Microsoft's software-plus-services disinformation

Microsoft's software-plus-services disinformation

Summary: Microsoft's FUD around software-plus-services is deliberately muddling up two very different things. It lamely cites Google Gears as a justification for installing Office locally, while behind the scenes it's building the next generation of Office servers to run best in the cloud.


My blood boils every time I hear some Microsoft executive crowing about its so-called 'software-plus-services' model. Microsoft's FUD around S+S is deliberately muddling up two very different things. I fumed when I read this comment in an interview last week by Chris Capossella, senior VP of the group that oversees Office, in which he singles out Google's use of Gears technology to enable offline use of its cloud-based applications:

"I thought the whole point [of the software-as-a-service model] was that I didn't have to download anything," Capossella said. "These guys are totally adopting the software-plus-services approach, but they just aren't using the term. And no one's calling them on it."

This is so lame as a line of attack, and yet it's a favorite at Microsoft, as if Google's decision to take advantage of the compute power that's there on the client justifies in one fell swoop not only Microsoft's entire legacy stack of desktop-bound applications and operating software but also the whole gamut of its extended server family. Extending cloud-based services so that they'll run locally in a few limited use cases is in no way equivalent to Microsoft's policy of encouraging its customers to keep buying and upgrading their installed base of server and desktop software in return for assurances that the vendor has a strategy of offering the "choice" of cloud-based equivalents.

My opposition to the 'software-plus-services' mantra is that it puts the cart before the horse. If you're going to do cloud computing right, you have to start with services. I wouldn't be debating this with Microsoft if the company were arguing for 'services-plus-software' — or even 'software-powered services', which is a phrase I was using to describe SaaS back in 2004. What's important is to shift from a software product mentality to a software-enabled services mindset.

For all the bluster of its senior VPs, it turns out that the next generation of Microsoft's flagship server products is being designed in exactly the way I've been arguing for. In a little noticed interview with CNET's Ina Fried last month, corporate VP Rajesh Jha revealed that Exchange 2010 (formerly known as Exchange 14) — along with many of its Office 2010 stablemates — is being proven as a service first before later on being turned into a server product:

"The last time around, though, Microsoft built the server software first and then delivered the service. In developing Exchange 14 — and indeed many components of the next Office — Microsoft has flipped the switch and is instead developing the service first and doing the server work second."

Behind the scenes, then, Microsoft has begun the technology re-architecture that will transform it into a cloud services company. I'm sure that, once it has completed the transformation, its users will still be able to use some of that functionality when disconnected (or semi-connected, as Gmail's 'flaky mode' now enables), and it will still sell server software to customers who choose to act as providers of cloud services in their own right. But the central tenet of the 'software-plus-services' mantra — that the average enterprise wants to be able to move its application infrastructure into the cloud and back out again at will — will have long since been disproven. For as Microsoft's Online Services division is discovering, the traffic is all one-way. Once customers have moved to the cloud, they never want to leave.

Topics: Software, CXO, Hardware, Microsoft, Servers, IT Employment

Phil Wainewright

About Phil Wainewright

Since 1998, Phil Wainewright has been a thought leader in cloud computing as a blogger, analyst and consultant.

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  • More Scenarios

    I don't really care about the PR spats.... but I do think you gloss over some very real S+S scenarios.

    You claim that to do cloud computing right "you have to start with services". One of the main values of S+S is that it enables customers to START migrating to the cloud in a phased approach. A customer can choose to move portions of users to a specific workload in the cloud and not have to do a big bang migration.

    S+S allows a business to move workloads and segments of user populations to the cloud at its own pace while maintaining an integrated IT infrastructure.

    Whether you would ever move those users or workloads back to on-premises - usually you would not need to move back.

    S+S is all about easing the transition to the cloud. Without a doubt - eventually MS will be mostly cloud services. Whether it's in 5 years or 25.

    • Re: More scenarios

      Some very good points. But my beef is that S+S serves the vendor's interests over customers, because it encourages customers to delay rather than hasten their move to a cloud services infrastructure.

