I can see it now: I'm in the middle of a PowerPoint presentation to a potential client. Just as I get to the part where I am explaining the true value of my proposal, up pops an advertisement for a feminine hygiene product. You laugh now, but this could become a reality if Microsoft moves into an advertising-supported software delivery model.

Recent rumblings at Microsoft show the company is looking at alternatives to the traditional method of selling software - that is, by licensing use of individual products. In the now famous "Ray Ozzie memo", Microsoft's CTO says that the business model "in the form of advertising-supported services and software" is both challenging and promising to his company's business. He stresses the word promising.

Ozzie wrote, "This model has the potential to fundamentally impact how we and other developers build, deliver and monetize innovations." He calls it a key tenet that Microsoft must embrace.

Great - it's not as if our society suffers from a dearth of advertising now. We have ads on television, on the radio, in newspapers and magazines, on just about every commercial Web site. You can't even check the weather on the Internet without having ads for nasal sprays pop up over radar images of rain clouds. The last thing I want is software brought to me courtesy of advertisers.

The ad-supported sales model is just one way Microsoft and other companies are looking to deliver their products and services over the Internet. There's also the traditional transaction model (buying the package) as well as a subscription pay-as-you-use-it model. All three methods are in use today. Until now, Microsoft hasn't been a big proponent of the advertising model, but the company can't help but feel it is missing out on something that Google has perfected.

Microsoft also feels the pinch of shrinking revenue on some of its software titles. In an internal paper written by MSN employees, the workers cite a 7% drop in sales of packaged software including Works, Money, Encarta and digital imaging software in 2004, with the trend continuing in 2005. It's possible that Microsoft could someday offer such consumer applications for free - as long as we don't mind car ads zooming across the screen from time to time. And if this turns out to be a profitable move for Microsoft, could Word, Excel and PowerPoint be far behind? What about Exchange and other enterprise applications?