After teasing with the news that they would be announcing a cloud OS back at the beginning of October, Microsoft have just announced Windows Azure, an online services platform intended for developers to create cross-platform inter-operable software. Windows Azure provides developers with on-demand compute and storage to host, scale, and manage web applications on the internet through Microsoft data centers.
Using existing Visual Studio 2008, SOAP, REST, ASP.NET, IIS and XML knowledge - or, alternatively, Eclipse, Ruby, PHP or Python - developers can either create applications that run online with minimal footprint on users' own machines, or add web-service components (such as synchronization and co-processing) to existing desktop applications. Azure is scalable, meaning that processing capability can change according to service demand.
Windows Azure will be available both to mainstream developers and hobbyists, with a complete offline development suite including computation and storage services. During the initial preview stage Azure will be free (with some usage limits); after that, pricing will be based on a consumption model taking into account machine hours, bandwidth, storage and transactions. More details on Azure here.