SPELLING IT OUT FOR MICROSOFT.

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Author: Greene, JayBeucke, Dan

HEADLINER

When Microsoft bought Groove Networks in April, it was happy to absorb Groove's software technology into some Office productivity products. But the real key to the deal was Groove founder and CEO Ray Ozzie. Something of a legend in software circles, Ozzie struck digital gold in 1989 when he created Lotus Notes, the widely used messaging software.

Now, Ozzie is pushing the bounds of innovation again. Chairman Bill Gates and CEO Steven Ballmer tapped Ozzie to lead Microsoft's charge into software delivered over the Internet. In a frank Oct. 28 memo to top execs, Ozzie spelled out how Microsoft is trailing rivals such as search leader Google and Net-phone pioneer Skype. "We must reflect upon what's going on around us, and reflect upon our strengths, weaknesses and industry leadership responsibilities, and respond," Ozzie wrote. "It's clear that if we fail to do so, our business as we know it is at risk." Sometimes, it takes an outsider to cut through the fog.

Copyright The McGraw-Hill Companies, Copyright 2005

PHOTO (COLOR): Ray Ozzie

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By Jay Greene

Edited By Dan Beucke