Microsoft Azure en-us Sun, 28 Dec 2014 14:03:42 -0500 Sun, 28 Dec 2014 14:03:42 -0500 The latest news on Microsoft Azure from Business Insider Business Insider SOURCE: Here's The 'Dirty Little Secret' Of Microsoft's Cloud Business (MSFT) Thu, 13 Nov 2014 17:01:00 -0500 Julie Bort <p><img style="float:right;" src="" alt="microsoft ceo satya nadella" border="0"></p><p>There's a huge change going on in the tech industry that will create a whole new crop of winners and losers: cloud computing.</p> <p>Microsoft CEO Satya Nadella&nbsp;recently declared that Microsoft was already in with the winners. "We absolutely caught the trend ... it's no longer up for debate, whether we get the cloud," <a href="">he said.</a></p> <p>One reason he gave to back up his claim: Microsoft's cloud business is on track to be a $4.5 billion business.</p> <p>But sources tell Business Insider that this $4.5 billion number isn't as straightforward as it seems.</p> <h2>The Dirty Secret</h2> <p>The $4-billion-mark is a major milestone for cloud computing companies. In its last fiscal year, which ended in June, Microsoft had $2.8 billion in cloud revenue.</p> <p>Pure cloud company <a href=""> just hit over $4 billion in revenues in its last fiscal year and expects to hit $5.3 billion</a> at the end of its current fiscal year. It took it 15 years and a major acquisition, marketing automation company Exact Target.</p> <p>Cloud market leader Amazon is on track to generate over $4 billion in revenue this year, too. Amazon doesn't release its cloud revenues, but its "other" segment, which includes its cloud Amazon Web Services, had $1.4 billion in revenues, most of which come from AWS.</p> <p>But our sources say that Microsoft is getting to that number by giving away cloud services for free or at a steep discount as part of bigger enterprise contracts, even to customers who aren't yet using those cloud services.</p> <p><img style="float:right;" src="" alt="Microsoft Office Online" border="0">As one former Microsoft employee told Business Insider, "What Microsoft is doing is claiming a certain percentage of their Enterprise Agreements — these are renewals of their big licensing agreements — as cloud revenue. They bundle the 'rights' to use Azure or Office 365 as part of their overall agreement. The dirty secret is that very few customers are actually taking Microsoft up on using Azure in any meaningful way."</p> <p>In other words, when an enterprise signs a new contract to buy software like Windows, Microsoft's database and Microsoft Office, the salesperson may toss in free (or almost free) access to Microsoft's cloud Azure (which includes a cloud version of the database) and Microsoft's online version of Office, Office 365.</p> <p>Microsoft then assigns a percentage of that contract as cloud revenue.</p> <p>It's a little like giving you a free toaster when you sign up for a checking account, then claiming toaster sales are going crazy.</p> <h2>Giving It Away For Free</h2> <p>Cynthia Farren has seen this sort of contract negotiation tactic happen first hand.</p> <p><a href="">Farren is a consultant</a> who makes her living helping enterprise navigate Microsoft's complex software licensing agreements. (In geek speak, she's a "software asset management consultant." Software license agreements from companies like IBM, SAP, Oracle, and Microsoft are so tricky and expensive there's a whole industry of consultants that helps companies negotiate them.)</p> <p><img style="float:right;" src=" farren.jpg" alt="Cynthia Farren" border="0">"Since early in the days of Microsoft’s venture into cloud computing we have often heard of and seen examples of cloud services getting added to customer’s Enterprise Agreements at heavily discounted rates or an overall discount making the addition of the cloud services have a net zero dollar impact on the agreement," Farren tells Business Insider.</p> <p>She adds: "I have also heard some Microsoft sales folks go so far as to boast that all of the EAs [enterprise agreements] they manage have some cloud services on them but have also explained that not all of them have implemented those services yet."</p> <p>To decode that a little: she's saying that some Microsoft salespeople claim that all of their customers have access to Microsoft's cloud, even when they aren't using it yet.</p> <h2>The Tactic is Working</h2> <p>There's a brilliance to this: Build it and they will come.</p> <p>If it costs the enterprise nothing to have access to Azure or Office 365, they'll try it out, and hopefully like it enough to pay full price during the next contract negotiation.</p> <p>"In all fairness, I have seen an increase in the number of customers actually moving to Office 365, Azure, and Dynamics Online," Farren says. Microsoft has used similar tactics in the past, such as including licenses to less-popular server products in a bundle with licenses to products that had higher demand. Eventually, companies would come around and start using the products they've already partly paid for.</p> <p>On the other hand, Farren says she's "jaded" when she hears Microsoft report the number of cloud users or its revenue numbers.</p> <p>"What I would really like to know is how many of their total number of users have ever been activated. I’d really like to see a more transparent way of reporting the numbers (such as active users, etc)," she says.</p> <h2>Not The Whole Battle</h2> <p>While getting existing Microsoft customers to try Microsoft’s cloud is huge, it’s not the whole battle. Microsoft also needs to win over new customers.</p> <p><img style="float:right;" src="" alt="google cloud napkin" border="0">“Most of the hot new companies don't use Microsoft,” the former employee tells us. “These are the most important companies for growth of the cloud. Amazon and Google dominate share in these new high growth companies.”</p> <p>Microsoft tells us that this is changing and that the company is really starting to win over startups to its cloud.