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Rumor: Microsoft set for vast data-center push

March 02, 2008

I've received a few more hints about the big cloud-computing initiative Microsoft may be about to announce, perhaps during the company's Mix08 conference in Las Vegas this coming week. One of the cornerstones of the strategy, I've heard, will be an aggressive acceleration of the company's investment in its data center network. The construction program will be "totally over the top," said a person briefed on the plan. The first phase of the buildout, said the source, will include the construction of about two dozen data centers around the world, each covering about 500,000 square feet or more. The timing of the construction is unclear.

If accurate, this report would be in line with comments that Microsoft CEO Steve Ballmer made in an interview with the Financial Times a week ago. Echoing predictions already made by representatives of Sun Microsystems, Yahoo, and IBM, among others, Ballmer argued "that a new super-group of tech companies would dominate the cloud computing market, each of them managing what amounts to a giant centralised computer made up of a number of big datacentres. 'Amazon has one. Rumours are Google will have one. We’ve said we’re going to have one,' Mr Ballmer said."

Despite the airiness of the "cloud" buzzword, web-based computing requires a whole lot of bricks and mortar. Microsoft has the resources and, it appears, the will to invest many billions in the physical infrastructure necessary to secure a place among the "super-group" of companies set to dominate the new era of computing.

I've also heard that people may be "stunned" about the extent to which Microsoft will embrace open-source software and interoperability in its plan. We shall see.


About time. I'm just a bit surprised that Bill Gates has decided to retire at this critical point. Now's the time when Microsoft's dominance will be challenged.

Microsoft is doing the right thing. Interesting times ahead. Plenty of innovation is expected and I'm curious how Microsoft will carry out its balancing act between SAAS and the traditional model.

Maybe SMBs start first and we see a gradual shift with large enterprises joining last while Microsoft manages to make the best of both worlds.

Posted by: Aditya Narayan [TypeKey Profile Page] at March 2, 2008 05:19 PM

Hmm, regarding the extent of interoperability, in my post


I wonder whether the collaboration protocols behind any collaborative editing of Office documents will be published under the recent interoperability initiative?

Maybe, Microsoft isn't worried someone might replicate all their features, so third party implementations are to be encouraged (as is presently the case for OpenXML)?

It would be a very good thing if the collaboration protocols were freely implementable.

Posted by: jharrop2 [TypeKey Profile Page] at March 2, 2008 10:16 PM

Back in 2000 I compiled the most comprehensive database of datacenters around the world. My consulting group used the dataset as a analytics tool for major telco clients. Its was also interesting for doing predictive analysis. If a company suddenly buys a lot of rackspace and bandwidth, they are usually up to something.

I was on a boat with a friend a few weeks ago. He had made his millions building out datacenters during the late 90's boom. So many people got that market wrong and it was amazing to watch it implode. There are empty datacenters around Boston that have been vacant for five years. If it's a grid, why are companies building out new facilities when there is so much existing cheap space out there? MS has to spent it's money somewhere and they don't want to be trumped by another Google server warehouse.

Posted by: Dave Evans [TypeKey Profile Page] at March 3, 2008 10:09 AM

"why are companies building out new facilities when there is so much existing cheap space out there?"...might have something to do with the costs of power (which I imagine isn't too cheap around Boston) and labor. Also, never underestimate the power of the Edifice Complex.

Posted by: photoncourier.blogspot.com [TypeKey Profile Page] at March 3, 2008 11:55 AM

>> "why are companies building out new facilities
>> when there is so much existing cheap space out
>> there?"...

It might also have something to do with the fact that Boston subsidized the building of those datacenters, under the misguided notion that they would bring jobs and wealth into the community, only to have them sit empty when the bubble burst and the demand failed to materialize. As we Irish say, "Fool me once, shame on you. Fool me twice, shame on me."

Posted by: Linuxguru1968 [TypeKey Profile Page] at March 4, 2008 01:23 AM

"Fool me once, shame on you. Fool me twice, shame on me."

Here is the Texas version! Alan


Posted by: alan [TypeKey Profile Page] at March 4, 2008 09:13 AM

I think the principle of single point of failure still applies here... except in a much bigger way.

Posted by: John_Champe [TypeKey Profile Page] at March 17, 2008 04:30 AM

I didn't get a chance to watch the MIX08 event. Did they announce the predicted data center investment plan?

Posted by: Jake Kaldenbaugh [TypeKey Profile Page] at March 19, 2008 02:53 PM

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