The five-yearly wave is rolling in. A decade after Bill Gates wrote his “internet tidal wave” memo, outlining how the new medium would change computing, and five years after another on internet-focused software, Microsoft is bracing for a further sea change. This time it is software as an internet service.

The trend is no sudden revelation. Google, for example, has for some time wowed consumers, investors and advertisers with its search service and rapid proliferation of new online services to go with it. Microsoft has started reacting, with its reorganisation into three divisions, the appointment of Ray Ozzie to lead the services strategy, and the recent launch of Windows Live.