Who wins the Cloud Revolution?

Examining the Case for Microsoft Azure

Before the holidays, I published a piece on the latest technological revolution, cloud computing (you can find that article here). This month, I wanted to address who I feel is positioned to win this revolution and why. More specifically, I will discuss Microsoft’s position in the cloud and discuss what uniquely makes our cloud solution Azure best positioned to win.

There are three specific points that differentiate Microsoft from the other players in this industry. It is not only our strength in each of these areas, but specifically our leadership in each of them that sets Microsoft apart. While many companies are strong in one or possibly two of these areas, Microsoft delivers in all three.

Microsoft’s success in these areas has allowed us to establish ourselves as a cloud leader. What are these three areas? First, is Microsoft’s history in technology that gives us the Enterprise experience that provides the best support and experience, our customers have come to expect. Second, Microsoft is Hyperscale, and this refers to the us having the necessary resources to truly compete on a large scale. Third, is the fact that Microsoft is truly a Hybrid solution that allows customers to succeed on premises and in the cloud together.

Analyzing each of these points will help us understand Microsoft’s position and why I feel Microsoft is best positioned to win the cloud revolution. It should help us see why over 80% of the Fortune 500 has already started using Azure and more and more companies are turning to Microsoft every day for their cloud computing needs.

We are Enterprise Grade

Microsoft was founded in 1975. Let that sink in for a moment. The company has been around for over 40 years! For most of those 40 years, we have been a market leader in the enterprise space. Companies trust Microsoft because of our longevity in servicing them. Trust is earned and the enterprise space has come to trust Microsoft.

Now, it should be mentioned that Microsoft is not the only cloud player with significant enterprise experience. Microsoft is not even the oldest player in the enterprise space. IBM and HP both have been around longer and both have gained strong reputations in the enterprise space. They have both attempted to translate their cache into success in cloud computing.

Unfortunately, if their stock price, declining revenues, or any other major financial indicator show, they just have not been able to remain relevant in today’s market. There was a time when IBM was the biggest baddest kid in the room, but it has lost much of its luster. The same can be said of HP to a lesser extent, and it is another company on a downward plunge.

The major difference between these enterprise players and Microsoft is that Microsoft's longevity shows that we have not only remained as relevant as ever, but also we continue to dominate through our ever-expanding enterprise solutions portfolio. Additionally, much of Microsoft’s cloud growth has been organic and in-house, though they have made a few acquisitions. Almost all of IBM’s recent cloud growth has been from acquisitions like SoftLayer, clearleap, Gravitant, Aspera, Ustream, bluebox, cleversafe, etc. That is why you see "an IBM Company" next to all of their names. There is a big difference between developing your own cloud capabilities and cobbling together the capabilities of many.

HP is following the path of least resistance, one that many others have followed as well, and that is to concede defeat to exit the public cloud business. HP has instead decided to focus on services rather than compete with the other cloud players in the infrastructure space. Even though they are an established technological heavyweight with experience in the enterprise, they simply did not have the resources available to commit to the cloud to compete with likes of Microsoft.

Being Enterprise Grade also means having the best features in development. Azure provides the best options when it comes to size of virtual machines in the public cloud. That means the Microsoft G-Series (aka Godzilla Series) packs a punch of 32 CPU core, 448 GB Ram, and over 6.5 TB local SSD. Premium storage can be expanded up to 64 TB per VM, with over 50,000 IOPS per VM, and less than 1ms read latency. Microsoft takes our enterprise experience and translates it into the best cloud in terms of performance capabilities and layers in an integrated management portal that allows for simplified end-to-end management of the services.

Amongst the established Enterprise players in the cloud space, only Microsoft has leveraged experience to be the leading cloud provider. Microsoft provides unparalleled levels of support for these products. Azure also is better integrated with all the other Microsoft Enterprise products. That is why most of the largest companies in the world today are on Azure. Everyone already uses Microsoft products, are familiar with Microsoft services, and this is what makes the transition to Azure so easy.

Hyperscale Resources

There are only a few companies that have the financial resources to truly be considered hyperscale players. This means they have the resources to build up the infrastructure necessary to most effectively scaling the number of servers in data centers to minimize the costs of computing. By reaching economies of scale, these hyperscale players are able to deliver the best value to their customers.

There are only three companies that can truly consider themselves hyperscale players. Aside from Microsoft, there is Amazon and Google. Amazon and Google are relatively newer players in the technology industry, but both have been dominant in recent years. Both have tremendous amounts of resources that they have available to be real players in cloud computing.

For many years, Microsoft has been the leader in innovation because of our leading spend on research and development amongst any company in the world. This has added up to nearly $12 billion a year in research and development. Amazon and Google have been catching up as of late and are now nearly spending as much as Microsoft.

