Unfortunately, weather in the Midwest has kept me from attending TechEd 2013 in person, but I’m there in spirit and watching from afar.
It’s pretty popular to speculate about the demise of a giant, particularly one with a checkered past such as Microsoft. It’s true that the company has major challenges ahead of it, but many signs indicate that, while the winds of IT are changing in many ways, Microsoft’s future is secure.
According to this information, Google Apps is far and away the current leader when compared against Office 365. Bear in mind that this information pits cloud service vs. cloud service. When on-premises solutions are included in the analysis, Microsoft remains the leader in the collaboration space.
As more organizations opt to trade in on premises services for cloud-based ones, though, it’s obvious that Microsoft has the most to lose. Further, according to this survey of UK IT decision makers, Microsoft is in a very good place over the next 24 months. According to the survey, 37% of respondents plan to deploy Office 365 within two years compared to only 15% for Google Apps.
While hardly a scientific survey, it does point to a positive direction for Microsoft and the company’s cloud ambitions.
And speaking of cloud…
Microsoft’s Azure cloud platform and service offerings are enjoying tremendous success. This year, Microsoft announced that these service offerings have crossed the $1 billion threshold. At present, Azure commands about 20% of the cloud market compared to 71% for Amazon Web Services. Analysts expect Azure to expand to up to 35% in the next year, at the expense of AWS.
At TechEd 2013, Microsoft made a number of major announcements with regard to Windows Azure:
- Users are no longer being charged for virtual machines that are in a stopped state.
- Billing is now being performed on a per-minute basis. Previously, if a user used any portion of an hour, he was charged for a full hour.
- Microsoft has announced dramatically lower dev/test pricing. In some cases, dev/test pricing for Windows Azure is 97% off standard rates. In fact, all MSDN subscription holders can use a variety of Azure services now for just 6 cents per hour.
Between 2008 and 2013, Hyper-V’s market share has increased from 20.3% to 27.5% of the market while VMware’s share has dropped from 65.4% to 56.8%. At first glance, one would assume that vSphere has lost major ground, but that’s not likely the case. During this period, the entire virtualization market has grown dramatically. VMware now commands a smaller portion of a larger whole. However, using that same logic, it’s obvious that Microsoft has made incredible gains in the past few years. Hyper-V 2012 was a major step forward for hypervisor competition and it appears as if its paying dividends.
It’s likely that we’ll see continued Hyper-V growth, too, particularly as Microsoft releases Windows Server 2012 R2 in late 2013. This R2 release carries with it a number of new improvements to Hyper-V, including:
- Windows Azure compatibility: Seamlessly migrate virtual machines to and from Windows Azure.
- Generation 2 virtual machines: These are virtual machines that shed all of their legacy shackles and run solely on UEFI. Gen 2 virtual machines support only 64-bit operating systems starting with Windows 8 or Windows Server 2012.
- Improved workload migration: Microsoft indicates that the new Hyper-V will provide Live Migration speeds that are up to twice as fast as the feature found in Hyper-V 2012 thanks to new inbuilt compression capabilities.
- Better storage control: With Storage Quality of Service, Hyper-V can throttle virtual machines that are using inordinate storage I/O.
These are just a few new features in Hyper-V 2012 R2, but they demonstrate Microsoft’s commitment to moving forward as well as to positioning Azure as an easily consumable go-to platform.
The client side risk
Perhaps the area in which Microsoft is most at risk is on the client side. Windows 8 has certainly not been the success that Microsoft expected, and it’s created numerous challenges that need to be overcome.
However, given that many of the world’s enterprise applications continue to run on Windows, and given that Office remains the dominant player in the desktop space, thinking that Windows is going to die is simply exaggeration. While we’re likely to see some further loss of Microsoft control over endpoints, it’s likely that a good portion of that loss will be converted into virtual desktops consumable by any endpoint device on the market, although Microsoft is continuing to push its Surface Pro tablet, and there are rumors afoot that the company is working on the successor to this line of products. Obviously, the company isn’t going to give up. It has a lot invested in Windows.
Action Item: For CIOs, there is clear upside on what’s happening with Microsoft, notwithstanding the client issues that the company is working to overcome. With so many data centers running mostly Windows applications coupled with the fact that Azure also supports Linux virtual machines, Microsoft is positioning itself well as a provider for the future and enabling organizations to seamlessly migrate workloads between on and off premises services.