Microsoft will likely top $50 billion in cloud revenue at this time next year.
Microsoft will likely top $50 billion in cloud revenue at this time next year.

If #1 Microsoft Isn’t “Real” Cloud, Why Are World’s Largest Companies Buying It?

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The ridiculous premise that Microsoft’s industry-leading commercial-cloud business isn’t “real” cloud got even more absurd last week as two massive corporations—ExxonMobil and Albertsons—picked Azure, Dynamics 365 and Microsoft 365 to accelerate their digital transformations and drive innovation and revenue.

For reasons I cannot fathom and that have no basis in reality, some pundits and supposed experts in the media continue to push the silly notion that the only “real” cloud is IaaS, and that therefore Amazon, the world leader in IaaS by a large margin, is the world leader in the cloud.

That shallow perspective fails to take into account the vast and fast-growing software layers of the cloud—PaaS and SaaS—and attempts to relegate Microsoft’s massive cloud businesses for its Microsoft 365 and Office 365 franchises into the never-never land of “not really cloud.”

And yet, while such silliness continues to make its way into articles and analyses, Microsoft continues to win huge and transformative deals with corporations that could have picked any cloud provider in the world.

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RECOMMENDED READING FROM CLOUD WARS:

The World’s Top 5 Cloud-Computing Suppliers: #1 Microsoft, #2 Amazon, #3 Salesforce, #4 SAP, #5 IBM
Amazon Versus Oracle: The Battle for Cloud Database Leadership
As Amazon Battles with Retailers, Microsoft Leads Them into the Cloud
Why Microsoft Is #1 in the Cloud: 10 Key Insights
SAP’s Stunning Transformation: Qualtrics Already “Crown Jewel of Company”
Watch Out, Microsoft and Amazon: Google Cloud CEO Thomas Kurian Plans To Be #1
The Coming Hybrid Wave: Where Do Microsoft, IBM and Amazon Stand? (Part 1 of 2)
Oracle, SAP and Workday Driving Red-Hot Cloud ERP Growth Into 2019

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Late last week, it was energy giant ExxonMobil (2018 revenue of $290 billion) and grocery-store leader Albertson’s (2018 revenue will be about $60 billion) that chose Microsoft Azure and related cloud solutions to help the companies reinvent themselves for the digital future.

ExxonMobil had this to say about its partnership with Microsoft in the Permian Basin in the southwestern U.S.—and bear in mind it is customer ExxonMobil, not Microsoft, making these claims:

  • “Permian application to generate billions of dollars in value over the next decade and drive capital efficiency”
  • “Potential to expand production by as much as 50,000 oil-equivalent barrels a day by 2025”
  • “Largest-ever oil and gas acreage to use cloud technology”
  • Microsoft “will help drive growth in the Permian and serve as a model for additional implementation across the U.S. and abroad,” said Staale Gjervik, senior vice president, Permian Integrated Development for XTO.
  • “The unconventional business is fast moving, complex and data rich, which makes it well suited for the application of digital technologies to strengthen our operations and help deliver greater value,” Gjervik said.

Albertsons Companies offered these perspectives about how Azure and related cloud services will boost customer experiences by enhancing the company’s digital capabilities and turning the promise of the “frictionless future” of grocery shopping into a reality.

  • “Our partnership has already produced an innovative way to save time at the gas pump,” said executive vice president and CIO Anuj Dhanda. “Microsoft’s strengths in cognitive technologies, artificial intelligence and data science applied at scale at Albertsons Companies will transform the customer experience in our stores and digitally.”
  • Albertson’s plans to use Using Microsoft Azure, Azure AI and Azure Cognitive Services in both short- and long-term projects to help employees make better and faster decisions that will lead to better outcomes for customers.
  • And Microsoft 365 will provide a secure and modern cloud-based work platform for employees at both the store level and at Albertsons headquarters.
  • Problems Albertons hopes to eliminate: customers can’t find the products they want, the wait-times at the butcher shop and deli counters are excessive, and overly long checkout lines create a bad impression as customers complete their shopping experience.

And these two very different types of deals with massive and highly demanding customers come as the momentum for Azure and other elements of the Microsoft commercial cloud show no signs of letting up even as the annual revenue for Microsoft’s commercial cloud tops $32 billion.

Earlier last week, I wrote about how Microsoft corporate VP Julia White touted the “phenomenal pipeline” of large global companies moving their SAP workloads to Azure, and six months ago the world’s largest automaker, Volkswagen, made a major commitment to the Microsoft cloud.

Microsoft strikes cloud deals with two more massive companies, proving why it's #1 in cloud

Two weeks ago, in a piece called #1 Microsoft vs. #2 Amazon: Numbers Prove Who Rules the Cloud, I laid out in great detail the financial evidence for my contention is that it is Microsoft and not Amazon that’s ruling the cloud. And trust me, I have great respect for Amazon and AWS CEO Andy Jassy, whom I recently named as the Cloud Wars CEO of the Year for 2018.

One more example: last summer, the world’s largest company, Walmart, signed a massive 5-year deal with Microsoft to lead the Fortune 1 company into the future: Walmart CIO: We Picked Microsoft For Huge Cloud Deal To Accelerate Digital Transformation.

Competition’s a great thing, and customer choice is a fabulous thing. And here in the Cloud Wars, the company that’s winning more often than anyone else—especially with some huge and industry-leading global players—is Microsoft.

And that’s not a fuzzy-headed opinion—that’s a fact.

(Disclosure: At the time of this writing, Microsoft was a client of Evans Strategic Communications LLC.)

 

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RECOMMENDED READING FROM CLOUD WARS:

The World’s Top 5 Cloud-Computing Suppliers: #1 Microsoft, #2 Amazon, #3 Salesforce, #4 SAP, #5 IBM
Amazon Versus Oracle: The Battle for Cloud Database Leadership
As Amazon Battles with Retailers, Microsoft Leads Them into the Cloud
Why Microsoft Is #1 in the Cloud: 10 Key Insights
SAP’s Stunning Transformation: Qualtrics Already “Crown Jewel of Company”
Watch Out, Microsoft and Amazon: Google Cloud CEO Thomas Kurian Plans To Be #1
The Coming Hybrid Wave: Where Do Microsoft, IBM and Amazon Stand? (Part 1 of 2)
Oracle, SAP and Workday Driving Red-Hot Cloud ERP Growth Into 2019

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