Group4_MicrosoftAzure

Microsoft's Go to Market strategy for Azure in India

Raghu Vamsi PGP/017/35

Yasemin Oz IE/017/40 Shruti Mandal PGP/017/50

Group 4

Agenda:

Cloud Computing – brief Key drivers of Cloud computing Risks associated with Cloud computing Major player in the field of Cloud computing All about Microsoft Microsoft’s cloud strategy Product offerings Potential market segments in India Challenges and risks in Indian markets Microsoft advantage Gartner hype cycleRecommendations

Key Drivers

Cloud Computing / Key drivers

Risks

Covert large investment ->smaller variable operating expenses Provide strategic advantages Eliminate hiring cost Reduced maintenance cost Activation of per use fee Reduce waste in capital employed and energy Redeploy organizational resources to strategic ends

Privacy and Data security• Customers feel

uncomfortable• Concerns about

safety of the data - high

Legal issues – Physical location• Depends on

government as data could be located outside the country

Vendor Lock-in• Transition of

consumers to move from one cloud provider to other, due to various reasons

Delivery of technology resources which provide storage and Processing capacity on demand as service. Always available, paid for when consumed.

Basic cloud services

Major Cloud Computing Providers in India

Email offerings Hotmail Microsoft – Microsoft live services Google – Gmail Yahoo mail

Customer Relationship Management Salesforce.com – ‘software on demand’ Pay per use model

Infrastructure as a service

Amazon: EC2 offering – Elastic cloud Computing power / highly scalable AT&T CA technologies HP Verizon

Software as a service

Microsoft Google: Google Apps Salesforce.com Customer Relationship management Softlayer(IBM), Dallas

Platform as a service

Google: Google App Engine Building generic apps

Microsoft: AZURE IBM Smart cloud Openshift Cloud foundry Cloud bees

Virtual machines, servers, storage Load balancers, network etc.

CRM, email, Virtual desktop Communication, games

Execution runtime, database Development tools, webserver

MS–DOS Operating system

Windows Operating System

IPO – 1986

1990 – Entered India

Founded: 1975

Timeline

Products:

Operating system software Server application software Business and consumer applications software Software development tools Search engine services Internet and Intranet services Video game consoles Digital music entertainment devices

Entry into India:

Indian Government

IT Industry

Local developer

communityAcademia

Entry into India

Focus:

Become key IT player Support growth of local IT industry

Partner enablement programs Microsoft Unlimited potential program

Enhancing education, jobs & other opportunities

Operating Segments:Client

(Windows & Windows

live)

Server & Tools

Online services business

Microsoft business division

Entertainment and

Devices division

Azure, Cloud computing platform was part of Server & Tools

As of 2008:

Offices in 16 cities Employees: 5000+

Revenue Business Model:

License based software model Software licenses – Single user Volume licenses – large enterprises

Microsoft’s Cloud Strategy:G

over

ning

Prin

cipl

es Product to be offered in both traditional + Cloud

Continue importance of combining both models –

that work in hybrid manner

Deliver seamless computing experience – various devices

‘Software + Services’ strategy

Product offerings:

Infrastructure and Platform as a service

Software as a service

Offering as Subscription services - Desktop enable service Microsoft’s SaaS strategy:

Business Productivity online suite Productivity and collaboration tools (Office, Share point, Live meeting)

Pay per use model – saving large firms from occurring computing costs

Competitor:

Google Apps – offered packaged email and desktop productivity solution at$50 per user / year

Service limited to set of developers, Community Technology Preview (CTP) Positioning: Infrastructure ++ category

MICROSOFT ONLINE

MICROSOFT AZURE

Azure Value Proposition:

Software writer absolved from managing machine Provide documentation – how to run and Microsoft would manage the rest Cloud application will be built on Azure

Utilize cloud database SQL Azure Application services - AppFabric

Potential Market Segments In India

Government Large Enterprise

Small and Medium Business

Small and Medium Business

Improving speed , quality and accessibility NeGP (National Governance Plan) : 27 Mission Mode Projects(MMPs)& 8

components Cooperate, collaborate and integrate

information Increase in IT infrastructure and capabilities New Millennium, New Services: Internet Banking Tickect,online Pan and

Passport ,filing of Income tax returns and paying property tax

Avg IT expenditure expected to grow from $3 million 2009-10 by 8 % in 2010-11

But the enterprise were inherently in flexible

Concerns were on data security and vendor lock in

But the banking and financial service vertical was the largest spender averaging an annual spend of about $8.5 million on IT

They didn’t have in house expertise nether capacity to invest in huge infrastructure

It adaptation can solve there complex business problems

Need to provide extremely reliable and secure services

Awareness of government policies that encourages SMBs to increasingly adopt It solutions

Challenges and Risks In The Indian Market

Insecurities of business owner as Cloud computing considered to be

of lower data integrity &

security

SMB’s cost factor and

Piracy

Inexpensive and available labour force

Non availability

of affordable,

reliable broadband

across country

Microsoft Advantage

Application and products as a horizontal

industry

Provided productivity tools, email and chat applications ,portals and other services across industries

Delivered both on premise an cloud

offerings to customers

It could leverage the reach of its partners and channel resellers

to contact the end customers

Had strong relationship with the

Indian ISVs

What should be the focus on Microsoft Azure ? Large enterprises If so, what product strategy should it consider?

Should it build partnerships with ISVs and SMBs?Should Microsoft follow a different strategy to target different industries?Should pricing strategy be different from India to rest of the world?Was India ready for this new form of delivery of IT services?What about the infrastructure, such as broad band connectivity to enable cloud service?Given high barriers to entry! Do you think consumers would be interested in shifting to cloud services?According to Gartner, Cloud services would enter trough of disillusionment in Hype cycle. Your take?

Questions to ponder upon?

Recommendations:

Gartner Hype Cycle:

Azure to be introducedEmphasize on Azure value propositionDiversify revenue stream with hybrid business modelThere should be more agility in products and services offeredBenefits of leaner operating systems to be advertisedFocus should be on mainly Large enterprises, as SMB markets is highly fragmented (to capture 10% of the SMB market 350,000 customers need to be targeted)Microsoft should build partnerships with ISVs

Increase awareness of IT solving complex business problems

Applications and service without high capital investment

Extremely reliable and secure services Awareness of government policies

Leverage on existing relationships with Vendors Pricing should be different for Indian markets compared

to rest of the world – given price sensitivity of Indian consumer.

Different pricing strategies to be followed for different industries. In brief: Threat of failing to deliver, what it is expected to do so.

Azure Pricing in India:As azure was providing added benefits , its pricing should be Close to amazon’s pricing Model and leverage on Azure value proposition.

Linux/Unix Usage Windows Usage Azure

Standard on Demand Instances

Small $0.095 per hr.. $0.12 per hr. $0.095 per hr..

Large $0.38 per hr. $0.48 per hr. $0.38 per hr.

Extra Large $0.76 per hr. $0.96 per hr. $0.96 per hr.

High Memory on Demand Instances

Extra Large $0.57 per hr. $0.62 per hr. $0.62 per hr.

Double Extra Large $1.34 per hr. $1.44 per hr. $1.44 per hr.

Quadruple Extra Large $2.68 per hr. $2.88 per hr. $2.88 per hr.

High CPU on Demand Instances

Medium $0.19 per hr. $0.29 per hr. $0.29 per hr.

Extra Large $0.76 per hr. $1.16 per hr. $1.16 per hr.

Thank you!