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Niall Kennedy Says Goodbye To Microsoft

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Niall Kennedy, who joined Microsoft in April and some hoped would be the next “big voice” at the company after Scoble left, has walked away from the company after a surprisingly short tenure.

Hearing him explain it, it makes perfect sense, and most people might have done the same thing in his place.

The Windows Live initiative got off to a huge start, with lots of new services created and an “invest to win” strategy in the new division. There were so many new programs created and headcount opening up Microsoft told Wall Street it would be spending $2 billion more than anticipated in the short-term to cover these new costs including over 10,000 new hires over the last fiscal year.

The stock plummeted on the announcement Microsoft did not have its costs under control. Microsoft’s market cap lost close to $59 billion in the six weeks after I joined and second quarter financials were released, more than the GDP of Ecuador and over half the market cap of Google. What do you do when the market responds to your 6 month-old online services strategy by reducing your valuation by 1.5 Yahoos? Windows Live is under some heavy change, reorganization, pullback, and general paralysis and unfortunately my ability to perform, hire, and execute was completely frozen as well.

It’s such a shame. I probably had as many high hopes as Niall did, proud to see that Microsoft was going to be bold and brave, do big things and show that the company had grown new balls. I was excited, and seeing the stock market basically tell Microsoft that it didn’t want the company to innovate is the most dissapointing thing to happen all year.

Microsoft, inspired by Google, was going to throw a lot of money at a lot of smart people to start something special. The work they’ve done in the short time they’ve had is amazing, and more of that would have made for something great. In a sense, Windows Live was becoming a company within a company, and maybe Microsoft needs to realize that their current investor crop is too safe, too afraid of what they were doing, and should just spin off an IPO of Live, in order to give it a fighting chance.

Think about it: the enormous userbases of Hotmail/Live Mail, Messenger and Spaces, plus the technology and investment in MSN Search, Windows Live, and all the other Live investments could easily generate at least half of Yahoo’s market cap, and that would be enough to give Live a chance to become a real player, as well as divorce it from Microsoft’s corporate culture. Microsoft has too many problems right now to keep running Live, so let Live run itself, and you won’t lose that big investment you already put in. And if Live fails, Microsoft could remain majority stockholder and take it back on the cheap.

Anyway, I hope Niall gets what he wanted out of his future plans, and that Microsoft does something smart. Live has potential, the only section in the entire company with the potential to have huge growth. The Live team rocks, and delivers, and deserves better than this.


Randy Morin says:
Scoble gone. Niall gone. Someone at Microsoft has to step up and be the corporate face to the blogosphere. Who will it be? A great opportunity for some existing Microsoft bloggers.

Randy’s linking to Frank Arrigo, Don Box and Alex Barnett. I vote for Alex, if only because I’ve met him and he’s really cool and personable. Alex wishes Niall luck.

Valleywag has an exit interview with Niall, which includes this:

Wag: Microsoft seems friendly toward people returning after leaving for their own startups. I’ve seen a few people leave for other companies and return with no problem. Do you see yourself ever doing that?

Niall: Not really, but perhaps if the company was split up first and there was some new project I was excited about that could only be done at a company such as Microsoft.

Wag: Split up?

Niall: Splitting the company into desktop, server, online, and possibly gaming divisions. It’s just too big.

My sentiments exactly.Kevn Burton says:

It took Scoble years to leave Microsoft and join a startup. Niall Kennedy was smart enough to do it in only four months.

Scoble says:
That’s a bummer. Microsoft needs more Web natives, not fewer. Reading his blog today I’m left saddened, especially since Niall was hired to make an RSS synchronization platform.

Dare Obasanjo says:

As the person who referred Niall to the company and gave him some advice when he was weighing whether to join Windows Live, I am sad to see him leave so soon. I sympathize with his reasons for leaving although some of what he wrote is inaccurate and based on speculation rather than the actual facts of the matter. That said, I found Niall to be quite knowledgeable, smart and passionate, so I expect him to do well in his endeavors.

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Niall Kennedy Says Goodbye To Microsoft
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