Microsoft Tunes Windows Server Line For Application Hosting

Microsoft needs a stronger foothold in the market for software delivered as an Internet service. So the company is tuning Longhorn Server and future versions of its database software, development tools, and run-time environment to better support hosted applications.

The moves come as Microsoft tries to convince Web companies to choose Windows over Linux and as Google opens its computing infrastructure to other companies. The engineering work is a result of CTO Ray Ozzie's mandate to get Microsoft's server products in better shape to run Web applications. Microsoft is expected next week to release a second beta version of Longhorn Server that could contain some of the changes.

"Ray's work influences our engineering in a substantive way," says Bob Muglia, who took over as senior VP of Microsoft's server and tools business last fall.

Longhorn Server, due next year, will contain improvements to Internet Information Services, the operating system's built-in Web server, that give system administrators finer control over what types of components, such as dynamic HTML, PHP, and Secure Sockets Layer, are served inside Web pages. Admins will be able to control what components run using scripting languages, which should help companies serving up Web apps better allocate processor resources and assign security measures to software. Longhorn Server and Windows Vista also will contain a new scripting language and command-line interface called PowerShell for quickly moving .Net workloads and Exchange mailboxes among groups of computers. Muglia calls PowerShell "critical to hosters."

The changes will help Windows Server catch up to functions already available in the open source Apache Web server, which runs on Linux. The combo has proven popular for hosting Web pages. "There's a reason why it's dominated--there are product advantages to Apache and Linux over Windows," Muglia admits.

But Michael Cherry, an analyst at Directions on Microsoft, says technical catch-up is only half the battle. Microsoft also needs to devise ways to license its server software that allow for large numbers of online users without requiring a client-access li-cense on each PC.

Microsoft began giving IT pros greater control over software components in Windows Server 2003, and it's winning converts. Internet domain-name registrar and Web-site hosting company Go Daddy Software recently shifted 4 million URLs from Apache to Windows, market research and Internet security company Netcraft said last week. "That's because of core work we did in IIS," Muglia says.

Microsoft also is developing features in SQL Server, Visual Studio, and its .Net run-time environment for improved app hosting.

Catching Up To Office

Sales of Microsoft's server software and tools jumped 16% in the quarter ended March 31, to $2.8 billion. That's nearly as much revenue as Microsoft's cash-cow information worker division brings in. The Office unit is nearly twice as profitable, however, largely because of longer selling cycles and a higher cost of sales in the server business. (Revenue distribution will change when Microsoft shifts its Exchange business to the information worker group at the start of its fiscal year.)

Microsoft is selling more high-end copies of SQL Server, raising the database's average sale price. And it's offering free versions of SQL Server and Visual Studio as a counterweight to Linux and the open source MySQL database, in hopes users will upgrade later.

Microsoft also is trying to head off Google, which just introduced the ability to let users label Web pages and search results of interest, then have co-workers subscribe to a database of those tags to refine their own searches (see story, "Google Almost Sounded Humble At Its Press Day Event"). Google is testing the ability to run E-mail for companies on its servers, and it recently introduced software to search business apps using its search appliance.