At a developers conference last week, Microsoft rolled out a mind bending set of new ideas (products?) that leverage the concept of cloud computing. This makes a lot of sense because as companies figure out that they can rent software, storage and servers from big name providers like IBM, Amazon, Google, and HP, the landscape for software providers will change. Bill Gates has long argued that Microsoft is not the hegemony that people believe. As the European Union was screaming that Microsoft had an unfair advantage in the market, Bill was saying that his company could lose their position quickly due to the speed of innovation in the technology industry. I am sure that Bill always imagined that Microsoft would be able to outflank rivals, but in truth, he was dead on in his evaluation that their current monopoly could go away in the space of a few years.
As we sit here today, Microsoft is under heavy pressure from companies that are delivering software in the SaaS model, open source products, and rivals like Google who want to take away whole pieces of Microsoft’s pie. In order to best defend their territory, Microsoft is not working to introduce new layers of products that can help companies better manage cloud computing environments. I guess this is their, “if we can’t beat them, let’s join them” approach to innovation. They have announced a new platform call Azure that will bundle up lots of new capabilities for customers that want to stay with Microsoft as a provider of all forms of digital plumbing. Here is your warning, the following is from the Microsoft site so it is a bit difficult to digest…
“The Azure™ Services Platform is an internet-scale cloud computing and services platform hosted in Microsoft data centers. The Azure Services Platform provides a range of functionality to build applications that span from consumer web to enterprise scenarios and includes a cloud operating system and a set of developer services. Fully interoperable through the support of industry standards and web protocols such as REST and SOAP, you can use the Azure services individually or together, either to build new applications or to extend existing ones.”
If that did not make much sense to you, just understand that the team at Microsoft is trying to move from a product world, to a services and product world. They realize that they will no longer be able to sell Office and Windows in shrink wrapped packages and succeed. They will have to move into being a cloud based supplier – even on their data center products. This transition will make or break this stalwart company and although it will not be easy for them, I never bet against them either. Remember, many people laughed when they got into the game box market and I have observed that the Xbox 360 is doing pretty well these days.
I feel like I should go further and tell you about Microsoft’s “Mesh” platform as well, but that would make things even more confusing. In a way, I feel bad for them because they are trying to do the right things, but they live in a complicated world that forces them to always be creating new vocabulary and spin on their specific ways of doing what the market is already dictating. So let’s settle on this for you to watch… Microsoft has now committed to a new direction of providing services and platforms as a major revenue source. Keep you eyes on Mesh, Azure, and Office Live because they normally do not get it right on the first try, but they always get it right on the second or third…
Scott Klososky
Scott@klososky.com