A Microsoft-labeled computer mouse.
Microsoft continues to focus on its "intelligent cloud" theme. PHOTO: Laura

Microsoft drove home its visionary shift to an "Intelligent Cloud and Intelligent Edge" in its annual report released Aug. 2.

Microsoft officials, in their company's annual report submitted last week at the beginning of its new financial year, expanded on what CEO Satya Nadella described earlier this year as a future built on artificial intelligence (AI), cloud computing and data.

“Our strategy is to build best-in-class platforms and productivity services for an intelligent cloud and an intelligent edge infused with artificial intelligence,” officials said in the annual report.

Intelligence Over Mobile

Nadella at Microsoft’s Build conference in May outlined a new strategy for Microsoft’s future.

The "Mobile First, Cloud First" mantra that drove his first three years at the helm was out. A new mantra — "Intelligent Cloud and Intelligent Edge" — was in. 

“It's no longer just mobile-first," Nadella said back in May. "The user experience itself is going to span all of your devices."

Different Kind of Computing

And if that wasn’t clear enough, officials at the 124,000-employee, $89.9 billion Redmond, Wash.-based giant didn’t waste any time explaining it further in granular detail in their annual filing last week.

“A person’s experience with technology," officials noted, "increasingly spans a multitude of devices and becomes more natural and multi-sensory with voice, ink and gaze interactions. We believe a new technology paradigm is emerging that manifests itself through an intelligent cloud and an intelligent edge where computing is more distributed.”

Even rendered in the driest of regulatory language, this statement is about far more than Microsoft dumping its mobile device ambitions: this envisions an entirely different kind of computing for enterprises. 

Going Way Beyond Mobile 

Officials added this new computing will be built around AI enabling users to move their computing experiences from one device to another without any noticeable differences.

Microsoft hasn't always been flawless with AI.

And for the record, in fact, this new vision does not do away with mobile. Rather, it envisions a future where user interaction with Microsoft apps on all devices will be the same, no matter what kind of device is being used. These experiences will be fed with all the data accessible — or stored — in an intelligent cloud. 

“Productivity is our first and foremost objective, to enable people to meet and collaborate more easily, and to effectively express ideas in new ways,” officials added.

Microsoft's Development Areas

To achieve this, Microsoft will be focusing its research and development efforts in three areas: 

1. Intelligent cloud

Microsoft has invested heavily in the development of the Azure Cloud over the past few years, and that will be key to enabling this "intelligent" future. The intelligent cloud in Microsoft-speak offers infrastructure that unifies cloud and on-premises systems.

In the annual report, Microsoft also claims to be the only company with a public, private and hybrid cloud platform designed for enterprises of all sizes. But that’s not all.

“We are working to enhance the customer’s return on investment by enabling enterprises to combine their existing datacenters and our public cloud into a single cohesive infrastructure," officials said. "Businesses can deploy applications in their own datacenter, a partner’s datacenter, or in our datacenters with common security, management and administration across all environments, providing the flexibility and scale they want.”

2. Personal Computing

If personal computing has, for a long time, been associated with desktops, Microsoft’s personal computing ambition stretches much wider than this. Personal computing, officials said, has nothing to do with hardware, but about users.

“We strive to make computing more personal by putting users at the core of the experience, enabling them to interact with technology in more intuitive, engaging, and dynamic ways,” officials said.

Windows 10 is — and will continue to be — at the heart of this focus for the foreseeable future. This, is turn, is being driven by an original equipment manufacturer (OEM) ecosystem that will develop new hardware for Windows 10.

It will also see the development of more first-party apps and the monetization of existing services and offerings.

“We are working to create a broad developer opportunity by unifying the Windows installed base on Windows 10, and by enabling universal Windows applications to run across all device targets,” officials noted.

3. Productivity Offerings

Microsoft’s productivity app development ambitions will continue to be driven by Office, Office 365, Dynamics 365 and Microsoft 365.

The objective is to improve business processes and collaboration capabilities on all devices.

“New scenarios — like those enabled by Microsoft Teams — will redefine how work gets done and help foster employee engagement and culture," according to Microsoft officials. "This work creates an opportunity to reach new customers and expand the usage of our services by our existing customers. We see opportunity in combining our offerings in new ways that are mobile, secure, collaborative, intelligent, and trustworthy."

New Windows Categories

All these areas will be enabled by investing “significant resources” in many enterprise-focused technologies to:

  • Produce new modular business applications.
  • Build and run cloud-based services to provide experiences for businesses.
  • Develop new categories of devices using Windows.