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There is this impression that Microsoft is protecting its turf when it comes to Web-based Office-style applications. You see Google doing it and start-ups like Zoho--and there are online ERP applications--and Microsoft hasn't done that yet. But Microsoft could do it, so why don't you?
Ozzie: People as far back as Desktop.com have done it. Well, I don't know how to say it other than to say that we're running a fairly significant business. Protecting implies setting up barriers--there are no barriers. These people are free to go take whatever solutions they want to put them in a browser. We believe--and I believe this deeply, I've been a desktop business for a while--that the deployment environment of using desktop tools on a PC is a really valuable one. Sometimes, just because you can doesn't mean that you necessarily should. To the extent that there are scenarios that involve the Web that are very useful, we are going to go after those scenarios because it helps our customers--we got to stay focused on those customers.
We're not going to be in a reactionary mode that just because somebody proves that something can be done, and it has some trade-offs, then we just immediately have to follow suit. I think that there are a lot of lessons they learned right now with those competitors of things that they've done that people just aren't using, and things that they've done where people are actually using it in ways that they aren't using desktop apps today. So I think that we are all learning from this and our product will end up in some hybrid form.
Looking forward, do you think that all your own premise software will have some sort of services component?
Ozzie: I believe that moving forward--and it's not going to be overnight--most applications that we would have conceived of as desktop applications...Actually, I shouldn't even say "most" because that would imply more than 50 percent. I would say the vast majority, the vast majority of applications that are today desktop apps or Web apps or rich Internet apps are all going to have some sort of component that is Web and client and mobile. Mobile, people don't talk a lot about today, (but) there is a lot of innovation, or turmoil--you can call it what you like--in terms of form factors.
But I think the more Web developers want to extend their things outward, the more they realize that gosh, it's hard to try to figure out how to develop something for mobile and a desktop component. Desktop is on the increase not just because of local documents and off-line support. But because if you've got a Web site, people have to keep voluntarily coming back to you, and having something on the desktop that keeps reminding them and feeding them on a daily basis is actually a very, very useful thing for Web apps.
Where is it not going to happen and be true? There are very few environments that are not connected to the Internet. The Defense Department or places where they truly provide a firewall. Those guys continue to use applications that are server-based and client server or internal Web apps. But the vast majority of the commercial world and consumers--I personally believe will be these hybrid apps.
You say that this software and services design pattern is going to dominate and we're starting to see that now. How does that affect Windows on the desktop?
Ozzie: In my view, the primary role of a desktop environment or a device environment, a device's operating system--this is true of phone or a PC--is to make the best possible programmer-to-hardware experience or user-to-hardware experience.
The things that run on (my phone) like mail and my MLB apps--so I can do game day on my phone--those things are essentially going to take advantage of that client OS to give the richest possible experience while still being service-connected.
I still think there is huge importance in every OS, in innovation in the OS itself. But there will be pure Internet apps that don't care what they're run on. And there will be local client apps, but those clients ones are also going to be connected.
Do you think people are taking extreme views and discussing software and online services?
Ozzie: I think that it's easier to think about one extreme or the other, but everybody that is building software is actually thinking it in a hybrid mode at this point. Take the rhetoric aside--for all things that we do, I don't see us living at the extreme world, meaning apps that don't connect to the Web or service apps don't have some (offline) component.
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