</p> <p>In the last earnings call with analysts Nadella said that 40% of Azure revenue now comes from start-ups and independent software vendors (ISVs).</p> <p>Then again, Microsoft doesn't report how much revenue Azure brings in. The closest number we have is the total annual cloud revenue Microsoft reported in July (its fiscal year ends in June). It said then that total cloud revenue for the year was $2.8 billion. That included all of its cloud services: Azure, Office 365 and its competitor, Dynamics. Microsoft reported&nbsp;<a href="">total revenue of $87 billion</a>.</p> <p>The other danger to the plan is profit margins. For the next few years, and maybe decades, Microsoft will have to invest billions into its cloud infrastructure to support cloud customers and engage in a price war with Amazon and Google. Unlike before, Microsoft can't just hand over the software to the customer and be done with it.</p> <p>“You have to remember that in the past Microsoft has had gross margins in the 90% range for Office and Windows. There is no way to sustain that type of monopoly pricing in cloud when competing against Amazon and Google," our source says.</p> <p>Microsoft won't need ridiculously high margins if it captures a growing slice of the growing cloud computing pie. It will make money aplenty from that.</p> <p>The cloud computing is going nuts right now, growing at around 30% a year and is&nbsp;<a href="">expected to generate $121 billion next year,</a> predicts market research firm Markets and Markets.</p> <p>A spokesperson also tells us that Microsoft's cloud growth is not yet coming at the expense of its high-margin on-premise products like SQL Server, System Center and Windows Server.</p> <p>Revenue grew for all of those classic softare products last quarter. A spokesperson says this indicates "that the company is not just shifting revenue."</p> <p>Microsoft also raised prices on all of these products and said that its enterprise cutomers are buying more licenses for each of them as their data centers grow.</p> <p>And that indicates that companies are not yet ditching Microsoft's high-margin software products for the cloud. They are using more technology of every kind, both the cloud and traditional software.</p> <h2>And Now For The Good News</h2> <p>Profit margins on the cloud will eventually be sorted out for Microsoft, and all the cloud vendors.</p> <p>Even if enterprises pay less for each service, over time they'll be buying a lot of cloud services, including some premium high-margin services.</p> <p><img style="float:right;" src="" alt="Microsoft Satya Nadella" border="0"> Fancy new features that you can only get from the cloud versions of Microsoft software will convince more companies to try Microsoft’s cloud, according to a new <a href="">report from Forrester Research on Thursday.</a></p> <p>"Under Nadella’s mandate, commercial product development teams are focused on driving innovation into the cloud versions of its properties first (on-premises [software] second). And its sales engines are all rewarded for pushing as much cloud into each enterprise license agreement as possible," Forrester says.</p> <p>Forrester boldly predicts that, "Microsoft will make more profit from cloud than from [traditional] on-premises [software]." And it thinks this will happen in 2015.</p> <p>But, as our sources point out, first Microsoft needs to get companies to pay for these cloud services, not just try them out for free.</p> <p>Microsoft says that this is already starting to happen. Nadella told analysts in October that 60 percent of Azure customers are starting to use what the company calls 'premium services,' like data analytics or the Enterprise Mobility Suite, which helps IT departments manage mobile devices.</p> <p>Microsoft hasn't, however, disclosed how many Azure cutomers it has, although it did say that it is currently signing up 8,000 a accounts a week.</p><p><strong>SEE ALSO:&nbsp;<a href="" >The 50 Most Powerful People In Enterprise Tech In 2014</a></strong></p> <p><strong>SEE ALSO:&nbsp;<a href="" >Something Called 'The Race To Zero' Is Scaring A Lot Of Tech Companies</a></strong></p> <p><a href="">Join the conversation about this story &#187;</a></p> Microsoft's CEO Gave Us The Clearest Vision For The Company We've Had In Years (MSFT) Mon, 10 Nov 2014 11:41:00 -0500 Steve Kovach <p dir="ltr"><span><img style="float:right;" src="" border="0" alt="Satya Nadella Illustration Microsoft Windows Logo">Over the past few years, it has been tough to pinpoint what Microsoft’s focus is.</span></p> <p dir="ltr">In 2012, then-CEO Steve Ballmer <a href="">wrote an open letter to shareholders</a> labeling Microsoft as a "devices and services" company. It was a signal that Microsoft would not only make the software that people use, but the devices that software runs on. That's a very Apple-like philosophy but one that hasn't paid off for Microsoft, as seen in its Surface line of tablets and acquisition of Nokia.</p> <p dir="ltr"><span>The narrative shifted when Satya Nadella took over as CEO in April. Hardware took a backseat to what Nadella repeatedly called a "mobile first, cloud first" vision of computing, a vague mantra implying that he wanted Microsoft's software and services to power everything, even competing products. The launch of Office on iPad in the spring was perhaps the biggest gesture signifying a new openness at Microsoft.</span></p> <p dir="ltr">But despite the flood of new products from Microsoft in recent months — the Surface Pro 3; Office for iPhone, iPad, and Android; <a href="">even a fitness band</a> — Nadella has focused his vision for the company even further. In fact, he sees only three key parts of Microsoft’s business.</p> <p dir="ltr"><span>"The core products of this company are Windows, Office 365, and Azure," Nadella told a small gathering of journalists and analysts at Microsoft’s headquarters in Redmond, Washington, last week. "From a business model, those are the three big things we are very focused on. We ask how our effort is accruing to those things."