We analyze the major announcements made at Microsoft's MIX08 conference. Web designers and developers can use this research to understand Microsoft's latest technologies, products and strategies.

• Microsoft's advertising strategy was prevalent throughout the event. A new business model is emerging at Microsoft that will enable an ecosystem around advertising that also will leverage its traditional developer strengths.
• Microsoft is continuing on its path toward more openness, including a new focus on standards compliance.
• Its new products show Microsoft understands the development and design community, and their evolving roles in enterprise computing and beyond.

• Be open-minded when reviewing Microsoft announcements and offerings. Microsoft is a very different company than it was just a few years ago.
• Leverage Microsoft as an asset as it pursues consumer and advertising strategies. Its presence in consumer markets and enterprises means that it can be helpful to your consumerization strategies.
• Focus more on user experience issues.

Microsoft showed a more open and consumer-focused strategy at the MIX08 event than it has in previous years. However, the company will be challenged to execute consistently on this strategy. The Web is driving Microsoft to design and deliver products differently, and its responses, thus far, have been inconsistent. Microsoft is a different company now than it was a few years ago, and thus enterprises should keep an open mind when evaluating its offerings. However, realize that Microsoft has various multibillion-dollar businesses — and not all interests will align.

At the MIX08 conference for Web designers and developers, held in Las Vegas, 5 to 7 March 2008, Microsoft showed some continued evolution in its Web strategy and announced beta releases of Internet Explorer 8 (IE8), Silverlight 2 (and Silverlight for Mobile) and Expression Studio 2. There was also a preview of SQL Server Data Services.

At MIX08, Gartner identified some significant strategic trends, many of which were presented in the keynote by Ray Ozzie, Microsoft's chief software architect.

The advertising theme was consistent with recent investments. A new business model is emerging at Microsoft, enabling an ecosystem around advertising that also leverages its traditional developer strengths. As Ozzie put it, Microsoft is "deeply embracing advertising as the economic engine for the Web."

Many of the demonstrations used advertising templates and related tools to create banners and overlay advertisements, as well as to track advertisements (such as impressions and user engagement with advertisements) to demonstrate the relative ease of development of these types of applications. This is significantly different from traditional development tools that traditional enterprise vendors offer, and is in line with the drive to bring designers and developers closer.

DoubleClick, which is part of Google and a major competitor, demonstrated how it is using many of the Silverlight elements. The competition with DoubleClick likely will not be in building the ads but will be in tracking and reporting advertisements. (Building ads ultimately will be tied more to Silverlight and the Microsoft developer and designer tools.)

The tendency toward openness has continued, and has focused on the Web, following the Microsoft interoperability announcement in February 2008 and other changes during the past few years (see "Microsoft Declares Interfaces Accessible; Royalties May Apply"). These moves show that new thinking has come to Microsoft leaders at the highest levels, as new executives replace the "old guard." This openness doesn't pervade the whole company, however. Gartner will be watching to see if this openness is sustained and accelerated during the next 18 months.

The major example of openness was a focus on standards compliance. Microsoft released, in beta, the next version of its browser, IE8, on the first day of the conference. The major change (from the perspective of enterprise administrators) between IE8 and IE7 is that IE8 will default to the standards mode. Most Web developers favor this change, even though this will result in pages that don't display correctly for some sites. Web applications that traditional enterprise developers have built tend to be tested only on IE, as a result of attempts to standardize internally. This often also is due to a lack of awareness and appreciation for Web standards among enterprise developers. It is significant that Microsoft is willing to take this risk and favor the standards-oriented community over traditional enterprise developers. This is an intentionally symbolic gesture. Microsoft, of course, will support enterprise administrators in various ways to mitigate potential disruption.

The new browser is not as interesting as its implications. In the past, Microsoft would offer a more powerful browser to try to garner market share. This led to divergent approaches to Web development, which complicated the process and retarded progress. With IE8, Microsoft is embracing Cascading Style Sheets Level 2.1 (and other modern standards, as exemplified in the Acid2 test), while still pursuing a functionally competitive product (Activities and Web Slices) by putting new capabilities into an open environment. This is a complete change in attitude.

The target community gave IE8 beta a favorable reception at MIX08 and elsewhere. Web designers and developers, many of whom have a predisposition to be skeptical or critical of any Microsoft initiative, have applauded the standards commitment and the consumer-oriented features of IE8. The challenge for Microsoft will be to track and respond to concerns from enterprise customers. Although Microsoft has opted for standards first, it has made efforts to make it easier for enterprises to use IE8, specifically through multiple modes of operation, administrative capabilities, and a range of ways to deal with content at the directory and individual page level.

Two years ago, Microsoft stated that it cares about the design and Web development community. The products announced at MIX08 show that it understands this audience and is prepared to offer them competitive solutions. This, plus Adobe's AIR announcements a week before the MIX conference, further illustrates the intensity of the battle between Microsoft and its prime rival in Web development, Adobe.

