The Six Five team discusses CrowdStrike aftermath: Microsoft fires back at Delta.
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Transcript:
Daniel Newman: CrowdStrike Pat, funny, left turn, right turn. I mean, it was kind of another one of those things. Gosh, these big major world events happen and then the world just kind of forgets about them quickly. I feel like it was what, less than a month ago, there was an attempted assassination. I haven’t heard a word about that in two weeks, it’s amazing.
We talked about Kennedy for the first 40 years of my life it came up. It’s a funny world that we live in today that we just … And the CrowdStrike thing, literally a couple of weeks ago people couldn’t get out of Delta. If you were flying Delta, you could not get home. You were trapped for days and days and their systems were down and literally someone had to walk around and go terminal to terminal and update these things to get these things turned back on. Got thousands of flights canceled, half a billion dollars or more of damage. And of course, it wasn’t just the damage to Delta, it was everybody that was affected by it. It was a snowball. Now, this gets interesting though because this past week all of a sudden it’s coming back and Delta comes out, says, “We’re going to sue. There’s going to be, we need damages here.” And then CrowdStrike comes back and Microsoft comes back. And there was a letter from Microsoft that came out that talked about how they basically said, “Look, all the way up to the level of Satya Nadella we tried to help you guys. We offered one-to-one to come out and help, you declined our offer to help.”
And as you started to unpack this, you and I both wrote pieces about this. I wrote a pretty long tweet, because I don’t write articles anymore, I just tweet. But I wrote it where I was trying to break down what happened here. And what it looks like is that CrowdStrike, sorry, is that Delta has a very, very complex legacy technical estate that exists in its IT, and that they’re running a combination of different server, platform, Linux Windows. They’ve got many different tools, they’ve got distributed clouds. And the long and the short of it was, Pat, is when you have a very sort of distributed antiquated IT environment, right? Hi Clifford, when you have a-
Patrick Moorhead: That always distracts you, doesn’t it?
Daniel Newman: It always does, but thanks for throwing that up. But when you have a really, this antiquated technology estate, Pat, and something breaks, it’s probably never one thing, right? There’s a lot, it’s like a snowball of different things that ended up causing this. And the first thing that I saw is I was reading this letter, I’m thinking to myself, “Well, American Airlines was on the same and United was on the same and they had problems, but ironically, in a matter of just a few days they were able to get back up. So, what was the difference?” And so as you were kind of reading through this letter from Crowd, like you’re looking at it and you’re sort of in this environment where there was five, six, eight different technological and software and update and operating system standards being run across these states. And the fact that they couldn’t get brought up quickly blaming it on any one part becomes really, really difficult.
Now, of course, you have all the contractual things that basically says you can’t hold CrowdStrike or Microsoft harm for the damages. That’s a whole nother thing, because this is sort of what I would consider to be a above-the-fold event, more considerable in nature. But Pat, in the end it looks to me like everyone tried to help Delta. Delta didn’t want to be helped. And now, was that because they wanted to preserve their ability to litigate once the were created? Was that because they knew technologically that no Microsoft or CrowdStrike alone couldn’t come in and solve their problems? There was many things there, Pat, but what I kind of said long and short is this is going to be an interesting precedent set for how technology failures can snowball into litigation. And when a single point of failure creates a snowball of across this technology landscape that most enterprises have, full of technology debt, full of different software, Linux and Windows and different clouds, who is to blame? It’s very complicated. In the end though, I think Delta is trying to save face, but I’m not particularly optimistic that they’re going to have a good experience at court when you start unpacking what their IT environment looked like.
Patrick Moorhead: There were definitely mistakes made by CrowdStrike overall. They sent a corrupted file, which-
Daniel Newman: Totally.
Patrick Moorhead: … sent it spiraling. And customers have the ability to test stuff. And this is a classic thing that goes on in the enterprise. You don’t just send out a file to 125,000 stations without testing it first, unless it’s zero day. And these updates from CrowdStrike do come in in different flavors. And a lot of people just, even though it wasn’t zero day, they went ahead and did this. And the weird part about Microsoft is, there’s a couple of things going on there. First of all, Microsoft somehow gets implicated in crew management systems. That’s how you get the crew in the right place at the right time. This has nothing to do with a client PC that is sitting there that CrowdStrike made go away. Maybe you could stretch and say that, “Okay, flight attendants have a PC and they couldn’t use it because of this.” Maybe that’s a stretch. I mean, the reality is, and this came out in between Delta and Microsoft, that AWS and IBM and Kyndryl are actually the service providers to those flight systems.
Daniel Newman: I was trying to be nice, by the way. I wasn’t trying to call out blame, but-
Patrick Moorhead: Well, I’m just, no, this is my, “There were a mistake. Here are the facts.” And here’s come a little editorial, but this is also a little bit of fact. Every modern enterprise-grade PC in the last 10 years has the ability to go in and delete files and replace files without having to boot the PC into the operating system. And that’s through BIOS and they can do it in mass capabilities. So, I have to conclude, and I actually hope this goes to court with discovery, is I want to know, how old were those PCs that Delta has? Did they turn on this BIOS capability to be able to go in and literally automatically take out the corrupted file and put the new one in and reboot the PC? What were the procedures that were going on there? So yeah, that’s where I am. I mean, I think it is a, just to net this out, is a complete CYA by the leadership team at Delta. Cover your arse, because the board wants heads and the leadership team doesn’t want to all get fired, and who are they going to blame? And I’ll even go one step further and with Satya Nadella reaching out and nobody even responding, reaching out to the CEO on multiple times with an offer to help and think about how many times Microsoft has helped people who have issues that are in and around Windows, it borderlines negligence. Negligence.
Daniel Newman: Yeah. Well, I think, like I said, I think once the litigation decision was made or considered, it’s a preservation thing. You start to take on help and then it starts to negate the opportunity for possible damages to come in. Pat, by the way, some great comments have come in here, but the long and the short is, is that there’s some learnings here for it. There’s some learnings here for software providers. If there is any damages that will change the industry, it will cause a meaningful change in the industry going forward. And of course, Pat, this was the worst I’ve seen in a long time in terms of something that actually affected mass numbers of consumers. We’ve seen these unique one-offs inside of one company or these ransomware attacks that have been substantial. But this was a lot of, you used the word, I think it’s good. There was quite a bit of negligence that led to this. It is going to reshape some IT decisions.
Author Information
Daniel is the CEO of The Futurum Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise.
From the leading edge of AI to global technology policy, Daniel makes the connections between business, people and tech that are required for companies to benefit most from their technology investments. Daniel is a top 5 globally ranked industry analyst and his ideas are regularly cited or shared in television appearances by CNBC, Bloomberg, Wall Street Journal and hundreds of other sites around the world.
A 7x Best-Selling Author including his most recent book “Human/Machine.” Daniel is also a Forbes and MarketWatch (Dow Jones) contributor.
An MBA and Former Graduate Adjunct Faculty, Daniel is an Austin Texas transplant after 40 years in Chicago. His speaking takes him around the world each year as he shares his vision of the role technology will play in our future.
