Earlier this week I interviewed Brad Anderson, General Manager of the Management and Services Division at Microsoft, to ask him about some of the news that will be coming out of the Microsoft Management Summit 2009 (MMS) this week in Las Vegas. We've posted the first half of this two-part interview below.

Jeff James: What is the role of the Management and Services Division at Microsoft? And what are some of the things you'll be talking about at MMS this week?

Brad Anderson: At Microsoft what my team is really responsible for, if you think about manageability and management at Microsoft, that's actually what my team does. So a significant portion of my team works on Windows, works across both Windows client and Windows Server to ensure the appropriate manageability is built into the system, so Windows out-of-the-box is manageable. And then we build the products and services of desktop optimization package--System Center. So really everything from the underlying protocol we use--our implementation of WS-Man, PowerShell, Windows Update, Group Policy, through the application virtualization, all the way through our monitoring tools with Ops Manager, Configuration Manager, Virtual Machine Manager.

So here at MMS 2009, on a high-level our theme is "Physical -- Virtual -- Powerful." So we really think about this as a continuation of the conversation we started a year ago at MMS with customers and the industry about dynamic IT and very specifically the long-term mission and vision we put in place around delivering what we call the service-centric data center and user-centric client computing. So really what we'll hear this year being talked about is trends. There are some really interesting trends with the economy and everything that's happening, how that's impacting customers and organizations. We'll talk about the things we're delivering in the short term, so literally in the next couple of months, delivering on the commitments we made a year ago. And then we'll really talk about the tangible progress that has been made on these long-term visions around the service-centric data center and the user-centric client computing. We really just think about it as a continuation.

So a couple of high-level things to help frame it to begin with. As you're, I'm sure, acutely aware, what an interesting economic time to be able to work in. And in this economic time what we are seeing is that the technology and products we are shipping to the market are being rapidly adopted by the market. The market is embracing what we're doing. I'll give you a couple data points on that. And as I'm giving you the data points, think about what the competition to Microsoft's offerings are doing, where at best they're flat. What we are seeing, number one we are seeing all of our overall management business up 20 percent. If you take a look at our business around managing servers, not desktops, that business is going up faster than 40 percent. Over the last 90 days, we have had 1,000 new customers purchase the all-up System Center suite for managing their servers and data centers.

If you think about it, 20 percent all-up growth and 40 percent all-up growth in server management, those are phenomenal numbers in a healthy environment. In a challenging environment, I think that those are phenomenal, and the customer and folks really want to spend their dollars on the technology--that's what they're going to make their long term bets on. So we just have an incredible amount of momentum and wind on our backs right now.

Jeff James: We've gotten some feedback from our readers that indicates they're often being asked -- in these tough economic times -- to manage more systems and assume more responsibilities than they have before. Does that also create an opportunity on the Microsoft side by contributing to the potential sales growth of System Center products, as IT pros may be leveraging management tools more in an attempt to do more with less? Is that what you're seeing as well?

Brad Anderson: Well, we're seeing a couple of things. One, in this environment, low-cost, fast ROI really is paramount. If you think about how Microsoft packages and prices their offers, we're all about delivering high value at low cost and selling in volume. So just the core of Microsoft strategy is one fundamental piece here. What you also see in economic situations like this is customers will really limit or constrict the number of strategic vendors they're working with, and we're definitely benefiting from that.

I think more than anything, if you look there are a lot of conversations around virtualization, be it on the desktop or on the server, and if you look at what we're doing in the platform with Hyper-V, and especially as we come out with the new release of Windows Server 2008 R2 here with Live Migration capabilities, the phenomenal success we're seeing with our desktop virtualization capabilities. I think virtualization at the end and way that we're delivering, with the price, if you're looking at our competitor VMware, as low as 1/5 the price of their offering. It's a pretty clear answer for customers and where they should go.

The Desktop Optimization Pack, and we're 9 months to our fiscal year, ¾ the way through--it's growing in excess of 100 percent year-over-year. There are more than 14 million licenses of that in the market; it's only been in the market 2 years. So we're seeing this phenomenal growth, and as we watch what's happening in the market the competition to our management products in the market are at best reporting flat. If you look at VMware from last week they reported a 13 percent decline year-over-year. So when you look at the two, you can really see a pull, and that customers are making their votes.

The main thing we'll be communicating to the market is that Microsoft has a comprehensive management solution that allows you to manage from the desktop to the data center, allows you to manage across your physical and virtual assets, and we are the leader in ROI. Those really are at the core and foundation of everything communicating here. Customers want a single set of tools, to command across physical and virtual assets. They don’t want to have two. They're looking for a consistent way to manage their Windows environments, from the data center to their servers and across their data centers. And there's a whole lot of hype going on in the market going around about cloud. And what we're communicating is that the conversations about the cloud are great conversations, and if you think about what Microsoft has been communicating with our Software+Services strategy, these conversations about private cloud vs. public cloud, those fit right in line with what we've been communicating for years.

