hear things like, “We need to get rid of Bing, we need to get rid of Xbox.” They get scared because there is some kind of long term investment or some deep integration piece that supposedly exists.  Spinning these business’s off doesn’t mean they’re separated forever and they’ll never do business again, there is all kinds of cross licensing that can occur.

Mary Jo: And when we say, “Split it off” it could still be part of Microsoft, just a wholly owned subsidiary, kind of like how VMware is with EMC, it could be like that.

Leo: I want to point out, as with many boards, Microsoft also has committees where only the independent ward members, that is the non Microsoft members, serve.  There is the audit committee, the compensation committee, which determines what Nadella will get paid, the govern nets and nominating committee, I think that’s how they get new members on probably, and how the board runs, and regulatory public policy which at Microsoft has to be a very large important job.  The current chairman of BMW is the chair of that.  These committees are three or four member committees, they’re not very big. 

Paul: Is there like a house ways and means committee?

Leo: Generally what happens is the committees deliberate and then come back with a recommendation for the board, now most things the entire board will vote on. 

Paul: I’m sure they’re usually very reasonable, and of course what may happen with this new guy is, some of these things may cease to be reasonable.  So, I guess we’ll see. 

Leo: He’ll serve on a committee or two, because most of them serve on two committees. 

Paul: They’re going to want to keep this guy busy; they should invent a few new committees.  

Leo: The committee for the lawn and grounds.  The committee for fun and games.  I’m on the prom committee.  “I go to the meetings, but no one else ever shows, so I get to determine what the prom will be about this year.”  The Wall Street Journal had an article on how the board chose Nadella.  You guys have probably read it by now, I don’t know how accurate it is. 

Paul: First and unanimous, that’s all we need to say.  It’s done.  Do we buy that?  I mean that seems unlikely.

Mary Jo: John Thompson said that yesterday in one of those video interviews.  He said, “After we reviewed all of the candidates, Satya was our first and unanimous choice on the board.”

Leo: After everybody took themselves out of the run.

Paul: My initial reaction to that was like, “Really?”

Mary Jo: I know, yeah.  I might add a word, I might say, “After review all of the existing candidates” or something like that.

Paul: I would add the word technically, because this is probably the first time they actually voted officially, right? 

Leo: John Thompson comes and says, “Look, this is a crappy choice.  Not as in Satya, but there is no perfect person, but we think we’ve come up with a way that we can help Mr. Nadella succeed, that we can keep the continuity, that we can provide something for Bill to do.”  And I don’t know what Steve’s roll is.

Paul: As I described him on Twitter, “The kid who graduates from high school and then hangs out after school everyday for the next year.” 

Leo: Yeah, we should give him something to do. 

Mary Jo: Hey, he is going to be the biggest independent shareholder.  He should have a lot of say in what happens I think. 

Leo: Mary Jo, what in-sites do you have from the interview with Satya?  We didn’t know at the time that he was going to be the new CEO, although I presumed that’s why they did the dog and pony show.  It’s interesting that you got the interview right after your Ballmer interview with the next CEO, isn’t it?

Mary Jo: This was in November, and he wasn’t allowed to say anything the CEO process, or anything about his candidacy or whatever.  That was the ground rule for me going in.  You can talk to him about Steve’s legacy, you can talk to him about this and that, but no questions on the CEO thing, no wink wink, hint hint, none of that.  So, I didn’t get any kind of sense from him in that meeting, right then, but I got to tell you, the conversation that I had with Satya was very much him saying how much he had learned from Ballmer about how to be a manager, how to prioritize, how to think about strategy.  He basically said that Steve taught him a lot about what he knows, he is very much in his corner, he believes everything that he has done is right, and he doesn’t think they should be selling off their assets.  That was pretty clear. 

Leo: Maybe that was a campaign statement.  If you vote for me, I’m not going to be the guy who will break the company up.  Here is the Wall Street Journal writing.  They said after the early pool of 100 potential candidates from a swath of different industries, the board later made a more narrow pool of candidates by a board session on the weekend of December 14th.  That’s a month after you talked to them, but more than a month before they made the announcement.  “Some board members were exhausted from the months of work, and were concerned that the process had dragged on.  They left the meeting at a hotel less than eight miles from Microsoft’s headquarters without a pick.  The board had more potential CEO candidates with whom they wanted to meet, and were frustrated that research wasn’t ready on at least one new prospect.  As the directors considered possible executives, they launched to a debate on the governents  of the 300 million dollar company.  The notion of an executive chairman was born at this meeting, as the board debated the different scenarios that might be needed to run Microsoft depending on which candidate was selected.”

Paul: So this suggests that Bill Gates has Grima Wormtongue or whatever his role is here, was specific to obsession and love.  (?)

Leo: Right, they said, “Okay, we can pick Nadella.”

Paul: But we need to structure this differently for different people.

Leo: That’s right.  I think you would need even more than that if it were to say Alan Mulally, who had no experience inside Microsoft. 

Paul: Yeah, and maybe that guy would have been Steve Ballmer since they know each other.

Leo: Early on, directors realized that there was no single person who embodies all of the attributes that they wanted.  The choice would have to be a compromise, this is exactly as you had presumed, the weaknesses of the imperfect CEO would have to be balanced with the strength of the other officials inside Microsoft.  The directors had spoken with Nadella from the earliest stages.  He emerged at this time as the leading, internal contender.  I think we knew that, that was obvious.

Paul: He was clearly the best internal.  It could have been someone else, but honestly he was clearly the best choice internally I would say. 

Leo: The board met again on January 19th.

Mary Jo: Yeah, they had four remaining internal, and external candidates as of January 19th.  So you wonder, how many of those were internal.  Let’s talk about who the internal candidates were besides Nadella.  There was Tony Bates, Steven Elop, and Kevin Turner all were considered finalists, at least in the running throughout the process.  I don’t know if Kevin Turner made it into the finals, or even if Elop did.  I actually wrote something today saying, “If you look at what happened with Elop, remember when Microsoft bought Nokia, right away everyone was saying that Stephen Elop was going to be the next CEO.”

Paul: Don’t you think that would have been a disaster?  I think that he did as well as anyone could have done with Nokia, given where it was going, but the fact remains that this is a company that has been slowly spiraling a drain, and needed to be bought out before it disappeared.  Now were going to let him run our company.  That is such a different perception than what we have today.  We don’t know how this guy is going to do, but he definitely has this kind of smart, youthful engineer, youthful exuberance kind of thing going on, which gives off some nice positive vibes. 

Leo: According to the journal, after this January 19th meeting, directors and Bill Gates wanted a consumer focus in a new CEO.  After that 19th meeting, they appeared ready to select Mr. Nadella, even though he was mostly an enterprise background.  Gates said that you have to have someone who is comfortable running a company that is stacked with technical people.  The directors also wanted a consumer focus, that’s where leading the R and D on Bing was valuable on both regards.  They emerged from the meeting on January 19th with an agreement to start contract negotiations with Mr. Nadella

Paul: This guys success is going to hinge in many ways, on his ability to manage people he can trust to do the right thing in those various product groups, right?  Someone asked me earlier this week whether this was in some ways a response to the Sinofsky stuff, as in if this would prevent that kind of thing from happening again, and the truth is no, not really.  With Sinofsky you had the situation where Ballmer trusted him to do the right thing, and that’s how Windows 8 happened, because he did such a great job with Windows 7, and this guy is the right steward for this, and he is going to forward and do a great job.  But that doesn’t always work out, especially because he doesn’t have as fine of a handle on the consumer stuff, you have to trust that these people know what they’re talking about, and are doing the right thing.  I think that is maybe part of the Gates thing that he can stand over his shoulder and say no, or yes, or whatever, where it’s not clear that he understands those consumer tech products well enough. 

Mary Jo: He meaning Gates there, or Nadella?

Paul: Yeah, Nadella

Mary Jo: You can make the case, how well does Gates understand the current landscape as well, because he has been focused for the past six years on his foundation, and really learning about health, and public health, and all of these other fields that have nothing to do with technology.  I’m not saying he never read about what’s going on, but it’s very different running the OS team at Microsoft, versus coming to a board meeting five times a year and hearing what the OS team is doing.  You have to ask, how clued in is he about how very different the landscape is now with smartphones, with tablets, with Google, Google wasn’t a huge competitor to Microsoft six years ago, so a lot has changed and he is going to have a lot of homework to do to get back up to speed I think. 

Leo: Unless you’re worried that from now on we’re going to be hearing a lot of Kricket analogies during business discussions, Steve Ballmer is also Pete Carroll neighbor and friend apparently.  The journal says, Ballmer was watching the game same day the board approved the move for Mr. Gates and Nadella.  Mr. Gates, and Mr. Nadella both wanted the Microsoft founder to be the new CEO’s technology advisor, while remaining a board member.  They felt Mr. Gates involvement was critical due to, “Bill’s iconic industry presence.”  I think that that’s really the roll.  It’s almost a figure head.  I don’t think you’re going to expect Bill Gates to come in and say, “You know, we really want to bring the desktop back, but lets not do a start menu.”  You’re going to hear him, I think support Nadella on the board and maybe even publicly.  People look up to Bill Gates.  I don’t think he’s going to have to do a lot of work. 

Paul: I hope we don’t get into some weird situation where Nadella sends people off with their marching orders, and then they pause, then Gates nods, and then they go. 

Leo: That would be bad obviously.  One of our chatters works for Deutsche Bank and says, “We have two CEO’s.  It’s terrible, you never know which idiot to blame.”

Paul: It’s like you’re playing parents against each other. 

Leo: Another good question from the chat room here.  Wither, Elop, Bates, and Turner, is this a slap in the face, is this a kick in the butt?  Nadella is what, 48?  He isn’t going anywhere for a while. 

