Beyond Binary

LOS ANGELES--While some have criticized Steven Sinofsky for being tight-lipped, the Windows boss insists that he is being prudent, not secretive.

"Everybody wants to know what's coming and what's next." But, he said, talking too soon, too early is actually a bad thing that just leads to frustration.

"You reacting to some nightly developer build isn't really productive to anybody," Sinofsky said in an interview at this week's Professional Developers Conference.

Sinofsky says that people don't want to show up to a restaurant and watch a potato being peeled and taste it half-cooked. For the same reason, he prefers to not talk about things until they are well, fully baked.

"It's hard to imagine what else you want to see while it's in progress," Sinofsky said. "I don't want to see the daily cuts of a movie. I want to see what the director thought at the end."

As a result, Microsoft didn't show Windows 7 until last year's Professional Developers Conference, just a year before the product was released. That's in sharp contrast to the prior version of Windows, which was first shown as Longhorn back in 2003. It ultimately suffered through numerous delays and significant changes before being released as Vista.

Windows boss Steven Sinofsky said his Windows philosophy boils down to a single word--responsibility. "There's not another project in software to work on that a billion people use and we take that really, really seriously."

(Credit: Ina Fried/CNET)

From early indications, Sinofsky would appear to be on to something. While Vista was largely panned by critics and shunned by businesses, Windows 7 has thus far had strong early sales and gotten high marks from reviewers.

It's some of the same philosophy Sinofsky took in his earlier days, when he led development of Microsoft's Office franchise.

"Normal people have stuff to do," he said.

That's also why he doesn't really look for public feedback until the software is largely done.

"We don't want feedback on a screenshot," he said.

Sinofsky shifted from Office to Windows in March 2006 and earlier this year added responsibility for the business side of Windows as well, becoming the unit's president.

He said his philosophy toward Windows really boils down to a single word--responsibility. "There's not another project in software to work on that a billion people use and we take that really, really seriously in the hallways of our dev team," he said.

Sinofsky also isn't one to be swayed by emotional arguments for or against a feature. If you want his attention--show him the numbers. He said he wants feedback, but he wants that feedback to "be based on data and not assertions or opinions or anecdotes."

During his PDC talk on Wednesday, he referred to the other approach as "testosterone-based engineering."

"It turns out we did a lot of things by that method," Sinofsky said. Often times, decisions on which features to include in the next version of a product were made that way. People, Sinofsky said, would basically just ask their friends.

"Let me get this straight," Sinofsky said. "You are going to ask your 10 friends who all go to Fry's and build their own gaming machines and that's going to be the way we decide which features go in the product?"

That, he said, "seems a little homogeneous. It seems a little limited in its reliability."

But these days, Microsoft has a better option, gathering lots and lots of data from real-world use. Quite often, he said, the data will show things that might not be intuitive to Redmond's engineers.

As an example, he showed a graph at the conference that showed the huge variety of graphics resolutions that Windows users were operating at, including a significant number with VGA-resolution displays. Folks in Redmond initially assumed they didn't really need to worry about such low-resolution screens.

True to form, Sinofsky was emphatically silent when my questions drifted toward the future. I asked whether we might see a beta of Internet Explorer 9 at Mix and he literally just sat there silent until I asked the next question.

Later on in the interview, the mere mention of Windows 8 got the same stone-faced glare.

"I won't ask you what's in Windows 8, but can you talk at all (about it)? You mentioned that you are a few weeks into designing IE 9," I said. "Are you a similar amount into Windows 8?"

Silence. More silence.

"I didn't say any of the words--Windows 8--those were all your words," he said. "Next."

Sinofsky did have some interesting things to say when I asked for his take on competitors like Google and Apple.

"You have to take it very seriously," he said of the competitors. "That's always, always true in the software world. In the software world it doesn't take a lot to have a dramatic shift in how people perceive you or how they act. It's just very important no matter what your perceived or real or measured share is at one moment, it doesn't take a lot to change it down the road."

Windows 7 isn't just getting good reviews, it's also selling well, CEO Steve Ballmer told shareholders Thursday.

Delivering opening remarks at Microsoft's shareholder meeting, Ballmer said that Windows 7 was off to a "fantastic start."

"We've already sold twice as many units as any OS in a comparable time frame," Ballmer said. "Windows 7 is simply the best PC operating system that we or anyone else has ever built."

Microsoft CEO Steve Ballmer delivers a point at the company's Worldwide Partner Conference in July.

(Credit: Microsoft )

By last week, Windows 7 accounted for 4 percent of Web-accessing devices, according to Net Applications; it took Vista more than seven months to reach that level.

Addressing the overall economy, Ballmer reiterated that things seem to have stabilized.

"The economy has, at least for now, leveled off," he said.

The meeting is still going on and has just entered the question-and-answer session and I'll update this post if anything interesting comes up. So far, though, it's been mostly about local and legislative matters, rather than technological issues.

Microsoft vs. Apple
There was one fun one from a shareholder who noted that young people tend to gravitate toward Macs and that Apple seems to be outmarketing Microsoft.

"You've got a real bad image out there," the shareholder said. "You sure don't have that younger generation."

Ballmer acknowledged that there are "certainly always opportunities for improvement."

"We all watch television," he said.

