Q&A: Alistair Baker, Microsoft UK managing director

Microsoft UK's new managing director gives Computing his first interview

Microsoft has appointed a new managing director for its UK business.

Alistair Baker takes over the job from Neil Holloway, who has moved to a role in the software giant's European organisation.

He stepped up from running Microsoft UK's Small and Mid-market Solutions and Partners division this month.

In his first interview since taking on the role, Baker talked to Computing about the challenges he faces.

What are your first priorities in the new job?

We need to focus on a number of areas, including some of the big policy items such as security, child protection, spam, the EU ruling, and the recent co-operation announcement with Sun (Computing, 8 April). Microsoft has to drive value into UK plc, from a consumer perspective in the home, right up to large enterprises, using our products and our partners' capabilities.

The business is in a strong shape. It is healthy from a financial perspective and in employee satisfaction. And we've done a good job over the last few years addressing issues around customer and partner satisfaction.

If you think about where we are today, we have a very broad portfolio of technology and a very important role to play as a responsible leader in the marketplace.

The phrase 'responsible leader' is frequently used by Microsoft executives lately. What does it mean?

It's about how we add value to our customers and partners by our ability to innovate and how we invest our $6.8bn in research and development, which gives us huge capacity to drive what technology can deliver. We consider competition to be a very healthy thing - some people paint us as being into global domination, that's absolutely not the case. If it were we'd spend that money in a very different way.

Being a responsible leader is about ensuring what we do is for the good of the consumer and the customer, and for those people who work in our environment, and how our partners can make good business out of our technology, and to do that in a way that is open and inclusive and allows our competition to do its bit. It's also about driving a great return on investment to our shareholders and stakeholders and employees.

One area the industry is looking to you for responsible leadership is security. How are you tackling this issue?

The fact is, this is an industry problem. Microsoft happens to be a very big player and therefore a very big target for people who want to write a hack or a virus. The company has invested huge amounts of time and effort into how we address this problem, from Bill Gates and his senior development managers down. We believe we have made massive strides in how we address the management of security. But if you choose not to use the locks and alarms available you may have a problem.

We have worked hard to educate customers and partners on how to get better security out of what you have today. Using Windows Update in XP, how you lock systems down using anti-virus software and firewalls, and keeping software up to date, will all take you a long way towards a secure and robust environment. But there's a lot of older technology out there and these tools will take effect more as people buy new PCs. Then you have to look at what we've done in our core technology. Security is number one on the agenda in every product group. It's not about features, it has to be done in a way that ensures a secure environment.

If you go back to the 1990s and the dot com explosion, and then consider what we now know about how people can exploit the internet, a lot of products that came out for internet access inherently didn't have the right security. The technology, the processes and the responsible leader element are all about how we work with hardware vendors and ISPs to get a comprehensive lock-down strategy. That will manifest itself in the next generation of technology, such as Windows XP Service Pack 2 that has a lot of security features incorporated into it. We can use the next generation of technology to create a more secure environment and provide the tools to allow more effective security management.

I believe we are on the right track. It hurts us when problems are found, but on every new release we have dramatically reduced the number of critical bugs and security holes that are found. We run our business on our technology, as do our customers. Those that have taken the appropriate measures, such as staying current on software and updates and have effective firewall technology, they have not suffered as much as those that have left their door open.

Many of your customers will be considering whether to renew their Software Assurance (SA) contracts this year. How do you counter criticism about a lack of value for money in the scheme?

The renewal rates are where we expected them to be. We didn't expect everyone to renew, we believe that everyone who bought into the Microsoft strategy would renew. It comes down to the specific needs of the business. With Licensing 6.0, we tried to reduce a lot of the complexity. A lot of investment went into understanding market needs and we received positive feedback. We want to add more value into SA, and are looking at different ways of achieving that. It's not a static programme,.

I look at the numbers. We should not feel embarrassed about the uptake or the value that customers derive from SA. If we don't help people realise the full benefits of SA, then that's shame on us.

A lot of those customers are considering open-source software as an alternative or maybe just as a negotiating tactic. How do you respond?

You will always have people who evaluate, those who use it as a negotiating tactic, and those who are pleased with our technology. The reality is we are hit from both sides. On the one hand, we're told we are trying to control everything and are squeezing out competition. On the other hand, the open-source players talk about the great traction they have in the market. In certain circumstances, open source is a viable alternative, but we believe our platforms will equally address the business needs and be better value. Some people are looking at moving from Unix to Linux, which is an obvious move.

The reality of what open source can and cannot do is setting in. People will have looked at it and maybe even deployed an open-source desktop, but then moved back to Windows because open source cannot match the functionality. I encountered a company the other day where the big resistance to open source was the end user's experience. They didn't want to use the system because it didn't do what they wanted and wasn't compatible with what they had at home. There will be people that look early, but we are not losing market share.