Microsoft Mum on Cloud Revenues
Microsoft announced record Q4 revenues today but the earnings release made no mention of cloud revenues. In stark contrast, IBM earlier this week said its cloud-related revenues will double this year, and VMware largely credited cloud computing in a strong earnings report earlier this week. So, should Wall Street and partners worry about Microsoft’s silence on cloud revenues?
Actually, no. From where I sit, Microsoft’s two major cloud platforms — Office 365 and Windows Azure — remain well-positioned for long-term success. Office 365 debuted June 28, far too recent for Microsoft to comment about initial revenues. And Windows Azure, Microsoft’s platform as a service (PaaS), only has one year under its belt. Azure revenues are surely small since most customers are still kicking the tires. But we do hear from a growing number of readers that are launching applications in the Azure cloud. Key examples include:
- Quosal, a quoting software platform for VARs and MSPs, now available on Azure.
- CA ARCserve, the backup software platform, coming to Windows Azure later this year.
- MediaValet, a digital asset management system (DAMS), which seems to be catching on in Azure.
The momentum story seems less clear for Office 365. The platform’s predecessor, BPOS (Business Productivity Online Suite) remains online and continues to suffer from occasional failures — giving Microsoft’s cloud efforts a black eye. Microsoft claims to have more than 40,000 cloud partners — but how many of them actually generate noteworthy revenue from Microsoft’s cloud? The answer that question is unknown.
Still, Microsoft COO Kevin Turner in a prepared statement said Microsoft was well-positioned for cloud computing over the long haul. And I concede: Deadlines kept me away from the actual earnings call, which may have contained some cloud chatter.
Also, plenty of technology giants decline to discuss cloud revenues. A key example: When Google recently announced quarterly results, the company said nothing about Google Apps revenues and the Google Apps partner program — though the Google Apps reseller program has more than 1,000 members at last count.