</span></p> <p dir="ltr"><span>In other words, everything else beyond Windows, Office, and the Azure cloud business is just gravy, hooks to pull those who may not use Windows devices into the Microsoft ecosystem. It is the most definitive vision for Microsoft we have heard in years, perhaps even decades.</span></p> <p dir="ltr"><span>Still, Nadella is going about it in a very Microsoft-y way. The next phase for the company surrounds the concept of productivity, with the idea that no matter what kind of device you use, a Microsoft app should be there to help you do it better.</span></p> <p dir="ltr">It's not the sexiest vision. Apple specializes in making hardware that frenzied fans line up all day for. Google is working on everything from driverless cars to <a href="">cheating death</a>. Facebook helps more than 1 billion people per month share and communicate, while dabbling in other futuristic projects like virtual reality. Nadella thinks Microsoft can fit in by helping you manage your email, to-do lists, documents, and calendar better than anyone else.</p> <p dir="ltr"><span>“I don’t think of [productivity] as some narrow thing you do at work,” Nadella said. “It’s </span><span>the</span><span> software category … We think of it as the core driver of the use of technology.”</span></p> <p dir="ltr"><span><img src="" border="0" alt="Satya Nadella microsoft ceo" width="800"></span><span style="line-height: 1.5em;">As boring as that may sound, Microsoft feels like a much different company than it was under Ballmer just a few months ago. There's more experimentation, more willingness to work with competing platforms, and an effort to make Windows as ubiquitous as the most popular operating system in the world, Android. Nadella thinks Microsoft can be everywhere, even if you don't notice it.</span></p> <p dir="ltr"><span>During a series of demos with Nadella and a circle of key executives, iPhones and Google Nexus phones were used just as often as gadgets running Windows 8 or Windows Phone. Office, one of those three core products, is getting a facelift next year for touchscreen Windows devices. And now anyone can download office for iPhone, iPad, or Android tablets and use those apps to create and edit documents for free, another one of those hooks Microsoft hopes will persuade users to start paying for the Office 365 subscription service.</span></p> <p dir="ltr"><span><img src="" border="0" alt="terry myerson windows 10 event" width="800"></span><span style="line-height: 1.5em;">The next version of Windows, Windows 10, is another piece of the puzzle. When it launches next year, Windows 10 will be Microsoft’s first operating system to run on everything from phones to big-screen TVs. It will even run on objects that are part of the so-called "internet of things" trend, like internet-controlled appliances.</span></p> <p dir="ltr"><span>We have gotten only a small taste of Windows 10 so far, but it seems like a reset from the disaster that Windows 8 turned out to be. And with most of the Windows world still running Windows 7, there is potential for a massive upgrade cycle next year.</span></p> <p dir="ltr"><span><img src="" border="0" alt="microsoft next lock screen android" width="800"></span><span style="line-height: 1.5em;">Finally, there is the mishmash of projects coming out of Microsoft Garage, a division dedicated to hacking together projects and figuring out what might stick. One of the latest apps to come out of there is the Next Lock Screen for Android phones. (Yes, Android.) It replaces your regular lock screen with helpful notifications like the ability to swipe a calendar alert to jump into a conference call. The plan for projects like Next is to discover new tools that can be adapted to other Microsoft products down the road.</span></p> <p><span id="docs-internal-guid-7c6f07ac-9a76-4665-6574-add56b0cfe9f"><span>"We want to change the mainstream product development culture and experimentation culture," Nadella said. "They all need to be going on in parallel."</span></span></p> <h3><strong><br>NOW WATCH: <a href="">The 9 Worst Mistakes You Can Make On Your Resume</a></strong></h3> <div><div> <script src="//"></script><div id="ooyalaplayer" style="width:1920px;height:1080px"></div> <script>OO.ready(function() { OO.Player.create('ooyalaplayer', 'QweGg0azq2j-NO7lQwHKmLLbhSZ7RGCb'); });</script><noscript><div>Please enable Javascript to watch this video</div></noscript> </div></div> <p><span style="line-height: 1.5em;"> </span></p> <h3><strong><a href=""></a></strong></h3><p><a href="">Join the conversation about this story &#187;</a></p> The 39 Most Important People In Cloud Computing Tue, 08 Apr 2014 17:37:00 -0400 Julie Bort <p><img style="float:right;" src="" border="0" alt="Cloud computing people" width="480" /></p><p>No question about it: cloud computing is changing the world. It's the invisible part of your smartphone and tablet, the part that holds your apps and files, and lets you work from anywhere.</p> <p><a href="">IBM estimates that 85% of new software today</a> is being built for the cloud and that one-quarter of the world's apps will be available on the cloud by 2016.</p> <p>By 2017, enterprises are expected to be spending <a href="">$235 billion on the cloud, </a>predicts market research firm IHS.</p> <p>All thanks to many people at tech companies, big and small.</p><h3>No. 39, AppDynamics' Jyoti Bansal: Intelligence in the cloud</h3> <img src="" alt="" /> <p><p><strong>Jyoti Bansal, founder and CEO, AppDynamics</strong></p> <p>IPO-bound AppDynamics is well-known in an area called &ldquo;application intelligence.&rdquo; It helps people figure out how their apps are performing in the cloud or troubleshoot app problems.</p> <p>Bansal's company is growing like crazy, sources tell us: 175% year over year. That's impressive because he's already doing a sizeable business. At the start of 2013, <a href="">AppDynamics had about 500 customers</a>. He's raised about $86.5 million from venture investors, too, according <a href="">to CrunchBase.