Cloud computing continues to be big business. Cloud-based offerings pulled in $46.4 billion in 2008, a number that was projected to increase to $56.3 billion in 2009 and $150.1 billion by 2013. Thus the technology is slated to have a 21% CAGR over the near horizon.
Steve Ballmer is busy directing the resources of Microsoft to build its future in the cloud. Quoting Ballmer:
“The cloud fuels Microsoft, and Microsoft fuels the cloud. About 70 percent of the folks that work for us today are either doing something exclusively for the cloud or is inspired to serve the five dimensions that I talked about today. A year from now, that will be 90 percent.”
Ballmer is buoyant with the fresh success of Office 2010. Microsoft Office 2010, due in June, will is optimized for the cloud. Ballmer said. “We’re having some success. For the parts of our Office product that are already in the cloud, about 90 percent of the customers – at least institutions that we work with – choose us.”
Microsoft is moving toward storing data in the cloud as much, or more, than on a user’s hard drive – whether it be the movies that users can download via Xbox Live or TellMe, a voice-driven service that will handle about 10 billion spoken commands this year. The Windows 7.0 will also have the plug inns that will enable it to connect to the cloud. Windows Azure, SQL Azure, Microsoft SharePoint, and Exchange – lie on top of data services and use the smartphones and enterprise computing devices as input. Microsoft is also launching an ad campaign focused on its commercial and government businesses, which stand to benefit from cloud services.
So, then that is about Microsoft’s effort to move and centralize its business around cloud computing. Reproduced below is Steve Ballmer’s memo to the Microsoft group employees which places emphasis on cloud computing as the future for Microsoft. For once Mr.Ballmer you are so right and spot on.
The Body copy of the memo:
Today, I spoke to a group of students and faculty at the University of Washington to discuss how cloud computing will change the way people and businesses use technology.
My goal was to challenge people to look at the cloud more broadly and understand the multidimensional nature of the cloud transformation happening today. Other companies have defined the cloud in a narrow, one-dimensional way. Although these companies provide some interesting components, Microsoft is uniquely delivering on a wide range of cloud capabilities that bring increasingly more value to our customers.
In my speech, I outlined the five dimensions that define the way people use and realize value in the cloud:
• The cloud creates opportunities and responsibilities
• The cloud learns and helps you learn, decide and take action
• The cloud enhances your social and professional interactions
• The cloud wants smarter devices
• The cloud drives server advances that drive the cloud
This view fuels our investments across the entire company, from datacenters to cloud platform technologies to cloud-based development tools and applications. Today, nearly every one of our products has, or is developing, features or services that support the cloud. As I said today, when it comes to the cloud, we are all in. We are all in across every product line we have and across every dimension of the cloud.
Of course, this is not news to any of you. We have been making huge investments in the cloud for the past decade. Nearly five years ago, Ray’s “Services Disruption” memo provided the outline for what we needed to do as a company, and with the delivery of Windows Azure at the recent PDC, we have made huge strides in making this vision real.
To keep our momentum, it is critical that every Microsoft employee works to deliver the full benefits of the cloud to our customers.
As a part of this, I request that you do the following:
• Watch the speech on demand here
• Learn more about our cloud offerings and how they relate to our overarching software plus services strategy here
• Review your commitments to ensure you are landing our vision with customers and partners.
Of course, there is more work to do. We have strong competitors. We need to be (and are) willing to change our business models to take advantage of the cloud. We must move at “cloud speed,” especially in our consumer offerings. And we need to be crystal clear about the value we provide to all our customers.
To drive our message home even further, today you will see an ad campaign in the U.S. focused on our commercial and government businesses, a new website with consolidated content and case studies, and ongoing emphasis on the cloud from me and other members of the SLT in our upcoming speeches and presentations.
We have an enormous opportunity in front of us. We have great products and services in the market today and a range
of new ones on their way.
All of our products make the cloud better, and the cloud makes our products better.