Microsoft 2012 Annual Report Download - page 10

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Competition
The Windows operating system faces competition from various commercial software products and from alternative
platforms and devices, mainly from Apple and Google. We believe Windows competes effectively by giving customers
choice, value, flexibility, security, an easy-to-use interface, compatibility with a broad range of hardware and software
applications, including those that enable productivity, and the largest support network for any operating system.
Additionally, Windows 8 will run on both x86 and ARM architecture, enabling an even wider range of devices that run
Windows. The Windows 8 operating system will include the Windows Store, an online application marketplace. This
marketplace will benefit our developer and partner ecosystems by providing access to a large customer base and will
benefit Windows users by providing centralized access to certified applications.
Windows Live software and services compete with similar software and service products from Apple, Google, Yahoo!, and
a wide array of websites and portals that provide communication and sharing tools and services.
Our PC hardware products face competition from computer and other hardware manufacturers, many of which are also
current or potential partners.
Server and Tools
Server and Tools develops and markets server software, software developer tools, services, and solutions that are
designed to make information technology professionals and developers and their systems more productive and efficient.
Server software is integrated server infrastructure and middleware designed to support software applications built on the
Windows Server operating system. This includes the server platform, database, business intelligence, storage,
management and operations, virtualization, service-oriented architecture platform, security and identity software. Server
and Tools also builds standalone and software development lifecycle tools for software architects, developers, testers,
and project managers. Server offerings can be run on-site, in a partner-hosted environment, or in a Microsoft-hosted
environment.
Our cloud-based services comprise a scalable operating system with computing, storage, management, and database
capabilities, from which customers can run enterprise workloads and web applications. These services also include a
platform that helps developers connect applications and services in the cloud or on premise. Our goal is to enable
customers to devote more resources to development and use of applications that benefit their businesses, rather than
managing on-premises hardware and software. We are unique in our ability to provide customers hybrid solutions that
bring together the benefits of traditional on-site offerings with cloud-based services.
Server and Tools offers a broad range of enterprise consulting and product support services (“Enterprise Services”) that
assist customers in developing, deploying, and managing Microsoft server and desktop solutions. In addition, Windows
Embedded extends the power of Windows and the cloud to intelligent systems by delivering specialized operating
systems, tools, and services. Server and Tools also provides training and certification to developers and information
technology professionals for our Server and Tools, Microsoft Business Division, and Windows & Windows Live Division
products and services.
Approximately 55% of Server and Tools revenue comes primarily from multi-year volume licensing agreements,
approximately 25% is purchased through transactional volume licensing programs, retail packaged product and licenses
sold to OEMs, and the remainder comes from Enterprise Services.
Principal Products and Services: Windows Server operating systems; Windows Azure; Microsoft SQL Server;
SQL Azure; Windows Intune; Windows Embedded; Visual Studio; Silverlight; System Center products; Microsoft
Consulting Services; and Premier product support services.