It could be years before Windows Azure and the Azure Services Platform reach any level of critical mass, observers say. The platform could substantially change over that time. But the company that came late to the Internet is re-jiggering its entire product line to embrace the figurative "cloud."

"It's the transformation of our software, it's the transformation of our strategy and our offerings across the board to fundamentally embrace services," said Ray Ozzie, Microsoft's chief software architect, who described the new Azure platform as a turning point for Microsoft.

Formerly code-named project "Red Dog," Windows Azure provides compute and storage services for services-based applications running on Windows 2008 servers in Microsoft's data centers.