No question about it: Nadella’s Microsoft is a triumph. Finally, in the 2020s, Microsoft focused on the most innovative technologies after the PC itself. And while revenue from AI products hasn’t begun to offset Microsoft’s massive investment, it has the confidence — and resources — to wait until the products improve and users find them useful.
But can Microsoft really avoid the hubris that set it back so far? Consider what happened in May of this year with a product called Recall.
The feature was supposed to represent Microsoft’s integration of AI into its hardware, software and infrastructure. The idea was to give users a sort of personal version of the Internet Archive. Recall will constantly capture everything that happens on your machine: what you read, what you type, photos and videos you watch, sites you visit. Just describe to your machine what you’re looking for: What were those rug samples I was considering for my living room? Where is this report on Amazon ecology? When did I go to Paris? Those moments will pop out like magic, like you have a homunculus that knows everything about you. It sounds scary – kind of like a built-in Big Brother – but Microsoft insisted that users can feel safe. Everything stays on your computer!
Almost immediately, critics denounced it as a privacy nightmare. For one thing, they note, Recall works by default and eats your personal information, no matter how sensitive, without asking for permission. While Microsoft stresses that only the user can access Recall, security researchers have found “holes you could fly a plane through,” as one tester put it.
“Within about 48 hours, we went from, ‘Wow, this is super exciting!'” to people expressing some reservations, says Brad Smith. As the press piled in, Smith was on a plane to meet Nadella in Washington, DC. By the time he landed, he figured it would be wise for Recall to only work if users opted in; Nadella agreed. Meanwhile, in Redmond, Microsoft’s top executives gathered in boardrooms to see how they could shrink the product. Fortunately, since the feature hadn’t shipped yet, they didn’t have to pull Recall. They postponed the launch. And they would add security features like just-in-time encryption.
“People pointed out to us some obvious things that we needed to do that we needed to capture,” Nadella says. But his own responsible AI team also missed them. The know-it-all measure led to a product announcement that failed, showing that even when led by a supposed empath, Microsoft still retains too many of its former character flaws. Only now, it’s a $3 trillion company with locked access to the products of the leading AI operation.
“You can think of it one of two ways,” says Brad Smith. “One is, ‘Gosh, I wish we had thought of this sooner.’ Hindsight is a great thing. Or two, ‘Hey, it’s good that we’re using this to make this change—let’s explicitly explain why.’ It was really a learning moment for the whole company.”
that’s fine After 50 years, though, it’s a lesson Microsoft — and Nadella — should have learned long ago.
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