</a></p></p> <br/><br/><h3>No. 38, MuleSoft's Ross Mason: Connecting clouds together</h3> <img src="" alt="" /> <p><p><strong>Ross Mason, founder and VP of product strategy, MuleSoft</strong></p> <p>Mason came up with a solution to a really hard problem for cloud computing. His company, MuleSoft connects different clouds together so that they can share information.</p> <p>It's been a venture investment darling and not just from VCs&nbsp;like NEA and Lightspeed <a href="">but from big-name tech companies</a>. In March, Mason raised <a href="">another a $50 million</a>, bringing the total to $131 million.</p> <p>There's so much interest in his company that SAP, and Cisco have invested, too.</p></p> <br/><br/><h3>No. 37, VMware's Simone Brunozzi: Luring enterprises away from Amazon</h3> <img src="" alt="" /> <p><p><strong>Simone Brunozzi, vCloud Hybrid Service vice president and chief technologist, Hybrid Cloud, <strong>VMware</strong><br /></strong></p> <p>VMware gained a feather in its cloud cap when it hired Simone Brunozzi away from <a href="">Amazon a couple of weeks ago.</a></p> <p>Brunozzi's new title is a mouthful: He's VMware vCloud hybrid service vice president and chief technologist, Hybrid Cloud.</p> <p>That means he's helping VMware lure enterprises to the cloud.</p> <p>Brunozzi was known as one of the faces of Amazon's cloud, doing a lot public speaking on Amazon's behalf since 2008. He helped teach the enterprise world what cloud computing was all about.</p> <p>There were apparently no hard feelings in his move. His old boss, Amazon's Werner Vogels, <a href="">tweeted a congrats note to him.</a></p></p> <br/><br/><a href="">See the rest of the story at Business Insider</a> Microsoft Featured A Famous Apple Blogger During Its Keynote Thu, 03 Apr 2014 20:45:00 -0400 Kyle Russell <p><img style="float:right;" src="" border="0" alt="build 2014 john gruber vesper azure" /></p><p>There was a clear underlying current throughout the various presentations during today's keynote at Microsoft's Build conference: "We're cool with Apple now."</p> <p>Most of that had to do with the tools that Microsoft is giving to developers to build apps for Windows platforms and then port to iOS or Android.</p> <p>But some of it felt &nbsp;like Microsoft was trying to say that it wasn't just an option, that they are happy to help developers be successful on other platforms.</p> <p>The one shout-out to the Apple crowd that drew everyone's attention came during a series of video presentations by developers who have used Azure to make beautiful, well-designed apps on other platforms.</p> <p>The first video featured John Gruber, a noted independent Apple blogger &mdash; of <a href="" target="_blank">Daring Fireball</a> fame &mdash; touting the benefits Azure offered for the development of the syncing features in Gruber's note-taking app, <a href="" target="_blank">Vesper</a>.&nbsp;</p> <p>His appearance caught a number of people in the audience (both in person and online) off guard:</p> <p><img src=" shot 2014-04-03 at 4.41.53 pm.png" border="0" alt="build 2014 mary jo foloey tweet" /></p> <p><img src=" shot 2014-04-03 at 4.43.43 pm.png" border="0" alt="build 2014 kyle baxter tweet" /></p> <p>This isn't public collaboration between Gruber and Microsoft, however. He has a strong following among Apple developers, which is why Microsoft occasionally sponsors his site (with its 4 million to 5 million monthly page views) with a weeklong ad for Microsoft Azure, its cloud service.</p> <p>The going rate for <a href="" target="_blank">sponsorships on his site is $9,250 per week</a>, though Microsoft might be able to negotiate that number down.</p> <p>Gruber is known for writing smart, concise posts about Apple's past and future, but occasionally looks at other companies as well. Back in February, he <a href="" target="_blank">concluded a post on Microsoft</a> by suggesting that services like Azure could be what keeps the company relevant in the post-PC era: "The next ubiquity isn't&nbsp;running on&nbsp;every device, it's&nbsp;talking to&nbsp;every device."</p><p><strong>SEE ALSO:&nbsp;<a href="" >How Microsoft is positioning the Xbox to take on Amazon, Roku and the Apple TV</a></strong></p> <p><a href="">Join the conversation about this story &#187;</a></p> Microsoft Just Used An iPhone On Stage At Its Developer Conference (MSFT) Thu, 03 Apr 2014 14:08:35 -0400 Julie Bort <p><img style="float:right;" src="" border="0" alt="build 2014 docusign" width="480" /></p><p>Microsoft is hosting its big developer conference in San Francisco this week, and one of the big themes is how much nicer Microsoft is toward iOS and Android under its new CEO, Satya Nadella.</p> <p>The company even did several demos on stage using iPhones. This would have been unheard of just a few years ago.</p> <p>Plus it announced a new foundation for open-source projects, where apps and projects are freely available for anyone to use, the .<a href="">Net Foundation</a>. Those projects will help developers write apps for "other platforms," not just Windows, said Microsoft's Scott Guthrie. Guthrie is the new cloud and enterprise chief, the job that Nadella was doing before he became CEO.</p> <p>On top of that, it released new tools that help programmers write Android and iOS apps hosted on Microsoft's cloud, Azure.</p> <p>Interestingly, it didn't show any actual Microsoft employees holding an iPhone. And Nadella was nowhere near these demos when they happened. (His keynote was yesterday.)</p> <p>Instead, it invited&nbsp;Grant Peterson, CTO of a company called e-signature company DocuSign, on stage during Guthrie's keynote. DocuSign and Microsoft are partners who just signed an agreement that lets Office 365 subscribers sign documents without leaving Microsoft&rsquo;s Office apps.</p> <p>Peterson showed off an iPhone document-signing app that uses Microsoft's cloud, Azure.