That said, Ballmer noted that "96 times out of 100, worldwide, people choose a PC with Windows."

He added that even in the toughest market--the high end of the U.S. consumer market--Windows is chosen 83 times out of 100.

"That doesn't let us rest on our laurels," Ballmer said. "Apple has picked up a couple tenths of a percent of market share."

But those couple tenths matter, he agreed. He said the downturn in the economy has actually bolstered Windows' competitive position. "People understand that Macintoshes are quite a bit more expensive."

Another questioner asked why Microsoft can't better compete against Apple's iPhone and other smartphones.

"Certainly our objective is to have the leading position," Ballmer said. "I think we have a lot of opportunity to improve...Undoubtedly we've got our work cut out for us."

He did say that Microsoft has put a lot of smart people on the task.

"We've got our heads down to do our best," Ballmer said.

LOS ANGELES--As a software guy, Windows division president Steven Sinofsky readily admits that he had little idea of all that goes into building a laptop.

Like many at Microsoft, he tended to think of products as done once the software was finalized. During the past couple of months, though, he has gotten a much better idea, as his Windows team went through the process of designing and building a Windows 7 laptop in conjunction with Acer.

Steven Sinofsky, surprised the PDC crowd on Wednesday, announcing that paid attendees would get a free notebook that Microsoft helped design.

(Credit: Ina Fried/CNET)

That laptop made its debut on Wednesday, as Microsoft handed out the devices to paid attendees of the Professional Developers Conference here. It's quite a little laptop, built around an 11.6-inch swiveling touch screen that works as either a tablet or traditional notebook.

Sinofsky wanted to give attendees at this week's PDC a computer that would really show off Windows 7's capabilities, including a touch screen and top-of-the-line wireless. Oh, and it should be light. And have a glossy screen. And not cost too much.

"They look at you like, 'what are you building'?" Sinofsky said in an interview with CNET.

Sinofsky said it's kind of like remodeling a kitchen. "You start off by saying I want these cabinets this counter top and this kind of a sink and all of a sudden you've got this kitchen you can't afford and don't have the time to build. That's pretty much the first phase of building a laptop."

In the end, Sinofsky had to make a few compromises, but the process itself was an important one for the Windows team, Sinofsky said. While PDC attendees got the laptops, his team got a better appreciation for the full process of designing and building a Windows PC.

"That was part of the learning, really making sure we can walk in their shoes," Sinofsky said.

The Windows team quickly learned about some of the trade-offs that computer makers have to make, as well as some of the hidden costs. At one point, Sinofsky said, he wanted to cut out Bluetooth in order to add GPS capabilities.

There were two problems with that, though. First, taking off Bluetooth would actually cost money. It was already part of the wireless chipset and the standard chassis had a blue indicator light built-in already, meaning that it would cost more to cover up that light.

Unboxing the free PDC laptop (photos)

And with Sinofsky's ideal laptop already containing multiple flavors of Wi-Fi, Ethernet, wide-area networking and three audio paths, there just wasn't room for GPS.

"They were like, look we're running out of room here," Sinofsky said.

Other things Sinofsky did get. Although most laptops with touchscreens have matte finishes, Sinofsky said "We really wanted a glossy screen."

Sure enough, the PDC has a glossy touchscreen.

That's just a part of what Sinofsky talked about in our interview on Wednesday. Look for more from our chat in the coming days.

LOS ANGELES--During Tuesday's keynote speech, Ray Ozzie outlined how Windows Azure works from a software perspective.

Across the Los Angeles Convention Center, though, developers had a chance to see just what Azure is running on. Microsoft uprooted one of its containers from its Washington data center and brought it to the Professional Developers Conference.

The container was one of the more popular attractions on the PDC show floor as attendees had a chance to peek in and even step inside the container.

It is Microsoft's fourth generation of data center design----newer even than the containers used at the recently opened Chicago data center, which CNET toured earlier this year.

It's about half as long as the containers in Chicago and holds hundreds rather than thousands of servers. On the other hand, it has its own cooling system built in and can operate in a much wider range of climates. It can operate with at a temperature of anywhere from 50 to 95 degrees Fahrenheit and anywhere from 20 percent to 80 percent relative humidity. That--combined with its rugged design--means the fourth-generation units can literally be run outdoors.

The units still require power and high-speed networking, of course, as well as water. However, they use only two to three gallons of water per minute as opposed to hundreds of gallons of water for some other designs.

The public display also allowed a chance to talk about some details Microsoft generally prefers not to talk about--such as whose servers are used. The unit on display at PDC, for example, was running Dell boxes.

The goal of the fourth-generation devices is to further reduce the amount of lead time Microsoft needs to add capacity--from a matter of months if it has to build a new data center wing to as little as six weeks to equip and install a new self-contained unit.

A PDC peek at a Microsoft server container (photos)

LOS ANGELES--After spending much of Tuesday in the clouds, the second day of the Professional Developers Conference on Wednesday is expected to be far more grounded.

On tap is a discussion of the Office 2010 beta as well as the first details on Internet Explorer 9, although Microsoft is not providing code. Microsoft is also talking about Silverlight 4 and releasing a beta of that product.

8:30 a.m. PT: Windows unit president Steven Sinofsky takes the stage.

