Cloud IaaS Becomes Accessible to SMBs with Limited In House Technical Expertise

An earlier post to this blog remarked on what then appeared to be a set of considerable technical hurdles facing small to medium sized businesses (SMBs) in the US considering a migration to cloud, Infrastructure as a Service (IaaS) offers. But this writer recently identified technical communications pieces, published by Microsoft Azure and Amazon EC2, which may serve to lessen the challenge of these same hurdles.

WordPress is, arguably, the most popular blog platform available to consumers in the US. SMBs looking to launch an online content promotional effort can, and do implement new instances of WordPress every day. But while acquiring WordPress is a free-of-charge process, hosting one’s blog is not. One can argue hosting is also available, free-of-charge, on WordPress’ corporate (.com) site. But there is a cost to everything, so most SMBs will look to find a hosting partner, rather than give up the SEO equity in repayment for a tenancy on this corporate site. Conventional hosting isn’t cheap. So many SMBs consider partnering with a cloud, IaaS like Azure, or Amazon EC2 on the promise of substantial cost savings, as compared to conventional hosting resources.

In an online presentation titled How to host a Scalable and Optimized WordPress for Azure in minutes, Sunitha Muthukrishna, Program Manager, Azure Websites, provides a step-by-step procedure SMBs should be likely to easily follow. The short presentation includes a lot of imagery, which should make the process easier.

Amazon EC2 also offers documentation on the same task, titled Tutorial: Hosting a WordPress Blog with Amazon EC2, but the presentation is geared more for the technical user. Nevertheless, the objective is still the same, to encourage SMBs, and any other sized organization contemplating a move to cloud, IaaS for its blog, to overcome some of the technical intimidation of the process.

The Microsoft Azure piece is of particular interest as it is an example of Microsoft’s movement away from a parochial view of just which pieces of software ought to be supported on a Microsoft cloud. If this new, welcoming and expansive approach reverberates over a wider set of possible applications to be hosted on Azure, Microsoft should accelerate the sales pace for Azure.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2014 All Rights Reserved


Microsoft Implements a Highly Competitive Strategy to Gain Dominant Position in the Cloud Data Storage Markets

On June 23, 2014, Microsoft® announced lower consumer costs for OneDrive, its cloud, IaaS offer. The same press release also announced substantially more storage for consumers either opting for the free version of OneDrive, or for anyone with a valid subscription plan to Office 365.

These activities are consistent with Michael Porter’s notion of “competition to be the best”. In a book titled ‘Understanding Michael Porter’, by Joan Magretta (published 2010, Harvard Business Review Press), Michael Porter is presented as holding an opinion this strategy is ‘absolutely the wrong way to think about competition’. Why? As Porter sees it, this strategy transforms competition into a zero sum conflict for a mirage-like market, which doesn’t really exist.

Rather, Porter thinks markets actually have a much broader depth than they appear to have in a “competition to be the best” view. Successful competitors for these real markets will present consumers with differentiated product offers, built solely to deliver one of the two prizes Porter really thinks matters — either lower costs (and, therefore, greater profits), or premium prices — and nothing more. The mistake, as Porter sees it, is to sacrifice one, or both of these objectives, to win market share from supposed competitors for the same customer.

So why would Microsoft opt for this type of strategy? We have little indication, at least as of yet, as to a correct answer to this question. But perhaps this announcement is another example of the type of effort Microsoft is making via other lines of communication with its markets to hasten the pace at which enterprise business customers (the core of Microsoft’s customer base, and its most profitable segment) are moving to Microsoft cloud IaaS offers like OneDrive and Office 365.

This writer recently attended a trade show for a Microsoft product, which was attended by representatives of a cross section of corporate customers. A number of representatives remarked on the intensity of Microsoft’s efforts to prod them along to Office 365, Azure and OneDrive. There was also mention of some incentives offered to ease the transition from on premise computing to cloud offers. Bottom line: there is now an urgency about the need to move customers onto the cloud path.

