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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.'"

17 of 133 comments (clear)

  1. In other words... by pushing-robot · · Score: 5, Insightful

    "...We're not sure our OS and Office monopoly will last forever, so we'd really like to see if we could actually turn a profit on something else."

    --
    How can I believe you when you tell me what I don't want to hear?
    1. Re:In other words... by alen · · Score: 5, Insightful

      Bill Gates and Steve Ballmer have always said that they knew Windows and Office won't last forever. in the last 10 years they expanded into video games, business software, database servers, general IT servers for IT management, etc.The "cloud" is just a buzzword. few months ago i was reading some article about how someone was deploying servers for some internal project. and the article said they were building out a private cloud.

      most of the cloud nonsense is for small businesses. i've helped a few build infrastructure and it's a waste of money buying servers, Windows Server licenses, etc. easier and cheaper to outsource it to Azure, Google or someone else.

      for larger businesses hardware is so cheap that it doesn't make sense. We're about to buy a few $15,000 servers when the new Intel CPU's come out. 2 6 core CPU's, 72GB of RAM, 500GB to 1TB of hard drive space, all kinds of monitoring capability, etc for $15,000 each.

      i was talking to an IT sales person the other day and he didn't even try to sell an hardware to us. he kept on pushing services. servers are a commodity made in China by little kids. just like ipods. I guess services is the next frontier to try to squeeze some profits

    2. Re:In other words... by dave562 · · Score: 3, Interesting

      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?

    3. Re:In other words... by ircmaxell · · Score: 3, Insightful

      Well, it's not BS. It's incomplete. It should be: If you're not growing or giving your customers a reason to stay, you're dieing... The caveat is that "giving your customers a reason to stay" in MS lingo is "Let's lock them into something so hard, that once they are a customer, they can never go somewhere else without a HUGE migrating expense"...

      --
      If a man isn't willing to take some risk for his opinions, either his opinions are no good or he's no good
  2. It's _research and development_, not just research by melted · · Score: 4, Informative

    Research costs Microsoft about $700M a year, probably less now after the recent belt tightening and layoffs.

    R&D means everything that's involved in creating products, including developers, testers, program management, management, non-sales executive pay, etc, etc., and yes, research as well.

  3. Azure looks interesting... But... by ircmaxell · · Score: 5, Informative

    Azure is definitely interesting... It's distributed programing model does look to have some advantages. But I think it won't take off like Amazon's has for a few reasons...

    First off, there are no computing containers. What I mean by that is you can only run applications on Azure, not whole operating systems. This does have some efficiency gains (in that you don't have an added OS layer in the middle, but it VASTLY increases the tie-in to the system, and prevents you from doing simple things like adding a server template to turn on if your site gets a lot of load.

    Second, It requires applications to be custom written for the environment. You can't trivially port a ready-made application from a single server to Azure... While this is good on the efficiency side, it's not good for the weekend warrior or small businesses who want to remain portable and flexible...

    Third, it's only on their cloud. You have to trust MS's infrastructure. And you need to trust MS with YOUR data... It's not like amazon's offerings where clones have popped up that are compatible (so you could recreate your own cloud if you wanted to, or use a competitors)... So that locks you in to their system. My guess, is that most sizable companies won't like this at all...

    I'm not saying people won't use it. I'm not saying people won't like it. What I am saying is that it is not playing in the same field as the other "Cloud" computing platforms. IF MS opens up Azure (at least in a binary form) where you can install it on your own infrastructure, then it may have a shot. If they allow guest operating systems, then it may have a shot. But without both, I think there's just too much tie-in to be comfortable (and base your business around)...

    Disclaimer: This is based on a presentation which I attended by the lead engineer for Azure back in December of 08. Things may have changed since then, but I haven't kept up with it specifically...

    --
    If a man isn't willing to take some risk for his opinions, either his opinions are no good or he's no good
  4. Watch This by Slash.Poop · · Score: 3, Interesting

    Watch /. tear apart Microsoft for even mentioning the word "cloud".
    When just yesterday /. was praising Ubuntu working on the "cloud".

    http://linux.slashdot.org/story/10/03/03/1947235/Ubuntu-Desktop-In-the-Cloud

    1. Re:Watch This by Svenne · · Score: 3, Informative

      Did you actually read the comments?

      "Let's Open-Source the cloud (Score:2, Interesting)
      by Anonymous Coward writes: on Wednesday March 03, @08:50PM (#31349408)

      Then we can run our own cloud and connect to it from wherever we want. There's a snowball's chance in hell I'm going to run my desktop on hardware that is out of my control, but for local applications, that might be interesting."

