MICROSOFT believes the promise of completely on-demand software hosted in the internet "cloud" will not come to pass.
Craig Mundie says software won't come through 'the clouds'
Instead, the company is pushing a hybrid model of software delivery that uses end-user computing devices as well as the World Wide Web.
The push to hang onto at least part of the licenced software model that has underpinned the company's fortunes, comes as the world's largest software group continues to wage a battle against open-source type formats (the latest being Open Document Format) and plans to shake up the small-business customer relationship management market.
"It (software) will absolutely not just be in the cloud," Microsoft strategy and research chief Craig Mundie said. "That, I think, is well understood and increasingly agreed to now.
"There was a short period of time when people were advocating that software would just come down the wires and you would rent it on some on-demand way. I think that day is passing. People are realising that would not capitalise on the capacity that is increasing in all of the client devices such as cell phones, games consoles, PCs and televisions.
"All these things are substantial computers and there is real value in being able to use that horse power. Microsoft is very focused now on all our products having appropriate use of both the local computing asset as well as the cloud computing asset."
Microsoft, Windows Services, Cloud