Why Microsoft Still
Matters
It is hardly one of the
cool kids on the tech block, but in a world where data integrity and trust
matters, the company's Azure cloud platform is a security blanket for big
corporations.
CEO, 1871 @tullman
Way back in April of 2014, I wrote a short cautionary column about
some of the good and bad aspects of the cloud. Specifically, I noted that
startups in particular needed to make certain that they didn't end up
prematurely spreading their businesses a mile wide and an inch deep. The many
charms and exciting enticements of the cloud make this frightfully easy to do.
The cloud is cheap, relatively easy to navigate, and everywhere you wanted to
be (just like VISA)-; all at once. That, of course, is both a blessing and a
potential curse if you aren't careful about how you roll out your offerings.
Trying to support and service from "here to eternity" isn't easy for
anybody.
At that time,
especially for new entrants, the main reason that the cloud was so easy and
accessible was because there was really only one reasonable and cost-effective
on-ramp. That was Amazon Web Services (AWS), which really created the cloud for
us civilians who simply didn't care to learn about, or pay for, any more
infrastructure than what was absolutely necessary to get our companies
launched. AWS was an inexpensive, ubiquitous and utterly scalable ("buy"
the byte--pun intended) solution that seemed to become the industry standard
overnight. Google and Microsoft were basically nowhere, and IBM wasn't even in
the game. Watson was playing chess while Amazon was cashing checks.
I sat in many tense
meetings when the guys from Microsoft tried to give people amazing deals on
Azure (which Microsoft eventually offered as a cloud alternative) and it was as
if they were offering to give these people a bad case of acne. Microsoft was
discovering that it couldn't even give the service away and, for my two cents,
I didn't see any realistic prospect that things would get better. Not
because Azure was a bad service, but because the last thing growing startups
can afford (regardless of the "learn as you go" myths) is on-the-job
training. No one wants to pay for someone they're already paying to learn on
their dime. The brutal reality was that even if you were inclined to try
Azure, you couldn't find and hire anyone who knew how to work with it, because
everyone else you knew was using AWS. If you can't find the horses to hurdle
the next hill, you stick with the herd and go with what's tried and
true-- even if it's relatively new. In the mainframe era, guess who got
rich from the saying, "Nobody ever got fired for choosing IBM."
So, for several years,
I basically believed, once again, that Microsoft had missed the boat.
("Binged" anyone lately?) And frankly, when I continued to see that
Microsoft still ranked among the most valuable companies in the world, its
stock at all-time highs, I couldn't really understand or explain why. I had met
Microsoft CEO Satya Nadella at 1871 and he was a terrific and
committed technologist, but he wasn't a magician. There had to be more to the
story.
Ultimately, whenever I
was asked, I attributed Microsoft's persistent value largely to the inertia
that kept Windows and Office entrenched for so many years. No one I know is
getting any less lazy and sticking with what has worked for you in the past is
too easy, even though it's not gonna get the job done going forward. Habits and
installed bases are hard to break.
The better explanation is that I hadn't really focused on a much
bigger boat and a far more material movement. I was so entrenched in our
startups and small businesses that I missed how quickly the cloud was
transforming the enterprise-level solutions. The biggest global
businesses can't get to the cloud fast enough. And frankly, this space is
Microsoft's home court and increasingly one where, once again, it's Microsoft's
business to win or lose. I like Microsoft's odds these days because I learned
long ago that, if you want to beat Babe Ruth, you
better be playing something other than baseball.
However, the real psychological driver-- the thing that
even Amazon (and certainly GOOGLE as well) will have to eventually
overcome-- isn't simply the reliance on the breadth and stability of
Microsoft's technology, which by definition is almost never cutting-edge.
Microsoft's critical advantage is that in our new connected world, where we get
into strangers' cars, invite strangers to stay in our homes and buy things from
strangers all over the world, nothing matters more than trust. And, lo and
behold, the big boys trust Microsoft a lot more with their data and their
security than they may ever trust the new
tech kids on the block.
The trust issue is
likely to make Azure a winner in the long run. If you're looking for someone to
hold your hand while you're crossing the chasm, it's more than reassuring to be
guided and supported by Microsoft, a company that's already there with its
legacy customer base. Just as an example, Microsoft's Active Directory service
has more than a 90% market share in the enterprise segment.
As hard as it is to
believe, Microsoft--an ogre for decades-- has become the trusted OG and,
most likely, the keeper of the cloud for the future.