Paul: Well, no CEO job is permanent. 

Mary Jo: One thing I have heard about all three of those internal candidates is all of them really want to be a CEO, and they were all CEOs before. 

Leo: Where was Turner a CEO?

Mary Jo: He was CEO of Sam’s Club. 

Leo: Bates was of course CEO of Skype.  They all were CEOs, and they all were passed over.

Mary Jo: And they all want to be CEOs again.  If you got turned down, you’re probably thinking, “Should I look for a CEO job elsewhere?” because Satya isn’t going anywhere for a while.

Leo: All of this is in the calculations; no wonder the board was exhausted.  According to the journal, Turner and his wife immediately went to Cabo on January 23rd.  Mr. Thompson said he didn’t anticipate that leading the CEO search would be a full-time job.  Mr. Thompsons’ wife complained about how much time her husband was spending on the phone.  Right there, you just saw one of the big things.  What happens to the people we say no to?

Paul: That’s interesting actually.  The problem is, these guys and any money that you just mentioned, they’re not going to become the CEO of a company that is even a tiny percentage of the size of Microsoft. 

Leo: Which is better to be an Executive Vice President, or a President of a division of Microsoft, or a CEO at a smaller company. 

Paul: I don’t have that kind of ambition. 

Leo: With Paul and I in our pajamas. 

Paul: I’m literally not wearing pants. 

Leo: We’re grown men who spend our time podcasting, so probably the wrong people to ask. 

Mary Jo: I’m glad you didn’t say that I was in my pajamas. 

Leo: No!  Mary Jo is wearing a business suit, and is ready to take on the world, and boy Microsoft, you missed a bet. 

Paul: It’s fair to say that when I go to sleep tonight that I will be wearing these exact clothes. 

Leo: Let’s take a break, lots more to talk about, obviously.  A number of people tweeted, “I can’t wait to hear what Paul and Mary Jo have to say about this.”  In a way, I think we got Paul on immediately on TNT, however I wanted it to stew for a day because sometimes the immediate thoughts change over time as you think a little bit more about the subject.  This is a perfect time to talk about it.  We will continue.  Including, what should Nadella do?  W.W.S.D.  What would Satya do?  Our show brought to you today by IT Pro TV.  Those great folks over at IT Pro TV want to help you improve your skills.  Get a better job, get those certifications to get into the business, or if you’re already in the business, get the knowledge to be a better IT professional.  Visit ITPro.TV/ww and you can see what it’s all about.  I’m actually very honored by what the folks at IT Pro TV are up to.  For a long time, these guys had been training people in this subject matter, but they’ve watched the screensavers for years, they attended an NAB talk.  Todd and Tim are great.  They remind me a lot of Patrick and I on the screensavers.  If you look at the set, it looks just like it.  They came to an NAB panel that I ran, and they got inspired.  They said, “We could probably do something a little more than we’re doing, and they launched IT Pro TV using a lot of the same technology that we use here at TWiTThe Tri-caster, the Heil Microphones.  Their set looks so much like the screensavers set.  They broadcast live, as well as offer downloads, which is really great.  It works on Roku as well as your computer and your mobile devices.  They’re live right now, in fact there is a live chat room that you can participate in as well which really is great.  You can also go back through the episode library.  If you take a look at the episode library, they have hundreds of videos in three very important kinds of certification categories.  They have the CompTIA stuff, A+, Net+, Security+, the MCSA videos for Microsoft certifications, and Cysco certifications.  What you’re really getting is a huge library of study materials, and the price is right.  Normally it’s $57 a month for everything, full access, live, and downloads.  That’s $570 when you buy the year long plan.  You save considerably.  We’ve got a great offer since they are fans of TWiT.  Don and Tim were here, they came into the studio.  It was great to meet them.  They have offered us 50% off because you’re watching Windows Weekly.  If you go to ITPro.TV/ww, you can take a tour of the site, learn all about it, then you can use the code WW50 and it will only be $28.50 a month/ $285 dollars for an entire year.  So much less than going to school to do this, or even buying study materials.  It’s not just for the first month, or year, it is forever.  So please, take advantage of this now.  ITPro.TV/ww, use the offer code WW50.  Of course there is easy cancellation.  Really great guys, I am a big fan of IT Pro TV.  You’re watching Windows Weekly.  Paul Thurrott is here, Mary Jo Foley.  Paul, are you okay? 

Paul: Yes. 

Leo: We are talking obviously about the big Microsoft story, the new CEO.  Immediately Twitter goes crazy, the blogosphere goes crazy.  What should Satya do?  He’s in charge now, took office immediately.  Presumably doing a lot of all hands meetings right now.  I don’t know what he’s up to.  What do you think?  The wisdom of many years of Microsoft; you’ve been watching Microsoft longer than he has been at Microsoft. 

Mary Jo: Here is my advice, and this is going to sound a little weird I think.  I have interviewed Satya a number of times, in his different jobs at Microsoft. 

Leo: To his credit, he has been very accessible, hasn’t he?

Mary Jo: He has been pretty accessible, yeah.  In the old days when I would interview him, he would really let his geek flag fly.  He was so techy.  The interviews, you would walk away and just go, “Whoa.”  Now, I feel like they have made him go too high level, and use too many tech buzz words, and not be as geeky as he used to be.  My advice would be, Satya, be the tech visionary that you are, and don’t get caught up in all of the management bingo buzz-speak.  That would be my advice. 

Leo: Now, he is a cloud guy.  Microsoft is in this kind of transition.  Not only from desktop computing to tablet computing, but from desktop software to SAS, and to cloud computing.  He’s the right guy, it seems to me, to make that transition, any advice there?  You say play the Microsoft strengths, software, software, and software.

Mary Jo: That was kind of interesting yesterday.  One of the first things he did on his day one, was he had an all hands meeting for all of his employees, then he had an all hands for a group of invited partners and customers that they brought to campus.  He gave a very short presentation that was webcast, and you know what I found interesting?  He talked about software a lot, and that is a little bit different because Microsoft has been talking so much about devices and services, and they have been kind of distancing themselves from being called a software company.  I don’t know how many times he said it yesterday, but he said it numerous times in fifteen minutes.  “This is all about software, our strength is software, what’s different about us is what we know about software.”  And I don’t know exactly why they had him say this, but there is definitely a reason that they had him say the word software so much.

Leo: Maybe it’s not a they, maybe it’s just him saying this is his agenda.  No?

Mary Jo: All of those speeches, he has to run through all of these approvals.

Leo: Really?  He’s the CEO!

Mary Jo: Still have to. 

Leo: Really?  Who?  Who is going to say, “You know, Satya, I know that you’re the CEO, but you can’t say that”?

Mary Jo: He has handlers like everybody and they probably have him vet the talk before he gives it.

Leo: Oh, that’s depressing.

Mary Jo: I think it’s the same for Presidents, I think it’s the same for everybody.  They run through the talk with people and they say, “Yeah, don’t say that” or, “Yeah, say that.” 

Leo: He said, “Software will define devices, software empowers everyone, software embedded in our devices and services.”  You say, “Microsoft may be repositioning itself as a device and services company” but first and foremost he says, “It’s a software company.”

Mary Jo: Yeah.  I don’t quite know what to make of it yet, but it really struck me yesterday.  I thought, “Huh, he’s trying to make a point, but I don’t know what that point is.” 

Leo: If you’re the President, your inaugural address is to set the agenda.  He said, “This is my agenda.  This is what I think is important.” 

Mary Jo: I don’t think this was his inaugural address yesterday.  He didn’t really talk a lot about, “Here is what I plan to do with devices, here is what I would like to see us do.”  He didn’t go over those things. 

Paul: I actually think that this was smart because, I’m sure if you were to go back a year and a half ago when they made this big devices and services announcement and listened to our podcast, we said, “It’s really odd for a company that basically makes all of it’s money selling software, that they somehow have arrived to determine that it doesn’t even have the word software in it.  It’s crazy.”  I think this was his was of positioning software as the basis for devices and services.  In other words, what he is talking about is, software on devices, and software that is delivered as a service.  It’s software.  This is maybe the message that should have been said originally when they had this little strategy name come up, and the thing that Microsoft fans, customers, whoever need to hear because people have been freaking out that his company that was so good at this thing, has been disentitling it for a year and a half. 

Leo: Not the least of which, shareholders who say you took a $900 million dollar write off for service?  Hardware hasn’t been a real success for Microsoft. The website says, “Services, Devices.”  Right?  Maybe it should say, “We make the software that powers the devices and the services that you use.”

Paul: Exactly.  I know that it came out of this bit to be simple, that you want to say it in the simplest way, and the simplest way was, “Devices, Services.”  Again, when you talk about Microsoft, it’s the software giant, it’s the software company, it’s the maker of software, it’s software.  That’s Microsoft.

Leo: What do you think?  Is that the right way to say it? 

Paul: I like it. 

Mary Jo: Yeah. 

Leo: I like it too. 

Paul: Like Mary Jo said.  He’s sending a message, and I like the message, because the message is not a 90 degree or a 180 degree turn.  It is just a restating of the things they are doing that makes more sense to the people who care about the company. 

Leo: Hey, by the way, let’s not forget Amy Hood in all of this.  I keep seeing articles saying, “Amy Hood is a CFO, she is important.”  One analyst said, “It’s a team.  It’s Nadella and Hood.  The way Hood has kept costs down has re-aligned the business and set expectations.”  This is Raymo Lindscow.  “We believe the combination of Mr. Nudella and Ms. Hood could be a recipe for successfully managing Microsoft’s transition to devices and services.”  That’s an analyst, and remember that analysts have different constituencies.   

Paul: Well what is the suggest in it?  Somehow Nudella is essentially a boon to this woman who was not already fairly promenaded.  Honestly, I believe Amy Hood has come into her own, I would say she’s a big part of that financial analyst meeting.

