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Bill's not a stupid guy, but Microsoft's problem is that they're very manager heavy. My partner interviewed there twice for a job and said he thought they were really top heavy.
The teams also often infight so things don't or won't get done because some manager somewhere killed it on the way up to higher ups because they won't get credit, or it makes them look bad, etc...
I can't remember now which team it was, but they were supposed to switch to .NET for a new version of a popular MS software - the team outright told their superiors they won't do it, the story goes that it wasn't their product or it had been a competing product that won out - so the program had to be written in C# or whatever they were using at the time!
Would Steve Jobs tolerate this shit? Never.
Now with Steven Sinofski in charge things are getting better though, seems like he hands on - Windows 7 was all done under him
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