The news today that Microsoft is axing its fledgling Windows OneCare subscription-based security product for desktop SoHo and consumer users was of little surprise to most of us.

As a product it was mediocre, and the unfortunate name meant it didn

My week of deep-diving into the world of Microsoft and its future technologies has come to an end. What a week it has been.

The time I’ve spent getting my hands dirty with the pre-beta code for Windows 7 has been nothing short of fascinating. Although the build we were able to bring back to the IT PRO offices was slightly behind the build being demoed on-stage, it nonetheless contains all the key features and technologies being touted as reasons to upgrade once Windows 7 hits the shops.

The issue of upgrading is the critical one. Microsoft continues to talk-up Vista - we would expect nothing less - yet compared to Windows 7, Vista doesn’t quite have the wow factor. Rather, Windows 7 is already shaping up to be the operating system Microsoft wanted to release two years ago, as opposed to the one it had to eventually take to market. Visually the changes are not that significant. Beyond the reworked taskbar the visuals are much the same as the Vista UI. This is not a bad thing. The Vista UI is very slick and modern, and the underlying code of Windows 7 is already showing signs at this early stage that it will deliver the operational performance that is still missing from Vista.

It is also encouraging to see that Windows 7 lelivers most of the functionality promised initially for Vista, but which failed to make it in to the final product, such as the advanced search capabilties.

By the end of PDC, there was still plenty of buzz around Azure, the company’s biggest push into the world of cloud computing. Developers love the idea of such a significant cloud platform, backed up with colossal amounts of processing and storage power, as well as true global distributed computing centres.

However, many of the developers I spoke with at PDC remain wary of doing too much with any hosted service in beta, even when they are being given away for free (and without any guarantees) while in the beta process.

Until such time as Microsoft can put a price on the Azure service and offer at least an idea of the service level agreement it will be able to commit to when the service comes out of beta, developers will remain wary of it. Not due to any failings of the platform as such, but simply becasue many won’t want to produce a successful app this early on that depends on a cloud envronment that may go up and down like a yoyo. The sooner Microsoft can both monetise Azure and guarantee quality of service, the sooner corporate customers and mainstream developers will flock to it. The key components to make Azure a successful platform and business for Microsoft are there, all that is needed is a sign of progress and a measure of the support that developers and users can expect once it launches as a 1.0 service. Once that can be quantified, then expect Azure to become an essential component of most mainstream web services that need lots of storage or lots of processing power on-demand.

Of course, there was more to PDC than just Azure and Windows 7. We got a very early peek at the work being done on the next version of Office, which will see the user interface settle down following the move to the ‘ribbon’, as well as more collaborative working features and closer integration with Microsoft’s unified communications products.

There was also a lot going on with core developer tools, from useful tools like Oomph to major progress on the next version of Visual Studio.

In short, after a few years of being in the doldrums, Microsoft finally has some meaningful buzz around it again. The next 18 months are going to be very exciting for users and developers alike.

Now the dust has settled on Tuesday’s Windows 7 launch, the attendees here at PDC have started asking some challenging questions about the OS, in particular about what it will mean for the short-to-medium term future of Vista and application compatibility.

Vista and 7 share a kernel, so Vista apps should have a reasonable degree of cross compatibility. The level of wholesale compatibility problems between Vista and 7 will be a fraction of what was seen between XP and Vista as a result of this.

However, the issue of what the future for Vista holds is more difficult.

With the existence of Windows 7 now officially out of the bag, coupled with the fact that it is far closer to a launch than most of us suspected, there are many compelling reasons not to upgrade to Vista from Windows XP. There are equally compelling reasons for businesses to leapfrog Vista and jump straight to 7, which promises to avoid many of the application and driver compatibility issues that blighted the early days of Vista.

Three different consumer versions of Vista is simply no longer sustainable. Vista Home Basic has been dying out for some time anyway, but logic suggests that Home Premium should head the same way, leaving just Ultimate as the single consumer SKU for Vista. System builders can then differentiate not on the OS build, but on the spec of the hardware it is pre-installed on.

Standardising on a single build will also remove confusion from the marketplace and help boost standalone and OEM sales.

Many are also looking for a big price cut, down as low as $99 here in the US. Developers are calling for Vista to be priced to go, much like Apple’s MacOS X. Doing so would also help halt the march of free platforms such as the various Linux builds (Ubuntu for example). Yes, Microsoft will make only a fraction of the profit margin it currently enjoys on Vista, but that is no breat problem if sales increase and if it continues to help trigger sales of the true cash cow, Office.

Overall, the developer reaction to 7 has been very positive. With a public beta expected in early 2009, it is expected that the user interface, particularly the desktop, will undergo further fine tuning to make it look a little more slick, and a little less comical and oversized. Even at the pre-beta stage, initial runtime performance is really good, with boot times around 20 per cent faster than Vista on our test hardware (a Dell XPS M1330 laptop).