Amy: I think it’s more, she’s a good compliment to him.  People on Wall Street who might be afraid of him because he’s such a techy and not a management guy.  She will be the one to hold their hands and make them feel good about it.

Leo: She is the Tim Cook in effect.  The person who manages operations, who manages production, makes sure the stuff gets done.  If you are a devices company, that is a more important roll than a software company, that’s a pretty important roll. 

Paul: I hope this isn’t inappropriate to mention, but I think there is an interesting story to be said for diversity as well.  She is a woman, and he is an Indian American running one of the worlds biggest companies.  I feel like it is definitely notable.

Leo: Absolutely!  I think it’s great.  The chairman of the board is an African American.  Bravo. 

Mary Jo: It is great to see, because it is very different from the Microsoft that we saw not too long ago. 

Paul: That’s for sure.  You mean the middle-aged, white man’s club? 

Leo: The Bill Gates’ college buddies club. 

Paul: Really, that’s Microsoft.  That’s what it has been.  So that’s a wonderful change right there. 

Leo: Now, whither Windows.

Mary Jo: Not whither on the vine, not that wither.

Leo: What happens to Windows? 

Paul: We don’t see the future, Leo, but I the future for Microsoft is going to involve, obviously trying to fix Windows as they can. 

Leo: You say in your article, “Windows must de-emphasize Windows to grow.” 

Paul: Right, and what I mean by that is, historically, Microsoft has tied it’s other platforms to Windows.  Office being the most obvious example, but there are other examples of that too.  In fact, looking at my software pick of the week, which involves Bing app stuff, still something that only runs on Windows.  Those are both examples of software products Microsoft makes, big and small, should run everywhere, regardless of where you are.  They should run as web apps, they should run as mobile apps on the most popular platforms, they should run on the Mac.  These are things that need to be everywhere.  We get caught up in these traditions that aren’t necessarily all that old, but the original vision for Microsoft in many ways was that, that’s what they would do.  They started off making developer tools, but then it was applications software, and they targeted the popular platforms, whatever they were.  Windows became this kind of a cyclone that sucked everything up into it.  As the world changes, Windows isn’t necessarily the focus of personal computing any more.  Increasingly it’s their mobile devices, and increasingly it’s their Android, and to a lesser extent IOS.  The argument here is that Microsoft needs to put the focus on where the people are.  There was a mobile release from Bing last week that I think targeted Android and IOS.  I got some angry e-mails from people saying, “Oh there’s Microsoft.  Windows phones coming soon, they’re doing IOS and Android first.”  Yeah, I would agree with you as a Windows phone user that I want it on Windows phone first, but there is a business to be run here.  You have to target where the people are.  I think that’s just the reality of it.  In the Smartphone world, 96% of those people are running Android and IOS. 

Leo: You point out in your article that Mason Mordor has already told Bloomburg that he wants Microsoft to de-emphasize Windows. 

Paul: Allegedly.  I think that there is some truth to that.  There is some good rational there. 

Mary Jo: It’s not so much that he is looking for them to de-emphasize Windows as it is to not favor Windows in every decision.  He is supposedly looking for them to decouple Office and Windows, and bring Office out on other platforms like the iPad.  Which by the way, they’re already on the road to doing. 

Paul: Yes, but recall, the plan is after it is on Windows.  Then it’s like, honestly, there are two things at issue that are at stake here.  One is simply like what I said earlier, just addressing where the customers are.  The other one though, and it is important for Office I think, is that the longer you ignore these platforms, the least viable Office is going forward.  After awhile, people just use other things.  If all of the people using the most popular platforms have moved past Office, you’ve got a whole other set of problems, actually even worse than the Windows thing. 

Leo: I’m reading this article from Bloomburg that talks about Morfit.  One of the things Morfit said is, “We found over time, the most effective way to get what you want accomplished is behind the scenes, that is probably on the board probably.  For us, it’s just the truths of people will do what you want if they like you, and if you haven’t publicly humiliated them.”  He says he is going to use data, and persuasion; not saber rattling.

Paul: This has never worked for me.  So I wish him well.

Leo: If that’s his role on the board, that’s great, that’s valuable.  Even if they don’t do what he says, if he brings in data and says, “Here’s a cogent article for this.” [Is cut off]

Paul: Well hold on a second, that’s his description of him.  What do other people say about him?  Of course he is going to position what he is doing is something like he is a white knight.  That’s what the guy who is pulling a knife out of your back and cleaning it with his shirt is saying.  What do other people say about this guy? 

Leo: We’ll find out. 

Paul: I’m just saying that I suspect it’s not very positive. 

Leo: Never when you’re an activist investor, and you kind of force your way into boards, that’s never seen as a positive. 

Paul: Not from the perspective of that company.

Leo: Who runs the board?  It’s going to be Gates, it’s going to be Ballmer, it’s going to be Nudella, and maybe it’s going to be a little of Thompson, and the rest of them are going to sit there.  It’s not going to be bad to get somebody who is smart and brings data to argue alternative points of view, even if they don’t do it.

Mary Jo: We can’t say for sure that he is going to be a negative disruptor, right?  Reading all of these articles, he has never said anything except for in his speeches.  He has never said, “I want Microsoft to sell Bing.”  What he, I think is going to bring to the board, I’m trying to be a optimist about it, is a short term perspective.  People on the Microsoft board only have a long term perspective.  They don’t mind waiting ten years to see if something that they’re investing in will actually pan out.  He’s going to be more, “Hey guys, we’re not going to wait around ten years to see if what we’re doing in tablets is really a good idea.” 

Leo: It’s such a leaky board that I’m convinced, if he is a pain in the ass, we will know soon.  It’s pretty obviously leaky.  I think that we are all agreeing that software is a good focus for Microsoft.  Let’s have a vote.  I move that it is a good idea to get Office everywhere, including IOS.  One of the things that has historically hurt Microsoft is internecine warfare between divisions.

Paul: If the US Government had split Microsoft up in the early 2000’s, one of the businesses that would have come out of that would have been Office, and they would have targeted these platforms.

Leo: From the point of view of the Office group, it increases revenues.  From the point of view of the RT and Service group, bad idea.  That is what a good leader like Nudella could do, is come in and say, “Look, I know, but we have an over-arching corporate strategy.”  I’ve been reading a lot about Amazon, I’m reading that book called The Everything Store.  I’ve been reading a lot about companies.  If you’re to continue to grow as a company, you’ve got to cannibalize existing business’s.  Apple said, “We know the iPhone is going to cannibalize the iPod.”

Paul: Even Microsoft used to do this.  Remember the decisions to let AOL on the Windows desktop.  It was just something they used to do back when they were young.

Leo: Back when they wanted to win!  But that is what a CEO should do.  They should say, “Look, this is an over-arching goal for the corporation.  Individual divisions do not get to choose.”  Here are the marching orders, now do it.

Paul: The theories should be like, “Look, if you want to beat IOS, that’s great, please Windows, do everything you can to beat IOS, but we’re going to be porting Office to IOS, too.  We’re not going to stop you from doing it, but we’re not going to give you artificial leverage to damage our most important business.”  

Leo: Right.

Paul: So I just think that's kind of a pragmatic thing they need to come to.

Leo: Am I right in assuming that's traditionally been a problem in the last few years for Microsoft?

Mary Jo Foley: It has been in the past, for sure.

Paul: Yeah, Mary Jo was talking about the internecine kind of warfare that occurred internally with the guns pointing at each other and that's where that comes from.

Leo: Yeah.

Mary Jo: Yeah. I mean, remember the whole original Microsoft tablet vision? The reason it got scuttled was because it didn't run Office. These days, well this didn't happen-

Leo: And J Allard throws up his hands and says well screw you, and leaves.

Mary Jo: So yeah, it's a balancing act though, right? Because if you're the CEO, you have to look at all of the data and say well, which is going to hurt us more, doing X or doing Y in terms of finance? And in terms of strategy, you have a lot of different things to weigh. Is it going to hurt us more to put Office on iPad before we put it on the Surface? Or is going to help us in terms of revenues and strategy?

Leo: Right.

Paul: Not to over-generalize, but I would say not doing stuff hurts you most in the long run and you know that's kind of what's happened.

Leo: Yeah, it's sometimes the hardest thing for a business to do, but you have to cannibalize you're existing business to grow, otherwise you're stagnant.

Paul: Yep. And that's why Windows is Microsoft to many people. And not only could they not cannibalize it, they stopped all the products, renamed the products to Windows something, just to get a little sniff of success on to it or whatever, it's just so awful. It's too bad.

Leo: Well good, what better time to change that than with a new CEO. With the support of Mr. Gates as the technical adviser. I think that's the role of Bill Gates.

Paul: Yeah he's going to be playing Stratego on his smart phone and just kind of waving.

Leo: Bill doesn't sound like that really.

