1. Mark Taylor Director, Developer & Platform Group Microsoft Ltd

3. Global Talent Pools The Internet

4. “SaaS”ServiceDelivery “SOA”ServiceComposition “Web 2.0” ServiceExperience

7. 7.1 million active XBox Live users (Aug 2007) Nearly 70% of all Xbox 360 consoles have an account Users have downloaded over 25 million pieces of content, including game trailers, movies, TV shows, and downloadable arcade titles On average every user has purchased around six Xbox Live Arcade titles

8. Not just online gaming but also: Game updates Purchase new games Windows Live Messenger Live Vision Themes TV and Film XBox Live allows the XBox to become something significantly more and different to previous game consoles A real “ah-hah” moment for Microsoft – and a demonstration of the value of Software + Services XBOX Live - A Software + Services Success Story

9. Google CEO Says Software to Play a Bigger Role “Let me just say it: We want native third-party applications on the iPhone, and we plan to have an SDK in developers' hands in February” - Steve Jobs Apple Reverses on Third-Party iPhone Apps "Ajax and Web 2.0 are great technologies for casual use, but for mission critical you need the capabilities of a desktop app." Greg Gianforte, CEO,RightNow

10. Google – Gears, AppsAdobe – AIR (“Apollo”)Salesforce – Offline EditionEbay – Turbo Lister / Desktop

12. “But Google's offline approach also is a recognition that Microsoft's right in insisting that not all computing will take place in the Internet cloud. Microsoft's been touting a vision of "software plus services" that relies on Internet-connected desktop apps, and more enterprise software-as-a-service companies, such as CRM vendor RightNow, recognize the need for some client software.” "It's unlikely than an organization will strictly choose one path or the other when it comes to SaaS and software services that are built in- house. Every organization will likely continue to have a mix of existing applications, SaaS subscriptions, and now through SOA, a collection of reusable components, Web services and business processes," said Sandy Carter, vice president of SOA and WebSphere strategy at IBM

13. Streaming Services Platform

14. Consistent, seamless experiences across multiple PCs and devices Choice of on-premise, partner- hosted or Microsoft-hosted delivery Federation between enterprises and cloud services Composition of multiple applications and services Enable multiple business models

15. Multi-headed Client On-Premise or Hosted Attached Services

16. Law Enforcement FireRescue First Responder On-Premise or Hosted Multi-headed Client

18. Personal Services: Live Windows Live, Office Live Workspaces, Popfly MSN, Live Search, Virtual Earth Business Services: Online Exchange Hosted Services Exchange, SharePoint, Office Communications Office Live Small Business, Dynamics Live CRM, Titan Developer Services Windows Live Cloud Infrastructure Services Silverlight Streaming, BizTalk Services … Service Enablers Web sites: Windows Server, SQL Server, Visual Studio, AdCenter Click to run client : ActiveX, AJAX, Silverlight,.NET, Win32 Softgrid

19. Services

20. The Future of Business Computing Revitalisation of IT Focus on business success Employee productivity and impact Customer experience The Future of Personal Computing From personal computer to personal computing Across multiple PCs and devices Blurring of digital workstyle and lifestyle Individual in control of their digital world

21. We are very serious about software, services and Software + Services Microsoft platform evolving to enable Software + Services Service delivery Service orientation Service experience Service economics Industry is embracing this model

23. ©2006 Microsoft Corporation. All rights reserved. Microsoft, Windows, Windows Vista and other product names are or may be registered trademarks and/or trademarks in the U.S. and/or other countries. The information herein is for informational purposes only and represents the current view of Microsoft Corporation as of the date of this presentation. Because Microsoft must respond to changing market conditions, it should not be interpreted to be a commitment on the part of Microsoft, and Microsoft cannot guarantee the accuracy of any information provided after the date of this presentation. MICROSOFT MAKES NO WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, AS TO THE INFORMATION IN THIS PRESENTATION.

24. Press/Quotes

25. "We'll look back on this announcement and say that's when Microsoft really started to provide software plus services," said John Rymer, senior analyst at Forrester Research. "It's the first step and there is so much more to come.“ - Reuters Some companies like Salesforce see services eventually replacing traditional software, but Microsoft is pushing a " software plus services " strategy with the promise that this option combines the best of both worlds. – Reuters Microsoft describes its strategy as “ software plus services.” Increasingly, industry analysts say, software will be a blend of online and offline abilities. Google, for example, introduced programming tools called Google Gears in May to help people use its Web-based applications like e-mail and word processing when a user is, say, on an airplane. - NYT Microsoft on Monday is expected to announce a free product called Office Live Workspaces for accessing and sharing documents online, which will enter testing "shortly," perhaps later this year. The software is expected to allow the vendor an offering to make its " software-plus- services " strategy real to the average Joe. – InfoWeek

26. “…Microsoft promises more offerings toward its vision of software plus services. If this one works as promised, it's an encouraging direction.” – InfoWeek “I think it’s important to look at the bigger picture with Microsoft Online, Windows Live, and Office Live (now including Office Live Workspaces),” said Peter O’Kelly, an analyst with The Burton Group. “While not directly competitive with all facets of Google Apps today, Microsoft is providing useful ’software plus services ’ offerings for the 500 million Office users worldwide, and there are still important advantages to using native client applications in many scenarios — it’s not an either/or proposition.” – ZDNet/Mary Jo Foley For Microsoft, Office Live Workspace is also the next step in what the company touts as its " software plus services " strategy, essentially the notion that online services can serve as a complement to locally run software, but not necessarily fully replace software running on a consumer's own desktop machine or on a businesses server. – CNET

27. "This transformation from software to software-plus- services is a very, very big deal for our company," Ray Ozzie, who succeeded co-founder Bill Gates as Microsoft's chief software architect in June 2006, told the gathering of investors and analysts. "It'll be a very critical aspect of all of our offerings over the next few years.“ – LA Times software plus services While Google documents can be created and edited online, Microsoft still requires the use of its Office suite for those specific functions, what it calls a software plus services strategy. - Nightly Business Report For the last year or so, Microsoft has been telling anyone who will listen that it doesn’t believe that online software is everything people are making it out to be. Instead, it’s been touting a vision it calls “ software plus services,” which means that people should be able to use software both on a PC that isn’t connected to the Internet and on any computer that is. But up until now, software plus services could be more accurately described as software plus talk.- WSJ “Adobe copies Microsoft's ' Software + Services ' strategy -- but little else”- Computerworld

28. The broad strategy being outlined today is based on the idea that software will be used in a variety of settings, spanning applications running on a desktop or server to those delivered to users remotely through the Internet. Microsoft calls it " software plus services." - Seattle Times It’s official: Microsoft wants you to know it’s serious about this whole hosted software thing. Today they will articulate a long-overdue roadmap for " software plus services " -- a hybrid approach that embraces both old-school boxed software and the flavor-of-the-month hosted services model. - InfoWorld This is an important step in Microsoft's “ software plus services ” strategy. - Network World Microsoft is ratcheting up its software-plus-services strategy with a new offering known as Office Live Workspace that is due later this year and that will let customers access, share and collaborate on documents online. – eWEEK Microsoft wants to provide anytime, anywhere access to Office information. The company pushes up to the Web with software plus services even as Google and other competitors push down to the desktop with services plus software. – Microsoft Watch