Microsoft’s Leader in Web Apps: Meet Dr. Flakenstein

By: Chuck Salter Mon Oct 13, 2008 at 5:45 PM

Strange things are going on in the lab of Gary Flake. Can this Web geek make Microsoft come alive?

A Live One: Gary Flake, founder of Live Labs, says Microsoft has a historic opportunity in web apps.| photograph by Amanda Koster

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Photo Magic: Live Labs' Photosynth app, which turns snapshots into 3-D worlds, is just one of flake's new technologies. | courtesy of Photosynth

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Flake demonstrated to his team early on that it was okay to take risks. He wanted Live Labs to have an office in downtown Seattle. Instead of going through channels, he found a loftlike space on his own -- defying the warnings of other execs that locating off campus was "suicide." Now it's the envy of Microsoft, with a living room/screening room and an orange-wallpapered meeting space known as the "bordello." Similarly, when MSN, the company's Web portal, wouldn't promote Photosynth on its home page unless it was rebranded using an MSN name, Web address, and logo, Live Labs launched the service solo.

"We're like a tightrope walker, between acting like a startup and managing relationships within Microsoft," says Alex Daley, 29, Live Labs' group product manager. Daley has solid geek cred of his own: As a junior at Rutgers, he taught computer-science classes, and he was managing the university's IT-services department by graduation. "I make sure we get what we need from the rest of the company without it getting in our way."

It's as if the alpha geeks are slyly trying to reprogram the company. And indeed, on the whiteboard in Flake's office, a colleague has taped the cover of a recent issue of Fast Company, with a picture of Flake's face superimposed on it. The story in that issue was about an ad agency hired to rebrand the company, but the cover line could apply to Flake just as well: "Can This Dude Make Microsoft Cool?"

To understand the challenges facing Flake and Live Labs, there's no better example than Photosynth. The project began after Flake acquired Seadragon, a Web startup whose founder, Blaise Agüera y Arcas, 33, had spent years figuring out how to easily display and navigate huge amounts of visual information. Seadragon can show an aerial view of every page of a book on one screen, then zoom in as close as an individual letter in the text -- all in high resolution.

The acquisition, made two months after Live Labs began, gave the little-known team a "shiny object" to tantalize product groups, says Brett Brewer, Flake's director of incubations and a 10-year veteran of Microsoft. It also demonstrated how Flake could use Live Labs as a recruiting tool, attracting Internet coders who think outside Microsoft's business model. (Agüera y Arcas's geek cred: He started Seadragon at 27 and was recently named one of Technology Review's top innovators under 35.)

Photosynth came together after Agüera y Arcas attended Microsoft Research's annual showcase and saw a 3-D model made from snapshots. A trio of researchers at Microsoft and the University of Washington had written software to recognize the same objects in multiple photos, calculate the depth of field, and stitch the images together.

To turn that research into a seamless consumer experience that happens in seconds on any given laptop -- instead of days on a supercomputer -- Agüera y Arcas formed a team of 15 that raced to create a bare-bones prototype in 2007 to get early feedback from the tech community. Photosynth epitomizes Ballmer's "software plus services" strategy. The photos are stored online, in "the cloud," at Microsoft, while the software performs the data-crunching necessary to synthesize the 3-D rendering on a user's computer.

Photosynth conveys a noticeable flair for design that's unusual for Microsoft. The reason: The ratio of engineers to designers at Live Labs is 10 to 1, not the usual 100 or so to 1. And thanks to Flake, product managers don't automatically have the final say on design. "I'm not saying working with Gary is like working with Steve Jobs," says Don Lindsay, an Apple veteran who had decided to leave Microsoft until he encountered Flake and joined his team as design director. "But Gary is pretty close."

Still, the question remains as to Live Labs' -- and by extension Flake's -- broader impact. Photosynth, like most new Web services, is free, its business model a work in progress. "How does it make money?" Flake says. "There are so many ways. You could link to stores that appear in photos, or individual products, and display an ad or turn it into a commerce event. Imagine what this does for real estate and hotels and tourist attractions."

Even if Photosynth does take off, it'll still deliver a pittance compared with Windows and Office. But Flake is unconcerned. Live Labs, he insists, is about generating multiple projects and leaders that have a cumulative impact throughout the company, financially, technologically, and culturally. "Whenever you make an effort like this, of course you're going to encounter skepticism," Flake says. "There's nothing I can do to convince people to have a change of heart, absent good evidence."

Evidence such as the Photosynth team tripling in size following the launch, when it relocated to MSN. (Plans are under way to incorporate it into various channels, such as Virtual Earth.) And evidence that Live Labs' innovation model is spreading to other parts of Microsoft. Agüera y Arcas, now a leading architect at MSN, is launching an applied research lab, and Ozzie, Flake's boss, has created a new startup lab in Boston. Both are modeled on the Live Labs methodology.

It's early, but Dr. Flakenstein's creation is up and walking.