Microsoft Eyes High-Octane Windows for Growth

Microsoft Tuesday made its OS for high-performance computing generally available, delivering on one of three goals the head of its server software business set last week to help grow revenue in Microsoft’s Windows Server business.

With Windows Compute Cluster Server 2003, which is now available, Microsoft aims to compete against Unix and Linux to run server clusters in compute-intensive environments, such as those running multiple simultaneous transactions or computations involving large amounts of data.

This is one server OS area in which the company’s Windows Server offerings have been weak, said Bob Muglia, senior vice president of Microsoft’s server and tools business, speaking at Microsoft’s Financial Analyst Meeting late last week in Redmond, Wash. The other areas where Windows has not performed effectively against Linux and Unix are in security and Web-hosting environments, he said.

During his presentation, Muglia said that customers choose Windows Server over its chief rival, Linux, when it is a better fit for their needs. But the product’s weaknesses in these three areas, where the company either has not had a product offering or has not had a strong one, have kept it from being successful, he said.

Microsoft plans to remedy that problem in its 2007 fiscal year, which began July 1, Muglia said. The company can outpace Linux in getting users to adopt Windows for these three applications, he said. “We see our investments as the opportunity to achieve this growth.”

With Windows Compute Cluster 2003 as a viable alternative to Linux and Unix for high-performance computing, Microsoft should start to see some gains in fiscal 2007 in providing the OS for those environments, Muglia said.

Microsoft also expects to see gains in Web hosting this year, though it will be 18 to 24 months before investments in security will contribute to a growth in revenue for Windows Server, he added.

Matt Rosoff, an analyst with Kirkland, Wash., research company Directions on Microsoft, praised Muglia’s comments, saying it’s rare to hear a Microsoft executive admit the company has not executed effectively in a certain area.

“He clearly identified the threat and said, ‘We have not done a good job here,’ ” he said. “It’s so refreshing to hear someone from Microsoft say that.”

-Elizabeth Montalbano, IDG News Service (San Francisco Bureau)

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