Microsoft

Microsoft's apology Tuesday about a contractor copying blogging site software from a small company called Plurk might not be enough to take the lawyers off alert.

"We are still thinking of pursuing the full extent of our legal options available due the seriousness of the situation," Plurk co-founder Alvin Woon said in a statement posted Thursday. "Basically, Microsoft accepts responsibility, but they do not offer accountability."

Microsoft accepted responsibility for the copying, blaming it on a third-party company. It suspended access indefinitely to the site at MSN China, called Juku. "We apologize to Plurk and we will be reaching out to them directly to explain what happened and the steps we have taken to resolve the situation," Microsoft said Tuesday.

There are many ways to measure how Windows 7 is doing. There are reports on new PC sales, tallies of boxed copy sales, and surveys of planned enterprise adoption, to name a few.

But one of the most encouraging signs for Microsoft is the lack of phone calls it is getting from people with problems. Overall, Microsoft said the volume of calls to its support lines is half of what it expected.

Gordon

(Credit: Microsoft)

"Overall we are finding our call center volume is down significantly more than we expected," said Barbara Gordon, vice president of customer support for Microsoft.

The drop in calls isn't just due to the fact that Windows 7 appears less problem-plagued than its predecessor, though. In the weeks leading up to and following the operating system's release, Microsoft also added two new ways to get help--through an online forum called Microsoft Answers and via the Microsoft Helps feed on Twitter.

"What we have found is we are seeing far more take-up of self-service...forums and Twitter to get responses," Gordon said in an interview this week.

With the Microsoft Answers forums, which launched late last year, users submit questions and experienced community members offer answers that Microsoft workers later validate to make sure they are correct.

So far, Microsoft has validated some 60,000 solutions. The company says that 83 percent of English-language queries are answered within seven days. Those in other languages have a slightly lower rate, but even of those 78 percent are taken care of within a week.

Meanwhile, Microsoft went live with its Twitter help site in October. Users can post a tweet with "@microsofthelps" in the message and Microsoft will respond. A team of seven employees dedicated full time to the project work with the broader support organization to respond to the many tweets. The goal is to either answer simple questions or to point people to a place where they can get a more detailed answer.

"It's hard to answer (most questions) in 140 characters," Gordon said.

But, she said, social networks like Twitter, Gordon said, allow the company to realize a problem that could be affecting thousands of people via a single short message.

"It's really like a customer megaphone," Gordon said.

Gordon hopes the new online options will not only cut down on call center expenses, but ultimately improve overall customer satisfaction with Windows. Customer satisfaction an area where the Mac has traditionally outpaced the various PC brands.

But Gordon says she hopes to see Windows gain ground. "We are really working on this," she said.

Although Apple touts its personal touch with its stores, Gordon suggests Microsoft's high-tech approach might ultimately win it more fans. "If I can help myself without having to go to the mall and sit at a geek bar I will be happier," she said.

Nonetheless, one of the main features of Microsoft's two retail stores is an answer desk very similar to the "Genius Bar" found in Apple stores.

As for the questions people ask on Twitter, they range from the expected range of bugs and problems to inquiries about future versions of products. This week, for example, one user asked when to expect Windows 8. Although vague, the answer was at least as direct as anything a reporter would get by asking Redmond.

"It will be a few years until the next official version comes out," Microsoft replied on the Twitter feed. "Keep an eye out on microsoft.com for future updates."

In addition to building goodwill and cutting costs, the online forums also allow Microsoft to quickly see when a problem is affecting a significant number of users. Such mechanisms helped Microsoft to recognize and then solve a video driver problem that was causing some users to have their systems hang when they reached 62 percent completion on an upgrade to Windows 7.

Within a week, Microsoft had a solution on its Website and shortly thereafter it posted an automated "Fix It," essentially a script that a user can click on to have the proper steps done automatically. The Windows 7 upgrade fix has already been used more than 35,000 times, Microsoft said.

"We're getting people able to meet their needs themselves," Gordon said.

Perhaps the next time Brad Smith heads to Brussels, it will be for a vacation.