The Web designer audience will become as important, if not more important, than the traditional software developer to whom Microsoft has appealed. Two demonstrations at MIX08 bore this out:

• NBC television's demonstration of its 2008 Beijing Olympics site represented a massive change in the way that the NBC audience can view a sporting event. It borders on a significant business model innovation.
• Cirque du Soleil's demonstration was basically just a business application, but it was unlike any business application most conference attendees had. It offered a fresh and engaging user experience, and was clearly designed in a totally different manner than traditional business applications.

Web designers will no longer just be creating innovative consumer-facing Web sites. They’re going to be leading the redesign of the computing experience in the enterprise. Microsoft has always understood the importance of the development community, but it seems that Adobe was the only other vendor to understand the long-term importance of this audience.

A major differentiator between Microsoft’s product portfolio and Adobe’s is the notion of supporting the designer-to-developer workflow through a common underlying technology foundation — in Microsoft’s case, Extensible Application Markup Language (XAML) is the common data format. Microsoft has incorporated XAML into the architecture of its product line, and supported it in the Expression tools for designers and the Visual Studio line for developers. Although Gartner considers this designer/developer synergy to be an important issue, thus far that message has not resonated in the market. Designers and developers seem to be content to live on separate islands and work independently. Also, Adobe has started implementing similar capability into its product line, although it is still behind Microsoft in this one area. Microsoft has a window of opportunity that is closing, but remains open in terms of using designer-to-developer workflow as a differentiator.

A challenge for Microsoft is that the most compelling work in terms of Web design and user experience design is on the consumer Web, and most of this is on a platform other than .NET. The primary competitive dynamic will be that Adobe is reaching out from its stronghold of designers in the consumer Web toward developers in the enterprise sector, while Microsoft is expanding from its developer base toward designers. Both vendors have made progress in these opposing trajectories, and a direct collision is under way.

A preview of SQL Server Data Services provided a glimpse into the future of Microsoft's cloud platform. SQL Server Data Services is Microsoft's entry into the cloud-based storage and data services market. It will compete with Amazon SimpleDB.

Although it is ostensibly "built on" an SQL Server, the cloud-based service does not provide the full set of services or interface mechanisms that a SQL database user expects. Rather, SQL Server Data Services is based on a subset of SQL Server functionality. The SQL Server engine has been adapted to work on it. Microsoft will use the beta testing process during the next year to determine what the features will be, and expects to release a full version during the first half of 2009.

A database in the cloud means:

• Key changes were made to work in large clusters and run on commodity machines with basic functionality (that is, no redundant array of independent disks). This is different from the design for SQL Server, which was designed to run on high-end hardware.
• Replication architecture was changed to copy information automatically to multiple locations for redundancy without sacrificing performance.
• A model was built to deploy and upgrade the SQL Server without running setup code (provisioning, in general, has changes).
• Facilities were made to copy data to multiple locations for redundancy to create an environment that is highly resilient.

This represents an important design shift that we likely will see in other Microsoft products for the global-class cloud infrastructure. To deal with this architecture, changes are not just at the database level. Microsoft is vague about whether this will support all the SQL constructs. Support for all SQL constructs does not seem to be a priority. Amazon SimpleDB and Amazon Simple Storage Service are the most direct competitors to Microsoft, and neither attempts to support SQL.

Microsoft has just started to define who the customer for SQL Server Data Services is and what that customer requires. This cloud-computing project is in the early stages, and there likely will be substantial changes during the next 12 to 18 months. Enterprises should consider it an interesting directional product but should wait until 2009 to look at it seriously.

Also discussed at a high level was a concept called "mesh," a vision for synchronizing information across multiple systems. Although presented as more marketing message than concept at MIX08, mesh is a promising vision of what to expect from Microsoft in the near future.

Microsoft understands that ubiquity is the key. Getting the widest possible audience to adopt Microsoft's approaches is the key to winning. In the past, this meant bundling with Windows for an instant market. In the future of the Web, it means adopting standards, making its application programming interfaces open, and otherwise ensuring that whatever it produces is accessible by the widest possible audience and can integrate with the widest range of applications and products.

Microsoft's main internal challenge with this strategy will be consistency of execution. The Web is driving Microsoft to design and deliver products differently, and its response, thus far, has been inconsistent. Execution needs to be consistent across the company's broad portfolio of offerings, including consumer, online services, Windows and Office, server and tools, and business applications.

Microsoft does not face a single competitor for all its strategies and announcements. Primary competitors are Adobe for Silverlight and Expression, Mozilla's Firefox for Internet Explorer, and Google for advertising and cloud. The competition also could change. An unintended consequence/"worst case scenario" for Microsoft will be if these companies align. If Microsoft weakens Adobe and drives it into the arms of Google and/or Apple, then Microsoft ultimately may face stronger competition.