PC-centric Microsoft has been moving toward the Net slowly for years. There's MSN search, the Live interactive gaming platform, Web-delivered software updates, and video chat, among other Net-centric applications. But PC software still dominates the company. Today the company finally and fully embraced the cloud. Following Google, Amazon, IBM, Salesforce.com, and others, Microsoft says it has spent $3 billion on its new cloud platform and that its plans are more ambitious than its rivals.

Next year Microsoft will open a 100-megawatt data center (these facilities are measured in power usage now, not in numbers of servers) in Chicago, bigger than anything Google has running.

It's a big shift for Microsoft, technically and culturally. Since most of its competitors were born on the Web, cloud computing isn't so much a shift for them as a natural evolution.

"We're going to create a new operating system for the next 20 to 50 years," [Microsoft chief software architect Ray] Ozzie says. "We don't get an opportunity to rewrite it very often, so we're really making key architectural decisions now for a long time."

PC, RIP.

But what happens when clouds collide?