Sinofsky said that Microsoft approaches Windows 7 like building a movie theater. Microsoft's job is to provide "great seats, great sounds and maybe a concession stand" while developers make the actual movies.

Although developers were interested in hearing about IE 9, the most popular part of Steven Sinofsky's talk was when he announced that paid PDC attendees were getting a free Windows 7 laptop.

(Credit: Ina Fried/CNET)

8:35 a.m. PT: Sinofsky is talking about the Windows 7 development process from before the code was publicly released through beta testing and release.

He's hitting on familiar refrains--trying to be more predictable, talking about features only when they are fully baked, and all of the "telemetry" Microsoft uses to get automated feedback.

Sinofsky is talking about the different mechanisms Microsoft uses from Windows Error Reporting, or Watson, to its Software Quality Monitor. Sinofsky notes that the monitoring tools require the user's permission in the final versions of Windows.

During the beta process, though, "we opt you in automatically," he says. (Not to quibble, but technically that's known as opt-out.)

Semantics aside, the shift to automated feedback has had a major impact on the way Windows is developed. In the past, Sinofsky said, bugs got fixed, in large part, based on "whoever screamed the loudest."

Sinofsky said it was basically "testosterone-based bug fixing."

With automated mechanism, Microsoft can see which problems are affecting the most people most often.

8:40 a.m. PT: Sinofsky is sharing some numbers about the Windows 7 beta.

Microsoft got 1.7 million feedback reports, or one feedback report every 10 seconds in the first two weeks after beta. There were 8.1 million installations of the beta, including 4.3 million installations of the release candidate.

There were 10.4 million error reports, which resulted in 4,753 code changes. The start menu was clicked 514 million times in the past six months, while the new Aero Snap and Shake features were clicked 46.4 million times during the same period.

8:45 a.m. PT: Sinofsky is talking about usability studies Microsoft does to test new features, and showing some examples of user feedback on the User Account Control dialog box.

First up, is a mother of a 5 year old who said that when she finally gets time to sit at the computer she'd rather not be interrupted. Instead, she suggested it would be better if there was a place she could go to find all the messages (not too different from the action center eventually included in Windows 7).

Now he's showing some testing of the Aero Snap and Aero Shake features that help manage multiple open windows.

"Get on down... I like that," said one user.

8:50 a.m. PT: If you haven't already, check out CNET's Ray Ozzie interview that posted this morning.

8:53 a.m. PT: Sinofsky brings out Mike Angiulo, who heads up Microsoft's dialogue with the "ecosystem"--folks like PC makers, software, and hardware developers.

He shows off Sony's super-thin, super-light Vaio X. I'm playing around with a demo model of this machine. People are really amazed with this computer. It's so light, some of the people I've shown it to could barely believe it was real.

Microsoft thought it would be good to learn how a laptop is made. It worked with Acer to build a 3.79 pound laptop with multi-touch, preloaded Office, etc.

"It was great for us as members of the ecosystem," Sinofsky said. The best news for those at PDC-- they are making the laptop available to paid PDC attendees for free.

That got the crowd excited. "Not this one, this one is mine," Sinofsky said, clutching the one he is showing off.

The laptops won't be ready for pick-up until 12:30 though. I encourage you to stay here for the rest of the talk."

9:08 a.m. PT: Talk shifts to Internet Explorer.

"There's a balance between standards and real-world," Sinofsky said.

Sinofsky talks about where Microsoft is headed with Internet Explorer 9.

We're about three weeks into the Internet Explorer 9 development, he says.

Sinofsky acknowledges some areas Microsoft needs to do better. One is the Acid 3 benchmark, IE 8 got 20 out of 100 on that test, while IE 9 is at 32 out of 100.

Performance, particularly JavaScript performance, is another area. He shows WebKit.org's SunSpider benchmark which shows IE 9 in the same ballpark as test versions of other leading browsers. Earlier versions of IE performed much worse on SunSpider than other browsers.

"We're getting very close to basically being a wash," Sinofsky said.

9:14 a.m. PT: Sinofsky shows another feature of IE 9--the ability to easily do rounded corners.

More importantly, the IE 9 rendering engine will shift text and graphics rendering to the graphics chip. That allows smoother text and faster performance. Although some browsers shift a bit of 3D work to the graphics processing units in PCs, Microsoft says IE is the first to tap hardware acceleration for standard text and graphics.

Sinofsky shows a few examples, including Bing Maps, where unaccelerated graphics rendered 14 frames per second, while hardware acceleration in IE 9 allowed upwards of 60 frames per second.

Geek detail: The IE logo on the taskbar for IE 9 was gray, as opposed to the blue logo of IE 8.

9:26 a.m. PT: Developer Division head Scott Guthrie on stage talking about Silverlight and Silverlight 4.

Priorities for the next version include improved media features, such as access to Webcams and microphones on a PC and output protection for those with premium content.

Developer Division head Scott Guthrie followed Stephen Sinofsky on stage on Wednesday, showing off some of the features of Silverlight 4.

(Credit: Ina Fried/CNET)

Guthrie demos a photo booth application, including video and still capture as well as different pixel shader effects, such as a crayon filter. The technology probably allows a lot more, but Apple fanboys would be right to point to the photo booth application on the Mac (though this is a concept app and Silverlight 4 is browser-based technology, not a desktop application).

