Microsoft turned the ship in 2014

With new leadership and aggressive moves in cloud and open source, Microsoft is on a much better course than it was a year ago

blue undo arrow

All of us at InfoWorld have wondered for years whether a giant, Balkanized corporation like Microsoft could haul itself into the post-PC, cloud-centric era without collapsing of its own weight.

That long march has only begun. But despite a few stumbles, Redmond can congratulate itself on major progress this year.

Smart cloud moves

Microsoft's various SaaS, IaaS, and PaaS services combine to form the No. 2 cloud behind Amazon Web Services. Why Microsoft over Google? Well, for one thing, Google hasn't even dropped hints about its enterprise cloud revenue this year. The only estimate I can find comes courtesy of Technology Business Research, which guesses Google will hit $1.6 billion -- as opposed to Satya Nadella's assertion that Microsoft will top $4 billion in cloud revenue in 2014.

According to Microsoft's latest quarterly numbers, commercial cloud revenue grew by 128 percent. As usual, Microsoft provides few clues about which offerings are driving revenue growth, but Office 365 almost certainly leads the way.

Now, to be clear, Office 365 isn't really a cloud offering. At its core, Office 365 is downloadable fatware sold by subscription and connected to Exchange, SharePoint, and Lync servers run by Microsoft in its cloud data centers. The point is that Microsoft appears to be making the transition from licensing to subscription without killing its cash cow. That's quite a hat trick and puts Microsoft in a good position for a sustainable SaaS future.

As for the Azure cloud, Redmond has invested billions in cloud data center infrastructure and is leading the way in hybrid cloud, with increasing integration planned between Windows Server/System Center and the Azure cloud. Plus, the company has been building out services on Azure at a frenetic pace.

Some notable Azure additions launched this year included the NoSQL database Azure DocumentDB; the cloud-based Visual Studio Online; disaster recovery in the form of Azure Site Recovery; and Azure Stream Analytics and Event Hubs for event processing. In addition, new enhancements to Azure Active Directory and Azure SQL Database are making it easier for customers to move on-premises applications to the cloud.

Perhaps the most significant progress, however, has been in Azure's aggressive support for open source technologies.

Loving open source

I was at the press conference where Satya Nadella introduced the "Microsoft [hearts] Linux" meme to general consternation. That statement of affection applies to Azure, which supports CentOS, Suse, Ubuntu, and most recently CoreOS. A reporter asked about Red Hat, and Nadella replied that it was all up to Red Hat -- he'd be happy to support that company's Linux on Azure as well.

The Microsoft Server and Tools folks may not share this enthusiasm, but Azure is a different animal. It needs customers. Large cloud deployments tend to use Linux. What's Microsoft's option -- sending users to another cloud?

More broadly, Microsoft needs to support open source because it has become the center of today's fast-paced enterprise technology development. Jump on the new or get left behind is the imperative: When open source projects or products get traction, cloud providers need to offer support or build services based on them. This year saw Microsoft jump on the Docker and Kubernetes bandwagon, as well as announce it was working to create a native Docker container for Windows.

Perhaps the biggest open source milestone this year came last month, when Microsoft open-sourced the entire server-side .Net stack. Yes, this was long overdue, but Microsoft says it's not finished yet and will be "partnering deeply" with Xamarin to open the .Net client side.

Windows, mobile, and more

It's a bit early to tell, but it looks as if Windows 10 will be to Windows 8 what Windows 7 was to Vista -- a welcome relief. On the desktop, the Start menu will return and the tiled Metro interface will go away, while Metro will persist on tablets and phones, whose apps will in turn be able to run on the Windows 10 desktop. InfoWorld's Woody Leonhard, one of Microsoft's most vocal Windows critics, has high hopes for Windows 10.

Little hope is in evidence for Microsoft's mobile business. Earlier this month, InfoWorld's Galen Gruman characterized Windows Phone as being caught in "a downward spiral -- without a strong underlying operating system, developers can't create compelling apps. Without a reasonable market share, developers won't create reasonable apps, even if the OS supports them."

The one mobile bright spot has been the Surface Pro 3, which corrected some of the weaknesses of earlier versions. According to Microsoft, the new model helped drive Surface revenue to $908 million for its first FY15 fiscal quarter.

That number is a little paradoxical. Microsoft's sharpest moves have been in the cloud, but so far, cloud revenue is only slightly ahead of the revenue netted by a so-so laptop/tablet. But hey, we often forget that we're still at the beginning of the cloud journey. This year, on the enterprise side, Microsoft did a good job of pointing things in the right direction.  

From CIO: 8 Free Online Courses to Grow Your Tech Skills
Notice to our Readers
We're now using social media to take your comments and feedback. Learn more about this here.