RealTime IT News

A 'Premium' Promise Out of Redmond

REDMOND, WASH. -- Microsoft is bullish on its stock -- and it wishes the financial community shared its optimism.

"You might think Windows and Office and Server are slow-growth businesses," Microsoft CEO Steve Ballmer told analysts at the company's annual Financial Analysts Meeting. "We think they're poised for robust growth."

Ballmer promised analysts that Microsoft wouldn't be weighed down by its "anchor businesses": Windows, Office and servers.

Microsoft is faced with a saturated PC market in developed countries and rampant piracy in developing markets. One way it plans to combat sinking sales of its client software is by offering higher-priced versions for enterprise users.

Ballmer said Microsoft will introduce a professional version of Windows Vista, called Windows Enterprise Edition. There also will be an Office Premium and a higher-end version of Office Server that will have a premium client access license.

"We'll have new SKUs, premium SKUs and higher prices," Ballmer said.

While enterprises are increasingly looking toward software on demand to lower licensing and management costs, Microsoft continues to move toward "integrated solutions" in which devices, applications and servers are deeply connected.

"In literally every area, there is some big, significant competitor," Ballmer told the analysts. "But there's nobody who's trying to compete and innovate across the entire expanse" of the sectors Microsoft has moved into."

He emphasized that the company's approach is not scattershot, despite the variety of initiatives, from Web search and Internet advertising to mobile phone software to enterprise collaboration tools.

"We see synergies between the different scenarios. They're not a set of unconnected experiences," he said.

Microsoft intends to grow its share of the server market, as well. Ballmer identified server software for hosting companies and high-performance clusters as two areas where it could grab share from Linux by offering better development tools and management software.

While it continues to push for growth in its core businesses, Ballmer said the company will keep pushing new products into the pipeline. He said Microsoft had its own version of Moore's Law, in which product releases doubled every 18 months.

"In the next year, our product pipeline will double that of the past three years," he said.

New products in the works include Windows Mobile 5.0, Office 12, Microsoft TV IPTV Edition, Solomon and Xbox 360.