Thursday, March 20, 2008

Scott Guthrie on Microsoft's Play for Rich Internet Applications - Knowledge@Wharton

A useful Silverlight interview with Scott Guthrie; an excerpt on Silverlight's direct and indirect revenue potential:

Knowledge@Wharton: Speaking of revenue, what's Microsoft's revenue model for Silverlight?

Guthrie: There are three ways that Microsoft will end up monetizing Silverlight.

The first is: We sell developer tools and servers. Silverlight does not require those and they're fairly reasonably priced, but we will see some monetization through those businesses as people who are building Silverlight [applications] decide to buy Visual Studio or higher versions of Visual Studio than the free versions.

The second way we will monetize is by having a connection with customers who are building these types of experiences. At the platform and tools layer, it offers us an opportunity to engage with them on advertising. That doesn't mean they have to use our advertising system. At the [MIX08] keynote [presentation], we specifically had DoubleClick -- soon to be Google -- on stage showing off their SDK [software development kit] for how you can integrate Silverlight with DoubleClick's ad system.

By having a conversation with customers and giving them great tools and power with Silverlight, we expect that some proportion will say, "Hey, we'll also enroll in the Microsoft ad system." And that kind of advertising monetization is a two-way street: The sites doing the advertising get the bulk of the money, but we get a percentage by helping with the ad network.

And then the third way that Microsoft is going to monetize Silverlight is through our own apps and our own sites, in terms of what we sometimes call "first-party applications" that we build on top of it. Obviously, we have a lot of apps that we build, not just in the developer's space, but in the knowledge productivity space and the enterprise space. I think that a lot of them will benefit from Silverlight as well. So we are going to be using the technology to build better apps for our existing product lines.

Scott Guthrie on Microsoft's Play for Rich Internet Applications - Knowledge@Wharton

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