Microsoft Targets Amazon EC2 With New Windows Azure Features

A few days after Ray Ozzie’s forward-looking memo on Microsoft’s (s MSFT) place in cloud computing, the company showed just how serious it is about being a leading player in the field. At its Professional Developers Conference, Microsoft rolled out many new features that should seriously strengthen the presence of Windows Azure among public cloud offerings, perhaps even making Microsoft’s Platform as a Service offering a closer competitor to Amazon Web Services’ (s AMZN) industry-leading IaaS offerings.

At the highest level, Microsoft is targeting users who might not even want to learn how to develop applications for the cloud. The New Virtual Machine Role feature lets customers move existing Windows Server applications to Azure, the result of which is the ability to start using the cloud without rewriting the application or losing access to existing data. Azure users will also be able to build new virtual machine role images in the cloud rather than porting on-premise virtual machines. Because they run a guest OS and house multiple applications per image, VM roles differ from the traditional Azure single-role, single-instance “worker” role.

If this sounds familiar, it’s because this is very close to what traditional IaaS offering provide for users. In fact, AWS actually has been allowing users to run existing Windows Server licenses in its cloud for several months. By adding the VM role capability, Microsoft is making Azure a direct competitor to IaaS clouds that offer Windows instances, most so AWS.

Then there is Server Application Virtualization, which will let users move existing virtualized application images to Azure unchanged, in worker roles, while still taking full advantage of the Azure’s PaaS management capabilities. As VMware’s Spring-based partnerships with (s crm) and Google App Engine (s goog) illustrate, saving customers from rewriting applications specifically for PaaS clouds is a big selling point.

Microsoft also seems to have taken aim at AWS by announcing Extra Small Instances, which cost only 5 cents per hour. AWS recently announced Micro Instances (including a free year’s use of one Micro Instance), which cost 2 cents per hour, so it’s up to other cloud providers to play catch up. At more than twice the price, Microsoft’s new instances might not seem to stack up, but differing characteristics of IaaS and PaaS make it somewhat an apples-to-oranges comparison.

The new features don’t stop there. Microsoft also brought its application Marketplace and DataMarket (codenamed Dallas) out of beta; unveiled the Windows Azure Virtual Network portfolio; added numerous features to AppFabric and SQL Azure; and announced new Azure-wide features like full IIS support (IIS is Microsoft’s web server), elevated privileges and multiple administrators.

As with most Windows Azure upgrades, the new features are plentiful and can be difficult to fully appreciate without doing some intense research. But Microsoft has to do this in order to make up for Azure’s relatively late release (sub req’d), and also to differentiate itself with a strong connection to existing Windows deployments. The company has been talking for a while about being “all in” for the cloud, and, at least in the case of Azure, it seems to be just that. Maybe its cloud business will survive Ray Ozzie’s departure after all.

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