Microsoft's Web-services announcement Tuesday is, in effect, an update of a strategy Chairman Bill Gates and Chief Executive Steve Ballmer...

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Microsoft’s Web-services announcement Tuesday is, in effect, an update of a strategy Chairman Bill Gates and Chief Executive Steve Ballmer unveiled five years ago.

Meanwhile, competitors have raced ahead with software and services deliverable entirely via the Internet.

But Microsoft insists its patient, big-picture approach will pay off someday.

“There are short-term deliverables, but this transformation … will not happen in six months or a year, or two years,” Ballmer said five years ago.

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“There’s a lot of work that needs to happen. And as the Internet makes this transition, and as we try to transition our business with it, we know we need to have the same kind of long-term approach and patience that we had with Windows itself,” Ballmer said.

A number of Microsoft products already are, or were, delivered via the Internet.

The company tried selling Office XP as a subscription service, but dropped the plan in 2002, in part because customers didn’t want to pay yearly fees for software they could buy outright.

Here are some of the milestones in Microsoft’s Web services odyssey:

2000: Just after a federal judge in the company’s landmark antitrust case orders Microsoft to be broken apart, the company unveils a plan for “Next Generation Windows Services.”

Ballmer talks about transforming the software business to a service business, but warns it may take several years to accomplish. A preview of the underlying technology, called .Net, is released.

2001: Microsoft delivers .Net version 1.0. Gates further describes the strategy and presents a set of services building blocks, code-named Hailstorm.

2002: An experiment with selling the Office suite online as a subscription service fizzles in Australia and New Zealand.

But consumer services gain: MSN begins charging for premium products such as extra Hotmail storage, and Xbox Live online game service begins.

2003: Windows Server 2003 is released, the first software to run computer servers that come with .Net components built in.

2004: Subscription music and video-service technology debuts, including copy-protection software now used by Napster and Yahoo! music ventures.

2005: Microsoft buys Groove, which makes collaboration software, and assigns Groove founder Ray Ozzie to shepherd Microsoft’s services strategy. Version 2.0 of .Net is released, along with new programmer toolkit. Ozzie and Gates outline services strategy.

Brier Dudley: 206-515-5687 or