A good question comes to mind, will companies like Microsoft, unhappy with individual flashes of purchasing, like 10,000 units of Windows XP, would rather migrate their users into a cloud infrastructure that replaced these discrete purchases into a steady stream of what amounts to being rental income? It’s starting with Azure and the new CEO has said cloud is the future. This may be where they are heading.

Microsoft might try to corner their own hardware market eventually, shepherding their customers into a cloud model, where you pay for a Windows 9 experience, connecting to Microsoft’s own hardware over the Internet. It would eliminate a huge sector of headaches for Microsoft, as they have never been truly able to strictly control the hardware their operating system runs on, unlike Apple. With a VM of Windows 9 that is remote controllable, Microsoft could provide a channel for their customers to use their suite of applications, achieving a silo lock-in. Instead of selling a license to use Windows 9, Microsoft could simply sell a $50 per month lease to computing resources within Microsoft. The sales pitch and marketing could be incredibly lucrative for Microsoft. Having a virtual OS canned with every application Microsoft makes available for a certain low per-month price, and altering that price based on the performance specifications of the VM ordered, so that clerical staff who need a basic interface can come in at $20 per month and developers who need more can come in at $200 per month.

That would eliminate many hurdles for IT administrators, the client machines could be thin clients, cookie cutter boxes with very little technology in them beyond the human interface components and the network connection. Storage, the VM instances, security, antivirus, the entire ball of wax could be handled by Microsoft itself, playing host to their customers and transforming their entire model from that of a classic production model to a new cloud-based leasing model. It would likely lower their profits for a short time, but the curve would not be so choppy, it would be smooth as leasing models, while working, are steady streams of money.

The risk to this possibility comes from the shift of importance from the local hardware to remote hardware. The weak link is the network itself. Virtual machine technology plays a part in this shift of risk, when you start putting more than one egg in a basket, you really have to concentrate on making sure your basket never fails. In this case, if the network link goes down, the entire affair disappears as if it wasn’t even there. This risk could be mitigated by establishing redundant network connections or having some sort of stop-gap measure devised where a host machine is shipped and installed to perform as a surrogate until the primary system returns to function. I don’t see this being a huge risk, as the Internet was designed to be very resilient to link failures as it is. It would come down to the last-mile service provider and the electrical grid maintaining service.

It’s something that is interesting to think about. Microsoft could do this, and it could revolutionize their business model and perhaps give them an edge in the enterprise level market. Only time will tell.