Om Malik has an interview with Ray Ozzie, in which Microsoft’s Chief Software Architect talks about the company’s shift to cloud computing. Part of the interview focuses on the profitability if cloud-based utility computing:
I think all of these utility-computing services, as they’re born will either be breaking even or profitable. At the scale that we’re talking about, nobody can afford, (even Microsoft) can’t afford to do it at a loss. We could subsidize it, I suppose. Google could subsidize it by profits in other parts of their business, we could subsidize it, but I don’t think there’s any reason that any of us in this world would bring out that infrastructure like this without charging for what we’re paying, and then trying to make some profit over it. The cost base is so high in terms of building these data centers you do want to kind of make it up.
Speaking of data centers, what about the rumors of a looming announcement of a massive data center buildout by Microsoft? Some expected we might hear details at last week’s MIX08 event.