Another focus for Silverlight 4 is improving Silverlight outside the browser.

9:37 a.m. PT: Guthrie's having a little trouble with some of the Silverlight demos, showing IIS server's support for creating iPhone-capable video.

"If someone is backstage and wants to kick the browser, feel free to," Guthrie said. "We'll try one more time."

9:40 a.m. PT: Guthrie is talking some of the technical features of Silverlight 4, including a new text editor that supports Roman fonts, as well as Arabic, Hebrew, and Kanji, among other alphabets.

9:45 a.m. PT: Guthrie shows a Silverlight-based video jigsaw puzzle. Turns out it is a video of the infamous Rick Astley video. "You've all been rickrolled," Guthrie said.

Also, for those who want to see the IIS smooth streaming on iPhone demo that Guthrie struggled to get working, it is on the Web here.

9:50 a.m. PT: It's getting code-heavy now, as Microsoft demos how to create Silverlight stuff in Visual Studio 2010. Meanwhile, there's some more detail on Microsoft's IE 9 plans in this blog post.

9:55 a.m. PT: Microsoft hasn't started talking about the Office 2010 beta yet, but it looks like you can start getting it from Microsoft's Web site.

10:04 a.m. PT: Still no Office talk on stage, but the beta is live and Microsoft has posted an article noting that Office Mobile 2010 is also in beta and available for Windows Mobile 6.5 phones via the Windows Mobile Marketplace.

The beta also adds an Outlook Social Connector, which allows users to bring in Windows Live and other social networking feeds into Outlook. LinkedIn is the first that will take advantage of it--early next year--but there is a software development kit for others to do so.

10:15 a.m. PT: The beta of Silverlight 4 is now available for download, Guthrie says. The final release is due in the first half of next year.

10:17 a.m. PT: Office unit senior vice president Kurt DelBene is introduced to talk about Office 2010.

10:20 a.m. PT: DelBene talking about efforts to bring Office not just to the desktop, but also via hosted services.

By the way, while I've been live blogging, we've also posted a story and photo gallery looking at the Windows Azure data center container that is on display at the PDC show floor.

10:35 a.m. PT: DelBene notes that the Office 2010 beta is now available, as are betas of the Office Web Apps for businesses as well as office Mobile for Windows Mobile 6.5.

"I hope that you will all download (Office 2010)," DelBene said.

As I note in my story on the Office 2010 beta, though, the Web Apps remain in their current Tech Preview form on Windows Live. There's no time frame for when they will get updated to the beta versions, which include Word editing and the OneNote Web app.

10:45 a.m. PT: Lots of Sharepoint demos. Lot's of coding. I'll spare you the details.

LOS ANGELES--When Ray Ozzie penned his Internet Services Disruption memo back in 2005, he had a pretty good idea where the computing world was going. He just didn't know how Microsoft was going to get there.

While many are ready to write off Microsoft as an declining icon of computing's last generation, Ozzie sees Microsoft positioned to leapfrog some of the companies that tend to be thought of as the leaders of the cloud computing world--names like Amazon, Salesforce and Google.

Ray Ozzie on stage at PDC '09.

(Credit: Microsoft)

"I will never, ever, utter the words 'mission accomplished' for obvious reasons," Ozzie said in an interview after his speech at the Professional Developers Conference. "But I'm really pleased with where things are."

It's been a tough journey, to be sure. But Ozzie says Microsoft has changed in ways he could not have imagined. In particular, Ozzie points to Windows Azure--Microsoft's operating system in the clouds. Rather than just offer a set of services to move today's computing programs to remote servers, Ozzie says Azure is designed to handle the applications of tomorrow.

"When we began developing Azure, we developed it more or less with a clean sheet of paper saying, 'What will the operating environment look like for the next 30 years?' Ozzie said. "If you look at VMware or (Amazon's) EC2, what it really is--and I mean to be saying this respectfully--but it's more or less a (virtual machine) hosting environment. It's not a transformational computing environment."

In a lengthy interview with CNET, Ozzie also talked about lessons Microsoft learned from the recent Sidekick outage as well as why people are wrong to count Microsoft out of the smartphone race.

Here is an edited transcript:

Question: From your perspective, where would you say Microsoft is in terms of making the kinds of shifts you talked about in 2005? What is different than you thought it might be?
Ozzie: You know, when I wrote the memo, I really didn't have a crisp plan in terms of how we're going to accomplish it. And I will never, ever, utter the words "mission accomplished" for obvious reasons. But I'm really pleased with where things are. I mean, I think we have a lot of software yet to deliver, but out at the end user perspective, the notion of Office being across phone, Web, and PC, kind of re-pivoting the experience around productivity as opposed to the device, I'm really happy about [that].

I thought users would be more ready for it by this point in time than I think people really are. I don't think in our minds yet we've yet found, quote unquote, the desktop for the Web in terms of our own personal stuff. It's kind of still scattered out there on the Web.

I didn't think that the cloud computing thing--the back-end side--would take off as much as it has. There wasn't as much about that in the memo, but at that same time, you'd probably be amused to see some of the PowerPoint decks that I was shopping around internally at the time with these big pictures of hydroelectric dams and all these things saying there's going to be this recentralization that happens at the back end of computing, but I didn't know how it was going to pan out.