      ---

      "Cost prohibitive? (Score:3, Insightful)
      by bsDaemon (87307) writes: on Wednesday March 03, @09:00PM (#31349544)

      EC2 charges based on CPU time and bandwidth usage, so this sounds like it'd end up eating up a monthly fee of ~$netbook per month. Why would anybody want to spend their money on this?"

      ---

      "i never saw the point of cloud desktops (Score:3, Interesting)
      by alen (225700) writes: on Wednesday March 03, @09:55PM (#31350268)

      hardware is dirt cheap and getting cheaper. you can buy a powerful server for cheap as well. but after you buy the Citrix or whatever licenses, a few more servers for redundancy, a ton of storage at enterprise prices, the enterprise hardware support, increase network bandwidth etc the savings vanish and it's cheaper to just buy regular desktop machines.

      same thing with EC2. by the time you put in the network hardware and new circuits and pay Amazon for 24x7 instances it's cheaper to just buy desktops. i'm typing this on a 5 year old HP that runs windows 7 just fine.

      i bet all this cloud nonsense is enterprise hardware companies trying to push higher margin products and no real trend that anyone is doing. the numbers just don't work out"

      ---

      No? Check.

      Just felt like bitching? Check.

      --

      Slagborr
  5. Re:I am from India. by paiute · · Score: 3, Funny

    China.

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  6. Lead or Follow? by whisper_jeff · · Score: 5, Interesting

    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.)

    1. Re:Lead or Follow? by jcupitt65 · · Score: 3, Informative

      If you're less than 50 users, google apps for your domain is free.

      $50/user is for the google apps 'premier edition', which includes 25gb of storage, tech support, 10 year archive, 99.9% sla and other stuff like that.

  7. Comment removed by account_deleted · · Score: 4, Insightful

    Comment removed based on user account deletion

  8. Interesting turnaround by sean_nestor · · Score: 4, Insightful
    From an article in Time magazine, December 29 1995:

    Gates is as fearful as he is feared, and these days he worries most about the Internet, Usenet and the World Wide Web, which threaten his software monopoly by shifting the nexus of control from stand-alone computers to the network that connects them. The Internet, by design, has no central operating system that Microsoft or anybody else can patent and license. And its libertarian culture is devoted to open--that is to say, nonproprietary--standards, none of which were set by Microsoft.

    Gates moved quickly this year to embrace the Net, although it sometimes seemed he was trying to wrap Microsoft's long arms around it.

    I remember reading Gates' book "The Road Ahead" something like seven years ago and being surprised at how wrong he was in his estimation of the impact that mainstream Internet connectivity would have. I wish I could get the exact quotes, but there were a few telling sentences where he comes off pretty clearly as dismissive that net connectivity would become anything more than a cute PC accessory. I'm still not sure if that was his genuine line of reasoning, or of it was just wishful thinking, but I think the point was clear that Microsoft was stacking their chips against net-based services, insisting that locally-run software was going to be the way of the future.

    Now they are investing in what Google has already been doing and doing well for years, following their trend of copying other business' models instead of innovating on their own. I'm sure this will work out well for them.

  9. Re:I am from India. by oldhack · · Score: 4, Funny

    MS should set that up in Dharamsala, up in the cloudy mountains. I can just imagine the synergy with Tibetan monks humming away.

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  10. Cloud Computing is perfectly secure. by Anonymous Coward · · Score: 3, Funny

    Wait a minute. I'm a manager, and I've been reading a lot of case studies and watching a lot of webcasts about The Cloud. Based on all of this glorious marketing literature, I, as a manager, have absolutely no reason to doubt the safety of any data put in The Cloud.

    The case studies all use words like "secure", "MD5", "RSS feeds" and "encryption" to describe the security of The Cloud. I don't know about you, but that sounds damn secure to me! Some Clouds even use SSL and HTTP. That's rock solid in my book.

    And don't forget that you have to use Web Services to access The Cloud. Nothing is more secure than SOA and Web Services, with the exception of perhaps SaaS. But I think that Cloud Services 2.0 will combine the tiers into an MVC-compliant stack that uses SaaS to increase the security and partitioning of the data.

    My main concern isn't with the security of The Cloud, but rather with getting my Indian team to learn all about it so we can deploy some first-generation The Cloud applications and Web Services to provide the ultimate platform upon which we can layer our business intelligence and reporting, because there are still a few verticals that we need to leverage before we can move to The Cloud 2.0.

  11. I know it is an unpopular opinion but by Raconteur · · Score: 4, Interesting

    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.

  12. $9 Billion? by Millennium · · Score: 3, Insightful

    Microsoft gave $9 Billion to its R&D department?

    Geez; how'd Steve Jobs convince them to donate that much?