Paul: He does, he's got that kind of nasally-

Leo: Windows 8.1 update 1 update. Update 4 coming, we'll talk about that in just a bit. More updates about the update. But first a word from ShareFile, a great product. I think we have not told people about ShareFile on this show before and we really should. Yeah, sure you have other choices, even a choice for Microsoft to share files. Here's why you want to look at ShareFile. First of all, across platform it's completely easy to use, it does not require an account on the part of the person receiving the file. Last thing you want to do is attach an email. And most business emails today, contain attachments: documents, spreadsheets, Powerpoint presentations, contracts. That's not the way to do it, it's not secure, you can have a real problem with bounce back as these files get big, a lot of inboxes can't handle these massive files, ShareFile can. They also don't have the thing you need, the security but ShareFile from Citrix sends your attachments as secure links. You can send files of almost any size with the highest degree of security, you'll get a notification when the file has been opened, and by whom, you can control access and say how long they can download as well as how many times. And there's a great outlet plug-in with ShareFile that makes it look like email, it's just not. I use ShareFile and I used to use a variety of sharing programs. Once I went to ShareFile I was just so happy because it just simplified my life considerably. Basically what happens is they get a link, click the link, they don't have to sign up for ShareFile, your branding is on the page. We have our TWiT logo on it and it explains clearly what to do, you click that link and it downloads, it unzips, if it's a folder it'll zip it up, and it's just great. Why don't you try it free for 30 days, or bring it to your business. Bring it to your IT guys say, let's look at this. HIPPA compliant, if you're in the medical field it's compliant with regulations from a variety of industries. In fact if you start your free trial, it'll ask you what industry and you can customize it for that industry. Now I'm going to invite you to try it free for 30 days and use the offer code: windows. But to do that, you can't click that big green button in the middle, you can't click that little green button at the menu bar, you have to go up to the little tiny text at the top of the page where it says podcast listeners, click here. Click there, and then I want you to enter the offer code: WINDOWS and you will be giving us a little credit and getting 30 days free. Do select your industry because it supports regulation in a variety of industries. Legal, medical, health care, manufacturing, marketing, non-profits, real estate and so forth. If you're a real estate agent, you've got to know about ShareFile. Sharefile.com, please use the offer code: WINDOWS after clicking that link at the top of the page. Sharefile.com. I'm Leo Laporte, Paul Thurrott and Mary Jo Foley are here. We are talking about Microsoft and Windows, as we do each and every Wednesday 11am Pacific, 2pm Eastern time, 1900 UTC. Moving on from the Microsoft-

Mary Jo: Wait, did we talk about Scott Gu?

Leo: Let's talk about Scott, they call him Scott Gu?

Mary Jo: Yeah, we call him Scott Gu.

Leo: He is now taking Satya's old job basically.

Mary Jo: He is, yep. And this to me, was a pretty surprising choice. Surprising in a good way, not a bad way.

Paul: Just to step back for a second though, because one of the big questions when it all was announced was okay but who's taking his old job? Microsoft had no comment on that.

Leo: They didn't say?

Paul: No. So everyone was wondering this. I don't know, Mary Jo I think it basically was, you know those little dogs that kind of grab on to your ankle and don't let go?

Mary Jo: It was, it was super annoying.

Paul: So she found out.

Leo: Why did they not announce it? Didn't they know that-

Paul: Maybe they didn't want to take the spotlight away, or...

Mary Jo: Exactly.

Leo: Yeah, but that's the obvious question.

Mary Jo: It is, but you want all eye on Satya. But Scott Gu is, at Microsoft, one of the biggest rockstars. The guy, like when he goes to build, people follow him around wanting his autograph. I'm not kidding. He comes out wearing the red polo shirt and people go crazy.

Paul: Now how did that- Did he just wear that one time? For some reason he was like the only guy with the red shirt, and then it became a thing, is that what happened?

Mary Jo: Well he says the reason he wears red shirts now is because he doesn't want to have to think about his wardrobe so he has millions of red polo shirts and everyday he just puts on the red shirts so he doesn't have to waste time thinking.

Leo: Great trademark.

Paul: That's what I do, as well.

Mary Jo: He wore a blue shirt that one time, remember that Paul? And people were like aaaah!

Leo: Paul, coffee-stained is not a color just so you know.

Paul: It becomes a color.

Mary Jo: Right, you've got to pick your colors well.

Leo: By the way, this is Interim. I don't know how interim Interim is.

Mary Jo: Not so interim, really. I think it's just a formality that it's interim.

Leo: Okay. And why is he so beloved? Is he a developer, is he a-?

Mary Jo: He is a developer and he is, well a developer's developer. He is a true developer, gets all into things like open-sourced tools and what you can do. He was originally the champion of Silverlight before Microsoft kind of nexted Silverlight.

Leo: Oh, that's where I know his name..

Mary Jo: Yep. Then, he moved over to Azure to be the head of program management a couple of years ago, and as soon as he came into that role in Azure, so many things started happening. Like they really started cranking up the pace of roll-outs and getting in with open-source companies, getting them committed to Azure, doing things that developers wanted that weren't typical Microsoft things like open-sourcing, certain kinds of tools or projects. So he just does what's right for developers and that's earned him a lot of loyalty.

Leo: Awesome. I like that kind of guy.

Mary Jo: He's a good guy, and super technical! Man, he's like techy to the Nth degree so they're bringing the engineers on right now at Microsoft.

Leo: That's a good sign, I think, yeah?

Mary Jo: That is a good sign.

Leo: Do you think Nadella, I guess Nadella, would have a lot of say about who his successor is.

Mary Jo: Yeah, I would think.

Leo: So you could read a little into that too, as to direction.

Mary Jo: Yeah.

Leo: Scott Gu, he's got a nickname and a trademark, that's my kind of guy.

Mary Jo: Scott Gu, yes.

Leo: Does he talk to journalists?

Mary Jo: Yes, he talks to journalists.

Leo: Love him!

Mary Jo: Yep, all good. All good news on the Scott Gu thing, and we don't know who's taking his place yet on Azure but...

Leo: It's turtles all the way.

Paul: Yeah, I know...It's unbelievable.

Leo: Somebody not Gu-ey. Good, good good good.

Mary Jo: Yeah, so we just have to talk about him because that was just kind of a nice surprise ending of a long day yesterday to hear it was him.

Leo: Okay, great. Now Windows 8.1 update 1.

Mary Jo: Yeah.

Leo: What's new-

Paul: It just seems to boring now...

Leo: I know, I know. A CEO search is like hot spicy food.

Mary Jo: I know, gossip.

Paul: Yeah, and this is like the Intermezzo. It's not even desert. So, let's see... I guess I'll just talk about the actual build and what's happening there, if that's okay.

Mary Jo: Do it.

Leo: Do it man. It leaked out, I saw it leaked out this week.

Paul: Yeah, Bill leaked and so we actually got our hands on it and it's interesting to look at and to see what's going on there. And I think the most accurate thing to say about it is that there's no big major thing, but it's kind of like Windows 8.1++, in the sense that the major themes of Windows 8.1, which are to make the operating system better for people on tablets and people on traditional computers, are further explored or expanded. And so, there's the stuff we know about like the search button, and the power options button on the start screen, when you right-click now in the start screen to the app screen, you get the menu like you would on the desktop, which is kind of nice. Actually, it's funny because there's a little bit of subtlety to this but there are two features related to the Metro app on the desktop's task bar. The first one is that you can pin a metro app to the task bar, so that it's always there like if you work primarily in the desktop environment but occasionally want to run a Metro app, you can do that-

Leo: And did I see the thumbnails on it too?

Paul: Well, so yes if it's running, you get the thumbnail. Which that's not a big deal, although there's an interesting side-effect to that and I'll get to it in a moment I didn't write about this but it's kind of interesting. The second one is you can also show any running Metro apps in the taskbar, which is a separate feature. What that means is, if you've got like three Metro apps and three desktop apps running they'll all have buttons in the taskbar and so you can switch to them more easily. And so that's where the preview comes up, the little thumbnail preview. And the interesting side-effect to that is Metro apps are actually managed by the operating system. So they go into this kind of, I don't know what the technical term for this is, like a tombstone kind of a state where, they're still in memory but they're kind of on the way out. And you can actually see that in the thumbnail because sometimes you'll see the thumbnail of the app, but sometimes all you'll see is the thumbnail of the app's start screen. You know, like the animational codes, and I believe that's for an app that's on the way out and it will eventually go out of memory. It's slowly fading, it's at a distant horizon.

Leo: It's on its way out...

Paul: Yeah, but there's actually one more feature that I think is worth mentioning, and it's a kind of toolbar that appears, or I guess we'd call it an Appbar or something. At the top, again with the mouse, so you're using a Metro app or a PC settings app, and you move the mouse to the top, a black bar comes across the top with the name of the app, a little icon in the corner, and then minimize and close buttons so that with the mouse, you can close those apps. Which was impossible without dragging and dropping before.

Leo: That's good. And are they still full screen only or do they have Metro apps?

Paul: No, still full screen only.

Leo: Let's not go crazy.

Paul: The other welcomes, maybe an edition for virtually everyone, is that in 8.1 they remove the Skydrive taskbar button, the tray icon. And a lot of people have complained it's hard to know if it's doing stuff, or if it's syncing, or if everything is syncing properly and they're putting that back and so it doesn't look like it's complete, but that's making a comeback as well. So, just a bunch of little things. And there's a lot of other little things, there all little. There's nothing that I would describe as super major in there but you know, I think these kinds of fit in finish improvements are important and I think they add up. I think Windows 8.1 could benefit from a few more of these things this year, I would love to see that happen. But I think this is shaping up to be a nice little feature pack, basically.

Leo: In a way, update 1 seems to be as big of a deal as 8.1 alone.

Paul: Yeah, almost. Almost.

Leo: Especially with the way it's handling Metro, that's a big deal.

Paul: If they got 8.1 update 1 to the point where Metro apps were running as Windows, I would say yeah, they could call it the 8.2 almost. I think that would be big.

Leo: Almost, yeah. Enterprise mode for IE.

Mary Jo: Yeah, this is one of those features that is going to be in 8.1 update 1 that is something enterprise users may be very interested in. So you know when you're on XP and you're kind of stuck with IE6, and a lot of people coded apps and internet sites to IE6, well people have done that with IE8 now. The problem is some of the software, including some of Microsoft's services and software like Office 365 and Office 2013, don't work with IE8. They discontinued that browser support. So, say you're in enterprise and you want to go to IE11 on either Windows 7 or Windows 8.1, you can't if you need IE8 in your shop. So Microsoft knows this has been a problem and they're taking this idea of the compatibility mode in Internet Explorer a step further, and they're adding this in as a feature supposedly, called Internet Explorer Enterprise Mode. Enterprise Mode IE, yeah. And the idea is you'll be able-

Leo: EM, not ME.

