Is Microsoft getting it?

In December I published a post that slightly slagged off Microsoft Learning Gateway for being outdated and not getting the message from Ray Ozzie: Software as a Service. And Indeed it seems like Microsoft is pouring resources into their services strategy. Microsoft SaaS Architectural team seems to be receiving a lot of focus. They just released a sample application, Litware, and Gianpaolo and Fred Chong is spending a time in China and India (which I believe is quite significant but I won't go into that here).

Microsoft's latest announcement is SaaS Incubation Center Program, a global initiative to help independent software vendors (ISVs) adopt the Software as a Service (SaaS) delivery model. I've noticed that some ISV's have allready been working with Microsoft on this, for instance at the Danish Microsoft Innovation Centre where CMS vendor Sitecore worked on a SaaS proof of concept a few weeks ago.

But still, it seems that Microsoft's previous technology dominance is forever lost (If you haven't already done so, read "Microsoft is dead"). And even if my employer might be the biggest, Microsoft technology based Software as a Service vendor in Norway, we aren't exactly being run down by Microsoft. The only Microsoft representative that keeps calling me is selling software licenses. There is some cruel irony to that.

What do you think, will Microsoft climb back?