Microsoft CEO Satya Nadella has always been vocal about his “cloud-first” strategy, and on Monday, made it clear that Azure, Microsoft’s cloud service platform, is a serious player in the field.
At a press event held in San Francisco, Nadella gave a bunch of figures that show Azure’s rapidly growing business. He said more than 80% of Fortune 500 companies use Azure, resulting in a revenue run rate of nearly $US4.4 billion.
Although the revenue run rate is not the actual sales amount — but what it would get if it extrapolated its current sales over 12 months — it’s still a good indication of where the business is headed in the future. Just to put that in perspective, Salesforce.com, which is one of the largest cloud software companies, had a little over $US4 billion in revenues last year, while Amazon Web Services, one of the most widely used cloud platforms, is estimated to have roughly $US4 billion in annual sales.
Nadella said Azure is also adding 10,000 new customers every week to its 350 million active directory user base. Those users have stored more than 30 trillion objects in total so far, according to Nadella. Moreover, in a sign that it’s really diversifying its sales channel, Nadella said almost 40% of Azure’s revenue came from startups and third-party independent software vendors (ISVs).
Scott Guthrie, executive VP of Microsoft’s Cloud and Enterprise group, also joined the presentation and emphasised how fast Azure has been scaling compared to other competitors. He said Azure now has 19 regional data centres in total, which is 2x more than Amazon’s and 6x more than Google Cloud’s. Each data center has the capacity to run up to 600,000 servers in every region, or 11.4 million servers across all regions, he said.
“This enables customers to use Azure to deploy and run their applications close to their own customers, as well as their own employees than ever before,” Guthrie said.
Because of its scale, Azure will be able to “continually cut prices,” Guthrie added, saying, “Ultimately, there’s really only going to be three vendors in the market that are going to be able to provide this level of hyper scale footprint: Microsoft, Amazon, and Google.”
John Rymer, VP and principal analyst at Forrester Research, told Business Insider that he agrees with Guthrie’s assessment, adding that Salesforce.com might be a distant No. 4. But he said today’s numbers were “certainly impressive” and it showed Nadella is doing a good job with Microsoft’s cloud business.
Aside from the growth figures, Rymer said Microsoft’s new partnership with Dell was what really stood out from today’s event. The new “hybrid computing” platform allows the enterprise to move applications back and forth between its own private data centres and Microsoft’s cloud, and that could be what really sets apart Azure from its main competitors like Amazon and Google, Rymer said.
Business Insider Emails & Alerts
Site highlights each day to your inbox.