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Conviction and confusion in Microsoft's cloud strategy

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Azure days

I asked Muglia how cloud computing is affecting Microsoft's business and bottom line. In his answer, he was keen to emphasise the company already has substantial cloud business: "Xbox live is one of the largest paid consumer services in the world."

Muglia added: "Windows Azure is still early days for us, but our expectation is that over time the cloud services will become a very large part of our business."

In my view, the body language has changed. When Microsoft announced Windows Azure in October 2008, it felt as if Microsoft was dragging itself into the cloud business. At the Professional Developers Conference in October 2009, Microsoft announced Azure would open for business in February, but again, it seemed halfhearted, and it was developer platform vice president Scott Guthrie with Silverlight 4.0 who grabbed the limelight.

TechEd New Orleans is different. Muglia understands what is happening and presents Microsoft's cloud platform with conviction. In addition, the engineering side of Azure seems to be working.

Early adopters have expressed frustration with the tools and sometimes the cost, but not the performance or reliability. Despite its conflicted strategy, which the company spins as hybrid, Microsoft's cloud push is finally happening, at least on the server and tools side of the business. ®

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