Microsoft’s CEO Says Company is Playing All Its Hands in the Cloud

During a recent speech at the University of Washington, Microsoft CEO Steve Ballmer spoke about his company’s future plans: and they primarily take place in the cloud! Citing services and platforms like Windows® Phone 7 Series and Xbox Live, Ballmer spoke about cloud-centric objectives. While Microsoft faces competition from Google and others when it comes to cloud-based initiatives, everyone is wondering how Microsoft will alter its desktop-centered products like the Windows franchise to remain ahead of the pack.

During his March 4 speech at the University of Washington, Ballmer stated that Microsoft’s primary focus in the future will be in the cloud and applications derived from the cloud. This may come as somewhat of a surprise, as Microsoft’s fortune largely comes from desktop-based software like Microsoft® Windows and Microsoft® Office, but Ballmer said, “We shipped Windows 7, which had a lot that’s not cloud-based. Out inspiration now starts with the cloud Windows Phone, Xbox, Windows Azure and SQL Azure … this is the best bet for our company.”

While speaking in front of a screen displaying a large cloud logo with the words “We’re all in,” Ballmer continued to say, “Companies like ours, can they move and dial in and focus and embrace? That’s where we’re programmed. You shouldn’t get into this industry if you don’t want things to chance. The field of endeavor keeps moving forward.”

When discussing Microsoft’s cloud initiatives, Ballmer spoke about the creation of a cloud-based Office that would allow workers to collaborate and communicate. He also referenced cloud-ported entertainment (via Xbox Live) and the creation of something he dubbed “smarter services” which would be capable of quickly integrating new hard- and software that could interact with the cloud smoothly. Ballmer spoke about Microsoft’s cloud-based development platform, Microsoft® Azure, and mentioned Azure Ocean, a University of Washington project which reportedly collects the world’s oceanographic data.

Microsoft’s most recent smartphone operating system, Windows® Phone 7 Series, was cited by Ballmer as one of the company’s cloud-centric smarter devices. “Earlier [Microsoft] phones were designed for voice and legacy [applications],” said the Microsoft CEO before adding that Microsoft® 7 Phone Series was created to “put people, places, content, commerce all front and center for the users with a different point of view that some other phones.”

Citing the reciprocal need of search and Bing Maps to draw in information from users in order to “learn” and define their actions, Ballmer placed the cloud at an even playing field. While Bing Maps has started integrating Flickr images into its Streetside feature—thus presenting an eye-level view of an environment—Microsoft is experimenting with putting Streetside cameras on bikes and pedestrians instead of on the roofs of cars to offer even more views to users. Search engines like Bing take history information ported to them by users and gauge user intent. Ballmer suggested that the “ability of the cloud to learn from all of the data that’s out there, and learn from me about what I’m interested in” is one of the cloud’s most basic and important dimensions.

When it comes to competition in the cloud, Microsoft faces the most in consumer applications. Ballmer praised Apple’s App Store, calling it “a very nice job,” but knows that Microsoft has a ways to go in terms of catching up to Apple’s cloud-based monetization of intellectual property like movies and music. As for Google, the company has a lead in the search engine market in the U.S. and its Google Apps cloud-based productivity has been making inroads with businesses and government.  Google recently announced plans for a dedicated federal cloud computing system sometime later in 2010. This announcement likely propelled Microsoft’s February 24 announcement Business Productivity Online Suites Federal. The online-services cloud for the U.S. government comes equipped with strict security reinforcements.

Overall, Ballmer’s speech at the University of Washington furthered the notion that Microsoft is poised to focus its competitive energies in the cloud more and more. The industry will be waiting to see what this will mean for the traditionally desktop-centric Windows franchise, Microsoft’s flagship product; especially since news recently surfaced suggesting Microsoft is currently developing Windows 8. For more information on Windows Azure please visit

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