</p> <p>He held up the iPhone and joked, "Here's a device I never expected to show on stage at a Microsoft conference."</p> <p>A few minutes later, another iPhone app was demonstrated by <a href="">Miguel de Icaza of Xamarin, </a>a company working to bring Microsoft software development tools work with non-Microsoft technologies.</p> <p>This is the second year in a row Microsoft used Apple devices during Build. Last year, before Nadella was CEO, he <a href="">chose to use a Mac in a demo</a>, not touching it himself, but having others show off how Microsoft's cloud could be used to create an iPhone app.</p> <p>Given skyrocketing sales of non-Windows devices, it's critical to Microsoft's cloud to win over all sorts of developers, especially those writing iPhone apps.</p> <p>The Mac demo last year shocked people at Microsoft, <a href="">one former employee told Business Insider</a>. Nadella was making the point that using another company's technology, even in public, shouldn't matter. That's a big shift in Microsoft's culture, and a smart one.</p> <p>Here's a photo of the DocuSign iPhone demo during Build 2014.</p> <p><img src="" border="0" alt="iPhone demo at Microsoft Build" width="800" /></p> <p>&nbsp;Here's a closeup of the DocuSign iPhone app that runs on Microsoft's cloud.</p> <p><img class="center" src="" border="0" alt="docusign ios" /></p><p><a href="">Join the conversation about this story &#187;</a></p> Top Microsoft Exec: Here's How We're Better Than Google And Amazon In The Cloud (AMZN, GOOG, MSFT) Wed, 19 Jun 2013 14:40:57 -0400 Julie Bort <p><img style="float:right;" src="" border="0" alt="Microsoft Satya Nadella" width="480" /></p><p>Microsoft's top cloud executive, Satya Nadella, thinks Bing and Xbox Live gives Microsoft an edge over cloud rivals Amazon and Google.</p> <p>On Wednesday on stage at the GigaOM Structure conference in San Francisco, he talked about how Microsoft plans to trump its cloud competition.&nbsp;</p> <p>Nadella is president of Microsoft's $19 billion Server and Tools Business, which is responsible for the Windows Azure cloud, (Microsoft's answer to Amazon), and things like Windows Server, SQL Server and developer tools.</p> <p><span style="font-size: 15px; line-height: 1.5em;">His <a href="">star is rising in Redmond</a>, too, as CEO Steve Ballmer reorganizes his management team.</span></p> <p>As Microsoft's core customers, enterprises, head to the cloud, it's Nadella's job to keep them from moving to alternatives.</p> <p>These are Microsoft's big competitors in the cloud, as Nadella sees them:</p> <ul> <li><strong>In software-as-a-service</strong>, where apps are rented over the Internet, Microsoft has Office 365, Skype, and a alternative called Dynamics. Microsoft's big competitors are and Google Apps, Nadella said.</li> <li><strong>In"private clouds", </strong>meaning the software that allows companies to build their own clouds, Nadella only sees one competitor: VMware.</li> <li><strong>In public clouds,</strong> where enterprises rent computers stored in someone else's data center, Nadella is eyeing Amazon and Google.</li> </ul> <p>GigaOm's Om Malik, who was on stage with&nbsp;Nadella, noticed &nbsp;that the big enterprise hardware vendors were missing from Nadella's list.&nbsp;</p> <p>&nbsp;"You think Dell, HP, IBM are going to be roadkill?" Malik asked.</p> <p>"I didn't say that," Nadella laughed.</p> <p>Nadella said these vendors "have a role to play" as part of the bigger cloud ecosystem.&nbsp;<span style="font-size: 15px; line-height: 1.5em;">But they're not&nbsp;</span><span style="font-size: 15px; line-height: 1.5em;">"at scale" because they don't run any massive internal apps on their own clouds like Amazon and Google do, he explained. </span></p> <p><span style="font-size: 15px; line-height: 1.5em;">Nadella explained why Microsoft's practice of "dogfooding," or using its own apps internally, is better than Amazon and Google's approach.</span></p> <p><span style="font-size: 15px; line-height: 1.5em;"></span><span style="font-size: 15px; line-height: 1.5em;">He said Microsoft runs lots of different types of apps on its own cloud, including:</span></p> <ul> <li>Search via Bing (Bing is running 17% of search share in the U.S., he said).</li> <li>Games via Xbox Live</li> <li>Enterprise Apps like Office 365</li> </ul> <p>In contrast, Nadella contends that Google and Amazon have let their clouds get "hijacked" by a single big app: Google with search, Amazon with ecommerce.</p> <p>That's an interesting perspective and one we're not sure enterprises will buy. Microsoft does have an advantage over Google and Amazon today, <a href="">enterprises tell us,</a>&nbsp;but it's not the tech, it's the support.</p><p><strong>SEE ALSO:&nbsp;<a href="" >The History Of The Tablet, An Idea Steve Jobs Stole And Turned Into A Game-Changer</a></strong></p> <p><strong>SEE ALSO:&nbsp;<a href="" >These US Cities Can't Hire Tech Workers Fast Enough</a></strong></p> <p><a href="">Join the conversation about this story &#187;</a></p> Microsoft Says Fortune 500 Firms Are Loving Its Amazon Cloud Killer (MSFT) Mon, 17 Jun 2013 13:51:00 -0400 Kevin McLaughlin <p><img style="float:right;" src="" border="0" alt="Steven Martin, Microsoft " width="480" /></p><p>Large enterprises are growing more comfortable with using Windows Azure, Microsoft's rival to Amazon's cloud computing service, a Microsoft exec said Friday.&nbsp;</p> <p><span style="font-size: 15px; line-height: 1.5em;">More than half of Fortune 500 firms are now using Windows Azure, which lets customers rent access to servers, storage, and other services over the Internet, Steven Martin, general manager of Windows Azure, </span><a href="">said in a blog post</a><span style="font-size: 15px; line-height: 1.5em;">.&nbsp;</span></p> <p><span style="font-size: 15px; line-height: 1.5em;">Microsoft now has 250,000 Azure customers&mdash;more than double what it had at this time last year&mdash;and is signing up 1,000 new ones per day, Martin said.