Microsoft Cedes Data Center Leadership to Google

January 24, 2009

I was surprised that there was not more coverage of Microsoft’s cut backs in its data center plans. Microsoft has been building data centers like the $650 million facility in San Antonia. I had heard about engineering innovations that would make these new data centers economical to build, maintain, and operate. I poked around a few technical papers and concluded that Microsoft was still saddled with the legacy of decisions made as long ago as 1999. I will put links to my writes about Microsoft’s data center writes up at the foot of this news item. Frankly I didn’t buy what I was hearing and reading about these leapfrog data centers but I am keeping an open mind. However, the financial reports from Microsoft have not been what Wall Street wanted to hear. Accordingly, this story “Microsoft Postpones Iowa Data Center” here, in my opinion, cedes leadership in data centers to Google. Microsoft is like a runner who drops out of a 5,000 meter race. The Google wins. If you think I am off base, make sure you check out these previous articles before you tell me that I am even more addled than I admit:

  • Architecture in 1999 here
  • Architecture in 2006 here
  • Microsoft capital expenditures here
  • Architecture in early 2008 here

What my research revealed is that in 1998 Google was behind Microsoft. Microsoft hired some engineers but went a different direction. Google hired some engineers and choose a different path. I document this in detail in my 2005 The Google Legacy. That decision allowed Google to pull ahead and eventually create the gap that exists today. Now Microsoft is taking a breather allowing Google to widen its lead. Google wins the data center race in my opinion. Microsoft now must win in software.

Stephen Arnold, January 24, 2009


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