So we think about what we're delivering, and for example in the data center, and with Windows, System Center, Forefront (our security suite), you have this consistent set of tools, whether its for today's managed data center, the foundational pieces for proprietary clouds people are going to be building, or the foundational pieces for the public cloud whether that be a hosted environment or customers running in the Azure platform. We'll be standing up and giving a comprehensive platform for developers to develop on. But for us, it's all about consistency, a familiar set of tools you are working on whether you are on-premise or using a public cloud. It's integrating the resource fabrics across the private and public, and then really getting that consistent development experience as well. If you're developing an application, that can run in my data center, it can run in a private cloud, it can run in a public cloud--I can make the choice where to run it. And then, because we're going to integrate the resource fabrics, I can move that application from a private to a public cloud using the same familiar tools that customers are using today.

So those are the key piece of how it resonates incredibly well, especially with these tough economic times. So let's talk about day 1 so you get an idea of what we're talking about.

On MMS day 1, it's really going to be focused on what we're doing in the data center, so we really do think of this as a continuation of the conversation we started last year, where we rolled out this vision called the service-centric data center. There's a couple of core foundational components of that. One, we believe that virtualization is going to be a core part of these data centers, if you think about the cloud conversations, virtualization is at the core of that. And last year we announced some things we want to do such as bringing application virtualization to the data center, and not only separate the offering from the heart but also separate the applications from the data center. And with these dynamic data centers and cloud environments, you want to reduce the friction so you can increase the agility at which you can move things between these servers. And by announcing application virtualization that gives another layer of agility to organizations.

Brad Anderson: We also announced last year that we were going to be bringing to the market the ability for System Center to manage across the data center, including non-Windows servers. We said that we were going to be doing the cross-platform capabilities, and that technology is currently in System Center Operations Manager 2007 R2 release, it's currently in the release candidate and we expect it to be released in the next 60 days. We've had a number of customers like CDW and HSBC, who we can get you in contact with as well, that are using this to manage across their entire data centers, HPUS, Solaris, AIX, Linux, and getting that one consistent way of doing it.

We promised with the new version of Windows Server, which is 2008 R2, that we'd have Live Migration capabilities. We'll be demonstrating that, talking about that, and also talking about how we'll be releasing an update to the System Center Virtual Machine Manager within 60 days of the release of Windows Server 2008 R2 where all that Live Migration capability is exposed and its integrated into your environment. So with that tool, you now have Live Migration across all Microsoft virtualization factors as well as all VMware virtualization factors, so even if I'm managing a virtual environment, I can use the same tools as I'm using to manage my physical environment.

We're going to be announcing a number of partners in the data center. There's some great work that partners like HP and Dell have done. So, for example, they have developed what we call PRO packs, PRO stands for Performance Resource Optimization. What that does is it allows Virtual Machine Manager and Operations Manager to integrate in a way that partners like HP and Dell can throw up tips that help organizations to more efficiently manage their data centers. So for example, they can have a policy around power that when certain constraints are hit, these PRO tips are serviced to the administrator and allow them to move workloads between servers in a way that reduces their power consumption.

HP is actually going a step further in releasing a suite that they call the Inside Control Suite for System Center, in which they take all the work they've done to integrate across System Center, put it in this integrated hole, in a way that customers can get a hold of that and have all the integration with Configuration Manager, Operations Manager, Virtual Machine Manager, so really we're seeing a lot of partners also embracing and extending the capabilities of System Center.

There are some significant announcements coming out from two key partners that are building knowledge in the form of management packs for Operations Manager to manage non-Windows environments. Novell and a company called Bridgeways will be announcing that they're going to have management packs for Solaris, Linux, AIX, Oracle, SAP, all these management packs and all this knowledge coming out that extends the capabilities of System Center beyond the Windows boundaries and also past the applications that Microsoft builds their ships.

We're going to have a rich conversation about the cloud. Lots and lots and lots of hype in the market right now about cloud, and our focus here is going to be the foundational components of the cloud is built in Hyper-V, System Center, and Forefront, and we're going to be talking about some of the things we're going to be doing across private and public clouds. So we're releasing two what we call solution accelerators, and these are guidance for organizations to build up their own private clouds using the tools that are available for one today, and then there's one for hosters, that gives hosters a set of best practices and guidances as well as some things, like a self-service portal, that allows them to easily have their customers be integrated into the additional capacities that they provide.

We're actually going to give a demonstration where we show a hoster whose capacity automatically shows up inside our System Center Virtual Machine Manager, so when an organization needs to add capacity, they can actually see in that tool they're using to manage their data center or private cloud, then use that same tool to automatically leverage capacity coming from a hosted cloud a public cloud, with the exact same consistency they're using to manage their own data centers today.

And then we'll talk about some of the things that we're doing with respect to Azure, and just give some additional details and guidance about how Windows Azure is going to be a core part of that public cloud, and how we're going to be integrating across the private public using these foundational pieces of Windows, System Center, and Forefront.

A big one, we will also be announcing on day one that we are making rapid progress on our management-as-a-service offering, which we'll announce: the System Center Online Desktop Manager. So we'll announce that, and then on Wednesday as we go to the client conversation--day 1 on Tuesday is about the data center and day 2 on Wednesday is about the client--we'll actually go into more details about what System Center Online is.

On day 1 we will also give a technology demonstration of application virtualization on the server. It's the first time we have ever shown the ability to isolate an application and have application virtualization running on a server like it does on your desktop.

Check back on the afternoon of Wednesday, April 29th for the second part of this two-part interview