Microsoft Plans to Turn Windows into Cloud-Streamed Operating System

Future updates will include Windows 365 Boot, a feature that will allow Windows 11 devices to log directly into a Cloud PC instance at boot.

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is setting its sights on the cloud, with plans to fully transition its Windows operating system to this platform, as revealed in an internal presentation during the ongoing FTC v. Microsoft hearing which was obtained by The Verge. The tech giant's strategy, which has been gradually moving Windows to the cloud on the commercial side with , is now being extended to consumers. The presentation highlighted the long-term opportunity of shifting “ increasingly to the cloud” in Microsoft's “Modern Life” consumer space.

Windows 365: A New Approach to Operating Systems

Windows 365, a service that streams a full version of Windows to devices, has so far been limited to commercial customers. However, Microsoft has been deeply integrating it into Windows 11. Future updates will include Windows 365 Boot, a feature that will allow Windows 11 devices to log directly into a Cloud PC instance at boot, bypassing the local version of Windows. Another feature, Windows 365 Switch, will integrate Cloud PCs into the Task View (virtual desktops) feature of Windows 11.

Silicon Partnerships and AI-Powered Services

Microsoft's presentation also underscored the company's need to invest in custom silicon . This strategy has already been implemented for its ARM-powered Surface Pro X devices. In addition, Microsoft has recently announced Windows Copilot, an AI-powered assistant for Windows 11 that can summarize, rewrite, or explain content viewed in apps. This is part of a broader AI push for Windows, with Microsoft collaborating with AMD and Intel to enable more Windows features on next-gen CPUs.

The Tech Industry's Paradigm Shift

Microsoft's move to the cloud signifies a major shift in the tech industry. The company is aiming to provide a more seamless and integrated user experience across devices. This move is not just about convenience, but also about creating a more efficient and effective computing environment. By leveraging the power of the cloud, Microsoft can deliver a consistent Windows experience to users, regardless of the device they are using.

The company's focus on AI-powered services and custom silicon partnerships further highlights its commitment to innovation and technological advancement. Microsoft is working on an own AI chip, which is developing under the codename “Athena”. The processor will compete with 's Hopper H100 GPU, which is also used by Microsoft for its Azure cloud platform.

AI-powered services are set to revolutionize how users interact with their devices, making computing more intuitive and personalized. Since its debut, Microsoft has continued to expand its Copilot offerings across its suite of applications. In May 2023, the company brought AI Copilot to PowerBI, Power Pages, and Microsoft Fabric. That same month, Microsoft announced Windows Copilot and AI Copilot for SharePoint and OneDrive, further expanding the reach of its AI capabilities. In March 2023, Copilot was brought to Viva EngageTeams, and the core Office apps, including Word, Excel, PowerPoint, and Outlook and in April 2023, Microsoft 365 Copilot was introduced to OneNote. The company also introduced PowerPoint Copilot, a -like AI that auto-generates presentations.

Commercial Challenges and The “Chromebook Threat”

Despite its ambitious cloud strategy, Microsoft faces challenges. The company identified the need to “shore up Windows commercial value and respond to Chromebook threat” for its “Modern Work” priorities in its 2022 financial year. Long term opportunities on the commercial side include growing the usage of cloud PCs with Windows 365.

 is reportedly preparing to launch a new line of high-quality  and tablets under the “Chromebook X” program. The initiative aims to elevate the Chromebook experience, distinguishing premium models from their baseline counterparts.  is reportedly preparing to launch a new line of high-quality  and tablets under the “Chromebook X” program, according to 9to5Google. The initiative aims to elevate the Chromebook experience, distinguishing premium models from their baseline counterparts.