Jean-Philippe Courtois, Microsoft [transcript in English]

Mr. Jean-Philippe Courtois, President of Microsoft EMEA and Senior Vice President of Microsoft Corporation visited Belgrade on October 10. It was a busy day for Mr. Courtois - he came at 8 am from Ljubljana and was supposed to leave to Budapest in the evening. After talking with the officials of the Serbian Government and the employees of the Microsoft office in Belgrade, Mr. Courtois kindly invited us to his luxurious suit in the Hyatt Regency Hotel. We talked about Microsoft's global plans and also about the ongoing legalization campaign.

Mr. Courtois assumed his position in July 2000. Prior to that, he was vice president of Worldwide Customer Marketing in July 1998. His focus was on leading the worldwide business planning process, driving customer satisfaction, enhancing field effectiveness and managing Microsoft's global customer information system, including www.microsoft.com. Following the company reorganization in March 1999, Mr. Courtois launched the Customer and Partner Satisfaction initiative and was instrumental in managing its strategic global roll-out. Prior to his promotion, Courtois was vice president of Microsoft Europe in 1997 and general manager for Microsoft France since 1994.

So, you have not seen much of the Belgrade?

Not yet... The next time I will spend the night here and visit some of the city.

How was your business day?

It was a business day, yes… It was a pretty good day. As you know, we entered the strategic agreement and the partnership with the Government a few months ago. In my job as a President for EMEA, I really look forward to visiting countries, especially where we are starting operations. In Yugoslavia and Serbia in particular, given all the past years, which have been very challenging for the country, and given the first step, we decided to make the commitment and come to the country, start operations.

I had a number of meetings, at the cabinet of Prime Minister, Minister of science and technology, with a big bank, with another big customer, with seven big partners, IT system integrators, with our people... Overall, I feel pretty good, confirming myself that much has been done, we were commenting earlier on that, announcing the Serbian version of Windows and Office 11 in the future, which is the strong message. And talking with Government about what we have agreed to do together, and where we are, I feel pretty good about what was accomplished. But still, there are a number of things that can be done in the coming months, and in the coming year.

You talked with some of the Microsoft key partners. Did they tell you about this campaign of legalization, how did it start, how does it go?

We had some comments about legalization, of course. I think it is very important for the whole industry. And I think a lot of good work has been done, but we need to do much more. I understand that there is a legal procedure coming, that there is a tax and some amendments being done right now, you know that it is taking some time, probably too much time, and I know it is complex, between federal level and Serbian level, to get intellectual property rights enforced. It’s the same in the magazine business, in the music business as well; to make sure the economy understands that well… intellectual property has to be respected, for business to flourish and to liven up the economy.

You have an office here now; the campaign started a month ago, and will go on until the end of the year. What are the problems, what actions do you have to take?

In the discussion with the Minister of science we concluded that we have to get all the different public entities to report and ask for the legalization of their software, on their PCs. I think we are up to good start, but we still need to push even more this communication next months. That was also the message I got from partners, saying: yes, it's good, but there is much more to be done … The good news is that the Minister said they are going to have a team in charge of pushing that; at the beginning there was just a Minister, and now we are having a body in charge of making that happen.

Did you talk about this e-government project? Does the Government want to use Microsoft solutions to help people obtain documents faster, etc?

We certainly did… I was very eager to share some work we have done in other countries, so I was mentioning some different examples, in the UK, so called The Government Gateway solution. I was talking about what we have done recently in Catalonia, where all the public services for education and employment, health etc. are being handled on our technology, and I was very eager to ask the Government when do we get started. I think there is a willingness to do something, but I have not seen yet a concrete plan. About the circled e-government plan for Serbia, I think they are probably taking right steps, having the Minister and the team now in charge of defining the course of actions. So I look forward to seeing the very first project in place.

The piracy is a big problem in many of the countries you are in charge of. I read that when you were in Lebanon, you said: "This country is in the top 5 for piracy". Which are the top 5 now, are we somewhere near?

Probably, of course… but in Lebanon, we have been in the country for a few years now, so it's not that we are just starting. Here in Serbia, we are at the very beginning. I even don't know what the piracy rate is, I guess it is above 90%, because if we just count estimated number of PCs for the Government, it is probably much less then 10%, I think, we estimate there are 400.000 PC's in Serbia, getting closer to half a million, so there is very, very long way to go. I understand, of course, that for many, many years there were UN sanctions, nobody was used to bye legal software, it was not even possible.

Having this legal environment in place, legal tax, just like in EU countries, and enforcing that, making sure that people understand that they have got to respect that, educating people is the key. I think we are going also to do a lot of education. I was happy to hear from the customers that they love to do that, 5-6 big customers, not just Government, but private business, CEOs talking with us, making advertising campaign and communication, saying: hey, this is a type of applications we have in our bank, telecommunication company, in our health sector and whatever, and we are very pleased with the value of the software, that's why we decided to be legal. We need to do a lot of that in Serbia; I mean also the local IT companies, we had also a good debate here in this same room, about all we could work together, to get this message across the community.

According to your experience, does the localization reduce the piracy?

