"Idea everything's going to the cloud is folly"

Despite a new-found love for cloud computing, Microsoft isn't ready to put traditional on-premises software out to pasture just yet.

With the development of its online operating system Azure and a range of other online business services, Redmond is ramping up its efforts in the cloud to keep up with rivals such as Google and Amazon.

Head of software and services at Microsoft International, Steve Clayton, told silicon.com the future of software is not entirely online, however.

"We're not saying everything's going to move to the cloud, because for some people that won't necessarily make sense," he said.

Many people will still want to work offline when there is poor connectivity according to Clayton but if their work is all stored in the cloud, they have limited options to access it.

"I think the notion that everything's just going to go to the cloud is folly in a way - it's kind of you're going to push everything up to the cloud just to bring it all the way back down again," he added.

He added that the recent Google Mail outage will make people think more carefully about jumping into the cloud and suggests that Microsoft's software plus services approach is more realistic.

"The approach we're taking is a good reminder that actually there is a lot to be said for client software on a device," he said.

Clayton - who this week spoke about cloud computing at a conference hosted by IT services company Equanet - added businesses who have invested in the on-premises approach aren't likely to ditch it overnight.

Nevertheless, Microsoft is pushing ahead with the development of its operating system, Windows Azure, which is currently in "community technology preview", or pre-beta form.

"There are a lot of people out there testing it and playing with it, there are a few people building applications on it. It's sort of in pre-beta phase at the moment and we'll hear more about it this year," Clayton told silicon.com.

Microsoft is developing business services that run in the cloud under the Business Productivity Online Suite banner including an online version of Exchange for business email, while an online version of SQL Server is already available.

Clayton added that versions of SharePoint and the Dynamics CRM technology will also be making their way into the cloud in the near future.