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Microsoft Spends $9 Billion On Research, Focuses On Cloud
superapecommando writes to share that Microsoft appears to be going all-out on research in the coming year, with a great focus on the cloud. They're supposedly planning to spend $9.5 billion in R&D; that's $3 billion more than the next-closest tech company. "'Especially in light of the tough difficult macroeconomic times that we're coming out of, we chose to really lean in and double down on our innovation,' [Microsoft COO Kevin] Turner said. Turner contended that Microsoft has more cloud services than any other company, ranging from its consumer email service to hosted enterprise products such as its Dynamics CRM (customer relationship management) system to its Azure cloud operating system. 'We're going to change and reinvent our company around leading in the cloud.'"
Has anyone checked to see if Microsoft has trademarked the word "Cloud"?
If Slashdot were chemistry it would look like this:Cadaverine
Watch /. tear apart Microsoft for even mentioning the word "cloud". /. was praising Ubuntu working on the "cloud".
When just yesterday
http://linux.slashdot.org/story/10/03/03/1947235/Ubuntu-Desktop-In-the-Cloud
I'll try anything once. Twice if it tastes good
We're going to change and reinvent our company around leading in the cloud.
Going to lead in the cloud? Given that Google, Microsoft's most-direct competitor, has been "in the cloud" for quite some time, as the expertise to innovate and excel, and has the money to ensure they have everything they need, I find that to be a bold prediction founded in whimsy rather than fact. Methinks Microsoft is about four or five years too late to the cloud computing game. Sure, they have the resources to make up a lot of time but they're competing against a company that has similar resources who already has those four or five years (or more) head start.
That said, it is nice to see Microsoft recognizing that the world has changed and making efforts to change with it.
(And, no, that last part wasn't me being a smartass - I'm actually serious. It's a good thing when major corporations recognize the world has changed and adapt accordingly rather than attempting to hold on to a bygone era.)
Ballmer gave a talk at the University of Washington on Microsoft's cloud strategy: http://www.microsoft.com/presspass/presskits/cloud/videogallery.aspx
Microsoft sees the future and it is about to run them over. A lot of organizations don't want to eat the hardware costs associated with Office upgrades every three to five years. Microsoft is offering to host the applications online. From what I've heard about Office 2010, they aren't doing a very good job yet.
At this point it looks like they're in a race with Google. Google is trying to add functionality to bring Docs on par with Office. Microsoft is trying to get Office online before Google replicates enough of the functionality to destroy Microsoft's licensing stream.
Given the perpetual beta mindset on Google's part, coupled with their absolutely abhorrent attitude toward end user support, I give Microsoft a better than 50/50 chance of getting a reasonable offering put together in time.
I'm dealing with a lot of the same issues that you mentioned. Specifically the SMB market and the move toward online hosting of services. What I've been finding is that although you can realize a savings in hardware cost, you end up losing some of those savings by having to bring in faster and redundant internet feeds.
Where have you seen the dividing line materialize for the decision to keep it in house versus move it offsite?
How is Microsoft going to make a profit in the cloud? The cloud is about the centralization and automatic configuration of vast amounts of computing resources. It will allow smaller companies to turn over their infrastructure management to cloud hosting companies.
When they were self-hosting, those smaller companies were often paying licensing fees to Microsoft because of some perceived cost benefit such as support or simplicity of administration. However, when shopping for cloud services, they don't need to worry about such details, and so they can focus much more on cost. A Windows based cloud hosting company would need thousands of licenses from Microsoft, and so they could save millions by using free software instead. These savings would lead to a huge price difference.
Microsoft could always offer special savings on bulk licenses, but they are going to have to offer major price drops. The centralization of hosting will give them far fewer direct customers. Where is the great amount of money to be made in this?
Their only hope is to offer things that can't be found in free software, or to reduce administrative costs enough to offset the cost of licenses. It will be a difficult challenge.
cloud computing is a very bad idea. The very same things that Ballmer spoke of as being exciting and profitable are the same ones that terrify me for lots of reasons. I'm not paranoid about privacy (that's gone) but it will get worse, and the possibilities for monopolization, piracy, and loss of data integrity increase exponentially. As a small business, it makes no sense for me to embrace the risk, and as a dinosaur in the digital world, I naturally balk at centralization disguised as convenience.
At a previous employer, I was asked by management to estimate how much time I spend doing "research", left undefined. The explanation - it's for tax purposes, and we can get a credit for research.
I'm not going to say I read the relevant laws to find the definition, but I did follow company policy and made a best guess based on what I thought should reasonably qualify under a sane tax system. So although I didn't claim anything that a normal person would call foul, I'm sure there were some hours that wouldn't qualify.
Hours were turned into dollars, and the results collected and turned in as "research and development" spending for tax purposes. We met both the letter and spirit of the law, as much as was possible. But we were not a product company, nor a major innovator in our market(s). We did lots of research with very little to show for it. The intended purpose of the law of course would be to encourage invention if not innovation, and have a more efficient and/or productive economy, resulting in snowballing gains as different sectors picked up on advances in other areas. Makes sense.
I'm sure someone else will point out how many cool things MS research announces then fails to turn into a marketable product, so I won't go into that. I'm also sure that Microsoft's obligations to its shareholders have continually been ignored as dividend payouts have been begrudgingly given, on the odd chances they are given at all. While sitting on piles of cash. As a shareholder, i'd like to see MS Research almost entirely dismantled, dividends you can count on, and for fuck's sake replace the entire marketing silo with a small panel of the following makeup who will say which products get to market and how:
A graphic designer
A soccer/hockey/whatever mom or dad
Someone employed in middle management of a non-technology company
One person of any type who has never seen an episode of survivor or american idol
One person who knows the words to every Lady GaGa song (artist to be updated by annual shareholder vote)
One person who belongs to every social network known to man and has no concept of privacy (must have an entry on http://failbooking.com/)
Bill Gates
A rat terrier (for product testing), alternatively a young japanese man will substitute as needed
A 14 year old girl (preferably familiar with glitter and whose favorite color is pink, replaced annually for obvious reasons)
A business analyst with a marketing related education, who counts as 1/2 vote
There's your entire marketing department, and they will make better decisions and cost less money. You can probably pay them in MacBooks, Comp tickets, maid service, fairy dust and unicorn shit, rainbowed versions of normal objects like neon beer signs and the like, permanent Bing #1 results for keyword 'smush', certificates for a discount on the next purchase of a Windows(tm) product, used panties, arcade crane game baubles, and insurance benefits with an occasional kick to the balls, respectively.