Vista will not be neglected by Microsoft in the coming months, with service pack two (SP2) already in early beta, with an expected release in early 2009, probably alongside the beta for 7. Vista will get better. Whether it will mature as well a XP, thus giving users a compelling reason to keep using it or to switch to it is hard to say. What is certain is that SP2 is unlikely to contain major feature changes, with all these being channelled into 7.

The announcement of Windows Azure was not much of a secret going into PDC. However, what surprised many was the volume of support that Microsoft is giving this major new project.

From data centres around the world that are three times the size of a football pitch each, to thousands of development and technical staff in place to make Azure work and eventually make it a reliable, service level-based product platform, Azure is a massive undertaking for Microsoft compared to its tip-toe steps into Software as a Service (SaaS) so far such as Windows Live.

For now, Azure is little more than a beta, and it was made very clear that the Azure service will not have any service level guarantees in place. In fact, there is no guarantee that apps you develop to run within the Azure cloud now will work on the eventual 1.0 version.

Of course, at this stage Microsoft could hardly ask users to pay for using Azure given there are no guarantees it will work 24/7, which is why it will be free during this technology preview stage. This is important, as to really understand the potential of a cloud computing platform such as Azure, you need to go and play with it - mess around with some code and see what you can do with it. Only then can you really understand the capabilities and limitations of the platform.

During the Azure demo, what was lacking was any qualified data about what Azure can deliver to customers. Microsoft has not been ‘dogfooding’ the platform, or at least isn’t admitting to it yet, and it is so new that there were few third-party examples, though our look at Dot Net Solutions gave us some insight into the benefits of utility processing.

So, the jury is out on Azure for now, but the potential is definitely there. As developers, you need to go and play with it, stress test it and challenge the infrastructure with applications that Microsoft never even considered when it began work on the Azure project.

After a very interesting day of pre-briefings, which I can’t tell you about until tomorrow evening due to a non-disclosure agreement, we are now ready for the official first day of Microsoft PDC.

Kicking off the conference is chief software architect Ray Ozzie, who has taken on the role previously held by Bill Gates. For Ozzie, this is a critical opportunity to engage with developers, as well as being the biggest key influencer community he has had to address since the departure of Gates from day-to-day operations at Microsoft.

With the medium and long-term plan for several enterprise and consumer technologies unclear, Ozzie must today provide a clear roadmap that developers can both follow and buy into, in order to ensure that alternative operating system and application platforms do not gain any further ground due to disaffected users and coders.

You can join us for our live blog of the keynote by clicking here. We begin at 4.30pm UK time today (Monday), but I recommend you load up the page from 4.15pm onwards to make sure you don’t miss the start. This is a text-based live blog so there’s no need for speakers or the need to watch video. The idea is that we distill the keynote down to the bare facts rather than you having to sit through all the waffle as well.

Greetings from Los Angeles, site of Microsoft PDC 2008.

Had a very disappointing flight over with Air New Zealand, what would have been an OK trip was marred by terrible customer service, but that is a story for another post.

The flight over did at least give me a chance to catch up with a few other PDC attendees, other than fellow journalists, to ask them what they were hoping for and expecting from PDC.

The responses were all pretty similar - decision makers and developers are looking for a fresh long-term roadmap for Microsoft’s core enterprise products, and all are looking forward to finding out more about Windows 7.

Perhaps the most interesting comment on the plane was this: “Vista is OK, and certainly not as flawed as most people claim it is. The trouble is that perception is 9/10ths of the battle and Microsoft has already lost the fight. Too many people THINK Vista is rubbish, and will never be convinced otherwise. Windows 7 is Microsoft’s best hope of winning back the masses, much like they did with Windows XP.”

Wise words indeed. More from me tomorrow.

In about 48 hours from now I’ll be taking off from London Heathrow en route to Los Angeles.

I’ll be joining journalists from around the world heading stateside to cover Microsoft’s Professional Developer Conference, known as PDC.

This is no ordinary IT conference, its the most important event in the calendar not only for Microsoft, but for most of its partners, developer community and enterprise customers. Never mind knowing what the company is planning to do 3 months from now, PDC is where you find out what the company will be doing five and 10 years from now.

The key takeaways this year will be roadmap information and deep drill-downs into Windows 7 and the next version of Office, but that’s only the tip of the iceberg. Everything that Microsoft makes is in play, from the Xbox 360 to keyboards, mice, databases, servers and CRM systems.

Personally, I’m still holding out hope for a new version of Microsoft Bob.

We will be live blogging from the keynote on Monday, as well as bringing you news from the show floor every day of the show. Keep an eye on the site for more PDC coverage over the next week.

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