Web hosted, ad-supported Windows: streaming to your PC

Microsoft patted itself on the back for completing .NET, while announcing 'live' Windows and Office offerings today. With these offerings, Microsoft hopes it can counter Google and tap into the trend for "software as a service."

Bill Gates, Microsoft's chief software architect, said Tuesday that planned versions of Visual Studio 2005, SQL Server 2005 and BizTalk Server 2006 are "the full realization of the dream around XML and web services that were part of an architectural direction the company bet on five years ago." The trio are due next week while the "dream" was called .NET, and announced by Gates at the Professional Developers' Conference (PDC) in Orlando in 2000.

Having delivered on .NET, Gates on Tuesday announced Windows Live and Office Live - Microsoft's take on software as a service that it is calling "live software." Live software, Windows Live and Office Live will derive revenue from advertising and subscriptions.

Live software comprises business and consumer services that are housed on servers and delivered on devices such as phones, car consoles, video game boxes or even those things called computers.

Gates, speaking at a press and analyst event in San Francisco, California, defined live software as software that remembers what the user wants, and that delivers data automatically to the variety of devices. Gates said that's different to today, where the device is at the center of the experience and users are forced to move data around between devices.

Windows Live is a new layer of client software combining many updated elements of MSN. It will be "largely" free and "mostly" supported by advertising, according to Microsoft's chief technology officer (CTO) Ray Ozzie.

Windows Live APIs will be made available to partners and competitors and while Ozzie promised services for business and government users, initial efforts will be - in classic Microsoft style - focused on personal use as initial users will be MSN subscribers. More than 250m MSN users are being "moved over" to Windows Live.

Windows Live lets users build their own home page using RSS and audio having located content and services via search. Windows Live features Windows Live Mail, built using Asynchronous Java Script and XML (AJAX) and that features an interface and search capabilities that look suspiciously similar to Google's Gmail, a re-worked IM that takes up to 600 buddies, and a friends list that allows contacts you link to to expose their own contacts list. A live contacts list will also update contacts in mail, messenger, a mobile device and on a PC.

Microsoft said Windows Live would be a separate offering to Windows, while pledging continue development of Windows as a competitive platform along with MSN.

Office Live is targeted businesses with less than 10 employees. Office Live, whose first beta is due in the first quarter of 2006, will provide a set of web, email, collaborative, analytics and customer relationship management (CRM) likely to tread on the toes of platform, ISV and services partners and competitors.

Small businesses can host and customize their sites, will be given 10Gb of free storage for up to five users, get an online meeting and collaboration service code-named Mojo, and have the ability to set-up collaborative sites for specific customers or projects. CRM is provided with contact and lead management, and the ability to export contacts' details to Exchange.

Veterans of internet services and those with a working knowledge of Microsoft will be very familiar much of this. Microsoft is using an architecture map for cross-platform services, hosted in a 'cloud', which is already in use. Microsoft is, incidentally, one of those companies providing such services

The differentiator is Microsoft's sudden, diehard commitment to forcing ads and embedded commerce on business and consumer users. Both Windows Live and Office Live will use Microsoft's adCenter, due for global launch next year. AdCenter will serve ads to users in a side pane based on context, and will up-sell users to more expensive services, such as anti-virus software.

In a blunt pitch to developers and potential partners who want to target end-users, Ozzie said Microsoft has an online audience of 400 million consumers, 35 million small business, and 55 million information workers each month through its numerous products and commercial relationships. Ozzie expects the online ad market to be worth $150 billion by 2015, up from $15 billion today.

"We have scratched the surface in the analytics we can bring to bear," Ozzie promised. "The breadth of audience and seamlessness of experience ... can make a difference. AdCenter will serve relevant offers on the web and in live software on mobile devices and enterprise devices."®