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Earlier this year, Microsoft made waves when it announced it was shifting gears. Its primary focus is now Azure, rather than Windows. It might seem perplexing because Windows is still popular among enterprise organizations.
Microsoft leadership bet its future on Azure. That’s why a cloud platform, not an OS, now drives Microsoft.
Putting a bold vision into action
Satya Nadella is a 180-degree departure from his brash predecessor Steve Ballmer. While Ballmer would be sweating through his shirt screaming, Nadella has an “air of imperturbable capability.” He’s been described as thoughtful, inclusive and egoless. But he’s every bit as competitive as Ballmer and their predecessor — Bill Gates.
Strategically and tactically, Nadella went all in on the cloud from his first day. His first company-wide email outlined a cloud-centric mission. A month after Nadella became CEO, Windows Azure was renamed Microsoft Azure. The subtle change symbolized a bold direction. Azure, not Windows, would drive Microsoft.
Windows is obviously still around. Very much so. Though, it’s been transformed by the “cloud think” permeating all of Microsoft’s traditional product offerings. There’s now focus on seamless architecture from premise to cloud. Consider the Windows as a Service feature that launched in 2017.
Using the cloud, Microsoft now delivers product updates and new features several times a year. The traditional update cycle was semi-annual or longer. Other Microsoft legacy products such as Office 365 also use this model.
Nadella isn’t afraid to go against tradition either to implement his vision. Long a staunch defender of proprietary software, Microsoft now embraces open source. Remember, Ballmer famously called Linux a “cancer.” Nadella delivered another 180-degree turn. In 2014, he said, “Microsoft loves Linux. Twenty percent of Azure is already Linux. We will always have first-class support for Linux.” As of Fall 2017, 40 percent of virtual machines in Azure ran Linux.
This once unlikely relationship signals Microsoft’s embrace of the cloud. To provide customers with more flexibility, it needed open source in the fold. Proving Microsoft was more than Windows helped Azure appeal to more customers.
Banking on Azure as an enterprise cloud solution
From the get-go, Nadella positioned Azure as the cloud solution for the enterprise. During his first year as CEO, he touted Microsoft’s data centers. He encouraged businesses to use them to store data, house software, and even handle big data.
And Microsoft invested accordingly in its data center infrastructure.
In Q1 2016, Microsoft increased its data center spend by 65 percent. The investment enabled it to meet the increasing business demand for cloud services. Today, Microsoft has 52 data center regions, more than any of its competitors.
Microsoft is banking on the versatility of Azure’s hybrid cloud. Organizations need consistency across development environments, operating models, and technology stacks. A hybrid cloud provides that stability, allowing services and applications to run together.
More organizations are using hybrid clouds to drive business strategies. And for organizations using applications that don’t translate well to the cloud, hybrid clouds are ideal.
Expect AI (artificial intelligence) to be the next big thing for Microsoft. Nadella believes converting data to AI will help businesses gain competitive advantages. Azure’s advanced tech already uses AI and the IoT.
In a span of just four years, Nadella used Azure to turnaround Microsoft. That doesn’t appear to be changing any time soon.
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Azure, not Windows, is driving Microsoft’s strategy and revenue growth
Windows is no longer the powerhouse that drives Microsoft’s growth. From organizational changes to recent acquisitions, Azure is at the forefront.
Earlier this year, Microsoft formed two new engineering teams: “Cloud + AI Platform” and “Experiences & Devices”. The goal of these teams is to lead Microsoft’s intelligent cloud and edge efforts.
These teams were formed by splitting apart the previous Windows and Devices group. Windows Server development also is now under the Cloud + AI Platform group. Under this realignment, legacy development teams are subservient to the cloud.
Earlier this month, Microsoft acquired GitHub for $7.5 billion. Such a move five years would’ve been unfathomable. GitHub is an open source software development platform. But times have changed under Nadella.
About 24 million people use GitHub, which features more than 80 million repositories. Owning GitHub strengthens Microsoft’s relationship with open source. It’s also really a shrewd brand ploy. The more Microsoft appeals to developers, the more likely developers will use Azure. Despite the initial backlash, the acquisition is sound logic given GitHub’s wild popularity.
It appears Microsoft is finally free of the Windows stranglehold. Azure drives the decisions — even ones that don’t provide direct or immediate financial gain. However, Microsoft can afford to play the long game. It’s not like the cloud isn’t paying off.
At the end of Q3 2017, Microsoft’s commercial cloud annualized revenue was more than $20 billion. Microsoft relies on its enterprise savvy and established customer base to push Azure. For example, Azure integrates well with Windows Server. Legacy products like Windows Server are still widely used. It also doesn’t hurt that Azure’s interface is described as business friendly.
How does this shift affect Learners?
Microsoft’s cloud-heavy strategy is causing significant changes to their organizational structure. But there won’t be an immediate impact on IT professionals or end users. This is especially true when it comes to certification.
If you’ve already started, continue on your MCSA or MCSE paths. If you hold those certs, you should earn Azure certification. It would position you to help enterprises leverage Azure. As a result, you’d likely be in high demand.
Start first with Microsoft Certified Solutions Associate (MCSA): Cloud Platform. Then move on to earning your Microsoft Certified Solutions Expert (MCSE) in Cloud Platform and Infrastructure. We also prepare learners for the MCSA: Cloud Platform certification exams with the Microsoft Azure 70-532 and Microsoft Azure 70-533 courses.
Microsoft placed more value on the cloud. Why shouldn’t you? Adding more cloud to your skill set will help you keep up with the changing IT industry.