Ina Fried

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Microsoft and Toyota Drive to the Cloud With Azure-based Electronics Systems for the Car

Microsoft has driven home a deal with Japanese automaker Toyota.

Toyota President Akio Toyoda and Microsoft CEO Steve Ballmer are holding a joint press conference at 1 pm PT today, and Mobilized hears that the new deal is a fairly broad pact covering a couple of different areas of Microsoft’s business.

There are certainly plenty of areas of potential collaboration. Microsoft’s Windows Auto software is used to power entertainment and navigation in a number of cars from Ford, Kia and others.

Reports also suggest there will be joint work on energy efficiency, and Microsoft has been signing up lots of big companies for its various cloud computing efforts.

Update: The two companies have issued a press release outlining the deal.

Toyota will use Windows Azure to power a new generation of in-car systems, known in the industry as telematics.

The two sides are also playing up the energy efficiency piece of the news, noting that the electronic systems can be used to monitor energy use, in addition to traditional tasks like navigation and entertainment. As part of the deal, the companies are making a $12 million investment in a Toyota subsidiary that offers digital information systems to its car owners.

Azure-based systems are due to start showing up in Toyota electric and hybrid cars next year, with an aim to have a global system up and running by 2015.

1:03 p.m. PT: The companies have started their press conference. Toyoda kicks things off by noting that he debated going to Redmond for the event in the wake of the massive earthquake. However, he said that after visiting some of the hardest-hit areas, he concluded the best thing he could do is to “provide hope and steady economic progress.”

“So, I am here,” Toyoda said.

As for the joint efforts, Toyoda spoke about an opportunity to improve in-car electronics as well provide “smart grid” services that can help ease the load of electric vehicles.

1:06 p.m.: Ballmer also takes a moment to acknowledge the quake and note Microsoft’s contributions to the recovery effort before diving into the specifics of the deal.

The first incarnation of the service will show up starting next year on hybrids and plug-in electrics. Examples of the possibilities, Ballmer said, are that car owners will be able to use their PC to turn on heat or air-conditioning while the car is charging or use a smartphone to remotely check maintenance information.

Ballmer talks about it as the ultimate in mobile computing and noted the need for information, given that many people spend a significant amount of their time in their car.

1:17 p.m.: Asked why the companies are starting with hybrids and electric vehicles, Ballmer said the companies are trying to “shoot ahead” of where the business is today, adding that technology will be needed to help manage power consumption, in addition to traditional navigation and entertainment products.

It’s still a little vague how much of what the companies are doing initially is for in-car electronics as compared to cloud-based services that are accessed via a PC or phone. I’ve asked about this, so hopefully we will get some clarity.

1:29 p.m.: Ballmer notes that the deal is, to some degree, about information accessed in the car, but adds it is also about information getting to and from the car to the cloud and other devices.