Mary Jo: EMIE, I think.

Leo: Don't say ME.

Mary Jo: Why?

Leo: Well, Windows Me, I think is the first-

Mary Jo: Oh, jeez! I didn't even think of that!

Leo: That would be one reason...

Mary Jo: Nooo....

Leo: Millennium Edition, anybody?

Mary Jo: No! No! Hahh. So yeah, you're going to be able, as a company, to say hey I have these intranet sites and I need them to display an IE8 for those sites, but for everything else I want it to display in IE11. That supposedly is how this is going to work. I've heard it's something you can do now with group policy settings, if you know how or care to do it that way. But they are actually going to make this a feature of the browser that's built into Windows 8.1 update 1, supposedly. So that's good, another cool sort of feature gets added to update 1.

Leo: Windows ME is back...

Mary Jo: Windows ME. No!! I didn't even think of that when you said that, Leo. I was like, "Oh....Why??"

Leo: You've buried it deep in your subconscious, that's why.

Paul: It's Internet Explorer Millennium Edition.

Mary Jo: I know...

Leo: "IEME."

Mary Jo: It's something you try to block from memory.

Leo: It's IEEM. Now I buried the lead because you have a little thing here.

Mary Jo: Yeah this isn't a huge deal, I don't think, but-

Paul: I disagree.

Mary Jo: Okay.

Paul: I think it is a huge deal.

Mary Jo: Originally, the game plan was to get update 1 out on March 11th, which is Patch Tuesday, I heard that from my sources. And that was called a ship target, it wasn't like set in stone, like that's it! It's going to be out on Windows update on that date, boom. It was kind of like yeah, we think that we can hit that target. Now, in the past week I've heard from two different sources that they've decided not to try to hit that target. Instead they're going to go with the Patch Tuesday in April to distribute update 1, so that will be April 8th. So instead of March 11th, April 8th.

Leo: Alright.

Mary Jo: Yeah, so I'm not one of those people saying that they slipped and something must be wrong! I'm not willing to go there because the original way I heard the news about March was it was a target, it wasn't like it's on the calendar and we've got to hit that date.

Paul: By the way, Microsoft has never once acknowledged this release either.

Mary Jo: No, they've never even said publicly that this exists. Right.

Paul: I mean, to be fair...

Mary Jo: I know, right. So it's hard to say well they slipped, because they haven't even said this exists.

Paul: Microsoft has missed the schedule that we reported. Those bastards!

Leo: The rumored schedule.

Mary Jo: There you go. Yeah, but the date April 8th is after Microsoft Build, so we'll probably hear more about update 1 at Build, I would think, if that's still their target. And OEMs, we should say OEMs who are going to preload update 1 on new PCs, they're still supposedly getting the code in March. So it doesn't sound like it really slipped per se, but more just a decision on how they get it out from a servicing perspective.

Leo: It's pretty clear that they want it to be a part of Windows update though, I would guess.

Mary Jo: Right.

Leo: I mean, that makes sense, right?

Paul: Yeah.

Leo: So you've got it can only be the second Tuesday of a month, so if it's going to be later in March, we can do it in April.

Paul: Yeah, right. In other words, they're not going to slip-stream it in some other date.

Mary Jo: TitanFall was supposed to be March 11, wasn’t it?

Leo: Oooh, you want to step on TitanFall..

Paul: It is March 11th.

Mary Jo: So maybe they also thought about that. I don't know, I'm just guessing on that one.

Paul: I cannot imagine-

Leo: That TitanFall division is very powerful, you don't want to mess with them.

Paul: TitanFall is not made by Microsoft.

Leo: Oh okay. The Xbox One division then. Paul, the leaked version you guys were playing with, and by you guys, I mean Raphael. Does that seem fairly stable? Is it fairly done, is it cooked?

Paul: Yeah, I mean people have already asked me should I install this?

Leo: No, don't! What are you, crazy?

Paul: Yeah, that's crazy talk. But no, this is a fairly minor update. So yeah, I've only had it for a couple of days. I wouldn't claim that it's anything other than what it is. But it's, yeah, it's fine.

Mary Jo: I'm curious how you know there was rumor that Microsoft was going to make boot to desktop the default on this release.

Leo: The default, oooh.

Paul: That was the dumbest thing I've ever heard.

Mary Jo: Right, I think it was a bad headline, actually.

Leo: It wasn't even a story, it was the bad headline. That happens.

Mary Jo: Yeah, I kind of think so.

Paul: The bad headline was the story.

Leo: The headline writers you know, don't understand what they're reading.

Paul: Well it's ridiculous, you can already change it in current version of Windows if you want to boot into the desktop. And why would they ever force people that have a touch machine to boot into the desktop, that's crazy. That makes no sense.

Mary Jo: Right, but what WZOR, the leaker however you say his name if you do pronounce it, he posted on February 2nd and said you guys don't understand what this is going to be I don't think. Boot to desktop can be the default on non-touch machines, like it can be set as a default on non-touch machines.

Leo: Well, that's on touch machines too.

Paul: That already can be done.

Leo: It exists.

Mary Jo: But I mean it can be set, I think, by the OEM.

Paul: By the OEM, it could be.

Mary Jo: That's the missing part.

Paul: That's an interesting guess because there is one major feature of this release that is actually relegated to OEMs. They will only appear on the new PCs, which has reduced the disk space a lot, you know usage or whatever. Someone sent me a shot of some comparison of memory usage, claiming that memory usage has gone down in this release as well. I don't think that means anything, I don't think anyone has ever examined Windows 8.1 and said wow, this thing really uses a lot of memory. You know, I think we're past that kind of an issue. But it is a very real problem when people buy a new Surface or other device that has, especially 32 gigs of storage, but 64 gigs whatever, and more than half of it is taken up by the OS and whatever else is installed on there. And there is work being done in this release to fix that problem but we're not going to see it out here-

Mary Jo: It's like disk footprint, right? That's more like disk footprint, so that you can put Windows 8.1 update 1 on smaller, cheaper tablets.

Paul: And have more usable space, yes. It's designed for PC makers, device makers.

Leo: Yeah, that way you can sell a 16 gig Windows 8 tablet.

Paul: Yeah, possibly. What we want is a Chrome Book

Leo: Just out of curiosity, who uses Internet Explorer anyway?

Paul: The cynical view Leo, is that everyone uses it. We use it to install Chrome. But, we-

Mary Jo: They still are the biggest market share, isn't it? Like 60-something%

Leo: You know what, I'm saying this facetiously because obviously everybody who listens to the show and you guys, we all know about other browsers, and in most cases use other browsers-

Paul: The truth is, I have IE and Chrome running all day long, I use both. I use IE for very specific things, for pinned taskbar type things, pin sites. The one feature that IE has that is crucial to me that Chrome does not support is the ability to have multiple tabs on a pinned site, I guess you'd call it. So I have all email together in one tab, I have news sites on one tab, you know, one button in the taskbar. I love that. The truth is I find IE to be very frustrating. I use IE, in some ways it's related to the integration with the OS where it can access the hardware in ways that Chrome can't, that I think cause problems frankly. In some ways it's just a functional thing, I don't know but I have a lot of problems with IE and I find it to be somewhat frustrating and so for normal web browsing, I actually do use Chrome for the most part.

Mary Jo: So do I.

Paul: Obviously on an RT device you don't have a choice and I think now that they've fixed the performance issues on RT, you know with Surface 2, I actually think that's maybe the single biggest problem with Windows RT. And the inability to run anything-

Leo: The inability to run anything but IE.

Paul: Yeah, I hate to say it like that, but yeah.

Leo: But again, that's a certain kind of user. Not the vast majority of users, as you look at the usage statistics IE is dominant on Windows, but that's because that is the default. I would guess some businesses certainly, we have to use IE with some of our venues.

Paul: It's not worth debating but I would say that if there was some way to look at user engagement, by that I mean people actively going out and doing stuff like opening multiple tabs and windows and browsing the web, and all that kind of that, I don't think a lot of those people are using IE honestly. I think that IE usage is either casual or is commanded.

Leo: It's at work, or it's people who just don't know any-

Paul: I say that, by the way, without any evidence at all.

Leo: No, no I think that's accurate. Although of course, there's the three people in the chatroom that say what are you crazy IE11 is the best thing since sliced bread, it's incredible! But you know, I think most geeks use something else.

Paul: I bet it's not. And I mean no offense to anybody. Obviously you'll find people who do use and love it all I can say is I use a lot of computers and that has not been my experience.

Leo: The best you can say about IE is it's not that bad. It sucks less.

Paul: Yeah, it's not a great marketing-

Leo: They did that didn't they?

Paul: Yeah, it sucks less.

Leo: It sucks less.

Paul: I think they did that for IE actually.

Leo: It was, that guy remember, he was doing all of that stuff and he had the-

Paul: Yeah, that's right it was. It was IE. Now with less sucking.

Leo: Which is really a task of acknowledgement among the hardcore geeks.

Paul: It's going to be a moment of truth for me if Chrome ever adds this multi-tab binning thing. Maybe in a little bit, I don't know.

Leo: I think a lot of geeks use them all, like I said I found Sleep Near on my system just the other day.

Paul: Yeah, I also have Firefox and Opera.

Leo: Yeah, we have them all. But that's our job is to use them all. In other news, Google will avoid sweeping any trust violations-

Paul: You know what?

Leo: How?

Paul: Screw them.

Mary Jo: Screw them.

Leo: Screeeewgle!!

