August 15, 2022
Microsoft introduces new technology to tie its cloud to rivals

Microsoft on Tuesday announced a new round of technologies aimed at making its cloud computing services work in data centers it doesn’t own — including the cloud data centers of its rivals.

Microsoft executives and analysts say the strategy has been crucial to the company’s growth in the cloud computing infrastructure market, which research firm Gartner estimates is worth $64.3 billion (about Rs 4,79,650 crore) and where Microsoft is a close match to market leader Amazon. The latter is in second place. Amazon Web Services. Microsoft said last week that revenue from its flagship cloud offering Azure grew 48 percent, a result that helped it overtake Apple as the world’s most valuable publicly traded company.

Microsoft’s strategy includes building out its most lucrative cloud software services, such as database tools, so that they can run inside their own data centers, which are owned by customers or even those of rivals such as Amazon. Huh.

Microsoft’s head of cloud and artificial intelligence Scott Guthrie told Reuters that the move has persuaded some customers to use its services when they can’t always use Microsoft’s data centers. Royal Bank of Canada, Guthrie said, faces legal requirements to keep some of its computing operations in its data centers and uses technology called Azure Arc to connect those facilities to Microsoft’s cloud.

“Historically the challenge with high-end services has been the concern of ‘locking in’ – what if I could only use them in your data center?” Guthrie said. “Customers feel more comfortable using those services because of the freedom of movement.”

Ed Anderson, a vice president, Gartner’s Distinguished Analyst, said the approach opens doors for Microsoft with customers, but it forces the company to compete on the quality of its software services rather than packaging it with cheap computing power. .

“To be honest, it’s a better way to compete,” Anderson said. “Customers are skeptical of rhetoric. They look for proof of capabilities and are wary of things where in theory the technology is multi-cloud but perhaps the software licensing doesn’t support it.”

© Thomson Reuters 2021

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