Back in June Microsoft announced major enhancements to its Azure public cloud – adding a robust set of Infrastructure as a Service (IaaS) capabilities to the existing .NET based Platform as a Service (PaaS) capabilities. Now comes word that Microsoft will put the Azure Service Management Portal into the Service Provider Edition of Windows Server 2012, allowing service providers to offer their own branded Azure based clouds. This leads to one question on Microsoft’s Windows Azure Strategy. How much of Azure will be in the version of Windows Server 2012 destined for on premise enterprise use?
Microsoft’s Biggest Asset
Microsoft’s biggest asset is the installed base of its Windows Server operating systems, the associated Windows applications that run on those servers and the corresponding Windows Desktop operating systems and applications. If you look at Microsoft as a cloud vendor with this asset in their pocket and compare Microsoft to Amazon and VMware the differences are stark. Amazon has effectively zero on premise footprint unless you include the on premise installations of AWS compatible clouds from vendors like Eucalyptus. VMware claim over 250,000 customers, but the customer base for Windows Server is at least one order of magnitude (10x) larger.
It is also the case, the Microsoft has a massive presence at the application layer that neither VMware nor Amazon have. If you look at the installed bases of SQL Server, Exchange Server, IIS, and the multitude of other server based applications, Microsoft is far ahead of any of its rivals on this front.
The New Windows Azure Strategy
Let’s combine the two things that we do already know with some informed speculation on the third:
- We already know that Microsoft is positioning the Azure public cloud as a robust, flexible and open IaaS public cloud offering fully capable of competing on a head-to-head basis with Amazon AWS and anyone else (Google?) who may enter the public IaaS market in the future.
- We have just seen the announcement that hosting companies will be able to private label Azure and offer Azure IaaS and PaaS services to their customers through the integration of the Azure Service Management Portan and API to Windows Server 2012.
- There is only one missing piece – one that Microsoft has hinted at on many previous occasions. That is how much a Azure is going to be built into the version of Windows Server 2012 that will be sold for on premise use by enterprise customers world wide?
The Seamless On-Premise, Service Provider, Azure Public Cloud Strategy
Microsoft has already stated on numerous occasions that it is going to let customers set up where applications run in their on-premise installations of Active Directory and at the same time point each set of users to the appropriate installation (on premise, server provider, Azure Cloud) instance of those applications. Microsoft has taken steps to make migrating SQL Server databases between instances easier. If Microsoft follows through on all of this with something that makes delivering applications on Windows 2012 identical to ordering up applications through a service provide or the Azure Cloud then Microsoft will be effectively leveraging it biggest asset (the installed base of Windows and Windows applications) to feed its Azure cloud strategy.
Impact on VMware vCloud
Many service providers have already stood up vCloud based clouds in an attempt to steal workloads running on the on-premise instances of VMware vSphere. So right now VMware is ahead of Microsoft in terms the size of the third party cloud ecosystem that has been built. But Microsoft has a substantial existing ecosystem of hosting providers that it fully intends to convert into Windows Azure Cloud partners. So this is an area where Microsoft, if it executes well, can catch up with VMware pretty quickly.
The card that Microsoft has to play here that VMware is completely missing is the installed base of operating systems and applications. The three key pieces here are Active Directory (whose stuff runs where), .NET (the application level API’s) and SQL Server (the database). In contrast, VMware has no Directory Service, it has the start of an application platform in the form of Cloud Foundry (but a long way to go) and no in house database server. If Microsoft can prove that dealing with Windows applications and services at the Windows level (instead of just encapsulating them the way VMware does) has advantages to the customer, then this war will tip towards Microsoft.
Microsoft also has the obvious advantage of having its own cloud, something VMware does not have or offer.
Impact upon Amazon AWS
While Azure now support Linux workloads, and AWS certainly supports Windows workloads, the trend here is clear. If Microsoft succeeds at nothing else, it will make Azure into the preferred Windows cloud. Microsoft will succeed at this at the on premise level for truly private clouds, at the service provider level, and at the public cloud level. The most likely scenario here is that if you are building or buying an application that is going to run on Windows, you are going to (with Microsoft’s help) gravitate towards Azure based clouds.
This puts Amazon in a difficult spot. Amazon has no on premise installations of software to leverage. Amazon could obviously focus upon being the Linux cloud company, but here it will have to content with Red Hat who are certainly going to be looking to steal a page or two from the Microsoft playbook.
Comparison of Vendor Cloud Offerings
|Vendor||Amazon AWS||Microsoft Azure||VMware vSphere|
|On premise private cloud|
|Cloud Partner (Service Provider) Program|
|Vendor Offered Public Cloud|
Late Breaking Updates
- According to this Wired article, Google is readying its own IaaS cloud offering – allowing users to run “anything”, not just applications restricted to the currently offered Google AppEngine service. A column has been added for Google to the table above.
- According to GigaOm in this post, VMware and EMC are considering spinning out CloudFoundry, some big data assets, and and IaaS offering into a completely independent company. If this is true than the red X in the lower right corner of the table above becomes a green check mark.
The combination of Microsoft’s own Azure cloud, Service Provider offered Azure Clouds, and Azure services in Windows Server 2012 will prove to be a formidable offering in the next generation of the system software wars. Someone once said that it takes Microsoft three tries to get something right. Well here comes Hyper-V 3 along with Windows Server 2012, and a whole bunch of new Azure services.