      Picking up on your final point, MS will be toast if it has to move to cloud services in as little as 5 years. S+S is designed to push the transition out as close as possible to 25 years, because then MS has a chance to survive.
      phil wainewright
      • There should be public clouds and lots of private data centers / clouds

        I don't see why on-premises vendors cannot compete with public clouds by dramatically sweetening and simplifying the acquisition and maintenance of data centers. Dell, Cisco, and others seem to be moving in this direction. A company e.g. should be able to go to Dell and apply for financing and acquire data center modules and supporting services, and be able to manage its data center in a very easy fashion. If the company wants to manage its data center from very high or very low levels, it should be able to do so. I believe companies should have the option to go to Dell as their single point of contact, as they manage hardware and software issues with their data center. I think there should be (at least optional) unified financing and leasing options - so that companies won't have to sort through disparate payment arrangements. Arguably, the major reason Americans use private transportation rather than public mass transit systems, is because of financing and leasing options on vehicles. I believe when these options become mainstream for data centers, the distribution of private data centers and public clouds, will resemble the distribution of private transportation and public mass transit systems in the U.S. and other countries.

        As for the software component of software + services, I think MS should use designers and developers to create desktop interfaces to services that dramatically distinguish them from browser interfaces. (This can actually be seen on the MS Surface platform.) I seriously think MS is courting the browser too much to the detriment of its desktop business, because it is making browser based apps appear and function too similar to desktop apps. The more desktop apps and browser apps appear and function similarly, the more Windows gets undermined - and also the more user experience gets held back.
        P. Douglas
  • RE: Microsoft's software-plus-services disinformation

    The real power of Outlook is its ability to be stand alone and connected to the cloud. This is and always will be a business need. Why? Well, you just can't always be fact a large part of the time you aren't depending on where you live and/or travel. Especially on airplanes...
    • That's what gears is for

      For local storage.
  • Do you ever think

    that this cloud stuff may never pan out? Through its last incarnations - utility computing, Grid, N1, rpc, etc., it was always hyped - and never came to fruition. What makes you think that large corporations will hand over control of their data to a vendor? That's the elephant/800 lb gorilla in the cloud "room". I just don't see it happening.
    Roger Ramjet
  • RE: Microsoft's software-plus-services disinformation

    Screw the cloud. one step closer to world government.
  • RE: Microsoft's software-plus-services disinformation

    Phil - you've one overboard... you're reading waaaaay too much into Microsoft's position on S+S.

    No one ever claimed that, as you say: "Google?s decision to take advantage of the compute power that?s there on the client justifies in one fell swoop not only Microsoft?s entire legacy stack of desktop-bound applications and operating software but also the whole gamut of its extended server family"

    As a matter of fact, you're the ONLY person whom I have ever seen try to make such a claim - MSFT execs included.

    The idea of S+S, very simply, is that using local software can be a great complement to cloud computing - as opposed to a SaaS model where the assumption of anything running locally is Taboo.

    Capossella was just pointing out that other companies actually use this model...

    Nothing wrong with it... it's really just simple, common sense. Suprised to see it has you all in a lather.

  • RE: Microsoft's software-plus-services disinformation

    Phil you are absolutely spot on! Let's debunk the rest of the software as a service strategy untill we've got a competitive offering and can work out how to leverage our channel dominance and unlawful bundling monopoly to bring it to market rapidily. We've seen this time and time again - Lotus Notes, Netscape, Novell and on and on.. The web medium is making it interesting though - and Microsoft is going to have a hard time working out when to pull the trigger on the Children (their current client and server cash cow) I mean their revenue from Office will shrivel up once they have a services based competitive offering for a fraction of the cost with flexible contracts - then of course how do we continue to pay our loyal partners who have been our silver bullet all these years?
  • RE: Microsoft's software-plus-services disinformation

    Thesis, antithesis, synthesis. SaaS is not going to replace existing computing models but rather complement them. Any other model ignores decades of computer science history. No new computing model has entirely replaced the prior model. After an intial period of irrational excitement, new models evolve to coexist and integrate with existing models. Any other approach ignores the trillions of dollars in existing investment.
    Ben Pasmore