Microsoft eyes services for business

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CEO Steve Ballmer said in November that a Windows Server "Live" service makes sense. "Clearly, if you just look at what we have done already with identity and Active Directory federation with Passport, you start to get a Live element, if you will, of Windows Server. Perhaps the most important thing we do is to allow developers to federate their own applications running on their own servers with the rest of our cloud-based (on the network) services," he said.

Microsoft has also ventured into the managed services area. Directions on Microsoft analyst Matt Rosoff expects to see more activity in that area, following the appointment of CIO Ron Markezich to run the company's managed services business. "I suspect they are thinking of getting into some sort of service that would help with configuration of desktops and maybe deployment of software and patches. I'm not sure whether that would come from Microsoft or partners, but that's the kind of service I'd expect to see from them," he said.

In crafting new services, Microsoft has to avoid colliding with partners, which could be one reason for its careful approach, Rosoff said. "That might be why they are being so cagey on this. They haven't figured out what the partner model is going to be, and they don't want to alarm them for something that may not happen."

The other possibility is that Microsoft will stay out of the enterprise services business entirely and leave it to partners. "They may not get into this business. I mean, I think Microsoft would prefer to keep selling software and keep seeing the server and tools business grow 18 or 20 percent a year. If they can do that without getting into services, they'd probably just as soon stay out of the services business. It's a lower margin business," Rosoff said.

Overall, mapping out services that make sense to customers is challenging, Microsoft's Muglia admitted. "In some spaces it's not exactly as clear how you would add services and what would make sense for customers."

Other executives have expressed similar sentiments. Paul Flessner, Microsoft's senior vice president of server applications, told CNET News.com in September that it was still unclear how the company could deliver services to augment its SQL Server database, for instance. Services for other products, like the company's Exchange e-mail and messaging server are easier to envision, he said.

"Offering hosted versions of Exchange and Live Communication Server would make a lot of sense," Rosoff said.

E-mail seems an obvious candidate for hosting--and various companies do offer hosted Exchange services--but IT managers at many larger companies that rely on e-mail as a vital communications tool might not be keen to trust that service to an outside provider.

Right now, a services approach probably makes more sense for smaller businesses, Rosoff said. "Office Live, for small and midsize businesses, makes some sense. When you get down below a certain size--say, 25 PCs or so--I think selling servers becomes very difficult and Microsoft doesn't have the channel to do it.

"So at that point it makes more sense to offer some of these things as a service, because you're not going to sell them servers anyway," Rosoff said.

On the enterprise front, it's clear that Microsoft's plans are in flux, a point made by Ray Ozzie at a San Francisco tech conference in October: "For enterprises, I think we've just barely scratched the surface about which systems can...be brought into the cloud in some way shape or form."

[Captain_Spock]

From the contents of this article...

... it does appear that Microsoft is a company in need of directions particularly when it comes to the question of its planned services offerings. But, such has been that fate of companies which do not find themselves nimble enough to respond in a timely manner to technological as well as market demands; for example -- Microsoft's yet to be stated strategies with regards to web-services interoperability with other OEM products such as the OpenDocument Format Standards which is supported by IBM, Sun Microsystems and Google -- companies now well positioned to give Microsoft a run for its money through the Linux Operating System and the OpenOffice products offerings, both of these products being based on the open-source development model!