Microsoft, which now ranks among the world's Top 100 Cloud Services Providers, wants to have its cake and eat it, too. Even as the company expands the Windows Azure cloud, the company also partners with more than 16,500 infrastructure hosting partners and nearly 10,000 application hosters. The big question: Can all of those CSPs thrive while competing and cooperating with Microsoft's own cloud services?
The debate reached a new level when Microsoft launched Cloud OS Network -- an ecosystem of more than 25 CSPs that currently or will soon leverage Windows Server 2012 R2, System Center 2012 R2 and Windows Azure Pack.
Many Cloud OS Network community participants are wildly successful. Examples include CSC (Computer Sciences Corp.), Dimension Data and Fujutsu Ltd. -- each of which have thriving managed and cloud offerings.
Cloud OS Alternatives
Still, the vast majority of the world's top CSPs and top MSPs (as tracked by MSPmentor) don't leverage Microsoft's Cloud OS platform. Plus, additional competition looms on multiple fronts:
- VMware's vCloud Hybrid Service continues to expand, with CenturyLink set to offer more data center support soon.
- OpenStack, the open source cloud platform, continues to gain ISV and service provider support. Plus, consulting firms like Mirantis are training OpenStack professionals.
- Google Compute Engine went live earlier this month. The combination of Compute Engine and Google Apps will compete aggressively against Azure and Office 365.
- Amazon Web Services continues to expand beyond its IaaS heritage. The latest example is WorkSpaces -- a hosted Desktop as a Service (DaaS).
Competition and Cooperation
Within Microsoft's own ecosystem, stress levels also will rise. Similar to how Microsoft now competes and cooperates with tablet and PC makers, the computing giant increasingly competes with its own CSP partners. Two examples:
- Windows Azure is adding 1,000 customers per day.
- Office 365 now has a $1.5 billion annual revenue run rate.
As a result, it's a safe bet CSPs that offer hosted Exchange, SharePoint and Lync will increasingly feel pricing and competitive pressures from Microsoft's cloud. And the price cuts will never stop, since Microsoft must keep pace with constant price cuts from Amazon, Google and more.
Why IT Pros Should Care
For IT professionals who want to extend on-premises workloads to the cloud, the news certainly is good. Microsoft's cloud services appear to be thriving. And third-party CSPs are joining the Cloud OS Network.
Still, make sure you do your homework. Growing competition means some CSPs will not survive over the long haul. Make sure your applications and corporate data don't get locked in a cloud data center that ultimately goes dark -- forever.
Contributor Joe Panettieri (@JoePanettieri) is editorial director of Nine Lives Media, a divsion of Penton.
