The Summer of Selling a Strategy

Microsoft begins campaign to sell its Web services vision.

Microsoft, which has stuck to its guns in building proprietary software over the past two decades, is about to blast down the walls when it begins rolling out .Net this summer.

The XML-based strategy, which allows software to be distributed as a service by application service providers, is the companys first attempt to push beyond the operating system battles with Unix in general, and Linux in particular, and focus on how users can utilize data more effectively.

"Right now, Linux is in a competitive situation," says Rick Belluzzo, president and COO. "We will respond by building products that are superior."

The goal is also to allow corporations to move data between servers and devices within an enterprise, regardless of what platform it resides on. The strategy, however, isnt without risks.

Historically, proprietary file formats and software incompatibilities have provided Redmond with tremendous advantages, creating barriers to entry for its competitors. XML will eliminate that, and given its rapid growth throughout the industry, the loss of Microsofts advantage may be inevitable.

But .Net is also a strategy to tie together Microsofts disparate products and services MSN, Office, Back Office servers, Hailstorm services, etc. to help mitigate the impact of that move to standards.

Microsoft is banking on its strong relationship with developers and services partners to make .Net a reality. It already has in place a marketing plan for those partners, slated to be uncorked at its Fusion partner conference next month. Microsoft says partner revenue will come from platform share and growth, and leads and marketing assistance, as well as new markets. In turn, the pitch for their customers is that they can reduce costs while cutting the time it takes to deliver solutions.

"The biggest challenge for us is to show our partners the opportunity," says Ian Rogoff, VP, worldwide partner group. "We havent made [.Net] clear enough."

Some third party possibilities were demonstrated last week when Microsoft rolled out Office XP, which now includes some .Net features such as SmartTags that customers or partners can develop on their own. Microsoft is expected to use SmartTags as a mechanism to lead Office users to MSN or other Microsoft Web services, and partners can use the technology similarly.

Another .Net feature Microsoft is widely promoting is SharePoint Team Services, a sort of collaborative workspace tool, that will provide an opportunity for ISVs to develop management and other tools, says Cliff Reeves, VP, Windows Server marketing.

Theres also the possibility of developing accelerators for BizTalk Server that predefine business processes, says Dave Wascha, product manager for BizTalk Server. There, partners will have to choose carefully, as Microsoft is developing accelerators as well, and has already created one for compliance to the new health privacy regulations called HIPPA and another for RosettaNet, the electronics industry standard.

Quilogy, an XML consultant, has developed about 80 small .Net applications, such as an app for processing expense reports that it plans to allow any of its customers to use as part of its services, says Alan Groh, CTO of Quilogy.

Quilogy has also developed what Microsoft has called a Blackberry Buster, an app for downloading Exchange e-mail on any device, and is working with Microsoft this week to develop .Net samples that will likely be demonstrated at Fusion. The company is also helping Microsoft to create its .Net training program, which Microsoft will also outline at Fusion.

As always, partners are key to Microsofts success and retaining their allegiance is more important than ever to the software giant. But most of the companys strongholds are under pressure as Windows is under threat from Linux and the company has yet to gain a foothold in the area of non-PC device operating systems.

Microsoft is planning to augment its well-established relationships with Accenture, Avanade and KPMG, and forge arrangements with the other Big Five consultants as well as regional and vertical industry boutique integrators.

The aim, says Reeves, is to let solution providers do for Microsoft what theyre already done for IBM and Sun penetrate the enterprise. And that is Microsofts ultimate goal.

This story was reported by Anne Knowles, David Raikow & Ed Sperling