After years of wrangling with Microsoft, the European Commission announced an accord with the software giant Wednesday on several fronts that seems poised to put an end to its antitrust concerns with Redmond.

Brad Smith

(Credit: Microsoft)

In the wake of the announcement, I spoke to Smith, Microsoft's general counsel, about the decision, what it means for the future of Windows, and whether the company sees its spot on the antitrust hot seat now being taken up by other companies, including Google.

Here's an edited transcript of our conversation:

Q: Is this really it as far as Europe is concerned?
Smith: This is definitely a major milestone for Microsoft. Today's announcement reflects a broad set of agreements that really address a wide array of issues. At the same time, we obviously need to keep our eye on the ball. Antitrust issues will continue to be important for us, just as they are going to continue to be important for a number of other leaders in our industry. We're going to have to do an excellent job implementing these agreement. We are going to have to do an excellent job addressing any new issues that arise in the future. Having said all that, I also think it is fair to say, as Commissioner [Neelie] Kroes did when she spoke in Brussels, this does represent the closing of one chapter and gives us the opportunity to open a new chapter. We're definitely enthused about that opportunity and we're committed to ensuring the next chapter is a positive and constructive one.

One of the things that Steve Ballmer talks a lot about in terms of antitrust issues is getting legal clarity on what one can and can't do. Do you feel like you now have that understanding with the EU?
Smith: I think this gives us a great deal more clarity. I think it gives the industry as a whole more clarity. It's perhaps most helpful in the area of interoperability because it really implements a new framework. It applies to a broad array of Microsoft products--Windows, Windows Server, Exchange, SharePoint--and for all of these products it has certain principles that we have to adhere to. It addresses the way we implement file formats.

At the same time, no advance on any single day can ever answer all questions for all companies for all time.

Essentially the EU has said through its very objections that you can't put a media player in Windows and you can't put a browser in Windows. What do you feel Microsoft can include in future versions?
Smith: There are two things to think about. First is what gets included in Windows, and second, what's the right way to address something that is included.

Our basic approach is to include in Windows, software that has APIs (application programming interfaces) that will be beneficial for other applications to call on and use. The browser is definitely an example of that. It's quite probably even more important in that role today than it was, say, when the browser issues first arose in the 1990s. The media player plays a similar role in terms of some broad APIs that are used by a wide variety of other applications.

There are other things that we have put in Windows in the past that don't necessarily involve the same role. A good example of that is Windows Live Messenger. We had Windows Messenger in Windows XP. It's not in Windows Vista or Windows 7 We're trying to make thoughtful decisions about what is included.

Then the second question that arises is how do things get included. How do we document APIs that our browser is using so that other browsers can use them as well? That's part of the U.S. consent decree.

How do we ensure that [computer makers] have flexibility to offer competing choices? How do we ensure that consumers are aware of competing choices and can use them if they wish. That latter part is an area where different governments have chosen different approaches at different times. The U.S. Department of Justice chose one approach in its consent decree. The Korean Fair Trade Commission chose a second approach. The European Commission in the media player case in 2004 chose a third approach. Today's announcement on the browser reflects the European Commission choosing a fourth approach.

Some people have the opinion that as a result of these different antitrust issues, Microsoft really finds itself with one hand tied behind its back as it competes in the battles of today. Do you believe Microsoft in the current antitrust environment competes on an even footing with some of the other Internet giants?
Smith: I do believe it is very important for all technology leaders in our industry to follow the same laws and obey the same rules. The rules don't necessarily apply in the same way when a company has a small market share as it does when a company has a large market share. But there are a number of companies that have large market shares for very important products. We've taken a number of steps to get into line with new legal rules in this field. The law has evolved and we've needed to evolve to address these new obligations.

We do believe our competitors need to play by the same rules. They've often been at the forefront of asking regulators to evolve the law in new directions. Now that the regulators have done so, we believe they need to pay attention as well.