&nbsp;</span></p> <p><span style="font-size: 15px; line-height: 1.5em;"><span>Amazon is the leader in "public cloud," which means selling access to servers, storage, and apps running its own data centers. <span>Windows Azure is a public cloud, too.&nbsp;</span></span></span></p> <p>But Microsoft thinks enterprises are always going to want to run clouds in their own data centers, which is called "private cloud." Microsoft sells the software for this, but Amazon doesn't.</p> <p>Despite Amazon's success, many enterprises aren't ready to put their sensitive data in its cloud. So, Microsoft's angle is that it can offer customers a mix of public and private clouds, which is called a "hybrid" cloud.</p> <p>VMware, Citrix, HP, and others are also pushing the hybrid cloud message.&nbsp;</p> <p>The knock on private clouds is that they're expensive and don't offer the economic benefits of shared hardware. This is why Amazon's pricing for its cloud, called Amazon Web Services, is so cheap.</p> <p><span style="font-size: 15px; line-height: 1.5em;">Amazon has done OK even without a private cloud service.&nbsp;</span><span style="font-size: 15px; line-height: 1.5em;">A</span><span style="font-size: 15px; line-height: 1.5em;">ccording to Wall Street analyst&nbsp;</span><a href="">Ben Schachter at Macquarie Capital</a><span style="font-size: 15px; line-height: 1.5em;">, it's on track to make $3.8 billion from cloud services this year.&nbsp;</span></p> <p><span style="font-size: 15px; line-height: 1.5em;">Microsoft said in April that Windows Azure <a href="">had racked up $1 billion in revenue</a> over the previous 12 months, but that included sales of software to hosting providers.&nbsp;</span></p><p><strong>SEE ALSO:&nbsp;<a href="" >Bill Gates Is Now On LinkedIn, And He Wrote A Great Post About Warren Buffett's Brilliance</a></strong></p> <p><a href="">Join the conversation about this story &#187;</a></p> Microsoft Hasn't Really Hit $1 Billion In Revenue From Its Amazon-Killer Cloud Mon, 29 Apr 2013 18:49:00 -0400 Julie Bort <p><img style="float:right;" src="" border="0" alt="Steve Ballmer" width="400" height="300" /></p><p>In the past 12 months, <a class="hidden_link" href="">Microsoft</a> has generated $1 billion in revenue from its cloud computing platform, Azure, and other software used to build clouds, Curt Anderson, finance chief for Microsoft&rsquo;s server and tools unit <a href="">told Bloomberg</a></p> <p>That sounds pretty amazing, as if Azure is right on the heels of the biggest cloud computing player, <a class="hidden_link" href="">Amazon</a>.</p> <p>But that's not really the case.</p> <p>Anderson is also counting the sales of software to hosting providers to build clouds, he told <a class="hidden_link" href="">Bloomberg</a>. For instance, Microsoft sells a version of its popular Windows Server platform to hosting providers and we would expect Microsoft to do well with it.</p> <p>That's because with cloud computing, companies don't buy their own software and hardware. Instead they rent it from others and access it remotely over a network like the Internet. And renting Windows Server is a big thing enterprises want to do. The big question is if Microsoft can get them to rent Windows Server from Microsoft.</p> <p>There's billions of dollars at stake as enterprises shift from buying software licenses from companies like Microsoft to renting cloud computing services from companies like Amazon.</p> <p>If Microsoft had truly earned $1 billion of revenue from Azure alone, it would be doing well. Amazon made an estimated $2.1 billion in revenues in 2012 on its cloud, Amazon Web Services, according to Wall Street analyst <a href="">Ben Schachter Macquarie Capital.</a> He estimated that AWS would generate $3.8 billion in revenue in 2013. We don't know AWS's actual revenues because it includes AWS in its &ldquo;other&rdquo; revenue category.</p><p><strong>SEE ALSO:&nbsp;<a href="" > The 10 Most Important Companies In Cloud Computing</a></strong></p> <p><a href="">Join the conversation about this story &#187;</a></p> After Success In Israel, Microsoft Launches More Accelerator Programs (MSFT) Wed, 24 Apr 2013 10:30:00 -0400 Julie Bort <p><img style="float:right;" src="" border="0" alt="Tzahi Weisfeld" width="400" height="300" /></p><p>On Monday, <a class="hidden_link" href="">Microsoft</a>'s second class of Israeli startups graduated from its Windows Azure Accelerator program</p> <p>The program, started about a year ago, has been such a hit that Microsoft is launching at least two other international Accelerator programs modeled after it, Microsoft's Tzahi Weisfeld, senior director of the global startup group, told <a class="hidden_link" href="">Business Insider</a>.</p> <p>These will be in India and China.</p> <p>At this point, Microsoft isn't talking about a U.S. Azure accelerator because Microsoft is already working with <a href="">TechStars Seattle</a>, Weisfeld told us.</p> <p>With the 13 new startups launched this week, Microsoft has graduated 26 Israeli startups and is claiming success on par with <a class="hidden_link" href="">TechStars</a> and Y Combinator. Graduates have "raised an average $900,000" in seed money from U.S. and Israeli venture capitalists, he said.</p> <p>There is one big difference between Microsoft's program and the others: Microsoft doesn't personally invest and it doesn't take a stake, Microsoft's Rob Craft, senior director of Cloud Strategy, told us.&nbsp;</p> <p>Startups are not required to use Microsoft technologies or to develop products for Microsoft platforms. But, since the point is to launch startups on Microsoft's cloud, Azure, the company gives them $60,000 worth of free Windows Azure service for two years plus three years worth of Microsoft software (Office, Windows Server, development tools).</p> <p>We talked to one of the new graduates, Pixtr's Aviv Gadot, cofounder and CEO, who confirmed that Microsoft isn't pushing its own wares beyond Azure. Pixtr is a mobile video editing app that runs on the <a class="hidden_link" href="">iPhone</a> but not on Windows Phone. The founders use don't even use Windows PCs. They use Macs.