Paul: Right, Microsoft gets Screwgled in Europe.

Leo: I like your illustration to this article Paul. He does a Google search on 'How to avoid sweeping any trust charges.'

Paul: Thank you, I actually went out of my way to show that to Mary Jo. I was so proud of that.

Leo: I love it!

Paul: I was like I can't really share this, I could show it to my wife and she'd be like ehh...

Leo: Paul, we get you.

Paul: Thank you, thank you.

Leo: We get you, you're among friends.

Paul: I giggled to myself when I made that this morning, I was so proud of it.

Leo: See? I spontaneously said how much I liked it.

Paul: Look at you, you pulled it right out of there. I thank you for that.

Leo: Actually I love all of your illustrations. I didn't know this but the chatroom informed me some time ago that you were a graphic artist before you did anything else.

Paul: Yeah.

Leo: So this is your hobby, is making goofy illustrations.

Paul: It's a way to express myself creatively. By lashing out at the companies that I cover.

Leo: So what is the actual news story here?

Paul: Okay. So Google is set to, or has basically settled with the European Union over the search-related charges. And from my perspective, the big story here is that Microsoft paid, over a decade, something like 3 point something billion dollars in fines to the European Union. They were embroiled in this thing forever. Google comes along, I have often said Google's ability to impact man-kind is exponentially greater than Microsoft's. Not only are they not dragged through the courts and charged with anything and fined anything, but the guy from the European Commissioner actually says look, we're going to charge you, but if you settle first we won't. And then they spend two and a half years fielding ineffectual settlement requests from Google until they finally do reach a settlement. And so, to me the interesting part is, why is it so different? What changed, you  know? Microsoft got dragged through the mud forever, in fact they're still dealing with it in some ways. They had to make a special version of Windows that doesn't even have a Windows Media Player, the most pointless Windows change of all time. And when it comes to Google, let's just talk, we'll figure it out. And honestly I think there are a lot of factors, but one of the things is that Google was coming of age when Microsoft was going through this thing, they were literally forming and becoming a company and so they know the sound. I mean, even Intel dealt with the EU regulators differently than Microsoft did, specifically because of what happened to Microsoft. So when they were charged with NI trust violations in Europe, I think Intel did pay a fine. It was a different age but they never did the trial stuff.

Leo: Right.

Paul: The other one is that there are different people running the show in Europe these days. Neelie Kroes is long gone, I mean this woman's deal was we'll stop criminals, or criminal companies or companies that are beheading illegally, by fining them as much as we can. And by the way, the European Union can fine them a lot! I mean they can fine them up to 10% of their annual revenues. Billions and billions of dollars, and that's what she did. The new guy Joaquín Almunia I think his name is, he doesn't believe in this philosophy. He believes that's not the way to stop people from doing the wrong thing, and that the way to do it is to settle. So it's just kind of a different, touchy feely vibe over there in EU. But because it's like a government, governmental organization, nothing happens quickly. So years have gone by, there was a three year investigation, spent a year and a half now going over this stuff and now they're just going to settle. So it's a little disappointing having watched and reported on what happened to Microsoft after so many years and then Google it's like, you're all set, thanks!

Leo: To be fair, the EU has a lot of other actions going on against Google, and France and Germany and others are suing them for other things.

Paul: Well the EU is I would say one other major thing, which is the Android thing. There's a product dumping charge, you know I think it will be handled in exactly the same way frankly. And yes, there are individual countries, but Google is a huge corporation. And they do have global reach and so yes, they're going to run into this kind of anti-trust stuff. But the fact remains that it's a different age and I think a lot of people looked at Microsoft and they looked- You remember like, it's so weird to be here in 2014 and think let me get this straight, they bundled a browser in their operating system, which everybody does. And this was such a huge problem, they were going to destroy the planet or something, that you had to drag them through the court for years and years, and billions of dollars in fines and you got them to decouple a media player, so great job on that.

Leo: Well done, bravo!

Paul: Yeah, it's just amazing. And then oh, that product was made pointless by the natural change in the industry now everyone uses iPhones and iPads. It's just funny we spent so much time on that. Does Microsoft get like a refund? Does the European Union say sorry about that, here's fifty percent. I don't think so, I don't think that's going to happen.

Leo: Oh well. Did you have anything to say about the Google Motorola sale? I forgot that's happened since we met last.

Mary Jo: I know, it happened right at the end of Windows Weekly last week.

Leo: That's right. Yeah.

Mary Jo: Yeah you know, I think it's interesting because some people have introduced the possibility that Google sold Motorola as part of this anti-trust settlement in Europe. They were saying like maybe this was a condition. I don't know that it was or wasn't.

Leo: Motorola did not have a big presence in Europe so I doubt it.

Mary Jo: No. But anyway it's still kind of an interesting thing to ponder, everybody had their two cents last week. Was this a bad thing for Microsoft; was it a good thing for Microsoft? I think most people said that it proved Google's patents that they bought, supposedly bought Motorola for, even though they never admitted that publicly, were kind of pointless. Although they did end up keeping the patents.

Leo: Yeah, I don't know if I agree with that. I think that they were not patents and they didn't keep them.

Mary Jo: They kept them, right? Google kept them.

Leo: They kept most of them, I think 2,000-

Mary Jo: Most of them were patents they couldn't really use against Microsoft.

Leo: It wasn't a war chest, it was defensive because, remember they have to protect Android or people aren't going to use it. I think it's Google's recognition that really our business is not selling handsets, our business is getting Android on as many phones as possible, and our other software on as many phones as possible. If we focus on that-

Mary Jo: I think they also bought them thinking they could use them to fight Microsoft and patent wars and it didn't end up that way for them.

Leo: Rockstar's killing them.

Mary Jo: Yeah, Microsoft has been killing-

Paul: I bet a little Apple would be there too, Microsoft does that with Surface where wow people love this stuff, we need a piece of that.

Mary Jo: Right, but anyway I don't know I've seen people try to argue that Google's selling Motorola was good for Windows phone. I don't really have an argument to make that that is the case.

Leo: I don't really understand why it would be, they're a minor player, Android and-

Mary Jo: I don't know, I saw people saying it showed that Microsoft maybe should not have bought Nokia because Google ended up saying you can't own a phone company and still be the software provider-

Leo: I think there's a lesson from Microsoft there that you go into competition against your OEM's at your peril.

Mary Jo: They still have their OEM partners for now but it's going to be interesting to see if they keep many of the others.

Paul: I don't think those are related. There's a unique situation with Nokia that-

Leo: Well here's the upshot, Microsoft will be the only Windows phone manufacturer, they're the only Windows-

Paul: Why is that an upshot?

Leo: Well that's the upshot, nobody else is going to compete against that.

Paul: But in other words, Nokia is 90% Windows phone and they're going out of business.

Leo: No, I understand.

Paul: But in other words, if they didn't buy them-

Leo: You're right, it's not directly- You're right.

Paul: That's what I mean. In other words, these-

Mary Jo: But supposedly Samsung is going to do a new phone, a new Windows phone. There's people who are committed.

Leo: This might have made a difference there. I wouldn't be surprised at all if Google- I mean Google has gotten some concessions from Samsung out of this, by the way.

Mary Jo: Right.

Leo: And I wouldn't be surprised at all if one of those concessions was well maybe we won't do the Windows phone. Google's saying look, we are not going to compete against you in hardware. It killed Nexus, they are-

Paul: Is that true, by the way?

Leo: Well it's the rumor, we don't know it hasn't happened yet.

Paul: I think the Nexus thing is a great idea. I heard they were going to use the play name.

Leo: They're going to go Google Play Edition, they will not make their own phones or tablets, they will let the OEMs have the hardware because they make money on Android.

Paul: You know what that is, it's signature PC, right? So, Google has not just copied it but they succeeded with this.

Leo: They made it work.

Paul: It's amazing.

Leo: That's one of the concessions they got out of Samsung, that they would not only cut back on the crapware, but they would also make it uninstallable. Partly that's the Korean government too, by the way, which made a law insisting on it. But never the less, I think that's exactly like you said, they declared victory in the signature PC war. So I think there is a little bit of a lesson from Microsoft, or maybe Google learned from Microsoft. You compete with your channel at your peril. It's easy for Google because much like Microsoft they're software is- They're a data company, they're not a software company, they're a data company. They get the data from the software, and they put their software out there. They don't care who makes the Android phone, as long as it's an Android phone and Google's software is on it.

Paul: Well except that the way things were trending, is that the biggest Android phone makers were kind of obscuring Android in a way.

Leo: Exactly and they got a concession. So it could very well be that they bought Motorola with that exact plan. Jessica Lessin says it and I think she's right in the information. Larry Page is a grand master, and these are all chess moves and it definitely makes sense saying that he's thinking well I need to do this this this and this, and I need to get Android purer, and he succeeded. Motorola was never- They didn't sell very many handsets apparently. It was a big drain on the bottom line, and they got the patents for whatever they're worth. So whatever, it's not our story. It's not our problem.

Paul: Well it's still interesting.

Mary Jo: Yes, in terms of arrival to Microsoft and how they fight over patents all of the time.

Leo: It was, I guess today or yesterday, that we got all of the companies, including Microsoft releasing their transparency reports.

Paul: Right, more like translucency reports.

Leo: Yeah, opacity reports.

Paul: I find this whole thing to be very odd because they reached an agreement with the government, these companies did, Microsoft, Google, LinkedIn and maybe Facebook, to be a little more transparent about the requests they get. But the rules they have to adhere to are a little strange. For example, Microsoft said, let me see. This is from January to June 2013, they received fewer than a thousand FISA requests, related to between 15,000 and 15,999 accounts. I thought that's an odd way to describe it but that's part of the requirement. They can only do it in thousands.

Leo: They're all doing it.