Do you anticipate a period of time over the next few years where Microsoft is more likely to be the subject of antitrust inquiries or the company on the other side of the table for a change?
Smith: I think that we have addressed a very wide array of issues. Perhaps, in part because we were the first company to have to go through these inquiries, at least since the dawn of the PC era. We've probably had to go farther and sooner than other companies have had to do. We're now in an era where a different company seems to be in the headlines for competition law issues, if not every day, at least every month.

I think that what we are going to see in the next decade is this field of law being applied to a wide number of technology leaders that have high market share. We're going to see that, not only in Washington and Brussels, but we're likely to see that in more countries around the world simply because the global economy has evolved.

Have you expressed concerns specifically to Europe or Washington, D.C., about some of Google's behaviors?
Smith: We were very transparent last year when Google entered into its agreement with Yahoo. We felt that that was an illegal agreement that Google had entered into for the sole purpose of preventing Microsoft from becoming a more successful competitor, together with Yahoo, in the search space.

It was only when the Department of Justice informed the parties that it was on the verge of filing suit that Google decided to drop that agreement. We have not been shy about raising concerns when we have them.

It was only a couple hours after you guys settled with Brussels that we heard from D.C. with regards to Intel. When you initially heard that the FTC was filing suit against Intel, did you have feelings of empathy toward what their lawyers are going through, or what were your initial reactions?
Smith: I obviously know from a lot of firsthand experience the challenges that arise when a company needs to address these kinds of issues. Our road was a long one and it had its share of difficult moments. Antitrust issues are never easy for company to address.

This isn't a case where Microsoft has taken a public stance or even voiced to the regulators a position, is it?
Smith: We have not taken any public or nonpublic positions on the issues.

Are you guys looking to reach an agreement with Plurk? You guys said that you used code you shouldn't have? I'm curious if you are trying to negotiate some sort of settlement with them?
Smith: I wouldn't want to say anything that goes beyond the public statement we put out.

It does seem when I look at any particular issue with regards to the Internet, Microsoft tends to have a much more cautious approach. It seems like it is tough to compete when others are bundling more than you.
Smith: I think our goal is to be thoughtful but also fast-moving. As we look at the Internet today, it is increasingly a regulated space. That wasn't the case a decade ago. I think a thoughtful company needs to really think through how its products and services are going to comply with the regulations that are going to be enforced or likely to be applied in many different countries around the world. At the same time, one cannot let that get in the way of moving forward quickly. I think it's striking that balance that is really quite important. One needs to move fast. One shouldn't move faster than speed of thought and yet one shouldn't be so thoughtful that one simply analyzes problems and fails to solve them.

Do you think Microsoft has erred a little too much on side of caution in recent years?
Smith: I don't know that we've erred too much on the side of caution, but I do think it's extremely important we move quickly. This is a very dynamic space it is certain to remain a very dynamic space. Customers are interested in deploying new products and services, whether it is on the client, on the server, or on the cloud. The real key is to develop the capability to be both thoughtful and fast moving.

Microsoft's Browser Choice Screen

(Credit: Microsoft)

Microsoft and the European Commission have settled their differences over the choice of Web browsers in Windows.

European Commissioner for Competition Policy Neelie Kroes on Wednesday formally announced a resolution to the Internet Explorer antitrust case against Microsoft. As part of the settlement, Windows PCs sold in the European Economic Area will now present users with a Choice Screen, allowing them to install alternative browsers beyond Internet Explorer.

The Choice Screen will offer users the ability to install up to 12 of the most widely used Web browsers that run under Windows. The choices will include the more widely known browsers, such as IE, Apple's Safari, Google's Chrome, Mozilla's Firefox, Opera, and AOL's browser, and lesser-known products including Maxthon, K-Meleon, Flock, Avant Browser, Sleipnir, and Slim Browser.

Users can download as many of the browsers as they wish or stick with Internet Explorer. Additionally, computer makers and users in Europe will be able to turn off IE totally and set up other browsers as the default. As part of the settlement, Microsoft is also prohibited from preventing the choice of different browsers through any contractual or technical means.

