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Microsoft's data center offensive sounds offensive

24 new information plants rumored

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Microsoft appears on the verge of ambushing rivals with a data center shock and awe initiative.

Rumors of Microsoft's great "cloud" build out arrive from Nick Carr. The technology pundit has been hearing things, and apparently the voices are not just in his head. They're the voices of Microsoft insiders falling over themselves to talk up the software maker's next major product shift.

According to Carr's sources, Microsoft will extend its data center reach - big time.

"One of the cornerstones of the strategy, I've heard, will be an aggressive acceleration of the company's investment in its data center network," Carr writes. "The construction program will be 'totally over the top,' said a person briefed on the plan. The first phase of the buildout, said the source, will include the construction of about two dozen data centers around the world, each covering about 500,000 square feet or more. The timing of the construction is unclear."

Microsoft has already been working to match Google data center-for-data center with both companies popping out $500m to $600m centers every couple of months. They've hunted down cheap power in multiple locations around the US and taken similar action overseas. Twenty-four new data centers, however, would signal a move by Microsoft to take a lead in the information plant arms race.

What would all of these data centers be for? Well, Carr thinks he has the answer there too.

"The new strategy will, I'm told, lay out a roadmap of moves across three major areas: the transformation of the company's portfolio of enterprise applications to a web-services architecture, the launch of web versions of its major PC applications, and the continued expansion of its data center network," Carr writes. "I expect that all these announcements will reflect Microsoft's focus on what it calls 'software plus services' - the tying of web apps to traditional installed apps - but they nevertheless promise to mark the start of a new era for the company that has dominated the PC age."

Microsoft executives have been babbling on about their software-as-a-service aspirations for a long time. And, as with anything Microsoft, it's important not to expect much action to match the vision - even with 24 new data centers online. Microsoft will no doubt be more conservative and less radical than these rumors indicate or at least take many years rather than a chunk of months to hit users with a bevy of new services. But at least it seems to be trying something new.

Interestingly, Carr points to rumors that Microsoft will make open source software a central piece of its new strategy.

"I've also heard that people may be 'stunned' about the extent to which Microsoft will embrace open-source software and interoperability in its plan," he writes.

We've long argued that Microsoft puts itself at an economic disadvantage with the mega data center build out by insisting on using homegrown software as opposed to open source code. The likes of Google, Amazon, Sun Microsystems and Yahoo! all rely on open source applications for both cost and innovation reasons. Maybe Microsoft will change its tune now and face the realties of this market. Its offer for Yahoo! seemed to indicate that Microsoft was already willing to head in this direction.

Let's see what the next week brings. ®

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