4 Things CIOs Need to Know About Microsoft's Reorg

News: Microsoft COO Turner Says Even More Innovation is Coming This YearCommentary: Microsoft's (Long Delayed) Reorg Will Fix the Executive Loyalty Gap

However, this virtuous cycle can still be virtuous for Microsoft without being so valuable to non-cloud customers. In fact, the days of on-premises Microsoft line of business software for your own datacenters may well be numbered, even if the company currently promises otherwise.

It's not difficult to see an era where, as Microsoft steers its ship into the harbor of devices in services, it decides to develop more in the cloud and, perhaps, save some of the effort and expense of engineering new operating system releases. (That doesn't appear to be in the immediate future, given the quick follow-up Windows Server 2012 R2 release only about a year after the original Windows Server 2012 release to manufacturing.)

If Redmond is creating devices that exist to consume its services, those services will naturally be a key area of investment for the company. They'll also drive recurring revenue, whereas perpetual software licenses generally do not, and are less "sticky" to boot.

3. Microsoft Feels Vulnerable About Shift Away From PCs