Microsoft initially proposed stripping a browser out of Windows 7 entirely, a move first reported by CNET. Both competitors and the EU balked at that idea though, instead favoring some sort of ballot screen. Microsoft eventually relented, though the company and its rivals have gone back and forth for a while over the details.

Based on feedback it received, Microsoft modified and improved its design, according to the EC. The screen now appears in a neutral window, rather than an Internet Explorer window, and displays the browsers in a random order. The screen itself looks cleaner and less cluttered to the EC, which it believes will help users better focus on making their browser choice.

An important choice to make...

(Credit: Microsoft)

As part of the overall setup, Microsoft will continue to include IE in Windows but give PC makers the ability to install a different default browser. The Choice Screen will pop up the first time consumers use the default browser, allowing them to pick a different one if they prefer.

Microsoft has promised to make the screen available for five years in the European Economic Area and to offer it for Windows XP, Vista, and Windows 7, according to Europe's antitrust regulators.

"Millions of European consumers will benefit from this decision by having a free choice about which web browser they use," said Kroes. "Such choice will not only serve to improve people's experience of the internet now but also act as an incentive for web browser companies to innovate and offer people better browsers in the future."

Starting six months from now, Microsoft must report regularly to the Commission on its progress in implementing the new commitments, and the Commission can review the commitments two years from now.

After the EU announced the news, Microsoft issued its own statement on the resolution of the long-running, and expensive, antitrust case.

"We are embarking on a path that will require significant change within Microsoft. Nevertheless, we believe that these are important steps that resolve these competition law concerns," Microsoft general counsel Brad Smith said in the statement. "This is an important day and a major step forward, and we look forward to building a new foundation for the future in Europe."

The U.S. Justice Department, which waged its own years-long antitrust battle with Microsoft, applauded the outcome of the EU's case.

"As we understand it, the settlement is based on measures to enhance competition and is designed to preserve industry participants' incentives and ability to compete going forward. A settlement that helps to clarify obligations under European law allows the industry to move forward," Christine Varney, assistant attorney general in the Justice Department's antitrust division, said in a statement.

Updated at 5:37 a.m. PDT with Microsoft's statement, at 7:15 a.m. PDT with a statement from the U.S. Justice Department, and again at 10:00 a.m. PDT with details on and images of Choice Screen and names of additional browsers.

Microsoft's feisty little search service, Bing, has finally made an iPhone app, which is now up on the Apple iTunes app store.

Bing showed off the free app at a party thrown by its mobile team in San Francisco on Tuesday night. Information about the new app is also now on Microsoft's Bing blog here.

Its description on the iTunes store says: "Make decisions and get where you need to go with Bing. See the Bing daily image and related trivia on the home screen. Search maps or the Web with your voice--even say an address. Use Image Search and flick through previews. Download Bing today to find stuff nearby and get there fast."

A Bing PR e-mail noted the key features of the app include: Daily image from Bing.com; easy to access voice search; tips and tricks on the home page; "Locate Me" functionality; ability to add pushpins and save locations; show multiple locations on a single map.

It's a sweet little irony, since Microsoft and Apple have been frenemies over the years.

But bowing to the power of the iPhone as the premiere smartphone out there, Bing has to be on its platform, if it wants to compete with Google and others in the mobile arena.

Microsoft already has some apps for the iPhone, such as for its Seadragon photo app, a Tag Reader app and various manual apps.

And, while others have made apps that allow its popular software to work on the Apple device, Microsoft has yet to release one, although sources said the company is working on them.

Microsoft has already made Bing apps for Windows phones, the BlackBerry from Research in Motion, the Sidekick and select BREW-based devices on Verizon, as well as Bing mobile from a browser.

Company execs recently showed off a spate of innovations for Bing, including new mobile features, but not in an iPhone app.

But, no matter how you look at it, the iPhone app is the big time.

Here are more screenshots of the app:

Story Copyright (c) 2009 AllThingsD. All rights reserved.

Microsoft said on Tuesday that a blogging application posted to its MSN China site did in fact copy code from a rival.

Microblogging site Plurk lashed out at Microsoft on Monday saying that the Juku application stole its user interface and code. Microsoft said on Monday that it was investigating the matter and suspended the Juku service on Monday night.

