Dinner With Microsoft’s Craig Mundie: On Xbox Kinect, Instantaneous Total Recall, and a More Secretive Culture

I recently had dinner here in the Boston area with Craig Mundie, Microsoft’s chief research and strategy officer. With just one other guest present, it was an unusually personal and far-ranging discussion. Most of the talk was of a general nature—more background than anything else. Still, a few things stuck with me as noteworthy. I thought I would share them here.

Mundie, as you might have guessed from his title, serves as Microsoft’s long-term technology strategist and visionary. His domain includes basically anything and everything that Microsoft is eyeing in the 3-10-year time horizon, and even beyond. This includes the sprawling Microsoft Research (MSR) organization (six major labs around the world), the Health Solutions Group that oversees the company’s growing health IT efforts for healthcare enterprises, providers, and consumers, the Startup Business Group that incubates new technologies with the aim of creating new MS products, and a host of smaller operations and groups focused on various aspects of future technology identification and development. In this role, Mundie serves on a couple of government technology committees, including President Obama’s council of advisors on science and technology, and acts as a top Microsoft liaison to major governments such as China, India, and Russia. Even the famous Microsoft Home of the Future, an ever-updated exhibit on the main corporate campus, is part of his realm.

Taken as a whole, this is quite a realm, from advanced technology to fundamental research that’s about as pure as you can get in industry these days. Viewed another way, you could say Mundie was the yin to chief software architect Ray Ozzie’s yang—that is, until Ozzie announced his impending departure from the company last month. That’s because Ozzie’s job was to focus on Microsoft strategy and technology in the present to near term—meaning less than three years out. Together, as Mundie also said, they split most of Bill Gates’ duties (I think Mundie got the fun part, but that’s just me).

My dinner with Mundie took place in early October, less than two weeks before Ozzie’s announcement (so yes, I was admittedly slow to write up my notes). Now, with Ozzie soon to be heading out the door, I decided to go back to my notes and supplement them with some commentary and a follow up question or two to draw out the things I found most interesting:

Craig MundieMicrosoft is getting more secretive about its futuristic pursuits: This was really interesting to me—I think of it as the Steve Jobs effect, since the Apple kingpin is notorious for keeping things under wraps with dire penalties for those who leak. The way this came up was we were talking about TechFest, the technology fair for Microsoft employees where everyone in the product groups can see what is going on at the research labs (and to a degree, vice-versa) and other parts of the company doing advanced technology. Some outsiders, including a few press like me, were previously invited to this. But when I remarked to Mundie how I hadn’t seen much about TechFest lately, and certainly not been invited in recent years, he said that was deliberate (I didn’t take it personally).

“Everybody we compete with has plenty of notice of what we’re going to do next,” he told me. “Microsoft has little surprise value with the consumer.” Therefore, he says, “I’ve been a little bit more parsimonious about revealing the inventions I believe will be important.” He also said his goal was to “not make the company so much of an open supermarket where everybody wanders the shelves.”

Mundie’s job will not change with Ozzie’s departure: This subject, of course, didn’t come up at our dinner—but it was my chief follow-up question. I got nothing personal back from Mundie, just a “no change” statement from public relations.

The centrally funded model for Microsoft Research is still right: This is especially interesting to me, because I have written two books on corporate research. I can tell you that funding a corporate research operation straight from central corporate coffers-as opposed to via contracts with various business divisions for work they want done—is almost unheard of in this day and age. That’s because most companies believe that in order for their research groups to have good ties to their business needs, labs need to get all, or at least a major part of, their funding from business divisions—for work the business divisions want done. Microsoft’s approach is to let MSR work without those strings, in order to keep researchers more unfettered and open to new things. “I still think that that was and remains a good strategy,” Mundie told me. Over the years, many have questioned whether Microsoft’s investment in MSR has been worth it, and everyone from Gates to SVP of research Rick Rashid on down has steadfastly maintained it has been—with contributions to just about every Microsoft product. The way Mundie put it to me: MSR is “just becoming more and more integral.”

(Note: I am talking about research, the “R” part of R&D. The vast majority of Microsoft’s roughly $9 billion annual investment in R&D is for development, with the research labs getting only a fraction of this amount.)

The future is NUI: The idea here is that the world of computing is moving from the GUI (graphical user interface) to the NUI (natural user interface). This includes interacting with computers via voice, gesture, and touch commands. As Mundie puts it, “You start to be able to have the computer respond to people the way other people respond to people.”

Such a vision is hardly new—in fact, ideas about multi-modal computing were really all the rage in the bubble years of the 1990s, and the concept of this kind of interaction with computers goes back to about the day computers were invented. Still, with Microsoft, IBM, Google, and others still chasing the dream, it was nice to hear more up front from Mundie, who clearly believes the time to realize this long-standing vision is upon us.

One early manifestation of this, he says, is Kinect, an addition for Xbox 360 that lets game players control the action with gestures and their voices—without a controller. Mundie says Kinect drew heavily from Microsoft Research, which assimilated lots of different pieces of technology to make it possible. “It is the integration of all the MSR assets that led to Kinect,” he said. “Virtually all the labs had something” to contribute. “It’s something I think is quite revolutionary.”

Is Microsoft losing patience with China?: Despite years of work to develop good relations with China (part of the subject of my book Guanxi with Xconomy Boston editor Greg Huang), Microsoft is still finding piracy maddeningly frustrating. “Being paid for one copy out of five is undesirable,” is the way Mundie put it.

Favorite one liner about the future of computing: “Instantaneous total recall of everything.”

Good goal: Used to have it myself. Need help now.

Bob is Xconomy's founder and chairman. You can email him at [email protected] Follow @bbuderi

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