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March 31, 2006

IBM vs. Microsoft in big bucks business marketing battle

Posted by David Hunter at 8:33 AM ET.

IBM is apparently feeling the “heat” of Microsoft’s dubious $500 million “People-Ready” marketing campaign targeting business customers ([1], [2]) and has decided to fritter away some money too. Yesterday, they announced a bounty for Microsoft Exchange customers, but today comes word that they are really putting some serious cash on the table. Rebecca Barr and Dina Bass at Bloomberg News:

IBM Corp., the world’s largest provider of computer services, will spend more than $300 million on an advertising campaign to win customers and help revive its image with investors.

Chief Executive Officer Sam Palmisano is spending half his $632 million annual ad budget on print and TV spots that feature an asterisk and the question, “What Makes You Special?”


The ads, championed by strategy chief Bruce Harreld, set up a showdown between IBM and Microsoft Corp. as the companies seek to bolster sales and stock prices. International Business Machines is the No. 2 software maker behind Microsoft, which this month announced a $500 million effort to win corporate customers by exploiting questions about IBM’s services strategy.

“People are confused, and that’s why we are going into that campaign,” Harreld, who also took control of marketing in January, said in an interview at IBM’s Armonk, N.Y., headquarters. “We’re really trying to get at this problem.”

The ads, debuting in April, break with IBM tradition by including a theme song, “I’m Not Like Everybody Else” by 1960s British rock group The Kinks, and by painting the logo across a Manhattan helipad.

That ought to do about as much for the IBM stock price as Microsoft’s notorious Dinosaur Head campaign did for theirs. Mr. Harreld notably guided the fortunes of Boston Chicken before finding a berth directing strategy at IBM 10 years ago. As of January he runs both strategy and marketing, an interesting combination.

No ads from either campaign have appeared yet and for all I know they will be filled with charm and insouciance leading to an immediate desire by countless corporate IT folks to open their wallets. However, selling to business customers is not the same as selling to consumers and I suspect we are mostly destined for some chuckles at IBM and Microsoft’s considerable expense.

Filed under Coopetition, General Business, IBM, Marketing, Microsoft, Public Relations

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March 30, 2006

Microsoft rolls out rebranded FrontBridge hosted services

Posted by David Hunter at 7:47 PM ET.

Last year Microsoft acquired FrontBridge Technologies which provided a number of hosted add-on services (e.g. archiving, spam and virus filtering) for popular email servers including Microsoft Exchange. Now Microsoft had put its own stamp on the FrontBridge offerings as Joris Evers reports for CNET:

Microsoft has repackaged the hosted messaging service it acquired when it bought FrontBridge Technologies last year.

The Redmond, Wash.-based software maker has rebranded the service “Exchange Hosted Services,” crafting a new, per-user licensing model and future plans call for closer ties with Microsoft’s Exchange mail server, company representatives said in an interview Wednesday.

The messaging service is part of Microsoft’s overall effort to offer services that complement nearly all its software products. Although the company has unveiled many such services for small businesses and consumers, the FrontBridge technology is one of few examples of what it intends to offer large companies.

Of particular interest for non-Exchange customers:

Despite the new Exchange-centric name, the filtering and encryption services do work with other e-mail platforms such as IBM’s Lotus software, the Microsoft representatives said. There are no plans to change that, they said.

The official press release is here.

Filed under Acquisitions, Coopetition, Exchange, IBM, Microsoft, Security, Servers, Spam, Viruses and Worms

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First day of Microsoft EU antitrust hearing

Posted by David Hunter at 7:08 PM ET.

Ingrid Marson at ZDNet (UK) has a detailed recounting of the first day of the Microsoft antitrust compliance hearing before the European Commission that we mentioned earlier today. It doesn’t look like the Commission is buying Microsoft’s arguments, but that isn’t unexpected. More hopeful is:

Although the Commission appears unwavering in its decision that Microsoft has not complied with the order, the prospect for reaching a settlement on the fine may be greater, the source said.

During the hearing, one member of the Commission’s examination team noted that Microsoft has “made some progress” in providing better documentation.

“Because there has been continuous improvements in documentation, a settlement may be possible, whereas before the Commission refused to settle,” the source speculated.

As for tomorrow’s session, that’s when third parties with an interest in the case will testify.

Speaking of interested parties, Paul Meller of the IDG News Service reports that the US State Department weighed in today with a letter:

U.S. diplomats have intervened, urging the European Commission as well as all 25 national governments in the European Union to be fair to the company, diplomats and Commission officials said Thursday as the closed-door hearings got underway.

According to a memo written by unnamed government officials in Washington, D.C., the Microsoft complaints raise “substantial concerns” about the way Microsoft is being treated in the antitrust case, said a person familiar with the Commission’s activities. The memo was distributed to embassies around the E.U. and through the U.S. mission to the E.U. in Brussels.

Diplomats from the U.S. mission to the E.U. visited the offices of three European commissioners earlier this week. Jonathan Todd, the spokesman for Competition Commissioner Neelie Kroes confirmed that her close aides met with U.S. diplomats this week, and received the memo. He declined to comment on its content.

U.S. diplomats are also understood to have visited the offices of Internal Market Commissioner Charlie McCreevy and Commission Vice President Gunter Verheugen, according to a person familiar with the Commission’s activities.

A U.S. diplomat denied that the government is coming to Microsoft’s aide in its antitrust dispute. “Our interest is less that than wanting to see that everything is done properly,” the diplomat said on the condition of anonymity.

“We are careful not to take a position on the accuracy of Microsoft’s accusations, but if they were true they would be a matter of concern,” the diplomat said.

More on the history of diplomatic efforts by following the link.

Filed under Antitrust, General Business, Governmental Relations, Legal, Microsoft

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Windows Storage Server 2003 R2 to be launched next week

Posted by David Hunter at 6:30 PM ET.

At Microsoft’s Windows Server Division WebLog, product manager Shola Aluko reports that Windows Storage Server 2003 R2 will be officially launched next week at the Storage Networking World conference. You may recall that it was released to manufacturing last December.

Filed under Microsoft, Servers, Storage Server

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