Microsoft has said a third party and not it or its Chinese joint venture partner wrote the Juku program.

"The vendor has now acknowledged that a portion of the code they provided was indeed copied," Microsoft said in a statement. "This was in clear violation of the vendor's contract with the MSN China joint venture, and equally inconsistent with Microsoft's policies respecting intellectual property."

Microsoft said it is now suspending access to the Juku beta "indefinitely."

"We are obviously very disappointed, but we assume responsibility for this situation," Microsoft said. "We apologize to Plurk and we will be reaching out to them directly to explain what happened and the steps we have taken to resolve the situation."

Plurk has not said what, if any, action it will take against Microsoft. In a blog posting on Monday, it said it is still evaluating its options.

"We're still in shock asking why Microsoft would even stoop to this level of willfully plagiarizing a young and innovative upstart's work rather than reach out to us or innovate on their own terms," Plurk said in the blog.

It's the second time in recent weeks that Microsoft has been accused of lifting code. It was forced to pull a Windows 7 download tool after that product was found to contain open-source code. Microsoft blamed a third-party vendor in that case as well.

The company also said it and its Chinese joint venture "will be taking a look at our practices around applications code provided by third-party vendors."

Plurk accuses Microsoft China of ripping off its design and code to create its Juku microblogging service.

(Credit: Plurk)

It's been a busy year for Bob Muglia.

Microsoft's server and tools boss shipped an update to Windows Server, got promoted to division president, and prepared Microsoft's operating system in the clouds--Windows Azure--for its commercial launch.

Bob Muglia

(Credit: Microsoft)

In what has become a bit of a year-end ritual, Muglia sat down with CNET for a year-end interview. We hit on a range of topics, from the future of Windows Server, to why his bank won't be moving to Windows Azure any time soon, to the changing life of an IT manager, to Microsoft's consumer future. (Spoiler alert: Muglia thinks it is bright.)

Here's an edited transcript of our interview:

A few years out, how much does Windows Server, the server operating system, start to resemble Windows Azure?
Muglia: Well, making them as similar as possible is clearly the goal, and the goal is to take all the things that we do in Windows Server and make those capable to be done in Windows Azure, and then take the learning we have in Windows Azure and bring it back to Windows Server.

We just took the step of bringing the Windows Azure team, Amitabh (Srivastava) and his group, and putting that in my organization.

Now, what we also did as a part of that, is we merged the Windows Azure and Windows Server teams together. I just talked to Amitabh and he's really excited about the synergies that he can build across the organization and making these things as similar as possible.

In our own services, obviously we choose the hardware, and so there's a more limited set of things that work together. In some senses that gives us a bit of agility on the services side, because we can make something work in one very particular way, but what we've got a long term history of doing is understanding how to do that, and then abstracting that out to work in a much more general purpose way, to work with the hardware that our customers have.

One of the things we're looking at is how do we take the ideas that we're bringing to market in the form of Windows Azure service, and then build those into Windows Server and make them available to our on-premises customers and our hosters.

Do you expect there to be sort of an interim option? I wouldn't be surprised to see you guys do something in the intermediate term where you have the traditional Windows Server that runs on any hardware, you have Azure very customized for your data center, but then make a version of Windows Azure that they can write Azure apps for, but run in their own data centers.
Muglia: We're looking at those sorts of options. I think the trick to the thing is to understand what are the workloads that are most appropriate for doing that, and how would we structure that, and honestly we're still looking at that.

There are some interesting thoughts in that sense, and you can see how, for example, in a high-performance computing environment, where people could use hundreds or thousands of computers in one cluster, you know, Azure is really very, very helpful for something like that. But we're still looking at understanding exactly how we might bring some of those things to market.

