Microsoft Acquires File Sharing Service

FolderShare, owned by Austin, Texas-based, ByteTaxi Inc., allows subscribers to create a private peer-to-peer network to synchronize files across multiple devices and access or share files with other people. The service, which is available at no charge and requires a software download, is marketed as an easier way to share files than through email, uploading to a Web site or burning them to CDs or DVDs.

On Tuesday, Microsoft chairman Bill Gates told a San Francisco news conference that the company was developing a new wave of "live software" that would be available over the Web as a service. Microsoft is betting that it can make money by offering software supported by advertising instead of licensing. The company would continue to also sell packaged software.

Microsoft is feeling the pressure from growing companies that are offering software as a service, like Google Inc. and Yahoo Inc. on the consumer side, and Salesforce.com and NetSuite Inc. on the business side. The software giant's first products under its new strategy include Windows Live, which is being tested and would include FolderShare.

Windows Live combines a portal that features search, email, instant messaging, online maps and Internet telephone with other applications. In announcing the service, Gates said it would automatically update files and preferences across any number of devices users chose to use for access.

“I&'m thrilled with the acquisition of FolderShare and the opportunity to offer this technology with Windows Live software and services," Blake Irving, corporate vice president of the MSN Communication Services and Member Platform group at Microsoft, said in a statement. "FolderShare technology will help customers access their information anytime, anywhere and on multiple devices, unifying their overall experience.”

Microsoft planned to continue operating FolderShare for new and current subscribers.

The acquisition was the second announced on Thursday. The Redmond, Wash., software maker said it had acquired Switzerland-based Media-streams.com AG, which builds Internet telephony applications that integrate with Microsoft's Outlook and Exchange email software.