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Special Report: Microsoft Goes Soft in Move to Internet Services - 02 Nov 2005

As promised, Microsoft revealed its latest initiative yesterday, a wide-ranging series of Internet-based services that promotes existing Microsoft brands rather than trying to create all-new products. In that sense, the products and services that Microsoft announced are evolutionary rather than revolutionary, and reactive rather than proactive. Frankly, it's a curious move for a company that prides itself in making "bet the company" moves every five years or so.

So what did Microsoft announce, exactly? The company will deliver a series of Internet-based services, aimed at both consumers and small business users, under the Windows Live and Office Live brands. The services are largely designed to enhance Microsoft's existing Windows and Office products and, in some cases, to interact with each other.

The Windows Live services are aimed at individuals and include the following:

-, a Web portal (available now in beta form) that will aggregate content from the other Windows Live services and other online services. Designed with technologies such as RSS (Real Simple Syndication) and AJAX (Asynchronous JavaScript and XML), will eventually offer a rich, constantly-updated user interface.

- Windows Live Mail, formerly codenamed Kahuna, and originally foreseen as a successor to Hotmail, is a new Web email service (currently in beta) that will offer an Outlook-like user interface. Existing Hotmail users will be able to switch to Windows Live Mail when the service becomes publicly available. See my preview on the SuperSite for Windows for more information:

- Windows Live Messenger, a new instant messaging client (IM) that will replace MSN Messenger. Like its predecessor, Windows Live Messenger will be free, but it will support new functionality such as document and folder sharing, PC-to-PC phone calls.

- Windows Live Safety Center (, a free Web portal for scanning and removing PC-based viruses. Unlike service-type offerings (see below), Windows Live Safety Center will work on-demand only, so you'll need to manually visit the site to get help. Windows Live Safety Center is available now.

- Windows OneCare Live (formerly MSN OneCare) is a previously-announced subscription service for individuals that provides a two-way firewall, antivirus and antispyware solutions, data backup, and other features.

- Windows Live Favorites, a Web-based storage area for your Internet Explorer (IE) favorites.

- Windows Live Mobile Search, an MSN Search-like service for Windows Mobile-powered smart phones that lets you search the Web over-the-air, so you can find restaurants, other locations, and other information on the go.

Many of the Windows Live services will be free and advertiser supported, while other services will be subscription-based.

What's interesting, of course, is that most of these products were originally developed by MSN, which not coincidentally was recently pulled into the Windows division at Microsoft. The fact that the MSN brand is being dropped from these products and services is, of course, bad news for MSN fans. I had feared that MSN would be subsumed by the Windows group, and this is, in many ways, obviously what's happening. You can find out more about the Windows Live offerings, and sign up for beta versions of some services, at the Windows Live Ideas Web site.

The Office Live services are aimed at small businesses with fewer than 10 employees and include a free offering and several subscription-based offerings. Office Live Basics will be a service that provides small businesses with an online presence starter kit of sorts that includes a domain name, a Web site with 30 MB of online storage, and five Web email accounts. Office Live Basics will be free, but will be advertising supported. Microsoft will also offer several other Office Live services, beginning in 2006, which will help businesses "automate daily business tasks such as project management, sales and collateral management, customer management, expense reports, time and billing management, and secure internal and external collaboration." These services are all built on the Windows SharePoint Services platform and can be customized by Microsoft's partners.

In sharp contrast to the friendly and open Windows Live services, the Office Live services are "invitation-only" and will be available in beta form starting in early 2006. The company is offering a sign-up form for participating in the beta on its Web site, however. Be deferential. I'm told genuflecting regularly toward Redmond helps.

It's hard to know what to make of all this. Few of these services are startling or original, and all of them seem to lean a bit heavily on the company's core products. In many ways, Microsoft's response to the threat of Google, Yahoo!, and other online entities is somewhat tepid. As with Netscape a decade earlier, Microsoft will simply leverage its dominant Windows and Office products to compete in markets that were innovated by others. In that instance, of course, Microsoft found itself in legal hot water that continues to this day. It remains to be seen how various regulatory bodies--let alone customers--around the world will view these new services.

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