Microsoft plays catch-up with Web services push

Microsoft plans to unveil its vision for Web-based computing, as a looming antitrust battle and tougher competition cloud the software giant's future.

As previously reported, Microsoft today is expected to disclose a new strategy to develop Internet-based software and services called Next Generation Windows Services (NGWS). Chairman Bill Gates, CEO Steve Ballmer and other executives are scheduled to announce the new initiative at company headquarters in Redmond, Wash.

Next week, the company also is planning to announce a Java-like software programming language intended to simplify building Web services using its software.

Along with fighting government officials intent on breaking up the company--and potentially derailing the new software strategy--Microsoft also is battling competitors. While the company is promoting the announcement as its biggest in five years, analysts say that other software makers are embarking on the same road and that Microsoft may be playing catch-up.

Competitors, including Hewlett-Packard, IBM, Oracle and Sun Microsystems, along with start-ups, such as BowStreet and WebMethods, are all working on technology to deliver services over the Web. HP has been one of the most active competitors with its "e-speak" technology.

Microsoft and its competitors share the same "e-services" vision: In the future, people won't have to install software on their PCs or other Internet access devices. Instead, the software will be accessed through the Web as a service.

Core to the e-services strategy are Extensible Markup Language (XML), a Web standard for exchanging data, and new XML-based software tools that allow businesses with different computing systems to communicate with one another.

Gartner analyst Darryl Plummer said early examples of e-services include technologies that deliver stock quotes and weather reports to cell phones. Another example is renting software, such as accounting programs, over the Web through application service providers (ASP).

Microsoft executives have said a future service could allow patients to go to one Web site for all their health-care needs, from viewing medical histories to paying doctors' bills.

While consumers will use e-services, most of the money will be made in the business e-commerce market, analysts say. It will be like a virtual Yellow Pages, where a business can request a service over the Web and get responses back from companies that offer that service.

A travel agency, for example, could send a request over the Web for cheap flights from San Francisco to London. Through XML technology, the travel agent could automatically receive information from airlines that fit search criteria.

Although Microsoft will have to play catch-up, analysts say the company will become a major player in the Web services arena.

"Microsoft has one of the more complete architectural visions of how e-services should be created," said analyst Mike Gilpin of Giga Information Group. "They have an opportunity to be a leading player in the market, but whether they capitalize will depend on their ability to execute on delivering the products to market."

Although Microsoft has asserted that a breakup would hinder its ability to offer NGWS, Gilpin said he believes the company will still be able to deliver the technology because it could run independently of the old Windows operating system. The judge presiding over the Microsoft antitrust trial has ordered a breakup of the company into two parts: an operating systems company and an applications company.

"It would be different than what they expect, but in a post-breakup scenario, NGWS could become the next Windows as far as Microsoft is concerned," Gilpin said.

For Microsoft, the new thrust is part of the software giant's goal of keeping Windows the dominant operating system, even as computing begins to move from desktop PCs toward Internet-enabled wireless devices, such as cell phones and handheld computers.

The company faces new challenges from Web-based devices, alternative operating systems such as Linux, and alternative programming models that use the Java language.

Microsoft representatives say the company today will introduce plans for its new technology, as well as explain how existing products fit into the strategy. The announcement, which was delayed for three weeks because of the antitrust case, will involve all areas of Microsoft.

Over the past year, Microsoft executives have shared many details of the new strategy.

In a speech last week in Taiwan, Gates said Microsoft will spend three times as much on NGWS as it cost to put a man on the moon.

PCs will remain the center of the computing universe but will be complemented by handheld devices, Gates said. NGWS, he said, will be an operating system-like technology that will automatically update software, synchronize databases, and filter and compile information from multiple Web sites.

Future versions of Windows will contain handwriting and voice recognition, and browsers and applications will be more tightly integrated.

Earlier this month, Gates unveiled a key piece of the strategy, called BizTalk Server 2000. BizTalk Server is Microsoft's XML-based software for linking computing systems and applications across the Net.

A new feature within BizTalk Server, called "orchestration," allows businesses to easily define how e-commerce Web sites function and how information needs to be passed among mainframe, Unix, personal digital assistants, and Windows-based computers to complete a transaction.