Microsoft wants you on the cloud -- and it has several tricks to get you there

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Sorting out Microsoft's strategies is a challenge, but one thing seems clear: It wants you on the cloud. Mary Jo Foley reveals some of the clues that point to the company's intentions.

Microsoft's official and unofficial stances regarding the pace at which it expects customers to embrace cloud computing are two different things.

Publicly, Microsoft officials continue to insist that users can move at their own speed. Users can choose to buy and run Microsoft software on-premises. Or they subscribe to and use cloud-hosted versions of Microsoft wares – either directly from Microsoft or through Microsoft hosting partners. They also can opt to go with a hybrid on-premises/cloud approach as they see fit, Microsoft execs say.

But privately (and sometimes not so privately), Microsoft is upping the pressure on customers to move to the cloud. Not only is the company debuting new features and functionality first in the cloud editions of its products, but it's also limiting availability of some features exclusively to the cloud versions of its wares.

In the past, the "Online" versions of SharePoint, Exchange, and Lync included a subset of the features that were in the on-premises versions of those servers. Microsoft execs committed to adding as many of the missing features back into the cloud versions as soon as it was feasible.

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Now the reverse is happening. I've seen more than a few IT folks worried that Microsoft isn't going to provide some of the coming new features that are going to be part of the next major update for Office 365 to on-premises users of SharePoint and Exchange.

To some customers, it matters little that Microsoft cloud offerings — like CRM Online or Exchange Online — are ahead of their on-premises complements in terms of features. A bigger priority for many businesses is having time to test and train individual users on new releases before rolling them out en masse.

Microsoft officials told attendees of the company's SharePoint 2014 conference in March that Microsoft won't be releasing on-premises versions of Exchange and SharePoint Server "Next" until sometime in calendar 2015. And officials said that those on-premises versions will include only a subset of the new "Office Graph" technologies Microsoft also previewed during that conference. The reasoning: Certain technologies, like enterprise social networking, require the cloud in order to work the way they're architected.

Balancing the cadence scales: Getting rollouts just right

There's another factor to consider when attempting to navigate the Microsoft on-premises/cloud waters:  Microsoft's new, faster rollout cadence for both its software and services.

In the not-so-distant past, Microsoft could be counted on to deliver new versions of Windows and Office every two to three years. But over the past couple of years, Microsoft management has made a concerted effort to speed up not just the cloud, but also the on-premises, development trains.

Microsoft took close to three years to plan, develop, and deliver Windows 7. Ditto with Windows 8. But the team managed to plan, build, and release the next version, Windows 8.1, in about one year. And Windows 8.1 Update 1 — which, like 8.1 is not a service pack, as it includes some new features — is coming to market just about six months after 8.1 became broadly available. Windows Server is following a similar rapid cadence. Office (client and servers) hasn't yet managed to get on the fast track, but it's expected to do so this year.

For most consumers, faster equals better. But for others, a new version of Windows Server, even if one with only a few, incremental new features, is not a plus. Some businesses have found that a new release delivered every two to three years is too fast for them to test, deploy, and integrate. That's how IT policies such as "We only deploy every other Windows Server release" come to be.

Microsoft's guidance in these cases has been that users who want to be on the newest releases should think about going cloud, while those who can't digest products that quickly should stick with on-premises versions of its products. But recently, it seemed at least some in Redmond were rethinking that guidance.

Terry Myerson, the head of Microsoft's unified operating system division, planted the seed that Microsoft might be reconsidering yet again the pace at which it delivers new versions of its products. Instead of releasing its cloud wares ahead of its on-premises/locally installed ones, Microsoft could opt to release its consumer products at a faster pace than its enterprise ones, Myerson said. He didn't say that Microsoft is definitely planning to follow this route, but by the time Windows 9 arrives in the spring of 2015 (if sources are right), Microsoft could potentially end up pursuing that path.

The new, new guidance

If it's not apparent by now, Microsoft's guidance on when users should go to the cloud vs. when they should go with on-prem software isn't clear-cut. The one trend that is fairly transparent is that Microsoft is accelerating its cloud push and counting on sweeping up not just consumers, but enterprise customers with it.

But Microsoft is not going to stop building on-premises software any time soon. The company still gets the majority of its revenues from enterprise software sales, in spite of its new devices and services focus. New CEO Satya Nadella has a strong enterprise heritage and has gone back to emphasizing the importance of software (not just services and hardware) to Microsoft and its customers. 

Microsoft execs have said on the record that there are new versions of Exchange Server, SharePoint Server, and Lync Server in the pipeline.  SQL Server 2014, which Microsoft released to manufacturing in mid-March 2014, will no doubt be followed up with another on-premises release in the next year or two. Microsoft also is on tap to deliver a new version of Windows Server, System Center, and Windows client in calendar 2015. It's almost certain that more waves of releases of all these products will be delivered throughout the next decade.

Still, Microsoft is definitely increasing the use of both the carrot and the stick to try to move more of its users more quickly to the cloud. "The cloud" in this case, doesn't mean only Microsoft software hosted in Microsoft's and/or its partners' data centers. It also means cloud as in subscription model.

Look at the way Microsoft rolled out Office Mobile for iPhone and Android phones. Microsoft requires users to have an Office 365 subscription to use the freely downloadable client apps. Ditto with Office 365 Personal and Office 365 Home – two Office 365 subscription programs that enable users to download and use Office client apps on their PCs and devices for as many months/years as they pay their subscriptions. Many Microsoft watchers are expecting the company to create similar subscription plans to cover Windows client and possibly other on-premises server products in the not-too-distant future.

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