Ozzie Sees Microsoft's Future in the Web and Hub

In case anyone was wondering why the company is so interested in Yahoo, Ray Ozzie tells the audience at MIX that Microsoft's future lies in the Web, scattered devices and cloud computing.

LAS VEGAS-In a broad-ranging keynote at the Microsoft MIX conference here, Ray Ozzie, chief software architect at the software giant, laid out his vision for the role of the Web and the services opportunity across Microsoft businesses.

Ozzie said he sees the Web transforming Microsoft's products across five different areas: connected devices, connected entertainment, connected productivity, connected business and connected development. Ozzie also announced beta releases of Silverlight 2 and Internet Explorer 8.

Moreover, he noted the importance of advertising in driving the future of Microsoft and transforming the company's focus on application and services delivery.

Ozzie said the online advertising market stands at about $40 billion today and is expected to double to $80 billion over the next three years. So Microsoft is working on ways to monetize its advertising capability, he said.

"We want to do our part to ensure there's a vibrant ad ecosystem on the Web," so Microsoft is investing in search and content, commerce, and community issues, Ozzie said.

"And if you're wondering why we're so interested in Yahoo, I hope this makes it clear," he quipped.