</p> <p>Microsoft also has plenty of competition. There are more than two dozen accelerators/incubators in the "startup nation" of Israel, including the <a href="">Campus Tel Aviv</a> "hub" program run by <a class="hidden_link" href="">Google</a>.</p> <p><em>(Disclosure: Microsoft paid some of the travel expenses for Business Insider to attend a cloud computing event in Tel Aviv on Tuesday.)</em></p><p><a href="">Join the conversation about this story &#187;</a></p> Microsoft Is Beating Google For Big Cloud Deals Because It's Hungrier (MSFT, GOOG, AMZN, TM) Mon, 12 Nov 2012 12:00:00 -0500 Julie Bort <p><img style="float:right;" src="" border="0" alt="Steve Ballmer" /></p><p>When <a class="hidden_link" href="">Microsoft</a> launched Office 365 in the spring of 2011, pundits saw it as <a href="">a desperation move to fend off Google Apps</a>. And it was.</p> <p>But that desperation has become the very thing helping Microsoft win over customers, some customers say.</p> <p>Over the past few weeks, Microsoft has announced one big Office 365 deal after another: 15,000 <a href="">seats for the Santa Clara county</a> government (right in Google's backyard), <a href="">25,000 seats for the EPA</a>, and the granddaddy deal of them all, 200,000 seats for <a class="hidden_link" href="">Toyota</a>.&nbsp;(A "seat" in enterprise deals roughly translates to a license for a corporate employee.)</p> <p>Plus, Toyota has partnered with Microsoft for the car maker's all-important in-vehicle computing platform, <a href="">Toyota Entune</a>, which runs on Microsoft's application-hosting cloud, Azure. Entune adds apps to cars such as navigation using <a class="hidden_link" href="">Bing</a> Maps and lets drivers do voice-controlled, hands-free tasks like making phone calls.</p> <p>Toyota chose Microsoft because it was the only company both "big enough to scale globally" and hungry for the business, says Zack Hicks, Toyota's top technology executive in North America.</p> <p>"I think <a class="hidden_link" href="">Windows</a> Vista might have been a humbling experience for them," Hicks said. "I find them to be very open, very eager. The competition has heated up with Microsoft in the market. I find a better level of cooperation than I get with other vendors."</p> <p><strong>Don't miss:&nbsp;<a href="" class="title">The 10 Best Free Windows 8 Apps For Work And Play &gt;</a></strong></p><p><a href="">Join the conversation about this story &#187;</a></p> To Understand Just How Much The Cloud Will Change The World, Look At Toyota (MSFT, TM, WDAY, ORCL, CRM) Sun, 11 Nov 2012 10:30:00 -0500 Julie Bort <p><img style="float:right;" src="" border="0" alt="Zack Hicks Toyota" /></p><p>Spend a few minutes talking to Zack Hicks, Toyota's top technology executive in North America, and you'll walk away with a startling revelation: <a class="hidden_link" href="">Cloud computing</a> is changing everything about our world from how we work to how we manage our health.</p> <p>Hicks, the chief information officer for Toyota's U.S. arm, says that the automaker's adoption of cloud technology&mdash;Internet-based computing, served up through websites and apps&mdash;has freed up his staff to work on more meaningful projects.</p> <p>And those are really life-changing things, like apps that can monitor your vital signs.</p> <p>Last month, Hicks freed up more of his team from desktop-support drudgery <a href="">when Toyota signed a massive deal with Microsoft Office 365</a>, its cloud alternative to Exchange email and <a class="hidden_link" href="">Microsoft</a> Office desktop software. The deal took more than two years, but in the end Toyota is ditching IBM's <a class="hidden_link" href="">Lotus</a> Notes and putting its entire worldwide workforce of 200,000 employees on Office 365.</p> <p>Why? Because if "I'm screwing around worrying about what version of mail I'm on, it's wasted effort. It's a lost opportunity ... to do something more meaningful for our customers or our business," explains Hicks.</p> <p>To that end, Toyota is shedding a lot of other enterprise software and using all kinds of new cloud apps:</p> <ul> <li>Trading in Oracle's PeopleSoft for Workday's human-resources software</li> </ul> <ul> <li>Using Salesforce's Chatter for social media, including Web-development projects between employees, ad agencies, and other contractors</li> </ul> <ul> <li>Using Box, the online-storage service, to distribute executive reports, instead of email or printed reports (Box was a "big hit" with execs because everyone always has the same updated information, Hicks says)</li> </ul> <ul> <li>Using Amazon to host many of its marketing websites, like and Toyota's&nbsp;<a href="">environmental-information website</a></li> </ul> <ul> <li>Using Microsoft's cloud-computing service, Azure, to host a slew of new apps that run in cars, from <a class="hidden_link" href="">Facebook</a> to an app that awards you eco-points for miles driven in an electric vehicle</li> </ul> <p><span>"We have some awesome tech coming out in our vehicles," Hicks says.&nbsp;</span>The cloud has turned cars into the next big "connected platform," as Hicks puts it&mdash;another way besides PCs, smartphones, and tablets to access Internet-based services.</p> <p>Some examples:</p> <ul> <li>Semi-autonomous vehicles that can help the elderly get around</li> </ul> <ul> <li>Steering wheels that "can measure your heartbeat, respiration, blood-sugar levels, and send it to a doctor"</li> </ul> <ul> <li>Cars that can send an alert if a driver's health condition has become unsafe and needs medical help</li> </ul> <p>All this because the company no longer makes its IT people manage email.</p> <p>"It's cool that our team is part of that and we're not in the back office anymore," he says.</p> <p>Here's an edited transcript of the conversation.</p> <p><strong>Before signing with Microsoft, did you look at <a class="hidden_link" href="">Google</a> Apps?