News

Microsoft Beefs Up 'Live' With Acquisition

• By Stuart J. Johnston
• November 03, 2005

Even as Microsoft moves quickly to augment the online services, some analysts and observers have expressed skepticism that Microsoft’s service offerings are anywhere near ready for prime time.

The newly acquired service is FolderShare, which provides file synchronization and remote access technology to enable users to access information across multiple devices. Financial terms weren't disclosed for the purchase of the service from Austin, Texas-based ByteTaxi Inc., which was founded in 2002.

According to Microsoft’s announcement, “[FolderShare's service] saves customers the hassle of sending large files via e-mail, burning them to CDs or DVDs and mailing them, or uploading them to a Web site.” It lets customers sync information between devices, and “enables private, remote access to customers’ files from any Web browser.”

Microsoft hopes FolderShare will bolster the Windows Live and Office Live service offerings that the company rolled out earlier in the week. “With Windows Live software and services ... FolderShare technology will help customers access their information anytime, anywhere and on multiple devices, unifying their overall experience,” the statement said.

A day earlier, Microsoft announced its intent to acquire Zurich, Switzerland-based voice over Internet Protocol (VoIP) software developer, media-streams.com AG. The immediate application for the media-streams.com technology would be for Microsoft's Real-Time Collaboration platform, in Outlook, Exchange and Live Communications Server. But that technology could eventually work its way into Microsoft's online services strategy as well.

The FolderShare acquisition, and possibly eventually the media-streams.com acquisition, could provide key technologies in Microsoft’s move to reshape existing services (such as MSN Search and HotMail) and to introduce a cohesive set of new services, thus creating a new “Live” brand as a unifying element to its marketing pitch.

As more than one analyst has observed, once more Microsoft is trying to find the golden egg in what chief software architect and chairman Bill Gates described five years ago as the so-called “Hailstorm” services model that was intended to be the payoff for .NET. At that time, there was a lot of skepticism throughout the industry about the concept, both technologically and in terms of privacy, security, and how to monetize online services. So the plan foundered – at least for a time.

Now, however, Microsoft is ready to try again. Several analysts, while encouraged that the company is closer to the mark this time, still find plenty of faults to even the beta offerings announced this week.

“Microsoft cranked up the marketing hype around Office Live and Windows Live, yet it's now pretty clear the stuff isn't ready for the limelight,” JupiterResearch analyst Joe Wilcox, says on his blog, citing glitches in his test drives of some of the beta services as well as failed demos at the Live event.

"In the offline world, there are huge expectations about services like water, electricity and telephony working right. People get mad when the lights go out,” Wilcox continues. “If the online services don't deliver, switching brand affiliation would be as easy as switching services, and there are plenty of places offering the kind of stuff Microsoft plans for Live.”