Readers following Microsoft may want to maintain some attention to the results of all of these campaigns, as they come in. Michael Porter’s theories of competition are not to be discounted. If the cost of these efforts either start to degrade Microsoft’s profitability, or detract from its ability to charge premium prices for its products and services, they will be more of a burden than anything else.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2014 All Rights Reserved


Microsoft Works Familiar Territory for Its Annual TechEd Conference for 2014

Just 10 minutes into the TechEd Conference, 2014, Keynote Address, Mr. Brad Anderson, a Microsoft® Corporate Vice President landed on familiar ground, a podium before an audience of IT professionals assembled from global, enterprise businesses and their peers in the public and not-for-profit sectors. Mr. Anderson’s audience was then treated to a rather old fashioned rhetorical construction, more of the same elaborate argument from authority I noted in the very first few moments of the video recording of his presentation.

The construction goes something like this: Microsoft is one of only 3 vendors, anywhere, with the capabilities to support the needs at the top of the enterprise computing market – meaning the very largest organizations. I should note Mr. Anderson didn’t mention Microsoft’s two competitors, but it wouldn’t take much to assume them to be Google and Amazon.

Mr. Anderson illustrated this point with a play on the old “mandatory requirements” pitch, which goes as follows: Any organization in the target market should only discuss its needs with a supplier capable of supporting “hyper scale,” meaning a supplier who has demonstrated its ability to deploy “hundreds of thousands of servers per year” and is “going through incredible growth”. After all, only this select group of 3 suppliers can call on the necessary level of innovation required to support the enterprises represented at the conference audience with the best infrastructure.

“Public Cloud” Suppliers on this short list must also be “Enterprise Proven”. They must be able to demonstrate the right “capabilities” and an “enterprise-grade cloud”. This type of supplier has the financial capability to back “its SLAs financially [meaning with cash reimbursement to customers in the event of service outages, or other lapses in service quality]”.

Finally, supplier must demonstrate superlative performance with “Hybrid Cloud”, which Mr. Anderson defined in a somewhat different manner than the more familiar use of this term in IT circles. The common denominator for a supplier with the right experience in this area is a familiar Microsoft theme – scalability. A supplier with the right experience set with Hybrid Cloud will be very comfortable designing, building and supporting the same applications across any type of cloud. This is the core of Microsoft’s “consistent user experience” claim, which not only powers their promotion at this conference, but also powers their effort to provide the same user experience across tablets, PCs, and even smart phones.

It should not be a stretch to assume Mr. Anderson’s audience liked what they heard. If the audience meets the criteria of an assembly of IT professionals picked from the very largest enterprise businesses, then this is actually a group of some of Microsoft’s best customers. They certainly know how to ring those bells for these guys.


Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2014 All Rights Reserved


What’s Behind Amazon’s AWS Activate Offer?

Back on October 13, 2013, Amazon debuted its AWS Activate offer. This program includes promotional credits, developer support, training, coaching, and a special toolbox along with the usual community support offer. There are two tiers of service: “Self Starter” and “Portfolio Package”. The latter refers to early stage businesses working with a set of venture capital firms.

All of the above makes sense. But early stage ISVs can’t, enmasse, simply sign up for the AWS Activate offer. An application is required for one of the tiers offered — “Portfolio Package”. The other tier — Self Service — also requires an application and isn’t available to some current AWS customers.

So how does Amazon benefit from the program? Some of the information required to answer this question can be found in a blog post written by Werner Vogels, CTO of Amazon and published on the same day as the press release. The title of the post is AWS Activate – Supporting Startups on AWS. The post lists several successful businesses, including Pinterest, Spotify, Etsy, and Instagram. In the last paragraph of the post Vogels lists some other prominent businesses, not the least of which is Netflix, who are using precisely the same services as the ones offered in the AWS Activate service.

The real benefit to Amazon is, of course, the substantial usage charges the successful businesses listed on Vogel’s page pay for the use of the AWS services once they graduate from the program. Assuming the list of moderately successful businesses continuing to use, and pay for, AWS services post incubation stage is an order of magnitude greater than the handful of their enormously successful cousins, then it’s clear Amazon is benefiting substantially from the program. It may be safe to say most of the success of AWS, itself, as a profitable business unit within Amazon can be directly attributed to the kind of early support services and tools offered in this program.

At another level the AWS Activate service can be seen as Amazon’s effort to do its part to reduce the complexity of its IaaS and SaaS offer. Perhaps the approach they’ve taken with the AWS Activate service should serve as a model for competitors looking to make their own effort to ease the entry of new customers to their own Cloud offers.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2014 All Rights Reserved