I know you're the enterprise guy, but I thought I would give you the opportunity to come to the rescue of your consumer colleagues. One of the analysts pretty prominently said in The New York Times that it's kind of "game over" for Microsoft on the consumer side, particularly phones. I'm curious your thoughts on this.
Muglia: Well, I read your blog. You did, generally speaking, come to our defense. I mean, it's probably a fair thing to say that we understand the nerd. I think we understand more than the nerd, but it's certainly true that we do a good job with that audience, and that's actually my customer in a lot of senses, because I've got the developers and the IT pros.

You know, I feel like as a company we have a lot of focus on the consumer, and are doing a lot of great things that are quite revolutionary to consumers, and we're going to continue to do it. I mean, obviously if you look at what's happened even with Windows 7 and the success of Windows 7, most of the short term success has been in the consumer marketplace. The business marketplace is going to happen, but business moves slower than the consumer does.
Obviously we've had products like Xbox that have been very successful with consumer, and I think the new Zune work has been really fantastic, and obviously Bing has been really great.

I also think that people are going to be very pleasantly surprised to see the work we're doing in phones, and that will become visible next year. So, I think even in areas where there's been some concern, there is some really substantive, very, very innovative work coming down the line.

It seems a little weird to be saying this, but we're almost at 2010. Are there things in technology that you thought would have happened by now that haven't yet happened?
Muglia: Well, I certainly thought that the 787 would have flown by now. I hear it's supposed to fly Tuesday or Wednesday, though, so that's a good thing. I'm glad to hear that.

I think, if you had asked me in 2000, "Would we be further along on reading on devices than we are now?" I would have said we would be. And we're really starting to see that now with some very special purpose readers, but I would have thought it would have hit across more general purpose devices by now. So, that's probably been one thing.

You know, I think that that's related to how fast tablets or slates or whatever you might want to call them might have taken off. I might have thought that would have gone a little faster than it has. Those two are somewhat related with each other.

But those things always kind of come at different speeds, and I'm pretty confident both of them will become very important as we move forward.

If you could show the world as it is now to your 2000 self, what do you think would be most surprising?
Muglia: We've shifted to a world where all kinds of media are delivered digitally.

You think about what's happened with newspapers and magazines and things, I guess I wouldn't have predicted that shift would happen as dramatically. Not that it's delivered digitally, I think we would have expected that, but the kind of reporting and the real-time nature associated with it.

And I guess, similarly, some of the way social networks have developed, and the impact that they have had on the way people communicate. I find it so fascinating as an example to see the impact that Facebook has on what's happening in other countries like Iran, and getting information out, those sorts of things. You know, I'm not surprised by them, but I certainly wouldn't have predicted them back then.

So, probably your 2000 self might be surprised that in 2009 you're in touch with more people from your high school than you were in 2000?
Muglia: Right, exactly, things like that, exactly. That's a perfect way to say it.

Obviously, your focus is the IT world, and I'm curious, how different is the life of an IT manager? How much has changed in the last decade for what they do on a day-to-day basis?
Muglia: I actually think it's quite different for an IT manager. I think IT managers used to be expected to build the systems and do everything, and now I think they're much more focused on providing the infrastructure for the business teams and the people within business to do things.

One other thing that's missing at least from Microsoft at the end of this decade, as compared to the beginning is Bill Gates at least in a full-time sense. As one of the people kind of at the top of the technical ranks, I'm curious how have you noticed his absence in the last 18 months since he's left full-time work?
Muglia: I watched while Bill was here how his role shifted over a period of time. There was a period of time when the company was at a size and scope where Bill really was able to do the direction, the technical direction of very large parts of the company.

During the 1990s, we grew to a point where that was just not possible for a human being to do, although Bill's capacity is far beyond most. And so over time, Bill shifted into much more of an advisor role, and he provided advice and guidance.

While Bill's advice was always incredibly useful, he did a great job of also building a lot of people within the company that could also think in a similar sort of way to him. I mean, I'd like to think that I learned a lot from Bill and I'm able to do some of the things that Bill would have done.

I view part of my job is to take up and do many of the things that Bill did, and to do it in my area. My area of scope is broad but it's to a level that I think I can still do that effectively.

But I think what's happened is we now have a hierarchy of people. You've got Ray doing some significant cross-group things, and then you've got people like myself or Steven Sinofsky or folks in Stephen Elop's world, J Allard, all playing subset roles of what Bill used to do.

