Influence Beyond Microsoft

Redmond, Washington: Bradford L. Smith, Microsoft's general counsel, was in Berlin meeting with government officials this spring when a case kept popping up unexpectedly. How would the company respond, the officials demanded to know, to a judge's ruling in New York that would give the U.S. government access to a customer's email sitting in an Irish data center? Germans were already furious about revelations that Americans spied on the country's chancellor, Angela Merkel. And unless the ruling was reversed, one official told Smith, the German government would never rely on a U.S. company like Microsoft to store its data in the cloud. After his conversations about the case in Germany, Microsoft subsequently challenged the judge's ruling in court, the first time a U.S. company is believed to have fought back against a domestic warrant for data held overseas. A hearing on the case is planned for July 31. Such are the decisions regularly faced by Smith, 55, who has become the elder statesman of Microsoft and a de facto ambassador for the technology industry at large. As Microsoft's chief representative on public policy matters, including privacy - an issue under close scrutiny around the world -Smith plays a significant role in many of the most critical decisions affecting the company's fortunes. Smith said he told the German official about the case: "We've taken this on with a complete commitment to persevere and to do everything we can appropriately to win." The promise to the German officials carried weight. Smith is one of the most influential voices inside Microsoft, partly because he has been in his job since 2002, which makes him the longest serving member of the senior leadership team. His influence has only increased in recent years while Microsoft has churned through top executives and made other major changes, all in an effort to keep pace with competitors in the marketplace. Last week, in another major change, Microsoft said it planned to eliminate up to 18,000 jobs, or about 14 percent of its total work force, over the next 12 months in an effort to thin out layers of bureaucracy at the company and move more quickly. But Smith's weight extends to the wider tech industry as well, partly because of his understanding of Washington. Smith worked for years as a lawyer there before moving to Microsoft's headquarters here outside Seattle. While much of the tech industry looks upon government with a strong sense of skepticism, if not disdain, he has cultivated relationships there for years. "He brings a much more Washington sensibility to the West Coast than many of his peers," said Anne-Marie Slaughter, a former State Department official who now runs the New America Foundation and attended Princeton University with Smith. "He recognizes the necessity of government engagement. Government is not just an entity for favors. It has to be part of the solution." Smith's political skills have led to some speculation that he will pursue elected office. For now, though, he is putting those skills to use for Microsoft and the technology industry, particularly after the disclosures by Edward J. Snowden of government efforts to collect private data from online services operated by Microsoft, Google and others without search warrants and subpoenas. The leaks shook executives throughout the industry, many of whom worry about damage to the appeal of their products. Last year, Smith equated government snooping with other serious threats like malware and cyberattacks, and he also led an industry push for changes in how the government collects data. "People won't use technology they don't trust, and we need to take the kinds of steps to sustain that trust," he said in an interview last week. An earlier policy issue facing Microsoft suggests how Smith likes to handle problems with pragmatism. When he interviewed for the general counsel job in 2001 with Bill Gates and other senior leaders of the company, Microsoft was facing a litany of penalties in its antitrust battle with the Justice Department, narrowly avoiding a government-ordered breakup of the company. But a new wave of anti-trust battles in Europe and from private companies loomed. During his interview, Smith showed the executives a single slide declaring that Microsoft needed to make peace with its foes. At the time, Microsoft was widely seen as a bully. People who know Smith said that changing the company's legal stance in the anti-trust case, as well as later legal stances the company has taken, helped soften the company's public image. Microsoft's repeated stumbles with important products have also made the company seem less fearsome. After the Snowden disclosures, Smith pursued an industrywide effort to limit the damage. In July of last year, Smith picked up the phone and called his counterpart at Google, Kent Walker, to explore whether the companies could gain strength by working together on a settlement with the government on data collection. The overture was remarkable considering Microsoft and Google are ferocious business competitors, and Microsoft has decried Google's privacy practices through its "Scroogled" advertising campaign. But the two companies put aside their hostilities and, in January, they and other technology companies reached a deal with the Obama administration. Leslie Miller, a spokeswoman for Google, declined to comment. "Kent and I talk frequently," Smith said. "Sometimes we're on the same side, sometimes we're on opposite sides." And in the fall of 2013, Smith and Erika Rottenberg, the general counsel of LinkedIn, the social media company, organized a meeting of general counsels from a half dozen or so major technology companies to talk about further unifying their efforts to press for government change. The meeting, in a private dining room of a restaurant in Palo Alto, California, eventually led to the formation of the Reform Government Surveillance coalition, which counts Google, Facebook, Twitter, Apple, Microsoft and LinkedIn as members. "He's good glue for those kinds of groups because of his policy skills and general intelligence," Bruce Sewell, the general counsel of Apple, said of Smith.. @ 2014 New York Times News Service

Influence Beyond Microsoft

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