Microsoft prefers cloud over OpenXML

Microsoft will base support for the final OpenXML standard on customer demand. The market leader at this point prefers to move its clients to cloud computing, said Stephen Elop, president of Microsoft's Business Division. He considers cloud offerings a good extension of the desktop software that Microsoft currently sells.

"OpenXML can be implemented for a range of applications," Elop told Webwereld in an interview. "Some are characterized as strict and some are more broad in scope. We do our best to expand the standard in collaboration with the standards bodies and implement it ourselves. We have taken major steps, but in some areas more work needs to be done."

Microsoft recently faced criticism because the new Office 2010 productivity suite didn't implement the strict ISO-approved version of OpenXML but a version that had been rejected.

Elop dismissed the criticism, but declined to explain the considerations that Microsoft took. He argued that customers are happy with the current state of affairs and that Microsoft will take additional steps based on customer feedback.

"We see a great trend [with] the current growth and are in a position to take a leadership role to help customers move into the cloud," Elop said. He thinks that his company has a leading role and dismisses any threats from Google.

"They have interesting soundbites, but we are the ones who attract all the customers," he argued, pointing to the 40 million business users that currently purchase cloud services from Microsoft, such as Live Meeting, Exchange Online or Sharepoint Online. Microsoft dwarfs Google when it comes to cloud customer counts, he said. "In terms of actual customer wins, they are clearly taking a Microsoft decision."

Microsoft is winning because the company's offerings have a lower total cost of ownership than competing offerings, and offer better desktop integration, he said.

Microsoft is betting that its combination of desktop and cloud offerings will provide a winning combination. An individual could for instance read a cloud-based document and switch to a desktop application to edit. Elop expects that this would provide a better user experience.

In other cases, desktop applications can't be replaced by cloud offerings. Elop points at new video editing capabilities in Office 2010, which require so many computing resources that a desktop application is required.

Cloud services do have an advantage over desktop applications when it comes to their price. Many users like the Microsoft software, but are reluctant to pay for them. Elop is betting that this will create a new market for the company by offering premium paid products as an upgrade to basic free services. "We see that as a growth opportunity," Elop said.

The Microsoft executive meanwhile cautioned that a complete migration to cloud computing is a far way out, and that many hurdles have yet to be cleared. Concerns over privacy and security track records, for instance, could hold back cloud adoption. Rather than putting corporate data in a public cloud, firms could maintain control by building a private cloud instead. Microsoft has built private clouds for some large customers, including the U.S. government.

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