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Q&A: Mark Rees

01 Oct 10

Back in March Microsoft announced the appointment of Mark Rees, PhD, as its new National Technology Offi cer based in Wellington. Gavin Odgen meets him to talk software patents, Pacifi c Fibre, cloud computing and how New Zealand’s IT landscape is changing at pace.

GO What are New Zealand’s biggest challenges for the cloud right now?

MR Issues around data sovereignty, privacy and compliance requirements of the governments are the key barriers to adoption in terms of policy. There’s also a big trust thing. You’re giving your data away to someone, you don’t know where it is and you’re trusting them to look after it. That’s a big thing. At the moment physical location of data matters for lots of people, but over time that won’t matter. So in 20 or 30 years’ time no one will really care where their data is located. What will matter though are the guarantees about how it will be protected and whether it’s accessible or not.

GO When will there be a public announcement about a regional Australasian cloud?

MR One of the challenges in that is to do with international law and how you deal with things like data safe harbour. If New Zealand data is held in Singapore how is it protected properly? We think one of the ways you can solve that problem is by dealing with clumps of countries rather than every individual country having to negotiate an agreement. So, something in the Commonwealth, or some form of the Commonwealth, would be a good start.

GO Is a solution getting closer do you think?

MR Well the New Zealand government is doing work on its cloud and I know other governments around the world are talking about it. There’s an act being proposed in the US to harmonise some of the laws that deal with the cloud over there but these are very long running, diffi cult problems to solve.

GO What’s your view on Pacifi c Fibre?

MR I think it’s a fantastic initiative and we’re strongly supportive of it. International broadband is important for New Zealand. As a consumer of the cloud and a producer of cloud services, our connection to the external world is very important. We’d welcome talks about a public-private partnership and pricing models.

GO And what about the on-going Ultra Fast Broadband initiative?

MR We also think that’s a great opportunity but there needs to be more talk about services and content. It’s great having this network but that itself isn’t going to help too much, it’s only the services and content that are delivered across it. There are lots of opportunities in there, whether it’s remote diagnosis, virtual consultation of health, online learning systems or job training.

GO What is Microsoft’s stance on changes to software patents in New Zealand?

MR Fundamentally the fi nal decision needs to be in the economic interest of New Zealand. IRP should be designed and serve New Zealand’s interest. The concerns we still have is that there’s been no real detailed economic analysis of what impact any changes are going to have. The fundamental idea that someone who invents something, spends the time, money and effort to create something new, should be able to benefi t from it. That is something that we believe in deeply. It’s our core businesses. That’s why we spend US$9 billion a year on research and development. It’s important that we benefi t from that and show our shareholders that we benefi t from that. In a time where there’s so much talk about the importance of IT and export growth in New Zealand, it seems odd that we’d throw away a profi t prediction for a thing that we’d want to sell.

GO Is it true that 90% of Microsoft employees are working on something to do with the cloud in one form or another? Can you break that down into a local level?

MR Pretty much everyone in the business has some obligation to be involved in talking about or selling the cloud, or speaking to customers about the cloud. That’s really the way it’s cascaded in New Zealand. In my role it’s one of the key focuses in terms of talking to government, working on policy issues and communicating the opportunities. We don’t do any product development in New Zealand but the cloud is touching all our roles across the business. There’s been quite a fundamental change in Microsoft’s move from packaging up some software and providing it to the customer, to now being a deliverer.

GO How do you see the cloud and new delivery models changing your partners’ role?

 MR It is a change in attitude and what partners do will change. We see it as a role for the partner to provide support and help the customers on board. They will have a continued role but technology changes the role. It will be a big change for them.

GO Will their margin on software sales decline over time?

MR It’s quite a different business model; using the cloud compared to the model we have now. A lot will still be able to make quite a bit of money out of the services work they do. I think it moves the focus up onto software.

GO Is New Zealand coming out the recession from your point of view?

MR There’s been a lot of pressure of cost and attempts to drive down incremental cost of services on IT in general. We’re starting to see more people look at the opportunities of improving the quality of services they provide through technology. There’s still a strong interest in virtualisation and sharing.

GO Is it a good time to do a start-up?

MR It’s quite a challenging time – good in the sense that the infrastructure that’s available through us and Amazon really lowers the barrier to innovation. I think capital is a little harder to get hold of so maybe there’s a stronger test in terms of your idea in a business case, but if it is a sound idea then the infrastructure available to get things built makes it much easier to get up and running.

GO Where are you in the great tablet race?

MR It’s a great form factor and we’ve seen a proliferation of form factors with great natural user interfaces, like the iPad. They’ve done a nice job of that and we’re looking forward to our display style device that will be coming soon.

GO How soon?

MR I don’t know a date but Steve Ballmer has made some comments about it being a priority for us. I think it will be sooner rather than later.

GO Who are you working with on tablets?

MR It’s being driven by the OEM team and we’re working with a bunch of our partners. Microsoft’s model has always been to leverage our software and partners to provide a diverse range of hardware.

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