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OPINION: Microsoft's Cloud Services Mix Leaves Many Vendors in the Dust

Rob Enderle | Nov. 12, 2012
We are moving back to computing as a utility, and companies such as Google, Amazon and Microsoft appear to be understanding this move best.

Like other big trends, this will take a decade to mature. The end results, at least the one the service providers currently are demonstrating, fall down two paths: one in which the service provider buys commoditised hardware and sells the service to line management, and another in which the service provider is the hardware manufacturer, uses this to create competitive advantage and sells that advantage to line management.

Right now, both paths suggest that IT as we know it is largely outsourced to the service provider-rendering IT obsolete as it currently exits. We've seen this play out early in the trend cycle as line employees have used personal credit cards to buy Web services for their line of business.

Will Microsoft Become the New IBM?
If you look at the cloud service providers, only Microsoft has the full solution right now. With Azure and services such as Office 365, Redmond has both desktop- and server-based subscription services that comply with corporate requirements. Microsoft also has a sales force that can sell these services and is increasingly crafting this entire capability internally, from specialised servers to the new Microsoft Surface clients (the company's equivalent of a terminal).

The irony is that Microsoft never wanted to become IBM, yet that now appears to be its path to success. While Microsoft remains in front, Amazon and Google give chase, and even Apple appears to be adjusting itself to come after this opportunity.

For IT departments, the best self-defense may be to stop pretending this trend isn't happening and to start driving it themselves by facilitating these moves, assuring they are done properly and pushing vendors into supplying the services that line executives want. IT survives if it can become a strong advocate for line executives' needs and can effectively facilitate a more successful response-but it becomes obsolete if this service gets internalised.

Rob Enderle is president and principal analyst of the Enderle Group. Previously, he was the Senior Research Fellow for Forrester Research and the Giga Information Group. Prior to that he worked for IBM and held positions in Internal Audit, Competitive Analysis, Marketing, Finance and Security. Currently, Enderle writes on emerging technology, security and Linux for a variety of publications and appears on national news TV shows that include CNBC, FOX, Bloomberg and NPR.

 

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