You announced that Azure is going into production January 1. Is the code changing significantly between now and then, or is that just when the billing mechanisms kick in?
Ozzie: What happens is--and this is all just really difficult to explain to people--but we've rolled out big, new data centers. The community technology preview is on a certain sets of servers. Some of those people may or may not opt to become production customers. Getting their things migrated from one set of systems to the other, it's just internal logistics. So, no, the code doesn't change a whole lot, it's more operational processes. And we really don't want to start charging people until we at least have one billing cycle of knowing that everything is right.

You mentioned moving people from one set of servers to another and immediately I hear in the back of my head "Sidekick." Obviously, the architecture is totally different. But can you talk about what you took away from that [outage for the Sidekick device in October]? In one sense, it was a totally other part of the business, at the same time, it was sort of this early cloud service, and a pretty spectacular outage.
Ozzie: There are a lot of lessons to be learned. Let me just preface this by saying it's inappropriate for me to go deeply into it not just for legal aspects and things like that, but because they're T-Mobile's customers, not ours. T-Mobile is our customer. But let me just speak at the abstract level.

There are lessons to be learned in terms of how acquisitions are dealt with. I know that's a non-obvious conclusion, but basically when you're building your own services and when you're building services from scratch, you have a certain understanding because of the people who were involved in that or whatever--of how this thing relates to that thing. When you bring in a company, you tend to think of things differently. And so there were some lessons to be learned there. There were lessons that we didn't learn, (areas where) we know better and I'll just say we weren't using best practices in certain areas.

The biggest lesson is something that I shouldn't have had to learn, and I'll tell you why. In Groove, I took, for the time, a very contrarian view of, no, it's got to be all at the edge. Nothing at the center, it's all peer-to-peer distributed. Then we--and I mean including me--have kind of swung the pendulum to appliance-based computing that's Web-centric, where the truth is in the cloud, so to speak.

One of the fascinating things about the Sidekick recovery process was how wonderful it was that data is also on the devices, because when your confidence level drops in one copy of the data and you have another one, it's really handy. So knowing to treat peer computing and centralized computing are both good, they're both very, very good.

You talked about the cloud as being early days. And I'm curious, there are some folks that have been playing in the space for a while, you know, SalesForce and Amazon and even Google to an extent. What do you feel Microsoft is offering in the cloud that competitors aren't?
Ozzie: When we began developing Azure, we developed it more or less with a clean sheet of paper saying, "What will the operating environment look like for the next 30 years?" If the servers like Linux and Windows NT-based systems and Mac OS, if these are all based on things that were built when I was in school, what's the next one going to look like? That's the most significant advantage.

If you look at VMware or [Amazon's] EC2, what it really is--and I mean to be saying this respectfully--but it's more or less a [virtual machine] hosting environment. It's not a transformational computing environment. All programs in the future will be written in a way that there is no single point of failure. There's no one server that can die and take down the service. And unless you write your applications for a programming model that's inherently parallel, you don't get to that point. And so, yes, we support the same kind of mode that the EC2 or VMware will do where you can take a VM and put it up there, but the reality is you don't get the benefit of cloud unless you use this other thing.

You actually had to go back and add that in. One of the things you talked about today was to take a virtual machine and put it up on Azure.
Ozzie: That's a very good observation. Last year, we introduced, I guess I'll say [something that was] a little too far ahead and we had to back into the present. But I'm extremely pleased about [adding the virtual machine ability] because anytime someone starts playing with [Azure] and they start to get a taste for what it's really like, then you really say, oh, I get it. Now I know how to design the software for that next generation.

You talked about "three screens and a cloud" as a pretty consistent refrain for Microsoft. But we're still not hearing as much about some of those screens, particularly on the mobile side. You mentioned in the spring we're going to hear sort of about the next-generation platform?
Ozzie: Yeah.

A lot of people are saying, you know, Microsoft and the phone--it's been way too long, game over. Why is that not the case?
Ozzie: I think it makes for good copy to take an extreme position that someone is dead or alive or this or that. Yes, iPhone has a lot of momentum, unquestionably. But I think the phenomenon we're in right now is the app phone. And if you look at the depth of apps that are on these phones, they're not very deep. It's not like Office or AutoCAD, where there are just thousands of man years that have gone into developing these apps. They're relatively thin apps that are companions to some service.

And I think if you look at anyone who's building an app phone--whether it's Palm, Google with Android, RIM--ultimately, all the apps that people want will be on all the phones. They're relatively straight porting efforts. I think people are imagining some kind of a barrier to entry, at least from an app perspective that I don't believe is there.

The biggest barrier to entry is: is it a phone that people want to use? And is it a phone that carriers want to sell and people have to measure us based on what we produce. But I don't believe that there's an app barrier.

This year, it seems like you guys have made a conscious choice to focus on Azure and not on some of the more finished services that live one or two layers up. Are you still pursuing the sort of Live Mesh and the Live Platform layers?
Ozzie: Absolutely.