Paul: Yeah, they have to. It's not that transparent. To me, again, the interesting part of the story isn't necessarily the transparency report, which frankly isn't interesting in the slightest, it's that in the post about this on Microsoft General Console, Brad Smith actually kind of criticized the president, and the government I guess, implicitly, for not doing more to basically protect these companies from other governments that might be spying on them illegally.

Leo: That's an angle I hadn't thought of.

Paul: Yeah, and I thought that was kind of an interesting little dig there because you kind of read through this report and then all of a sudden there's this sentence that was like really critical of the president and it's like, wow. Interesting. So I guess they're agreeing to certain things but they still feel very strongly about Microsoft their future and business is online services and if people don't trust them, they're going to have bigger problems. And I think that's what they're trying to hit off.

Leo: And talk about burying the lede, the big story for you and me Paul. Here it comes, the big update for our Xbox One!

Paul: I got the map back for Call of Duty: Ghost.

Mary Jo: I said to him today when we were doing the show notes I'm like Paul why don't you have an Xbox story?

Leo: Yeah...

Paul: She said it.

Mary Jo: I did, I said it.

Paul: She said aren't you going to mention the Xbox update? I'm like, okay... So, there was an update on when the Xbox Launch, they called it Launch, the update. And of course the Xbox launched in November and so the next update happened in December, and it happened on Patch Tuesday in December. I thought that was interesting, I wonder if they're going to do this because- Going forward Surfaces, you know, does their updates on Patch Tuesday. And then January came and went with no Xbox One update and I thought that was really strange because Xbox frankly, needs a lot of updates. This is very much an incomplete product. It's not so much that it's buggy, although, anyone who uses the Xbox One could point to certain bugs. It's just that there's stuff that's missing, stuff that's been on the Xbox 360 for years. You know, the ability to plug in a USB key or a hard drive and play content that might be on that device. The ability to plug in a keyboard and type on a real keyboard when you have to enter a 25-digit product key, rather than doing it on a hand controller. By the way, if you've ever seen a young person text on an iPhone or some other device, you know how fast they go?

1:Yeah.

Paul: My son does that with an Xbox controller and it is notable.

Leo: Now I saw that it said it wasn't going to be in games?

Paul: No, it's just for typing in, you know filling out forms and things.

Leo: See I want it to be everywhere.

Paul: Some people are saying I want to use an Xbox One, but I want to use a keyboard and a mouse, so I can play it like on a PC. And you can't do that because the Xbox One, like the Xbox 360 supports controllers, and that's the level of playing field. But if support for that were added, people would have much more precise movements as possible than with a controller, it'd be like cheating essentially.

Leo: Oh, that's fair.

Paul: Yeah, so anyway... There is going to be an update in February and it is going to be on Patch Tuesday. And they've only announced a few of the things that are going to be in it, there's nothing hugely major but the USB keyboard support is one of them. A couple of other small things, nothing major. The interesting thing, in some ways is the next one was also talked about. And that one will be coming on March 4th, which is not a Patch Tuesday. It's like what the heck? But the reason is, it's something to do with TitanFaller, they're doing it ahead of TitanFaller, and the way that they described it is that this next update will include many new feature improvements, which they're not talking about. But most significantly, to our party and multi-player systems.

!: Right.

Paul: And I think they want to get this right because they anticipate that TitanFall is going to be a big deal, multi-player, you know for multi-player and I think they want to figure that out before.

Leo: Yeah, truth is I wasn't so worried about what features they added, just the fact that they were doing it.

Paul: Oh, yeah. I think by the time this year is over, I would be surprised if they didn't have at the least 8-10 system updates. I bet it falls into a cadence like you see with the Surface. I think that's going to be normal.

Leo: Yeah, it's just the fact that the dam broke. That's what I'm excited about.

Paul: I got nervous in January when there wasn't one and I thought, that's so strange because they so desperately need updates, you know? And so they're back on track.

Leo: I don't know why I'm sitting on Mary Jo's picture because she couldn't care less.

Mary Jo: I will pretend I care.

Paul: We won't stop talking until she nods off.

Leo: Yeah. Hey we're going to take a break, when we come back we'll have our tip of the week our software pick of the week and the beer of the week, most importantly. But first a word from Audible.com. Audible is a great source of audio entertainment because of course, Audible is the place to get your audio books. I'm a big Audible fan, Paul's a big Audible fan, we've been listening to Audible books for years. When did you start Paul?

Paul: Oh boy. I don't know, I looked up on my current account, this one doesn't go back to when I first began listening, but I think it goes back to maybe 2006 or '07. But I actually have a second, another Audible account that's older than that, so it's been at least 8 years but I'm not 100% sure.

Leo: Long time for me, this is 2000 and I've listened to over 500 books and I just love everything about Audible. My next book, by the way Dogfight: How Apple and Google went to war and started a Revolution.

Paul: That's a good one, yeah.

Leo: I think it was your recommendation that got me to get it. Just listened to The Everything Store, the Jeff Bezos and Amazon story, which is really interesting. Nick Bilton's Hatching Twitter, really great. So, it's a great source for tech information, but also science-fiction, fantasy, classics too. And what they've been doing lately with this classic series, they call them the signature performances, and a tip of the hat to Microsoft, they get big stars to read classic books. In this case, Kenneth Branagh reading Heart of Darkness, which is the Joseph Conrad inspiration for the Apocalypse Now movie. That's kind of loose inspiration, but really a classic. They've got a lot of classics, kids books too! Wind in the Willows, read by Shelly Frasier, they've got The Wonderful World of Oz, read by Anne Hathaway and Audible is the source of 150,000 great books. And not just books! For instance, with your Audible subscription that I'll tell you how to get in a bit, a daily digest of the New York Times or the Wall Street Journal, your choice. You also get radio shows comedy performances and more, really pleased that they've also brought The Hitchhikers Guide to the Galaxy, original BBC radio plays. I think a lot of people remember the book and the movies but Douglas Adams originally wrote these for the BBC and it is the best version of The Hitchhiker's Guide to the Galaxy, especially when you know that he was writing and finishing these scripts seconds before they went on the air. These are the definitive versions of The Hitchhiker's Guide. I could go on and on, Paul do you have a recommendation you'd like to share with us?

Paul: Yeah, I feel like it's been a while since we've done an Audible pick because I was looking through my library and I've actually listened to several books since I recall. There's a book called Driven, which is the history of the BMW, which is excellent. There's also Endurance, which is the Shackleton trip to Antarctica, but last year it made me recall that I sort of jokingly said that I had moved past Stephen King and I had started reading Joe Hill, who of course is Stephen King's son. But I listened to two full-length books from him, Horns and Nosferatu. But he has a collection of short stories that I just started, called Twentieth Century Ghosts. I think everyone's a little different, but I really- Maybe because the way I have to listen to Audible, you know I don't drive to work every day, I listen to Audible books in shorter chunks and find short stories to be much better, personally. So this kind of thing is my preference and he has a short story that's on Audible that he wrote with his father called In the Tall Grass, which is fantastic and so, I have high hopes for this one. I just started it but the collection of short stories he has is called Twentieth Century Ghosts. So far, it's been good.

Leo: Good. Good good good! Lots of good choices. I'll tell you what, here's the deal. Go to audible.com/windows and we're going to give you a book free. I think you've just had about twenty possible choices.

Paul: I know, I know I'm going to get this Hitchhiker's thing. I didn't realize it was out. By the way, I told this story a long time ago. One of the summers we went to Paris on our home swap, I listened to The Hitchhiker's Guide to the Galaxy, narrated by Stephen Fry.

1; Oh, must be awesome.

Paul: This is one of the best Audible books I've ever listened to. I was laughing hysterically on the Paris Metro, I was by myself and was crying because of how hard I was laughing. I know that's hard to imagine.

Leo: Publishing industry is a weird thing and it's very national. So whoever has the rights to the book in that country is who gets to choose the narrator for the book.

Paul: Well Stephen Fry is perfect. By the way, Martin Freeman, who played the main character in The Hitchhiker's Guide movie, and also was from Hobbit and Sherlock, does The Restaurant at the End of the Universe, also an excellent choice. But something about Stephen Fry doing Douglas Adams, and the looks I was getting, I actually thought someone was going to lead me off the train. Like you need to leave now, literally, you do not belong here.

Leo: I can see you laughing maniacally.

Paul: Yeah, like I don't know what's wrong with you, but you don't know how it works here.

Leo: Stephen Fry is the narrator for a game called Little Big Planet that I just love and it just gives that game a wumsy that is remarkable, unfortunately they got a Steven Fry imitator for the sequel and it's not the same. Stephen Fry Lite.

Paul: He's amazing.

Leo: The reason I brought it up is because he did the Harry Potter books in England.

Paul: Oh, great.

Leo: We don't get them here because Scholastic owns the right in the US and they've got the great Jim Dale, who does a wonderful job.

Paul: Okay, well we get Hitchhiker's with him here.

Leo: Yeah, that's nice.

Paul: I'm going to get this other one-

Leo: Yeah, they've got so many good choices. Go to audible.com/windows. You can see we really like them, they get the longest ads because all of the hosts at TWiT love Audible! And we just start talking about it, audible.com/windows give it a try today and get one book free. You'll join for the Gold account that's a book a month, first thirty days are free, first book is free, cancel anytime and the first thirty days you will pay nothing and still get to keep the book, and you'll also get the Daily Digest or the Times, or Wallstreet Journal. Free, for the first month! Audible.com/windows. Time for Paul Thurrott's tip of the week.

Paul: Not now Leo, I'm buying an Audible book. So, I have not tried- This is a tip, and it's also a software pick I guess, I found out about this on Twitter today thanks to Bart W. and have not had a chance to use it and I'm thankful for that, as you'll soon understand. But Nokia makes a tool called the Nokia software recovery tool.

