Microsoft Acquires Cloudyn

On Friday, Microsoft announced its intention to acquire Cloudyn, an Israeli company that focuses on the business aspects of cloud-based operations. How does this impact cloud strategy overall, and what are the downstream benefits to virtualization partner Citrix?

Because Cloudyn brings deep data analytics for optimization, the benefit to Microsoft is clear. According to Jeremy Winter, director of program management, Azure Security and Operations Management, “This acquisition fits squarely into our commitment to empower customers with the tools they need to govern their cloud adoption and realize the strategic benefits of a global, trusted, intelligent cloud.”

IT departments are slowly transitioning to the cloud. However, there are two main obstacles: (1) learning and adapting to a new hosting platform from a technical perspective, and (2) understanding the business concerns and return on investment. Technical people will find ways to address technical challenges, and it appears that Microsoft hopes to dispel the business concerns with the Cloudyn acquisition.

The Cloud

While the technical aspects of cloud adoption are challenging due to the numerous features and new functionality of Azure and other cloud providers, the business side of it is equally daunting. Even once all the technical aspects are addressed, an outstanding question relates to how much it will cost to run workloads in the cloud.

Generally, cloud isn’t going to provide a cost savings to an IT organization. When another entity addresses your data center requirements as a service, the benefit is based primarily on the additional products or services that can be provided due to multi-tenancy. For example, the large cloud providers such as Azure and Amazon Web Services are FedRAMP certified, which is beyond possibility for most self-hosted data centers.

Nevertheless, the financial impact of the cloud and return on investment are important business factors for every CIO. Further, if optimizations can narrow or overcome the financial impact by identifying underutilized resources, the cost of cloud suddenly becomes more palatable.


Cloudyn addresses the business aspects of not only Azure, but also Amazon Web Services, Google Cloud, OpenStack, and cloud containers. By providing deep analytics related to assets in use, costs, profit margins, and other business data, IT departments can make the best possible use of resources.

Winter also stated that, “As a Microsoft partner, Cloudyn has supported cost management for Microsoft Azure and other public clouds, helping customers continuously improve their cloud efficiency. Cloudyn customers have been able to optimize their cloud services usage and costs through automated monitoring, analytics and cost allocation.”

Even more importantly, Cloudyn’s solution extends beyond just enterprises to managed service providers and cloud solution providers.


Microsoft’s key virtualization partner, Citrix, will benefit from this acquisition as well. Up until recently, the key use cases for cloud for Citrix’s customers have been failover and bursting, and full adoption of the cloud has been lagging. A key reason for that has been lack of a clear understanding of the cost structure associated with transitioning to the cloud. With many stories circulating through the industry about IT organizations that faced severe sticker shock after migrating to the cloud, Citrix resellers and customers have been reluctant to make the change.

While Citrix has been preaching “cloud first” for over a year, adoption of the full Citrix Cloud solution has been slow. While the technical solution is still maturing, business data has lagged, and Cloudyn’s solution may serve to put a bow on the Citrix/Microsoft cloud packaging.

From the perspective of a Citrix reseller, having a clear and full understanding of the costs associated with maintaining end customers is key to making sound business decisions. For example, perhaps a manufacturing customer generally runs two shifts on weekdays. By understanding the exact costs to maintain this customer, it would be possible to turn off some computing resources during off hours, with a premium charge for nighttime and weekend consumption where needed. This would be a win-win for both the reseller and the customer.

Cloudyn + Microsoft

Clearly, the Cloudyn acquisition will bring big data analytics and optimization to Microsoft. IT management will have a solid tool to understand the business aspect of cloud operations in order to optimize resources. Further, the downstream benefit to Citrix resellers and customers will also be well received, as it provides the business data that has been lacking.

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