How Microsoft CEO Satya Nadella plans to beat Amazon in the cloud
Source: Julie Bort
Microsoft on Thursday said that its cloud computing revenue is on a "run rate" of more $10 billion, which puts it on track to hit its promised $20 billion run-rate by 2018.
Run rate is a slippery number that means that if customers keep spending the way they are, revenue will hit that number in a 12-month period.
It's slippery because some cloud contracts don't exactly work like that. They are fluid, with companies only paying for the actual compute resources they use.
In any case, Microsoft doesn't report its actual cloud revenues. Its cloud services are bundled and buried into each of its business units and reported mixed-in with traditional software sales.
till many analysts see Microsoft as No. 2 in terms of cloud revenue behind Amazon Web Services. Synergy Research, for instance, puts Microsoft at 10% market share.
And while it's not a completely zero sum game (many enterprises will use multiple cloud providers), there's an increasing number of enterprises that are going "all in" on the cloud, shutting down their own data centers and choosing Amazon. Once on Amazon, these users are very loyal to it, a recent survey found.
So on Thursday, during the quarterly conference call, Microsoft CEO Satya Nadella was asked how he plans to compete with Amazon and win.
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