You're right. Having a local version, in the local language, is the key. I am French, and French people need French version, in Catalonia they want Catalan version, that's the way people work and live in their societies. It will help people, I'm certain, and we have to share the effort to have localized version in their language, to use IT again.

Speaking about that, do you have French version on your laptop, in your office?

Actually I've got a mix, it’s a bit weird. I have US version and French version, because I am using a lot of English in my job, but I also use some applications in French.

Do you remember the time Windows was localized for the French market? Did you have problems, because French are very proud of their language and they have complete vocabulary that doesn't even resemble English?

There have been some provisions in the French law that makes the companies that use English word in their files pay a lot of money, I know it makes people laugh, but I think it is natural; it is good for the society to be proud of its language and its culture also. Besides, building some contents, which has nothing to do with our products, is very important for the local country.

Talking about localization, we hear different rumors here, that for us, something is being done in Slovenia, something is being done in Greece, something here in Belgrade… Do you know the details of this process?

I don't know the details really. In general, we have the team in Ireland, and we work with some companies in the local countries, to develop the localized versions. I don't know the details for Serbia, frankly.

When you localize software, we are talking about localizing menus, help, manuals etc. But there is more to localization: voice recognition, OCR... What do you think, when will it be possible for me to just plug in this voice recorder to the USB port, and have this conversation imported into Word and…

…translated into Serbian?

Well, I would settle for English for the time being. There is something like that in Microsoft Office, but it doesn't work so well…

It is one of the most complex problems to solve in technology, probably a lot of work is done, we have very good teams working on it in Cambridge, where we have a research facility for Europe, there are some people doing the same in China. I believe that in the next three to five years there will be some pretty radical breakthrough in technology, to enable that, at least for a few key languages; it is tricky to extend that technology to many languages. The next step is not necessarily the voice, you have seen that Tablet PC is coming up on the market, it can read and recognize your writing, and I think that is going to be the next technology in terms of recognition. So, we do believe that is going to trigger a lot of new scenarios, instead of using your pen, you are going to take your notes and read your notes, and automatically translate it into characters, or just use it and send to your newspaper.

What are the time margins for the TabletPC project? When do you expect this to happen?

Well, the Tablet PC will be launched actually in November… it's pretty soon…

As you said, that research is not done only in Redmond, but also in Europe, in Cambridge and China?

There are two peaces of research: research and development, which is really developing products, and most of that is being done in Redmond, except that we also have development center in Haifa, Israel, and now we have the new one in Denmark. Then we have what we call research, and those guys are really looking at the 5-10 years innovation, they don't do anything applied to our products, they think about visualization, speech recognition, a lot of incredible new things.

We probably can not hope to have such a research centre here tomorrow. But we have some researchers who might be doing a good job. Do you plan to sponsor their work, or give theme access to Windows source code, Office source code and so on, like you do to some research centers in the US?

You are actually well informed, and it's true that we are doing that in Europe, we have started to develop some partnership between Cambridge team and some Universities. And we are using also what we call the Share source agreement, which is the way for people at Universities to access the code of Windows, and to be in connection with our best researchers. If as we develop our activity in Serbia, we'll have the opportunity to link with the researchers in the country, with some exciting projects. I'd love to make that possible, between Cambridge and one of your Universities. We are not discussing this specifically at this point, but I am open to support such an activity in the future.

Now, let's go back to the products we use every day. When do you expect the next major redesign of Windows, Longhorn?

There are a few next steps for Windows, along the lines of the .NET platform. As you know, we shipped Windows XP less then a year ago, which we think is a pretty good step forward. You've got also the embedded version of Windows, in this kind of device, on the Tablet PC, on flat-screen technology, which enables new scenarios in a way you use digital music and video screening altogether. The next step will be converging the data storage technology between SQL server and Windows. Today you have different ways of archiving, searching, querying, information if you use SQL server, and another way if you use Windows file system. It is clumsy when you build some pretty important application systems to use those two different storage systems. Then there will be Longhorn, which is probably three years on the road, before there will be the full integration of .NET platform into Windows, so there will be also very significant change of the user interface.

Do you expect to ship .NET server sooner?

Yes, that's a good point. On the server side we expect to ship Windows.NET server in the next year, probably before the middle of the year. It will extend Windows's functionality, in terms of team productivity.

I read that mister Ballmer yesterday, at Gartner's symposium, introduced some new product called XDoc, based on XML, and that it is expected to ship with Office 11. That product is supposed to help companies organize information....

…and do workflow in particular… yes.

Do you see a lot of future for such kind of products? Do you think it will be like Excel was once?

We actually have a lot of work going on, in the division of developers, and we summarize that what we call digital information workers. Information worker for us is any person in any kind of business who has to manipulate, to communicate, take decisions, to get to group meetings etc. In the hospital it is very clumsy for a nurse to have information handy, because she doesn't have right device or right systems about a patient: what kind of treatment should this person have, what kind of medical file has this person; the same applies to a pilot in a plain or even a steward in a plain. So you can think about people who need to access information in much richer way. To do that, XML will play the big role and we are building a set of technologies and XDoc is one of them. It is all about the paper-based society - just think about the number of forms that you are proceeding as a person, with your Government, to get a permit, to give this and that. With your companies, you fill in the same information, with your address, what you are etc. And you think about the ways technology can simplify that, enable that, so in a way you can store the common scenarios on getting this process done rapidly, so if it is supposed to enable businesses, Government, people, to deal very easily in this process and to automate, so that you can save a lot time and a lot of money in this process.

