September 13, 1999 1:50 AM PDT

Microsoft eyes next big boom: e-commerce tools

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Microsoft fights talent drain with new tools, API

August 11, 1999
SAN FRANCISCO--Four years ago, Microsoft scrambled from behind to catch up with the "Internet gold rush" as chairman Bill Gates explained it. Today, the company spelled out plans to cash in on the next prospecting dream: e-commerce and Web development software.

Microsoft executives, including president Steve Ballmer and senior vice president Paul Maritz, today unveiled new development tools and programming interfaces designed to make the company's forthcoming Windows 2000 operating system more attractive as a Web development platform, the company said.

Windows is wildly popular with big companies as an operating system for PCs and smaller networked servers. But as the Web technology battleground shifts from client PCs to servers, Microsoft finds itself once again battling Sun Microsystems' Java programming language.

Large corporations favor Java and the Common Object Request Broker Architecture (CORBA) for large-scale applications by a 2-to-1 margin over Microsoft's Component Object Model (COM) technology, according to a report by Forrester Research.

As more companies adopt broad Internet commerce strategies--and fewer of them see Microsoft as a serious technology supplier--the greater the chances that the software giant could lose its sway over the industry.

And clearly, the adoption numbers for Java and CORBA do not please Microsoft's top brass.

Today, the giant made its first concerted effort to both simplify its software tools message and appeal to the dot com companies of the world that are building e-commerce sites.

Microsoft introduced Windows DNA 2000, an amalgamation of current and future technologies for building Web sites and sharable Web services. Ballmer said the company sees the coming evolution of Web services, such as catalogs, stock recommendation services, and purchasing technologies that can be combined to create personalized Web sites.

Other technology providers, including IBM and Hewlett-Packard, have announced plans to support Web services.

Microsoft is positioning its operating systems and tools to give developers an attractive way to build those services.

"We are at an inflection point in terms of what developers will use to build Web sites," said Ballmer here this morning. "This is more significant than the development of the browser [for Microsoft]. If we miss this [transition] we'll be in tough shape."

Microsoft plans to offer Web developers the ability to pull technology components from its MSN Web site. The company is calling these components "megaservices," which include an Internet identification and payment technology named Passport.

Future megaservices will include the LinkExchange system for exchanging banner adds, the Hotmail and Instant Messenger communication technologies, and Windows Update, a way of sending software upgrades and patches electronically.

Microsoft is reorienting all of its products around this new approach called Windows DNA 2000, in anticipation of the launch of Windows 2000, Microsoft?s revamped high-end operating system formerly called Windows NT.

Analysts said Microsoft, which pioneered easy-to-use Windows development tools with its Visual Basic product in the early 1990s, has so far missed a huge opportunity by not following the same strategy for the Web development market. The company's tool lineup includes scripting, component development, and other tools, but does not include a visually oriented tool for overall Web site development, analysts said.

As previously reported, Microsoft is attempting to model its ever-expanding roster of technologies--operating systems, applications, and various programming interfaces--in a single programming interface that developers can use to more easily build Web-based business systems.

Ballmer and Maritz highlighted a range of technologies expected to enter beta testing this year and ship next year following the commercial debut of Windows 2000.

The list includes a new version of Microsoft's SQL Server database reworked to support Extensible Markup Language (XML); a new toolset, Visual Studio 7.0; BizTalk Server, a planned XML server, ; a new release of the company?s Commerce Server business to consumer software; and a new software integration server, code-named Babylon.

Also in the works is a deployment and management tool called AppCenter for managing distributed Web services and applications.

With the new tools, Microsoft's "focus is not so much on new features and functions but on ease of use and the creation of Web applications," said Mike Gilpin, an analyst with Giga Information Group. "They're trying to make building Web applications as easy as building Visual Basic applications," said Gilpin.

Visual Studio 7.0 is expected to include better code development tools, application modeling features, and "state" management, which enables Web applications to track user movement through a Web site.

Microsoft, like other software makers--including Sun Microsystems and Oracle--doesn't expect the new tools to become a single significant source of revenue. But the company sees user-friendly development tools as key to attracting companies and software developers to its products-which in turn will drive profits.

"Tools are a strong competitive differentiator," said Eric Brown, an analyst with Forrester Research.

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