Windows Live offers Microsoft a quicker turnaround

Although it has taken Microsoft five years to develop the next version of Windows, the software maker seems to crank out a new Windows Live service every five minutes.

And, to some degree, that's the point.

Last fall, MSN executive David Cole and his colleagues pitched CEO Steve Ballmer and Chairman Bill Gates on the idea that the company could launch online services a whole lot faster than complicated software such as new operating systems. They presented their plan with many of the online services that have been introduced in recent months as part of Windows Live.

"They were amazed," Cole said in a recent internal e-mail to MSN workers. "And they said if we could pull off that many releases, it would be monumental for the company and for our customers."

Not long after that presentation, Gates touted the idea to the world, announcing the "Live" era of software with a launch event in San Francisco.

Recognizing that the company needs to be more nimble, Ballmer has pushed all of the company's units to think about longterm advances, things that can be delivered in the intermediate term, and "twitches" that can be made every few months. In many ways, Windows Live has become the ultimate "twitch."

When Microsoft first talked about Windows Live in November, most of the products on the table were existing MSN services that had been rebranded.

Since then, however, Microsoft has added more than a dozen new products under the ever-growing Windows Live umbrella. In his e-mail, Cole said that Microsoft's goal is to continuously update and launch products in a "rolling thunder" approach, as opposed to Microsoft's usual strategy of formal unified product launches.

Most of the products, he said, will launch to the public in an early beta version. Some, such as Windows Live Mail, are already in public testing with roughly 900,000 customers using the product. Others, such as a user-created-video site, code-named Warhol, have yet to publicly emerge.

"Think about this: Over the next 3-6 months, we'll ship more innovative technology into the marketplace than during our entire 10-year history," Cole said in his e-mail.

Cole, who plans to go on a yearlong leave of absence next month, sent the e-mail March 3, ahead of last week's "Rabble." Rabble is an all-hands meeting for the company's MSN unit, which is largely responsible for the Windows Live effort.

On the business side, Microsoft's new ad-serving engine, AdCenter, is at the heart of the effort. The engine, aimed at helping the company increase its ad sales and rates, draws on user demographic information to help drive more targeted marketing pitches.

The unified Windows Live services should allow Microsoft to get a deeper understanding of the people using its online services.

"Windows Live is our strategic bet to change the game and win," Cole wrote in the memo, which was first noted by Business Week Online.

Microsoft has even talked about using advertising as a way to pay for traditional desktop software, particularly consumer titles. However, the company said that while it has kicked around the idea during internal brainstorming sessions, no decisions have been made to offer online versions of existing desktop products.

Meanwhile, the list of Windows Live services continues to expand, reaching beyond MSN's traditional domain.

"They've got e-mail in there, they have Messenger in there," said Forrester Research analyst Charlene Li. "They will have classifieds. They will have local mapping. It's all the basic portal services."

In many cases, the Windows Live tools are also neatly aligned against competitive products from rivals like Google and Yahoo.

However, as she noted at the initial Windows Live launch, some of the Windows Live tools remain oriented more toward computer enthusiasts than to the masses. Windows Live relies heavily on the latest Web technologies, such as RSS feeds.

"I still think it's very geeky," Li said.

She pointed to the Live.com page, which lets users bring together Web feeds and Internet gadgets, provided they can figure out how. "It's only a small number of people who know what to do with it," Li said.

But, Li said Microsoft could give Windows Live a boost by allowing users to easily share their creations with like-minded folks. For example, if she puts together a page for "working moms" others could just adapt her creation.

The groundwork for such an approach, she said, can be seen in the new Windows Live Search, in which queries are seen as things that can be saved and shared, rather than just entered once and forgotten.

"It's the social nature of Live.com that I find so fascinating, or the potential of that," Li said.

Li said it is a recognition that for many people, borrowing other's work is a better option than creating something for themselves.

"You can personalize lots of things but most people don't want to," Li said. "You lower the barriers to that by sharing."