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Microsoft's Ozzie warns on cloud margins: News in brief

In today's news in brief, Microsoft's chief architect warns that the company's cloud margins may be low; VMware tells Veeam Software to discontinue free ESXi hypervisor support.

IT channel news in brief for June 8, 2009

Microsoft's Ozzie sees lower margins in cloud computing

Microsoft chief software architect last week warned that the company's margins will not be as robust in a cloud-computing world as they have been in the past, Reuters reported.

Speaking at a Silicon Valley event on Thursday, Ray Ozzie acknowledged that " margins on services are not like the margins on software, so [cloud computing] will increase our profit and it will increase our revenue, but you won't have that margin."

Ozzie said that margins at the lowest level --on the company's Azure cloud services, will be thinner than for a full-solution service such as cloud-delivered Exchange "You're pricing that solution around a business value more than cost so the margins are still very, very good."

Still, the question of margins on cloud services has dogged vendors and their partners alike. Many traditional VARs still view vendor-hosted cloud services as a threat that will disintermediate the channel.

VMware's Veeam restriction may spur defections to Hyper-V

VMware wants Veeam Software to discontinue support for VMware's free ESXi hypervisor with Veeam Backup and Replication 3.1 product. The move could push budget-conscious small businesses to Microsoft's Hyper-V, according to

VMware Inc. offers three configurations of its hypervisor: the traditional ESX, which includes a Linux-based service console; ESXi, which strips out the service console and is managed remotely but can be used as part of a full VMware Infrastructure 3 or vSphere deployment; and a free version of ESXi, which is limited to single-server deployments and does not support remote management. Microsoft Hyper V-R2 , with live migration and high-availability features, is due out this fall.

JBoss offers Java apps smorgasbord

Red Hat Inc. is serving up Java applications cafeteria-style with its new, modular JBoss Enterprise Platform and the JBoss Enterprise Web Platform and JBoss Enterprise Web Server. The new Web platform and server debuted June 1.

The goal of the flexible JBoss architecture and additional JBoss application servers is to give data centers choice in the size and sophistication of their Java Web servers, according to The new architecture will "future proof" JBoss applications to accommodate as-yet unknown new tools and technologies and simplify data center operations with a common JBoss platform, tools and management controls, company officials said.

Verizon exec talks up cloud-based CaaS

Verizon's cloud-based Computing as a Service (CaaS) platform, which promises to make telecom services available on a usage-based model, is now available to U.S. and European companies. Joseph Crawford, Verizon Business's executive director of product management and development for IT management solutions, talked to about what the company hopes is an emerging cloud services trend.

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