For 33 years, Microsoft’s vision has been “A computer on every desk and in every home” [“running Microsoft software”]. But that was the vision with Bill Gates in charge and he is now quoted as saying:
“We’ve really achieved the ideal of what I wanted Microsoft to become”
“Create experiences that combine the magic of software with the power of Internet services across a world of devices.”
[Kevin Turner, 8 September 2008]
In the same presentation, Turner spoke of the $8bn that the company will invest in research and development this year, across “4 pillars of innovation breadth”:
- Desktop: Windows Vista; Internet Explorer; Desktop Optimisation Pack; Microsoft Office System.
- Enterprise: SQL Server 2008 enterprise database; Windows Server 2008 infrastructure; Visual Studio 2008 development lifecycle; BizTalk business process management; System Center management; Dynamics ERP/CRM; Exchange and OCS unified communications; SharePoint portal, workflow and document management; PerformancePoint business intelligence.
- Entertainment and devices: Xbox 360; Zune; Mediaroom; Windows Mobile; Games; Surface.
- Software plus Services: Microsoft Online (business productivity suite – Exchange Server, SharePoint Server, Live Meeting, Communications Server – and Dynamics CRM Online); Live Services (Xbox Live, Live Search, Windows Live, Office Live, Live Mesh).
There are two main points to note in this strategy: enterprise is the fastest growing area in terms of revenue and profit; and the deliberate split between enterprise and consumer online services.
As I outlined in a recent post looking at software as a service (SaaS) vs. software plus services (S+S), there is a balance between on premise computing and cloud computing. Microsoft sees three models, with customer choice at the core (and expects most customers to select a hybrid of two or three models, rather than the fully-hosted SaaS model):
- Customer hosted, supported and managed.
- Partner-led, using partner expertise.
One more key point… last year, Microsoft SharePoint Server became the fastest growing server product in the history of the company and Turner thinks that virtualisation could grow even faster. Only time will tell.