In a keynote speech at the company’s Worldwide Partner Conference in Denver this month Ballmer laid out Microsoft’s software-plus-services strategy, saying partners and end-users need to prepare for a world where traditional software and web-based services combine.
The way information is managed and handled is changing and with it will come a transformation to the core model of the user interface and computation, Ballmer says.
“The fundamental transformation to software-plus-service that’s happening in the model of computation and user interface is upon us, and it will affect us all. To fully lead and realise the vision for this new model, will require that we all continue to build new business capability, as well as new technology capabilities.”
Only a model that brings together the best of the desktop world, rich user interfaces, offline and online access and personal integration – the ability to integrate, store, manage and link content in unique and arbitrary ways – will be able to supersede current computing models, says Ballmer.
Other vendors talk of software-as-a-service or Web 2.0 applications, but these are not “exactly right”, says Ballmer.
Although people like the “click and run” aspect of the web, they are not ready to give up the benefits of desktop computing or the control, manageability and security of enterprise computing, he says.
“It was truly nonsense to think that the world is going to give up the benefits of these rich clients – the controls, the speed, the offline characteristics. As we talk about things like voice recognition, handwriting, natural language recognition, video processing, there’s going to be more demand for rich clients, not less.”
The key to the software-plus-services model is to make the rich client as click-to-run, as a web application, says Ballmer.
To show some of Microsoft’s progress toward the software-plus-services model, Ballmer demonstrated Silverlight, the company’s new platform for rich web-based applications, saying it is the start of the transformation of the user interface model.
The new model meanwhile will see back-end computation done on customer premises and also on large scaled services, as opposed to individually provisioned and managed servers in hosting centres, says Ballmer.
But Ballmer warned partners the transition to a new computing model will be gradual. “This is a long-term migration. To bring the best of the web and the best of the enterprise together will take time. Our current model of computing will evolve and it will evolve generally in this direction.”
In the meantime software licensing will continue to grow, along with online advertising and subscriptions. Most importantly for partners, so will the amount of value delivered from providing customisation services, application development services, management services and hosting services.
“We see a big opportunity for our partners as we make this transformation to Windows and Windows Live and the new software-plus-service user interface and computing model.”
Opportunities exist today for partners to customise and resell Office Live, Exchange Hosted Services and Dynamics Live.
In the short-term, there is also plenty of opportunity for partners to build their own services around upcoming products such as Windows Server 2008, Visual Studio 2008 and SQL Server 2008, using rich client technologies like Silverlight, says Ballmer.
To fulfil its role in driving the platform for this new model, Microsoft is building out a new services platform ‘in the cloud’, says Ballmer.
“This is an ambitions project for us, but it’s very important.”