</strong></p> <p>We started this about two and half years ago. We worked with Google and they were a cool partner but they weren't structured to support a corporation of our size and go through the request-for-proposal process that's required of a company of our size. I think they've matured since then. But they weren't ready to deal with us and ultimately they backed out.</p> <p><strong>What are you doing with Microsoft Azure?</strong></p> <p>Microsoft's Azure cloud is what we're leveraging to communicate to our vehicles. The car is essentially a connected device. So today, in some of our Lexus vehicles you can customize your startup screen on your dashboard. You can check in with Facebook when you go to a different location. You can buy tickets for a movie or make a restaurant reservation right from your navigation screen.</p> <p>We've got a hybrid vehicle where we're working on a game. You see how many miles you drove to earn eco-points. The more eco-points you get, the more trees and flowers grow on your app.</p> <p><strong>Your IT people are the ones working on these new car apps?</strong></p> <p>Absolutely. That's the opportunity for me. These are the same providers in this new space, a <a class="hidden_link" href="">Cisco</a> or a Microsoft. IT has been doing business with them for years. They are new for our traditional engineers and we in IT can bridge that gap. But if I'm screwing around doing a mail upgrade and not working with our vehicle designers, then I'm missing out on that opportunity.</p> <p>We have some awesome tech coming out in our vehicles. It's cool that our team is part of that and we're not in the back office anymore.</p> <p><strong>Of all the clouds you could have picked, why Azure?</strong></p> <p>The great thing about Microsoft is that they've learned their security lessons the hard way and they've gotten really good at security. Security around the vehicle is No. 1.</p> <p>No. 2 is that you've got to have a partner that's big enough to scale globally.</p> <p>You have to find a partner that's willing to partner with us in a meaningful way. We're stepping into uncharted territory. You have to worry about who's going to own vehicle data. and that it's the customer's data. Its not the vendor's data. That's a privacy concern for us.</p> <p><strong>Microsoft doesn't have a great reputation for being easy to work with. How did you deal with that?</strong></p> <p>I think <a class="hidden_link" href="">Windows</a> Vista might have been a humbling experience for them. I find them to be very open, very eager. The competition has heated up with Microsoft in the market. I find a better level of cooperation than I get with other vendors.</p> <p>For instance, <a class="hidden_link" href="">Apple</a> is everyone's darling but everyone is knocking on their door. So while there's great partnership opportunities and capabilities, how much are they willing to invest with their partners? They don't have to today. So it's a matter of who can really scale and who can work with large corporate enterprises.</p><p><a href="">Join the conversation about this story &#187;</a></p> Internal Politics May Have Kept Microsoft From Dealing Amazon A Serious Blow (MSFT) Thu, 06 Sep 2012 14:17:44 -0400 Julie Bort <p><img style="float:right;" src="" border="0" alt="Microsoft Satya Nadella" /></p><p>Microsoft's latest <a class="hidden_link" href="">Windows</a> operating system for enterprise servers launched yesterday and should sell well.</p> <p>Microsoft is calling it a cloud-friendly operating system.</p> <p>But will its success cause Microsoft to win lots of new customers for its own Amazon-competitor, Azure?</p> <p>Probably not, one source close to Microsoft told BI.</p> <p>He says the new OS does not integrate with Windows Azure "in any concrete way."</p> <p class="p1">He says internal politics kept the Windows and Azure groups from working closely together.</p> <p>"So no, I don't think it'll help with Azure adoption in any way."</p> <p>We asked Microsoft about new features integrated with Azure and were sent a list:</p> <ul> <li>A feature in Windows Azure let's IT folks move apps between their own data center servers and Azure more easily.</li> <li>WS 2012 and Azure can now securely communicate though a virtual private networks.</li> <li>And Windows Server 2012 and Windows Azure can be managed through a single management portal.</li> </ul> <div><span style="line-height: 19.5px;">How is Azure doing as a product? Hard to say.</span></div> <p>Microsoft has been shy about reporting exactly how many users it has for its cloud. In May, Azure marketing exec <a class="hidden_link" href="">Bob Kelly</a>, said that Microsoft had in the "high tens of thousands" of customers for it and was "adding hundreds a day."</p> <p>Microsoft may have missed a good opportunity to beef up Azure's adoption.</p> <p>That's because Windows Server 2012 has been getting <a href="">good reviews</a>. It offers a lot of improvements over the previous server. Enterprises will probably move to adopt it sooner than they adopt Windows 8.</p> <p>We asked Microsoft if politics between the Windows Server team and the Azure team kept them from working more closely together. This is Microsoft's response:</p> <p>"Windows Server 2012 and Windows Azure are designed and developed for close integration to help customers build, manage and deliver applications across both their own datacenters and the Windows Azure public cloud, or in many cases both. &nbsp;Windows Server and Windows Azure are the foundation of the Cloud OS, which offers customers common application development, virtualization, management and identity technologies that can be applied to both."</p> <p><em>Are you a Microsoft insider with insight to share? We want to hear it! We are discreet. <a href=""></a> or <a href="!/julie188">@Julie188</a> on <a class="hidden_link" href="">Twitter</a>.</em></p><p><a href="">Join the conversation about this story &#187;</a></p>