For a long time, Microsoft and you talked about this notion of autonomic computing. One of the things that conveyed was the sense that the IT would just sort of manage itself. Now you guys talk more about Dynamic IT. It seems like some of the idea that it's just going to magically happen has been moved from the notion.
Muglia: Let's just sort of kind of go back and talk about the time from where all those things sort of emerged in the 2002, 2003 sort of time. People sometimes called things autonomic computing, they sometimes called it utility computing. You know, our name for it was always Dynamic IT. It actually started out as the Dynamic Systems Initiative, and we sort of broadened it a bit with Dynamic IT a few years ago.

And the idea being that operational resources should be largely self-managing, and the process, the lifecycle of developing an application should be connected from the point of requirements, definition, through development, all the way to operations. That vision has not changed. We said it was a 10-year vision in 2003, and it will probably take us 10 years to really fully fulfill it. I think every year, as we release new products, we take substantive steps forward.

Now, the thing I didn't understand back then is that all of this would lead so naturally to the cloud application model, and that's what we've kind of put in place over the last year or two. I would very clearly say that is the next thing.

When you think about some of the biggest trends in the coming few years, I imagine cloud computing is a big one?
Muglia: Yeah. The thing that to me is so exciting about that is the impact I think it's going to have on business, most importantly allowing people to write applications more rapidly that really meet the needs of tier one enterprise apps, and do so at a fraction of the cost, both from a hardware perspective and from an operational perspective.

So, the kinds of things that would have required a mainframe in the past.
Muglia: Absolutely. Obviously we built software for very high-end systems. I mean, being straight and honest, that's not the main thing that our software is used for. We have a fairly small number of our systems running on these big $100,000 plus machines. But it's an important segment of the market, and clearly UNIX has a significant segment there, and the mainframe is a significant segment there.

When I talk to the Windows Azure guys, and I talk the software architecture that they've put in place in terms of having isolation units and understanding how to contain failures, and then I look at the way we are building the next generation data center systems, built inside these containers, I recognize that a container is essentially the mainframe of the future. The difference is that it's thousands of times more powerful than a mainframe at a fraction of the cost.

Do you have a sense of how many people are actually doing real cloud computing today, what percentage of businesses, and what that might look like in the next two or three years?
Muglia: I think Forrester has done some work that it's a really small number of people, like 4 percent of folks that are actually deploying things right now. So, it's still very nascent. But we expect a really large number of folks to start to (use cloud computing) over the next 12 to 18 months.

We're right at that inflection point where people are going to begin to start building real applications and begin deploying those applications into their environment, both for internal use and for their external customers. Certainly if you go out three to five years, we expect it to become very mainstream.

One of the constant debates is when people ask how much work will be done in a company's own data centers as compared to some sort of public cloud like Microsoft is running with Azure. Do you have a sense of where that mix might be a couple years from now or five years from now?
Muglia: I think certainly over the next five years we'll still see more work done in-house than in a public cloud. I mean, you'd have to move an awful lot of work out in order to shift that.

The question will be what is the cost and the effect, and at one level how much can this be done for people in a public cloud environment at a lower cost, and what level of security and trust can be established so that people feel comfortable moving their workloads to the cloud. I don't expect my bank will be moving their core financial systems to a public cloud environment in a five-year horizon, and that's probably a fine decision on their part.

I want to make, enable, and build the technology infrastructure to allow people to move their most sensitive data into the cloud so that some day it will become possible for a bank to do that, but I think it will take a little while for it to actually happen.

Last week, Microsoft bought a company called Opalis that specializes in software to manage data centers. Is this a big company? What made you interested in them?
Muglia: It's a moderate sized company. I'm really excited about this acquisition. I mean, what they do is something that's called "run book automation," and what they've done is they've built a very strong base of understanding of how to automate tasks that are happening within the data center.

And by the way, that's quite heterogeneous in its nature. Although they run fully on Windows, they're not limited and restricted to data center tasks that happen simply in Windows, but they can reach out and work with Linux and UNIX systems, et cetera.

