Microsoft's LiveMeeting conferencing software sits on the Internet cloud and "competes vigorously with Webex," he noted. "But there are a number of customers, actually a huge number, who won't go near it because we run it on our servers. I won't argue if that's right or wrong, but it's a very difficult challenge."
The problem is getting the closed corporate environment and the Internet to "mesh together," Sinofsky said. "Products are needed to bridge that gap and work seamlessly," he noted.
That would appear to be the motivation behind Microsoft's recently announced Windows Live and Office Live. The former is an extension to MSN that allows some basic file sharing and other tasks online. The latter is incremental Web-provided functionality to be used along with Office applications.
In this transition, Microsoft the undisputed power in PC software, has the most to lose.
Earlier this week, Webex Communications' CEO Subrah Iyar told CRN that Microsoft's need to protect its base forces it to hedge its bets on the SaaS front. The reason Microsoft is publicly targeting Office Live and Windows Live at very small businesses and consumers, is that it doesn't want to jeopardize its server and more importantly its client revenue-- in larger businesses.
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