Sanford C. Bernstein just released "MSFT Q315: Who's Got the Biggest Cloud Now? ...And It Grows Faster Too!!!" The Wall Street brokerage firm's analysis of Microsoft's Q3 results found that the Commerical Cloud segment - which includes Microsoft Azure - helped the company beat consensus estimates for revenue, EPS, and operating margin.
Bernstein Senior Analyst Mark Moerdler writes "Microsoft's Commercial Cloud now has an annualized revenue run rate of $6.3B and grew 111% in constant currency this quarter. Note this makes their Commercial Cloud larger than Salesforce.com and growing over 3x as fast." Later on he reports that "customer usage of Azure compute doubled."
To sustain this incredible pace, however, Azure management tools will be needed. Here's why.
The growth of Microsoft Commercial Cloud and Amazon Web Services proves that enterprise customers are becoming comfortable moving their computing workloads to the cloud. This shouldn't come as a surprise. If the cost is the same, if you can get the same flexibility, and if you can simplify management, wouldn't you rather get out of the PC business and just "rent" the desktops and apps that your users need? And wouldn't the cloud be a better way to do DR or handle temp/contract workers than buying excess VDI capacity?
The challenges, of course, are the three "ifs". To date,
- Public cloud desktops haven't been cheap enough.
- The first attempts at Desktops as a Service (DaaS) have not been flexible. They have been rigid, one-size-fits-all desktops that don't meet the unique application and personalization needs of most corporate users.
- Management hasn't been simpler. Issues with application virtualization, Windows gold image sprawl, and management tool complexity have made cloud desktops harder to manage than physical PCs, requiring more IT staff and/or more senior IT skillsets.
Moerdler writes, "We believe there is significant opportunity in the Commercial Cloud and we are in the early stages of this massive growth story." We agree. But only if a new breed of desktop and application management software - designed for the cloud - emerges to address these 3 challenges.