Sorry, Amazon, But Microsoft Is The World’s #1 Cloud Vendor – Forbes – Forbes
(Note: After an award-winning career in the media business covering the tech industry, Bob Evans was VP of Strategic Communications at SAP in 2011, and Chief Communications Officer at Oracle from 2012 to 2016. He now runs his own firm, Evans Strategic Communications LLC.)
CLOUD WARS - Amazon Web Services is one of the truly great success stories of the past decade—superb vision, brilliant execution, outstanding people, and a hockey-stick growth rate that most enterprise-tech vendors can only dream about.
But life’s not always fair, and while AWS and its supporters can make some good points about how and why it’s the biggest of the big dogs in the cloud, the simple truth is that Microsoft is able to offer corporate customers more cloud innovation across more parts of those customers’ businesses—and can drive more business value for those customers via the cloud—than Amazon can.
And that’s why Microsoft is #1 in the Cloud Wars Top 10 ranking, and AWS is #2: while Amazon is unquestionably helping tens of thousands of businesses cut IT costs and accelerate some key processes, Microsoft and its sweeping Commercial Cloud products and services have become indispensable digital-transformation enablers for businesses in every industry in every region across the globe.
Let’s analyze this horserace from a few different perspectives: revenue, completeness of cloud offerings, future vision, scalability for world’s largest and most-demanding workloads, integration of powerful advanced technologies into cloud, and customer appeal across all industries.
Revenue. For the first quarter of 2017, Amazon said AWS was on a annual revenue run rate of “more than $14 billion,” while for the same period and the same metric, Microsoft CEO Satya Nadella cited a figure of “more than $15.2 billion.” So Microsoft wins the revenue game by probably $1 billion or more.
Completeness of cloud offerings. While AWS is an absolute killer in Infrastructure as a Service (IaaS), its Platform as a Service (PaaS) business is in its early stages, and it doesn’t play in the cloud-applications (SaaS) space.
Microsoft has become a powerhouse in all three layers, and that’s incredibly important because while some inside-baseball tech-industry purists will scream that each of those three categories must be evaluated separately, C-level executives on the customer side place huge value on completeness of offerings so that they don’t have to spend vast amounts of time and money integrating and patching and splicing disparate elements from multiple vendors that were never intended to work together.
So while tech-industry purists might sniff at such perspectives, customers embrace them and are increasingly making decisions based on depth of cloud commitment and assets.
Future Vision. Again, for what AWS does, it’s terrific—but at the same time, Nadella has spurred Microsoft to go all-in and end-to-end on the cloud across its enormous range of products and services that span everything from IoT sensors to mobile devices to hundreds of millions of PCs to mission-critical servers and all the way in to the data center itself.
That approach means that Microsoft is able to not only understand but also address customers’ needs across the board, which means customers aren’t forced to go to 100 different cloud vendors to procure 100 different services that will require thousands of people to integrate, manage, secure, and babysit.
Here’s how Nadella put it in his opening remarks during Microsoft’s recent Q1 earnings call—and please think about the significance of what he calls “the entire digital estate”: “[Customers] value our differentiated approach as the most trusted global hyperscale cloud with hybrid support and higher-level services to help drive their digital transformation. Moreover, they appreciate the agility, operational consistency, and security across the entire digital estate, spanning enterprise mobility, Office 365, Dynamics 365, and Azure.”
Scalability for world’s largest computing workloads. Nadella shared this overview of how the world’s largest transport and logistics company, Maersk, has increasingly shifted more of its business to the Microsoft Cloud to manage global operations spanning 1,000 vessels and 130 countries. “Maersk began their journey to the Microsoft Cloud with Office 365, Enterprise Mobility and Security in Windows 10,” Nadella said on the earnings call.
“They chose Dynamics 365 for operations to streamline container production and maintenance. Now Maersk is using Azure to digitally transform its supply chain management and global trade. The intelligent services in Azure deliver up-to-the-minute insights on carrier performance and equipment usage with real-time data visualization and advanced analytics, enabling them to trim costs and create new revenue streams.
“For a company that ships 17 million containers annually, the ability to react quickly can mean the difference of tens of millions of dollars to the bottom line. This is a great example of our three clouds coming together to enable deep digital transformation.”
Adopting advanced technologies to help customers drive digital transformation. Consider this: while most enterprise-tech companies have been talking about IoT and how wonderful it will be, very few have cobbled together (a) a complete and coherent strategy for what customers want and need for IoT, let alone (b) a complete set of products, technologies, and services that bring that strategy to life.
Among those that have delivered on both, Microsoft has jumped into the lead with its IoT Central, which Nadella described as “the first SaaS offering that provides the end-to-end solution for organizations of all sizes to manage their entire IoT ecosystem across devices, cloud, analytics, networks, and software.”
And recently at the world’s largest industrial trade show in Hannover, Germany, Nadella said, Microsoft worked with a range of manufacturing exhibitors to “showcase how they’re using our solutions to transform all aspects of manufacturing, from water management to food and beverage packaging, to improving safety on the factory floor.”
Appeal to and ability to perform across a wide range of industries. In an earlier earnings call—this one in late January—Nadella talked about another example of the power of Microsoft’s engagement at all levels of “the digital estate” at Mars Inc., a $35-billion global CPG powerhouse that was an early adopter of Office 365.
After that, he said, Mars adopted Windows 10 “to transform how its 80,000-strong global workforce collaborates while staying secure.” Building on that successful project, Mars then took the big leap into production apps in the cloud by “running mission-critical workloads on Azure with hundreds more on the way, including inventory management using Azure IoT.”
These examples make it unmistakably clear that Microsoft’s not just tinkering around the edges but is pushing its vast and fully integrated cloud capabilities toward running the workloads of some of the biggest corporations in the world.
Taking the AI Train. Okay, you might ask, but what about AI? Is Microsoft going to fall behind IBM and Salesforce.com and SAP? Let’s look at another customer example cited by Nadella in the more-recent earnings call of real-world production systems built on the Microsoft’s cloud, AI, and IoT services. “Digital transformation across these industries is being shaped by new technologies, from IoT to mixed reality to AI and the cloud,” Nadella said.
“thyssenkrupp Elevator is using HoloLens and Azure to digitize their entire sales and order process, shortening delivery times by 400%, and they chose Dynamics 365 to enable transformation in their Steel division. Leading global medical-technology company Stryker chose Office 365 to empower employees and is using HoloLens to improve operating-room designs for surgeons, staff, and ultimately the patients.”
I have a ton of respect for Amazon Web Services, and for the vision and drive of CEO Andy Jassy. It is no knock at AWS to be ranked #2, because the company in the top spot is simply doing a wide range of essential and transformative things for customers that other cloud vendors can only talk about.
Microsoft, congratulations on being #1 in the Cloud Wars Top 10. But you better keep pushing and driving on this hyperscale customer-centric innovation, because as the fabulous Satchel Paige once said, “Don’t look back—something might be gaining on you.”