According to Steve Ballmer, Windows Cloud will be released within a month. This OS is aimed at cloud computing and is possibly based on Midori. This OS is rumored to have a modular structure and is not based on Windows.
According to Ballmer, cloud-computing as Microsoft sees it, will not render client software as we know it today, completely useless. It will be more of an addition to it, and allow for simple tasks such as simple editing of Office documents. Ballmer also thinks that browser applications will never be powerfull enough for the needs of most users.
Currently, Microsoft has already some "cloudy" applications, such as Office Live Workspace and Live Mesh. However, these still need client software (like Office) to be installed on the end users PC.
In a related news story, Richard Stallman of the Free Software Foundation, warned that cloud computing is nothing more than a hype. You can read the story here.
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