Belluzzo Plugs .Net As Services Model

BOSTON–The new, more responsible Microsoft Corp., which capitulated in the DOJ settlement in part, officials said, because of Sept. 11, is still playing the game as fiercely as ever.

Speaking here today at Forrester Research Inc.s Executive Strategy Forum, Microsoft President and Chief Operating Officer Rick Belluzzo took some competitors to task, especially Sun Microsystems Inc., in the high stakes business for Web services—even if that means stretching the truth a bit.

Speaking with Forrester CEO George Colony before an audience of business executives at the Westin Copley Place hotel, Belluzzo dismissed Suns Java-based Web services initiative, Sun ONE, as insignificant.

“Sun is a hardware competitor, [Web services] is about software,” Belluzzo said. “To the extent that Java has been successful, other companies are more responsible. How much can Sun invest in software compared to how much we can?”

Despite the fact that Java has been around for about six years, and that Microsoft itself had a hand in some of Javas shortcomings, Belluzzo also said that Suns initiative followed Microsofts .Net by about six to nine months.

“We have a much more comprehensive vision, tools, products,” he said. “Some [competitors] are firmly Java, while our tools like Visual Studio.Net supports a variety of languages.”

Sun executives will get equal time later in Forresters conference, which is entitled, “The X Internet: The Next Voyage.” The forum was put in place to preview the variety of software and services that will serve what Forrester calls the X (extended, executable) Internet—an evolution of the current static HTML Web—over the coming decade.

Considering whats at stake, Belluzzo may be correct in continuing the attacks against Sun, even though the two companies settled their Java lawsuit last year. Forrester analyst Carl Howe predicted that the competition for Web services will be intense.

By the year 2005, “executable” Internet applications will eclipse the current number of Web pages. By 2010 there will be 14 billion devices connected to the Internet and technology spending will balloon to $2.7 trillion.

“A bloody clash looms for Microsoft and Sun,” Howe said.

Questioned on Microsofts record on security, Belluzzo was evasive, saying that, “We are a target due to the volume of our product. We have 118 million Hotmail accounts.

“If you [hackers] want to scale a virus, then you go after Outlook,” he added.

Belluzzo admitted, however, that Microsoft “has a lot of work to do” and that it was not as responsive as it could have been in communicating with customers about how to protect themselves from attacks. “We werent effective as we needed to be in helping our customers, providing them with a quick fix.

“We think our products are as secure as anybodys,” he said. “But they are still not secure enough.”

As for the future, Belluzzo said that despite the pressure to make Web services work on a variety of devices, the PC will still be the primary focus of Microsofts business, even if that means making less money.

“Profit margins will decline, but we will grow,” he said. “The financial model will change. We will be in a variety of businesses, with more collaboration. We made big bets. We step out. Who else would have made the Xbox bet in the U.S. Who would have spent the money to take that risk? Thats good, and good for the industry.”