Microsoft sharpens its cloud edge

Mumbai-based Zing HR, a human resources management firm, had a peculiar problem. Every morning and evening, while registering employee attendance, its data storage infrastructure would get overloaded.

By Anand J

The company had to buy servers to create capacity for just two hours of the day. But when Zing moved to Microsoft Corp’s Azure cloud service 10 months ago, it was able to cut its data storage cost by 30% apart from getting access to many analytical tools from Microsoft.

“We were earlier using the most popular cloud service out there. But we felt that the flexibility and tools that we were looking for were lacking. Also Microsoft came to us offering free onboarding and transitioning guidance from their Microsoft Development Centre (MDC),” says Prasad Rajappan, managing director of Zing HR. The company’s clients include HDFC bank, department of income tax, government of India and Adhunik Metaliks, a construction company. MDC is a 6,000 strong support and research centre of Microsoft in Hyderabad.

The $85 billion software giant from Seattle says that it is ready to be a ‘fierce competitor’ in a world headed towards a cloud-first mobile first era. “We see a proliferation of devices that create and consume data and the implications are far reaching. The cloud provides immense computing power to facilitate small business to expand without much capital cost and a flexibility of scale that they have never been able to do before,” says Tyler Bryson, general manager, marketing and operations at Microsoft India.

After Satya Nadella took over the reins from Steve Ballmer early this year, the company accepted the growth of the open source space in technology. It positioned Redmond-based Microsoft as a ‘Platform and Productivity’ company, subsuming Ballmer’s former four-pillar strategy of cloud, mobile, big data and devices. While the company’s devices have come as a failure despite the belated and moderate success of Surface tablets, the Windows operating system (OS) has been stagnating and Nokia increasingly being cornered by other Android handset makers.

Microsoft though is not worried about the consumerisation and the Android domination eating up its cloud business.

“Microsoft is becoming a much more open company and certainly market has led us that way and we are repositioning ourselves. And our tools and solutions support all the platforms and all languages apart from helping users to seamlessly transition from work and personal usage,” says Bryson. He points out that while devices create and capture data, the cloud will store and analyse data for its consumers. The cost of data collection, storage, security and analysis will come down with companies moving to cloud, Bryson adds.

However, Microsoft is tasting success in the cloud technology space, with the Azure platform growing at 136% during the latest quarter and now strongly positioned as the second biggest cloud player behind Amazon Web Services, which took startups and small business to the cloud in a big way. Amazon, which has 27% marketshare, grew at industry rates of around 50%, with the industry pegged at around $15 billion, on an annualised rate. The company, which now has 10% market share, has data centres in 19 locations across the world with two planned in India as announced by CEO Nadella on his trip to the country recently. Rajappan of Zing adds, “Domestic data centres will help us and Microsoft gain more financial services clients who are still concerned about information being moved into public cloud infrastructure outside of the country.”

IBM, which recently hived off its chip business, is growing its cloud business fast, gaining 7% market share, while Google has slashed prices forcing others including Microsoft to follow suit. “We believe cloud providers have not passed on the savings to customers based on the hardware price that has come down. On average, prices have fallen 15-20% year-on-year but the price drops by cloud providers have been in low single digits and we think that is not fair,” Shailesh Rao, Google’s global head of cloud business and director, told FE. All the companies are investing heavily in the cloud infrastructure, with Google pouring in $3 billion every quarter.

According to Bryson, in the enterprise world Microsoft still has a lead over others despite the enterprise apps being built on Google’s Play Store. “We are talking about the apps that run big dollar billion corporations and the scale is huge. People have been developing applications for our platforms for more than 20 years,” he says adding that such developers are coming to Azure. India has the second largest number of developers after the US with 1.6 million developers. India is important than most other markets as it provides software services to customers around the world, Bryson says.

Bryson says that Microsoft’s hybrid public-private cloud option for its customers gives it an edge over other cloud players. Bryson adds that the other products of Microsoft like Office 365 now being available over cloud also helps it gain more small businesses despite Google’s early penetration. “We are increasingly giving consumers the choice,” he says.