Microsoft's Week: Azure and Office 2010 Show the Cloud Will Dominate

Microsoft rolled out the beta of Office 2010 and other productivity software, and made some key announcements about its Windows Azure cloud platform, during the Professional Developers Conference in Los Angeles this week. Even as Microsoft moves to embrace the cloud, the release of Google Chrome OS to open source for developers on Nov. 19 suggests that Redmond may eventually have to think even further about the cloud--and ways it could potentially move parts of its Windows franchise from the desktop to the Web.

Microsoft offered a first glimpse of much of its future this week, using its Professional Developers Conference in Los Angeles as a high-profile platform for the release of the beta versions of Office 2010, SharePoint Server 2010, Project 2010, Visio 2010, Office Mobile 2010 and Office Web Apps for businesses. Many of the keynote addresses at the conference also dealt with Azure, Microsoft's major foray into the cloud.

As with Windows 7, which Microsoft released in a widespread public beta in order to generate massive amounts of user feedback, the public beta for Office 2010 and other applications will theoretically give Redmond's developers the information they need for tweaks and improvements before a collective general-release debut in 2010.

The beta versions can be downloaded from this site.

Unlike previous versions of Office, which have primarily been desktop-based, the new version of Microsoft's productivity platform shows Redmond beginning to embrace the cloud. Microsoft has decided to make browser-accessible editions of OneNote, Excel, Word and PowerPoint available to Microsoft Live subscribers, albeit with stripped-down functionality. (Those wanting the full range of tools for these applications will need to purchase the full version of Office 2010.) Microsoft clearly recognizes the potential threat from cloud-based productivity programs such as Google Apps, which could begin to eat into Microsoft's market share.

In its bid to further shore up Office's market share, Microsoft is also releasing Office Starter 2010, which will come preinstalled on PCs produced by the major manufacturers. Users of Starter will be able to save, view and create documents, but broader functionality will only be available with the inputting of a special code.

Click here to see a gallery of improvements to Microsoft Office 2010.

Of course, other announcements also dominated the Professional Developers Conference, including the one by Chief Software Architect Ray Ozzie that Microsoft would turn on its Windows Azure cloud platform on Jan. 1, 2010. Until now, the cloud-based platform for creating Web applications and services has been in Community Technology Preview.

"At its core, Azure is Windows-Windows Server," Ozzie told the audience.

Bob Muglia, president of Microsoft's Server and Tools Business division, emphasized in his own keynote that Microsoft's development of Azure took cues from not only the tech industry's evolving conception of the cloud, but also its own experiences with developing its own search engine, Bing.

"Over the past year, the industry understanding of the cloud has really evolved. One thing that has become very clear is that the cloud is about more than infrastructure-it's also an application model,"Muglia told his audience. "Microsoft has learned about how to build the next-generation application model."

Bing apparently helped with that learning process.

"Bing is a service that's always available; it's highly resilient; it runs on multiple data centers. If we tried to manage this through standard means, it'd be too expensive. What the Bing team did was build an infrastructure on a platform called Autopilot, which can manage the service with a very small amount of human intervention," Muglia added.

But while Autopilot worked well for Bing, it could not be wholly exported for use outside of Microsoft. "It wasn't built as a platform that could be generalized," Muglia said. "That's where Azure has come in-to take these ideas and generalize them in the form of an application platform that can be broadly used."

Just as with Office, Microsoft finds itself with substantial competition either present or building in the cloud-development arena. and Google have been establishing their own presence with enterprise-cloud platform offerings.

In order to gain a competitive advantage, Microsoft executives devoted part of the conference to outlining several cloud-based initiatives and programs, including Windows Server 2008 R2 Hyper-V virtual machine support on Azure, and Microsoft Pinpoint Marketplace, which lets partners market and sell applications. The RTM of Windows Identity Foundation will allow developers to provide simplified user access to cloud and on-premises applications.

"What's important is to begin to evolve these applications," Muglia said, "to take advantage of the attributes that the cloud delivers."

Outside of the Professional Developers Conference, other bits of news rose to brief attention. On Nov. 16, Microsoft announced that Windows Marketplace for Mobile, its mobile-applications store launched with Windows Mobile 6.5, will be available to users of Windows Mobile 6.0 and 6.1.

That news could perhaps be taken as a sign that Microsoft is looking for any and all ways to compete in the crowded mobile operating-system marketplace against sizable competitors such as Research In Motion, Apple and Palm. The total number of applications currently available in the Marketplace stands at 800, around three times the amount originally present during the store's launch in early October. Roughly 1,000 ISVs are currently registered to provide mobile applications.

Microsoft also upgraded Windows Marketplace for Mobile with features such as better anti-piracy protection, PC-based shopping and account management.

Click here for more information on Windows Mobile 6.5's features.

While these initiatives are under way, though, Microsoft can take some hope in the early success of Windows 7. During the company's Annual Shareholder Meeting on Nov. 19, Microsoft CEO Steve Ballmer suggested that both boxed and preinstalled versions of Windows 7 were selling "twice as many units" as any previous Windows edition, specifically the much-hated Vista.

Outside reports have suggested that Windows 7's share of the PC market has been increasing, with statistics company Net Applications estimating that the operating system occupied over 4 percent of the PC market by Nov. 9. By comparison, it took Vista nearly six months to reach that same level. A separate report from the NPD Group estimated that sales of Windows 7 boxed software were 234 percent higher than sales of Vista during the operating systems' first days of release.

But Microsoft faces a potential rival in that arena from Google, which released its Chrome Operating System to open source for developers on Nov. 19. The browser-based Chrome OS will run on netbooks as an alternative to desktop-based software systems built by Microsoft and Apple, with users' applications and data stored in the cloud and accessible through the Google Chrome Web browser layered atop the Chrome OS.

However, the Chrome OS-scheduled to debut for end users in late 2010-cannot support traditional desktop applications, something that Microsoft sought to highlight in its response to Google's announcement. Should Chrome OS eventually herald a move toward more cloud-based functionality for operating systems, though, Microsoft will likely have to attempt to replicate what it did with Office 2010, and find a way to port its traditional desktop-based model into a new arena. Ready or not, the cloud is coming.