Microsoft just announced a new offering called Windows Azure, a new online service for developing web applications. Azure, which has been discussed in very general terms in the last few months (as Project Red Dog, Windows Cloud and Windows Strata), sounds like it marks traditional software giant Microsoft’s biggest move into the Internet cloud, and into the software-as-a-service business model.

Azure is being released as a community preview today, which Microsoft says offers only a handful of the feature that will be available in the final version. I’m sitting in the audience of the Professional Developers Conference as Microsoft makes the announcement, and I’ll update with more info from the presentation.