Being able to automate a set of tasks is one of the key things that's going to be necessary to simplify the operations of any of these data center environments, and Opalis is a fantastic acquisition for us because they bring a ton of expertise and real world customer experience in that space. We think our customers will see value from this literally from day one.

Microsoft said late Monday that is suspending access to an MSN China microblogging site amid allegations the service is based on code swiped from a rival.

Canadian start-up Plurk lashed out at Microsoft earlier on Monday, saying that 80 percent of the code for Juku appeared to be lifted directly from its service.

Microsoft reiterated late Monday that it is investigating the matter but issued a statement saying it was pulling down the Juku feature while it looks into things.

"Earlier today, questions arose over a feature developed by a third-party vendor for our MSN China joint venture," Microsoft said in a statement. "Because questions have been raised about the code base comprising the service, MSN China will be suspending access to the Juku beta feature temporarily while we investigate the matter fully."

Microsoft added that the investigation was slowed by the fact that when questions were first raised it was the middle of the night in China.

"Now that the day has begun in China, our teams are working hard to track down the information," Microsoft said.

The company also confirmed what a source previously told CNET, namely that Microsoft's MSN China joint venture "contracted with an independent vendor" to create the MSN Juku feature, which debuted last month and is still in beta.

Earlier on Monday, Microsoft said it was investigating the issue.

For its part, Plurk said it is still trying to decide how to handle things.

"We're not entirely sure but we are exploring our options," Plurk said in its blog posting. "We have been seeking advice from respected colleagues, responding to press inquiries and gathering facts on the timeline of events and parties involved here to understand why and how this took place."

It's the second time in recent weeks that Microsoft has been accused of lifting other's work in its products. Last month, the company was forced to pull down a tool for loading Windows 7 onto Netbooks after allegations that the product improperly included open-source code. Microsoft later apologized and last week re-released the tool under the GPL open-source license. Microsoft also blamed a third-party vendor in that case.

Plurk accuses Microsoft China of ripping off its design and code to create its Juku microblogging service.

(Credit: Plurk)

Microsoft said on Monday afternoon that it's investigating allegations that a recently launched microblogging site in China lifts the code and interface of a start-up's rival service.

"Microsoft takes intellectual property seriously, and we are currently investigating these allegations," company spokesman Mark Murray said in a statement. "It may take some time due to the time zone differences with Beijing."

Earlier on Monday, Canada's Plurk went public with charges that Microsoft's Juku service "rips off" the look and feel of its microblogging service and also appears to use more than 80 percent of the same code, all without permission.

"Imitation may be the sincerest form of flattery, but blatant theft of code, design, and UI elements is just not cool, especially when the infringing party is the biggest software company in the world," Plurk said on its blog.

Plurk said it is still evaluating what to do in the case.

"We're not entirely sure but we are exploring our options," Plurk said. We have been seeking advice from respected colleagues, responding to press inquiries and gathering facts on the timeline of events and parties involved here to understand why and how this took place.

It's the second time in recent weeks that Microsoft has been accused of lifting other's work in its products. Last month, the company was forced to pull down a tool for loading Windows 7 onto Netbooks after allegations that the product improperly included open-source code. Microsoft later apologized and last week re-released the tool under the GPL open-source license.

Update, 5:50 p.m. PT: A few more details are starting to trickle in.

According to a source familiar with the situation, the Juku application was created for MSN China, which is a joint venture between Microsoft and a Chinese company. However, the source says the application was not designed by Microsoft or the joint venture, but rather by a third-party Chinese vendor hired for the task.

If that sounds a bit familiar, Microsoft also blamed a vendor for the Windows 7 download tool that contained GPL code. Contracting with vendors is typical, and Microsoft typically requires that the third party provide legal guarantees that the code is free of any intellectual property infringement.

As of this point, the Juku program continues to run on the MSN China site.

Plurk accuses Microsoft China of ripping off its design and code to create its Juku microblogging service.

(Credit: Plurk)