Two of technology’s reigning leaders experienced a rare earnings miss on Thursday.Quarterly figures from Google and Microsoft both disappointed Wall Street. Microsoft missed its profit expectations and Google incurred higher-than-expected expenses.

IBM performed better, with profit jumping 22 percent, . TCs’ profit also rose. Overall, tech stocks are down since the first of the year. The dollar depreciation has helped with overseas revenue, so investors are already eyeing the predicted dollar appreciation, which will hurt multinationals.

Microsoft is picking up the keys to the on-demand software kingdom. Its new business productivity online suite of several popular Microsoft products is priced at just $15/user per month. Gartner gives Google a pat on the back for promoting the hosted software model, which pushed Microsoft to compete in the SaaS arena.

Also according to Gartner, the growth of SaaS or cloud-based security services will more than triple in the next five years.

It was a week of “firsts” from software leaders that hope their newest creation will give them the key to a lucrative kingdom.

MuleSource has launched the first open-source SOA governance platform, starting a new wave of SOA tools. The platform has an integrated registry and repository.

Borland is working on what it describes as the first “FedEx tracking system for IT projects.” The Texas firm is launching a framework of management tools that sits on top of the development process to provide all stakeholders with visibility into the development process.

The first Moodle offering on a cloud computing platform has debuted, thanks to Infinity Learning Solutions using the Amazon Web Services platform.

Open-source Open-Xchange debuted its openSUSE Build tool, eliminating the need for developers to create testing environments for running apps in each Linux operating system.

And for the first time, we see how EMC is connecting the dots between three of its acquisition product lines. Mozy, Retrospect and Iomega are now one offering providing local and remote double-layer storage and disaster recovery in the cloud.

Yahoo, Google and Microsoft all testified before Congress this week about the proposed monopolistic Yahoo-Google partnership. If the antitrust regulators decide they don’t like the deal, Yahoo owes a termination fee of up to $250 million to Google. Meanwhile, Microsoft has been chatting with AOL about a possible deal.

And the government is giving some of the greenback keys to the kingdom to IBM in exchange for creating jobs in the United States. Bolstered by $140 million in government subsidies, IBM has committed to invest $1.5 billion for research and computer chip manufacturing in upstate New York, retaining about 1,000 jobs in the area. Keep your eye on developments arising from the NY governor’s plans; the public-private partnership is planed as the catalyst for high-tech business development in New York. Also already in the fold: Advanced Micro Devices is also planning a hi-tech development in NY; its $5.2 billion computer chip factory will receive $1.3 billion in state incentives and employ about 1,200 people.

Through a superior password, a disgruntled network administrator in the IT department for the City and County of San Francisco took control and locked everybody else out of access to the government’s backbone network system. He’s in jail now, but the IT guys aren’t making much progress getting access to law enforcement records, payroll, and many other crucial systems and sensitive databases.

Security experts say the ultimate accountability lies with the city for overlooking the number of people with “keys to the kingdom”—privileged passwords to the entire network. The lax security practices may not be the only problem. Given that they’re saying it could take eight weeks to restore the system, it seems either there was no back-up, or it was outdated, or the city is also locked out of the back-up.

Noted & Quoted

• According to Forrester Resarch, France is the top adopter of open source software worldwide. The survey also found that migrating users from existing Microsoft productivity tools to open-source alternatives has proved to be a significant challenge
• ReverseEngineering.com’s 3D software was awarded “Pick of the Week” by Desktop Engineering
• Johnson Controls plans to integrate its Metasys building management system with IBM Tivoli Monitoring for Energy Management software to provide optimization of energy management across data centers and building infrastructures
• Microsoft announced it will acquire Israeli data management software firm Zoomix
• OpenSpan, specializing in desktop productivity and SOA acceleration software, secured $13 million in venture capital funding

“Every keynote session talked about cloud services and their importance for Microsoft. In the past, the tone of the software-as-a-service topic was more like 'well, as a partner you should consider this because some customers want it,' while this year the tone was 'this is an unstoppable train, so you better prepare yourself to get onboard quickly.'"
- Sonoma Partners, Mike Snyder, blogging at Microsoft’s Worldwide Partner Conference