Live Mesh, as a specific case in point, after we got to a certain point in the beta, we said, okay, how are we going to get this to scale from instead of a million or two million people to hundreds of millions of people? So the team and the technology was put into Windows Live and so even though I'm not making a product announcement, when you look at the next version of the Live services that are downloaded to your desktop, I think you'll see the contribution that the Mesh technologies and the Live platform had to that.

In terms of high-level services, no, we're still concentrating [on them]. You know, we still have a very big focus on the Web apps. I think you probably won't hear a lot about that at PDC, but you'll hear some more about that as Office comes more into a broader beta.

Between Pinpoint and Windows Marketplace, Windows Mobile Marketplace, Zune Marketplace--you guys have a lot of marketplaces.
Ozzie: It'll be converging down to two, one for consumers and one for IT and developers. Yes, it's a big company, yes, we have many ways to sell, but ultimately, there should be one place for consumers to buy things online, you should have one shopping cart across this and that. That doesn't necessarily mean one [user interface] to the marketplace because when you're in Xbox, you want to see it through Xbox. When you're on a phone, you want to see it through the phone.

On the PC, I'm still not actually convinced what the right thing is. When you're on a PC, do you want to see the marketplace through the Web or through a client? You know, I can kind of see both. I mean, look at the Zune marketplace, people like being able to buy it through a media-oriented marketplace, but if you were buying apps, it's not really clear. But in any case, there's one marketplace back end that is syndicatable into multiple front ends for the consumer and for the enterprise/IT, and what we were talking about today was really the enterprise/IT one.

It struck me that today, a lot of the story about the cloud has been that it's great for load balancing, it's great for sort of having predictable investment in IT, but there hasn't been as much about what are the benefits when your app is running in the cloud. It sounds like the new project code-named Dallas could be an example of one of those things where you can build a type of application that you couldn't build on premise because you're using someone else's data.
Ozzie: It is the right way of thinking about it. What we're basically trying to say is by agreeing to get together in a certain way, by agreeing on certain guardrails on the road that we'll all drive on, there can be benefits. Right now, there are many pieces of public data, there are lots of commercial data providers and each one has a different kind of a licensing mechanism. Some license by developer, some license by customer, some license by individual user. There are just lots of different terms. And a lot of the big benefits in the data that's out there are what happens when you join them, when you bring them together. And I believe that there's going to be a lot of potential in this.

Will we see Microsoft be kind of one of those first and best customers, bringing a lot of its data and making it available ?
Ozzie: I think the biggest set of data that you'll see us take in many directions is maps. It's the most obvious from a consumer's perspective. You can layer upon it quite nicely. You can layer both apps and other forms of data on it quite nicely.

What are some of the things that people have developed on Azure? Are there any areas of types of applications that have particularly surprised you?
Ozzie: I'm not sure if you noticed some weeks ago, Qi Lu was at Web 2.0 and he announced this Twitter on Bing feature? That is on Azure. And it's one of the most fascinating stories in terms of agility.

A number of people from across the company looked at this thing and said, "Wow, if we had the Twitter fire hose, what could we do with it? Let's start experimenting." And this other lab said, "Oh, well I already know what to do, you actually have access to the fire hose? How could we ever get enough machines put together in time?"

And just in a matter of weeks, you know, this app just came together, people came together, and we had this thing live. And the number from the virtual machines that are processing the incoming feeds, it's fairly astounding. Since that time, other experiments involving 2,000 machines here, 3,000 machines there, are just popping up because people haven't conceptualized what would it be like to have that kind of resources at your disposal.

Are these the kinds of data feeds we're going to have in the future? I mean, Twitter, you have this tremendous data feed, but you can't take in everything, at least not over an extended period of time right now.
Ozzie: In late '05, I guess it was, when I wrote that last memo, I had a theme that I was kind of talking about internally about moving to the cloud experiences and the back end. These days, I'm basically asking people the question: What if everything was recorded, everything? You are recording in your pen there. Some phones have the capability now--or maybe they're just prototypes that we've got--but measure barometric pressure, measure temperature.

Obviously, there are accelerometers. If you can measure everything and you have this aggregated data, what can you then do with it? And I think just getting people to experiment with it will bring us to places that we haven't known before. People concentrate so much on the scary aspect of privacy related to advertising base uses of it, but there are other uses.

From a health perspective, there are many things that I could measure about myself that would be of value to me and no one else, but we still aren't building those apps. It's just too hard to gather all these things.

When you kind of look at where you are, what are the gates to getting where you want as fast as possible? Is it still a matter of evangelizing inside the company? How much is it still a challenge that Microsoft is such a big company that is divided into product teams responsible for the here and now? What are the things that are sort of the biggest gates?
Ozzie: I would say the biggest gate is the same gate it's been for several years, but it's trending in distinctly the right direction, which is prioritization. It's just simply there are a lot of opportunities, there are a lot of different directions that we could go. And left unchecked, every time you do something new, it causes more complexity.

One of the positive side effects, if you will, of the economic downturn is the fact that we've all been forced to make the hard choices.

Microsoft Chief Software Architect Ray Ozzie, speaking Tuesday at the company's Professional Developers Conference in Los Angeles.

(Credit: Ina Fried/CNET)

LOS ANGELES--Microsoft wants you to join it in the cloud.

That's the company's message Tuesday from its Professional Developers Conference here, where Chief Software Architect Ray Ozzie gave the opening keynote address.