So it will extend the Office family?

You can think about that, yes, as an extension in terms of functionality, which can be built on top of Office.

At the same conference, the Gartner group commented on Microsoft's new licensing models, which are now getting in the gear, and they said some of the users are not very satisfied with that, that actually they are angry. Here in Yugoslavia, we started with OSL agreement, and some people find it too complex. They thought: I'll go and buy software like I buy a book, but …

The issue of licensing is very complex, and we try to make it simple. With the new licensing program we call OSL 6.0 we made some changes in order to simplify the options. And when you do that, you always see customers that are used to some options, and they don't like it, and there are some other people that actually find the simplicity better. In the nutshell, we are trying to get an easy way for customers, small size, medium size, and big customers, to buy in the way that does not make them worry about counting licenses, comparing versions, make projections for next year... There is another option - you can own the software, have perpetual rights on it. Or you can lease the software, just like you do today with some mainframe software, or just like you do with your telecom bill: you just lease the service, you plug and word, but if you don't pay the bill, you won't have a phone working in your house. So, some customers love it, and the others say: well, I want to have a package, the box, and see the real stuff, because it costs me some money and because software is so untouchable.

Some time ago Microsoft introduced the concept of activation, but it is a concern for home users and small business for the time being. In corporations, you use the old method, you just enter your serial number and you don't have to activate the software. Do you think that activation will also come to that part of the market?

That's a good question, and frankly, we thought about it, and we try to find the right balance between the simplicity, an easy way of deploying the software and control that people are not cheating. At this point, we are not forcing to extend that to the corporate world, because we want to make it simple, but we also need to get the trust of the customers that they also buy legal software.

I had a good conversation with Mr. Ridzi, and he said that activation is not the tool to stop the piracy, but to control the licenses.

Yes, frankly, it's not going to stop the piracy, because if people really want to pirate, they can pirate, but at least for an average user having the system telling him "you have been already coping this software two times, it is no more reasonable to copy the third time, because you are not allowed to do it"…

However, more copies are pirated in companies, because at home I can maybe use the copy on two PCs, I don't have 20 PCs, but in the company…

You're right. Frankly, the focus of Microsoft's anti-piracy campaign is on businesses, not on the consumers. I don't say it's fine that people copy at home, that they copy music, software, etc., but about piracy I was talking about 90%+, it's just businesses. If you are talking about consumers, it would be even worst. But businesses have to buy staff, they have to buy chairs, they have to buy tables, they have to buy PCs, so it's really something that has to change in terms of education, because it's an asset, like another one in the company. So you have to buy software. It's how that should be.

Instead of a cup of coffee?

Yes, that's a good point, our subsidiaries in Finland, they made a big communication campaign and we have done the same here: "At the price of cup of coffee", and people liked the message, it makes you think about it, like: oh, that's right, that's how much it's worth, finally… And no matter you drink or use a cup of coffee, how many days or years, versus you use your word processor, e-mail system etc…

What do you think about Mr Gate's vision? You probably have contacts with him personally?

Oh, yes, many times, many years, twenty years…

So tell us something about his vision, not just tomorrow, but about the world many years from now?

The good thing about Bill is that he has changed, because now, more then ever, he's spending all his time in the software development, which is his passion. Two years ago, when he moved the responsibility of CEO to Steve Ballmer, he has really changed. In a way he is more relaxed, and happy. Not that he did not love his former job, but fundamentally, he's somebody who loves the technology, who loves to see technology can enable things to change. The .NET vision has been heavily pushed by Bill. And today he's spending most of his time as a chief software architect, with the key people we are having in the company, the key experts developing the technologies, to understand all that Bill is calling the user experiences, the new scenarios, the new things that people might do, that they don't even think of doing today, that can be enabled by technologies.

Bill is focused on what he's calling the digital decade, which is all the innovation that can really be brought by digital tools and digital systems. So, the information worker I was talking about, he believed and he had a statement that we can doubly increase the productivity, that is what he has done in the nineties. So we are working very hard to bring lot of value to 18 hours a day, or 16 hours a day, because the average person has 8 hours of sleep …But, in 16 hours, in the many things you do, you go to the car, you go back home, and you want to do things, you want to play music, you want to see pictures on your wall, you want to chat with your kids as you're traveling and move a lot of digital information. TabletPC, for example, has been pushed by Bill. This is the project that was incubated, there was nobody but just three people thinking about the concept, and being pushed by Gates 18 months ago, they came up with the prototype, and now it is the product we will sell.

Are we going to have Mr. Gates visit Serbia?

Why not, he is visiting many countries, I can't make any commitment on Bill's behalf … but Bill has been visiting many, many countries in the world, yes.

So who knows? Thank you very much.

Thank you, also for your support in Serbia. I know you are very active in the market.

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