The difference is where the company’s priorities are. Microsoft’s recently minted CEO Satya Nadella has made Microsoft into a Mobile-first and Cloud-first company, meaning the Microsoft still spends much more on cloud computing research and development than our other two major hyperscale competitors.

Nadella has essentially committed to the cloud, while Amazon is an online marketplace that has leveraged its investments in cloud services for its primary line of business and provided them to other companies to share in their cost savings. Google is still primarily a search company that happens to be a major player in a ton of other technologies and cloud computing happens to be one of those.

This is why Microsoft went from being a non-player in IaaS (one of the three primary components of cloud computing) in 2012 to a leader along with Amazon Web Services—the first major player in the space. This is also what has led Microsoft to being a leader in PaaS, while Google has been left behind and Amazon is still not a major player. Microsoft’s enormous $15 billion investments in datacenters has allowed it to double the amount of regions vs. Amazon with over 100 datacenters for improved performance (with plans to even go underwater!). The number of regions means that there is probably a Microsoft data center close to your business meaning better network performance.

This has all been great news for customers as pricing on storage has decreased over 96% in the past year or so to less than $.02 per GB/mo. This investment has also led to a new feature being announced on Azure approximately every 14 hours. Microsoft customers get to ride the cost curve down with friendly contracts that allow them to take advantage of lowered costs on pricing as we have a race to zero.

The Leaders in Hybrid Cloud

Finally, one of the major blockers for companies moving to the cloud has been reticence to move everything to the cloud at once. Most customers are hesitant of moving to the cloud for a host of reasons (security, legal, migration, etc.). They are also afraid of losing their entire datacenter footprint and essentially turning the keys to their datacenter over to an external provider.

Another point is that it does not always make sense to move everything over to the cloud. Some applications might make more sense to run on premises. Additionally, some large processes might not be economically as efficient as running on premises. Also, customers may have invested in data centers that still have some useful life remaining.

There is one major cloud provider, which specializes in hybrid cloud solutions. That is Microsoft. We at Microsoft sees ourselves as partners to our customers on their cloud journey. We believe that every cloud journey is different and calls for a custom-tailored solution to that customers’ individual needs. Microsoft has experience managing hybrid cloud scenarios efficiently and effectively. Microsoft also plays well with other systems and does better than anyone else with multi-cloud solutions. Companies that were traditionally Microsoft competitors like Oracle, SAP, and even IBM, are now considered partners (and sometimes even customers) in the New Microsoft.

Microsoft has made the right acquisitions (e.g. Inmage acquisition, which is now MS Migration Accelerator that allows VMWare VMs to be translated to Azure) to easily migrate workloads over to Azure. Microsoft also has invested heavily in architects and specialists with an expertise in cloud solutions and data analytics to provide support and guidance to customers on-site. Our experts use tools like the Microsoft Assessment and Planning Toolkit and the Business Readiness Cloud Assessment to help you determine which workloads would make sense in the cloud. Our professionals make sure you explore all of your options and will even help you move workloads over to Linux (encompassing over 30% of Azure workloads). That is another reason why Azure is considered the most open and flexible cloud. 

This expertise is what differentiates Microsoft from all competitors. Microsoft has the capabilities and specializes on finding the best solutions to customers’ problems to help them best leverage the cloud where it makes sense. This is the hybrid cloud advantage, Microsoft does not want to help you buy all of our products, it hopes to earn your trust as a partner on your successful cloud journey. Microsoft invests in resources that will ensure customer success.

Conclusion: Microsoft Leads Cloud Computing Revolution

When you take it all together as one package, nobody beats Microsoft in the cloud. Though many others can provide various cloud solutions, Microsoft is a one-stop shop that provides essentially everything you would want from the cloud (we did not even scratch the surface of IoT, Data Analytics, Machine Learning, or a number of other exciting features). Because of our experience in the enterprise space, Microsoft provides the experience you can trust. Our hyperscale investment translates into the best prices for our customer. Our hybrid expertise ensures that we will help you find the best solution for you determining what really should go the cloud and what can stay on premises.

If you ask the experts, Gartner has only placed Microsoft as a leader in all the major quadrants associated with cloud computing. If you look at the most recent financials, Microsoft’s investment in the cloud has translated in to strong earnings reports and an upward trend in the stock price. If you ask our customers—our biggest advocates, they say we are the best. To top it off, Microsoft is giving away $1 billion in cloud services for free to non-profits. Every way you slice it, Microsoft is winning the cloud revolution.

If you have any questions on how you or your organization can leverage the cloud to give yourself a competitive advantage, please feel free to reach out to me.

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Zeeshan Javed Hafeez, Esq. is a Cloud Solutions Specialist at Microsoft dedicated to helping large enterprise organizations leverage Microsoft's industry-leading cloud solution, Azure, to derive value. The opinions expressed in this article are the author's own and do not necessarily reflect the views of his employer.