Leo: Okay, we should say really quickly, do not download it.

Paul: Well, it's okay to download but the point of it is, if you're doing a software update in particular or something that breaks your Lumia smartphone, this can help you recover it and bring it back to life without having to bring it in for repairs or whatever. But it looks like something around 90% of Windows phones users are using Nokia devices so this is something you should know about. So I downloaded it and I haven't used it but I am very excited to discover it. So that's kind of a tip, just to keep this one at the ready in case you should ever need it. So that was quick.

Leo: Oh, I thought you said you bricked your phone, and so in case you brick it.

Paul: No, no what I'm saying is fortunately I've not needed it. But if you should ever need it, it is there.

Leo: Very good.

Paul: Yeah, last week I talked about the Bing apps for Windows 8.1 and how in the writing of the book I discovered that these apps are way more wonderful than I thought and I mentioned that- Well, I mean I knew they were good but I thought that some of the new ones were kind of superfluous or whatever but actually they're incredible, I talked about that last week. So last summer, I think last August, Microsoft released the four kind of core Bing apps on Windows phone as well. Bing finance, Bing news, Bing sports, and Bing weather. Those apps are incredible, I use all of them on my phone every day and they actually get used a lot. But in looking at these Windows 8.1 apps, I started to wonder you know, they have these new apps now on Windows 8.1. These would be great on the phone. You know like, you could see a Health & Fitness app, how wonderful would it be to have that on the phone because you could just take it on the go and that would make sense. Coincidentally, and it really is a coincidence, last week Microsoft released beta version of Bing travel and Bing food & drink, which are two of those new Windows 8.1 apps so that's cool. So you can get them on the Windows phone now as well. They work exactly like the PC versions, except they're formed for the small screen and all that kind of stuff, they basically offer the same functionality, the data syncs between them so if you've created favorites in any of the apps you can access them from the phone, you can access them on the tablet back and forth. The only thing that's missing is the health & fitness app, the one that would be the best one to have on a phone but I assume it's coming because basically they now have every single Bing app that's in Windows, is on Windows phone too. I think I mentioned Health Vault last week. If I didn't, this is Microsoft's central service for storing health-related data-

Leo: Very timely because of course, everybody's talking about health stuff.

Paul: Yeah, so there is a Health Vault app for Windows I believe, but also for Windows phone. So if you're using say, FitBit and you want to get your health data into a central place, FitBit integrates with Health Vault so that's stuff will appear on the Windows phone version.

Leo: This is going to be quite a war because Apple looks like their going to start doing a health passbook and this is going to be interesting.

Paul: Right, and so I suspect Apple will be very successful doing that. The Microsoft approach is the same approach it's ever been, dating back to Windows I guess, or Windows media player or whatever, that they integrate with these other services. So yeah, I think the neat thing about the Bing apps is that they integrate with the other services that make sense, and so for Bing travel you get like the Frommer's for a lot of the content, you get integration I think with Kayak for booking flights, you get integration with, I don't know if it's Priceline or one of the other sites, for hotels or whatever it is. So, yeah they do all that kind of cross services integration stuff. These are great apps so be sure to check these things out if you have a Windows phone.

Leo: Twitter's earning report coming out now, showing a small profit but beating expectations.

Paul: Was their press release 140 characters, Leo? Because it should've- Screw those guys.

Leo: It would have been good. Not a surprise, Twitter controls exactly how much profit it makes and they obviously thought, well let's beat Wall Street by a little bit, not much. Moving along, thank you Paul, to our enterprise pick of the week with Mary Jo Foley.

Mary Jo: Yes, this may not sound initially like an enterprise pick. But I'll explain why it is. My enterprise pick is Microsoft's Investment this week of $15 million in FourSquare. Which was announced the same day that they announced Satya Nadella was the new CEO so it got kind of buried. But what's interesting to me about this is, the $15 million is not just a pure hey we're investing in FourSquare like we did in Facebook, it's more we are actually going to license some of FourSquare's technology. Specifically the location data that they have and we're going to integrate that back into Bing on Windows 8 and Windows phone. So what this means is, it's more of a big data/machine learning kind of a play almost, that it is Microsoft investing in a check-in service. The idea, I think is going to be we'll see FourSquare's data and some of the API technology that they have show up in things like Bing on Windows phone, but also Cortana, the Microsoft equivalent of Siri that's going to be a part of Windows phone 8.1. Microsoft will just take this data and mine this data, add it to their own pool of data that they're indexing and making the results that show up through Cortana, through Bing, on phone and through Bing on Windows 8, more accurate when it comes to local data. So I'm optimistic because I don't have great luck right now with Bing on my Windows phone, searching locally. And I often am searching for bars in New York, perhaps and have very mixed results, they're not always up to date. It should get better.

Leo: You know, they didn't have to invest $15 million. I do believe that FourSquare license is set to send information out, half uses it and lots of other people use it but they must have wanted more than just the info.

Mary Jo: They did, they wanted a deeper level of data and access. It's not an exclusive deal, according to reports but they're getting more than they could get just for free.

Leo: Got it. 15 million, good news for Dens. I'm a big FourSquare fan, I like them. Going way back, way back when. Codename of the week.

Mary Jo: Yeah, this is a codename from way back in the past. I think like 2000-2003 somewhere in there. The codename is Xdocs. That was the codename, it turned out, for InfoPath, which was Microsoft's electronic forms technology that became part of Office and the reason I picked it as this week's codename is Microsoft announced this week that they're discontinuing InfoPath, at long last.

Leo: Gosh, that's a name from history, isn't it?

Mary Jo: It is. Yep. So they're going to, the last release of InfoPath is InfoPath 2013, which came out last year and also InfoPath forms service for SharePoint. Microsoft says they'll support them both through 2023, so you have a long lead time if you're still an InfoPath user. But instead what they'll do is they're developing some kind of new forms technology that will be shared across SharePoint access and Word. They aren't telling us what that is but they did say they will give us a sneak peak at the SharePoint conference, which is in March this year. So that's kind of interesting. It means to me that we're going to start hearing more about the next version of Office, probably around March.

Leo: The end of the path.

Mary Jo: The end of the InfoPath.

Paul: As you were talking, I looked this up on my site. The first time they mentioned Xdocs was in 2002-

Mary Jo: Was it?

Paul: Yeah, there were going to be two new applications in what was Office 11, one of them was OneNote and the other one was Xdocs.

Leo: It predates this show, even. This show has been going on forever.

Mary Jo: Especially today.

Leo: Our beer of the week, from the Georgetown Brewing Company.

Mary Jo: Okay, I have to pick a Seattle beer this week because of the-

Leo: Tamu!

Mary Jo: We haven't even talked about them yet.

Leo: I forgot Paul Allen was the owner until I saw him take the trophy.

Paul: Yeah, he just kind of walked to his car with it. I'll take that. I paid for this.

Mary Jo: And right now, while we're taping Windows Weekly, there are 700,000 people in Seattle at the parade. So we get to do a beer pick for them and I went to one of my most favorite Seattle brewers, Georgetown Brewing, and I picked a pilsner, which isn't necessarily my favorite beer style, but this is a very good one.

Leo: What distinguishes a pilsner? They're lighter, right?

Mary Jo: They're lighter, they typically are less hoppy and the real reason I picked the Rogers-

Leo: It tastes more like Currs.

Mary Jo: Yeah, but not that bad.

Paul: Is pasturized cheese?

Mary Jo: But the main reason I picked Rogers Pilsner was GeekWire had this awesome story about Brian Valentine, who used to be one of the big honchos on Windows and now he works at Amazon, but he went and bought a bus, and he turned the bus into a tailgating bus for the SeaHawks. One of the features he had on the bus-

Leo: Perfect, it's a short bus.

Paul: I was just going to say that, it would be a short bus.

Mary Jo: Look in the back though, go down. He's got a tap installed on the back of the bus that has Rogers Pilsner pouring right out of it.

Paul: Oh, that's a nice touch. They call the bus Bussell Wilson. Brother.

Mary Jo: Brian Valentine was always a card, and it looks like he still is one.

Leo: That's actually kind of cool.

Paul: You going to tell your story- You have another beer story though that we were discussing earlier.

Mary Jo: I don't want to bring that sad story up today.

Paul: Too soon?

Mary Jo: Well, I will. Blue Point Brewing, one of our independent breweries here in New York is being bought out by Anheuser Busch we found out.

Leo: It happens to the best of them.

Mary Jo: I know, and you know I'm not going to totally give up on them.

Paul: So they probably would just leave them alone I would imagine. We'd like to infuse this fake flavor into your beer.

Leo: You can go to the front page of their website, say yes I'm 21, let me in and boom. Try I'm not 21? Well it's going to take me like to Disney Land. Legal drinking age in America, that's good that's cute. It's always fun to see where the sites send you.

Mary Jo: One of their other beers, Blue Point, they have some awesome beers. One of my favorites is RastaFari.

Leo: Yeah mon. RastaFari. It's got a hempy flavor.

Paul: Nice.

Leo: Hey thank you so much for this great show and your stoot analysis of the happenings at Microsoft, as always. Really appreciate it, we do this show now Wednesdays, I hope you'll tune in and watch us live 11am Pacific, 2pm Eastern, 1900 UTC on TWiT but of course on demand audio and video is always available. Twit.tv/ww and then you can of course, subscribe, which would be the best thing to do, in the Xbox music store or wherever. Very much appreciated this week especially, all the work and the scoops you guys did. We will see Paul Thurrott at the super sites for Windows by the way, winsupersite.com. Mary Jo Foley, at allaboutmicrosoft.com, you can always go there. Thank you so much for a great show and we'll see you next week on Windows Weekly!