Ozzie announced plans for the formal launch of Windows Azure, the cloud-based operating system that lets developers write programs that run on servers in Microsoft's data centers. It will be in production for all users starting January 1, though a few customers will enter production now, Ozzie said.

In other news, Microsoft announced a technology preview of a new data service, code-named Dallas, that lets Azure customers access various commercial and public data sets. Early partners include NASA, the Associated Press, and InfoUSA.

Microsoft also announced another of its city-based code names. Sydney is a security mechanism that lets businesses exchange data between their servers and the Azure cloud. Entering testing next year, Sydney should allow a local application to talk to a cloud application. It will help businesses that want to run most of an application in Microsoft's data center, but that want to keep some sensitive parts running on their own servers.

Here's our live coverage of Ozzie's talk:

8:20 a.m. PST: There's a rap song playing with lyrics that involve floppy discs and spreadsheets. It may be a long morning.

8:23 a.m. PST: Please silence all pagers, cell phones and Windows Mobile devices. "They're both off," the reporter next to me quipped of the Windows Mobile phones. I was going to make some joke about the Sidekick, but I think I'll leave it at that.

8:30 a.m. PST: Ozzie takes the stage, noting how Microsoft first laid out its services strategy about four years ago. (That's when Microsoft launched Windows Live and Ozzie sent his services disruption memo).

Ozzie talks about how last year Microsoft announced its actual products for the space, many of which are hitting the market now.

He also notes the potential of Windows 7 to help get consumers to a more modern code base that developers can target.

"Windows 7 has the real potential to sweep through and reinvigorate the currently fragmented installed base," Ozzie said.

8:35 a.m. PST: First mention of "Three screens and a cloud." That's a phrase we're likely to hear a lot. It's Microsoft parlance for the three most important devices--PCs, phones, and TVs, as well as Internet services that connect all of those devices.

Ozzie also promises Microsoft will improve Internet Explorer--delivering the "best Internet browser without compromise."

Ozzie mentions what we'll hear at PDC--but also a few topics that will have to wait a bit.

He said people will have to wait until spring to to hear in detail about updates to Windows Live. He also said Microsoft will use its spring Mix show in Las Vegas to let developers know how to write code for the next generation of Windows phone.

8:38 a.m. PST: Loic LeMeur, founder and CEO of Seesmic, is talking about how that company is using Silverlight to help it get Seesmic onto more devices. Shows a Silverlight prototype of Seesmic's Twitter application. He also announces immediate availability of Seesmic for Windows.

8:45 a.m. PST: Ozzie shifts to Azure.

"It was only one year ago at PDC '08 that we launched Windows Azure...by launching our community technology preview," Ozzie said.

The technology preview will continue through end of the year. Windows Azure will switch to a production service on January 1. During January, the company will validate and test its payment and billing systems. First bills will be for February usage.

Tens of thousands of developers have used Windows Azure, Ozzie said.

8:50 a.m. PST: Ozzie said that Azure will be hosted in pairs of data centers in each region, starting in January.

In the U.S., Azure will run at facilities in Chicago and San Antonio, Texas. In Europe, Microsoft will tap spots in Dublin and Amsterdam, while in Asia, facilities are in Singapore and Hong Kong.

Microsoft is moving to data centers that house servers not in racks, but in self-contained shipping containers. Microsoft brought one of its containers here to the show floor. (For those not here, check out the piece I did when I toured the Chicago facility.)

A handful of Azure customers are going into production starting today, Ozzie said, including Automattic, the maker of WordPress. Founder Matt Mullenweg now on stage.

8:58 a.m. PST: Mullenweg invites up someone from I Can Haz Cheezburger. The "Cheezburger Network" is launching a new Azure-based Web Site--Oddlyspecific.com--a site devoted to funny and interesting signs.

9:04 a.m. PST: Ozzie announces a new Azure subsystem. Code-named Dallas, it's an open catalog and marketplace for data, both public and commercial.

"Dallas might catalyze a whole new wave of remixing and experimentation for developers," Ozzie said. Dallas can be found on Microsoft's Pinpoint site. Early partners include NASA, InfoUSA, and AP Online.

9:10 a.m. PST: Microsoft shows a demo using 3D imagery from the Mars rover using NASA's "Dallas" data feed. So that's what the 3D glasses on our seat were for.

9:14 a.m. PST: U.S. Chief Information Officer Vivek Kundra joins via satellite to talk about how opening up data can help tap a broader pool of researchers, such as what NASA is doing with the Pathfinder rover data. Anyone who wants to go use the data can go to this Web site, he said.

U.S. Chief Information Officer Vivek Kundra shows off a new job-finder application--on an iPhone--at Microsoft's developer conference.

(Credit: Ina Fried/CNET)

He also shows a career finder application built on government data that can help people find jobs near them. Most interesting is the fact that he is demonstrating the app on an iPhone.

9:20 a.m. PST: Ozzie is summing up, telling people to bet on Microsoft. "When thinking about the experience part of your apps, bet on Windows, bet on Windows 7," Ozzie said. You should also bet on Azure.

"These services are ready for business now," Ozzie said.

Finally, he said, pay attention to all the data that we can now gather.

