Recently, Information Week published a condensed transcript of a June 9 interview with Steve Ballmer, a follow-on to an interview the year before. The interview is about Microsoft’s view of how it’s doing overall, but especially how its cloud strategies are coming along.
It’s clear that Microsoft has made a number of commitments to the cloud environment and executed on many of them. What’s less clear is what Microsoft, e.g., Ballmer, is willing to say about just how well Microsoft is doing in the cloud and whether their cloud status in June 2011 is living up to their expectations. Ballmer makes the expected swipes at private clouds (are they really clouds or just data center virtualization – a fair question) and notes that moving enterprise computing to the cloud, beyond moving some office and collaboration applications for information workers, may occur more slowly than anyone had expected. (We’d note a fair number of exceptions, we think, to that statement, especially in large enterprises and governments.)
But the statement that got my attention – and set me to sitting down and writing this blog post – was Ballmer’s statement that “It's only a good day when a lot of Windows PCs sell.”
I’m having some difficulty in integrating that statement with what I can observe going on in the cloud (and Microsoft’s cloud activities).
- Cloud computing doesn’t require a PC (Windows or otherwise) at the other end. While it is true that most of us are accessing the cloud today (especially when we’re at the office) from a desktop or laptop PC and most of those PC's run Windows, things are changing. If I’m going to the cloud via a web browser (Microsoft’s or another), the operating system is largely irrelevant to what I can do in the cloud. If I’m using a tablet or a SmartPhone (and increasingly that will be the devices of choice), a simple assessment of the operating systems those devices employ makes it clear that I am unlikely to be using Windows.
- Steven J. Vaughan Nichols has recently said that unless Windows 8 establishes itself on the tablet and SmartPhone platforms we may be looking at the end of Windows’ dominance in the marketplace. (He goes on to note that since Linux underlies a lot of what goes on in the Android, Chrome, and other non-Windows device platforms, Linux is the winner here but that is a matter of definitions. Given that Android employs Java, perhaps this is not entirely a Linux environment? And, in any event, the unseen Linux on these devices is barely known to most users.)
It seems to me this must mean that Microsoft is sticking by earlier statements that the right way to access and use the cloud is in combination with a PC running Windows. Of course, that works just fine, but when you count the growth rates of tablets and SmartPhones versus the growth rates of any kind of PC (desktop, laptop, or netbook), especially from a global rather than a North American perspective, it seems likely that in a few years (absent a stunning Windows 8 success on the SmartPhone and tablet platforms) we will be using small, lightweight devices with powerful tools, but little need to store data locally.
I’m hoping that at the office announcement of Office 365 later this month, Microsoft will make it clearer just how we should slice and dice its commitment to the cloud versus its ongoing commitment to the Windows operating system. (Both continue on, of course; it’s a matter of resource allocation and company positioning.)
Of course, being an analyst, I’d like some numbers. As Ballmer stated in the Information Week interview (which is definitely worth reading) it’s hard for a large, public company like Microsoft to give out those kinds of numbers (because the Street takes careful notice and then punishes companies who are less than accurate predicting the future). But just some indications of direction will be very useful in assessing Microsoft as an important cloud vendor in an increasingly crowded field.
In the last two years we’ve seen enterprise vendors like Oracle and HP join IBM in stating their strong cloud intentions and starting to provide substantial cloud offerings as well as dozens (probably hundreds) of carriers and smaller regional players in every part of the world. It’s going to be a very competitive market.