You mentioned earlier that Microsoft is concentrating on services enablement in Windows going forward. A lot of people want to know if you see the future of Windows as more of an Internet service than as software that runs on a PC. How do you envision Windows going forward in an era of growing services? I think of Windows as a theres Windows and theres Windows Live and those are separateand I say that in a very formal, regulatory sense that they are separate productsbut we think about them together, and we think about Windows-enabling service and then Microsoft will be one of the biggest service providers through Windows Live.People want the power of a rich client and really everybody agrees on this. People love to shoot at us because that is our business, but the truth of the matter is, lets take Google and Yahoo, a lot of what they do is rich client software.AJAX is actually local code, it runs on the PC. Dont tell anybody, but its rich client code. If you take a look at Gtalk or the Yahoo IM or ours, its rich client code. So I think there is much more shared belief that you can deliver great experiences with rich client code than not. So that platform, the end-user platform, the developer platform, for rich-client code, be it on PCs or phoneswhich are getting smarter, not dumber, thats important innovation that needs to be supported by service and enable service and were working hard on all aspects of that issue. We are in a position today where we will divide things, some in exactly the same way we would have a few years ago due to our regulatory regime, which we will also factor into what goes into Windows and Windows Live. How does becoming far more of a services provider play out with your partners and those traditional service providers? Every innovation is both an opportunity and a threat for anybody in our industry, be it a partner or competitor. If we add anti-spyware into Windows, theres a partner who is not going to like it. But, hey, there could also be a Microsoft group who thought they were going to make money selling anti-spyware. So you can say thats a challenge, but it also creates a set of new opportunities. I think software as a service has exactly that same dimension. The truth is, the number of things that companies and individuals want to do with technology is still limited by the ability to customize it. If we can save people some routine customization and implementation so that the effort can be applied to the things that bring real value, then thats good. My first real experience of this was when we integrated the TCP-IP protocols into Windows, which, of course, now, we would say, How could you not have done that? But we had a bunch of partners who complained because their whole business was writing TCP-IP stacks or integrating them into Windows. Well, in the grand scheme of things, partners have done fine, and the move to software as a service should again be an enabler of new and different kinds of creativity. But things do change. Its not like its a static world for us or our partners. Editors Note: To read part two of this Q&A, click here. Check out eWEEK.coms for Microsoft and Windows news, views and analysis.