"Our world and our systems are increasingly wired with sensors, recording tons of data," Ozzie said. But, he said, "this data does no good unless we turn the potential into the kinetic...Let's dream and then let's build."

9:23 a.m. PST: Ozzie is done, handing off to Bob Muglia, president of Microsoft's Server and Tools business.

Muglia begins by trying to explain what is generally understood by the cloud.

"We're all learning together, but one thing that has become really clear is the cloud is more than about infrastructure," Muglia said. "It's also about an application model."

9:25 a.m. PST: Bing runs on more than 100,000 servers. That would be too much to manage using standard server management, Muglia said. The human cost would be too high. Instead, it has an "autopilot" management system.

"When things fail, they just go offline," Muglia said.

9:35 a.m. PST: We're off in geekland now. Don Box, a distinguished engineer at Microsoft, and Chris Anderson, a partner architect at Microsoft, have started coding. I'm pretty sure that most of the people who can understand what they are saying are in this auditorium. (And I'm not one of them.)

9:50 a.m. PST: OK, coding time is over. Muglia is back showing various customers including Kelley Blue Book and Domino's Pizza. Domino's says Azure is nifty because it has peak demand on Super Bowl Sunday that is twice that of any other day.

9:55 a.m. PST: Muglia announces Project Sydney, which allows businesses to connect their own servers with services that are running on Azure. Sydney will be in beta next year.

Muglia said Microsoft has been working on Sydney for a while, understanding that businesses are going to continue to run services in-house and need to connect those to the broader cloud.

10:00 a.m. PST: Muglia also is announcing a beta of an application server for Windows Server called AppFabric. The system will be available in beta next year for Azure as well. (AppFabric combines hosting and caching technologies previously code-named Dublin and Velocity, Microsoft said.)

Microsoft also plans to offer Windows Server virtual machine support next year, Muglia said.

10:03 a.m. PST: Microsoft's press release for the Day 1 keynote is out. Among things I haven't mentioned, Microsoft has finalized the code for its Windows Identity Foundation and is announcing the beta of ASP.Net MVC2 (now that's a mouthful).

10:30 a.m. PST: Muglia is wrapping up. Reiterates that Visual Studio 2010 is coming in the first half of next year. An updated version of System Center that helps manage private clouds and helps start to span into hosted and public cloud environments will be in beta next year.

Muglia also clarifies that Azure's second European and both Asian data centers will come on line next year.

"We're investing in this infrastructure all around the world so you don't have to," Muglia says,

Keynote ends.

The beta of Office 2010, expected this week, is now available to developers who are part of Microsoft's MSDN and TechNet developer programs.

Members of the public are also expected to get access to the beta this month, with the announcement likely to come on Wednesday as Office executive Kurt Del Bene gives his keynote speech at the Professional Developers Conference in Los Angeles.

As noted by ZDNet blogger Mary Jo Foley, Microsoft has already set up public Web pages for downloading the beta, although clicking on the download links returns a message that the beta is not yet available.

(Credit: CNET News)

In addition to the desktop applications, the beta would appear to include the browser-based Office Web Apps (although I am still checking the details on that one).

Also expected at the PDC is the formal launch of Windows Azure, Microsoft's cloud-based operating system as well as demos from the Seadragon and Live Labs teams, among other announcements.

Microsoft is already making some news at PDC. The company said on Monday that it is making available as open-source code its .Net Micro Framework.

Two pieces of the framework, though, its TCP/IP stack and its cryptography features are not included in the open-source release. In a blog posting, Microsoft's Peter Galli said that Microsoft is expected to remain involved in the development of the .Net Micro Framework, working alongside the community.

CNET News will have live coverage of the show, including Ray Ozzie's keynote speech, on Tuesday.

At a key supercomputing conference on Monday, Microsoft released a test version of its Excel spreadsheet redesigned to run on powerful clusters of servers.

By engineering Excel to run better on such clusters Microsoft said that customers are seeing spreadsheets that normally would take weeks to calculate now run in a few hours.

The software maker also released a beta version of Windows HPC Server 2008 R2--the latest version of Windows Server designed to run in high-performance compute clusters. The announcements were made at the SC09 conference in Portland, Ore.

Microsoft has taken the standard version of Excel 2010 and combined it with new Windows HPC Server 2008 R2 technology, allowing Excel to run on the cluster. The final version of Excel compute cluster and Win HPC Server 2008 R2 is expected to be ready in summer 2010. The capability has been in development for about 18 months.

The announcements are the latest in Microsoft's push over the last few years to better compete against Linux in the market for compute clusters--high-performance systems built by linking together large numbers of standard servers. Last year, for example, Microsoft managed to crack the upper echelons of the supercomputing ranks, landing in the top 25 rankings for the first time.

Microsoft also said the next version of its developer tools--Visual Studio 2010--will help ease the task of writing software that can run efficiently on such systems.

"Until now, the power of high-performance and parallel computing has largely been available to a limited subset of customers due to the complexity of environments and applications, as well as the challenges of parallel programming," Microsoft senior director Vince Mendillo said in a statement.

As for the new version of HPC Server, Microsoft said it offers the ability out-of-the-box to support clusters of up to 1,000 nodes as well as diskless boot and improved management and diagnostics abilities.