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Microsoft confronts its dragons with multi-device cloud push

Phil Wainewright Profile picture for user pwainewright June 2, 2014
Microsoft is battling back with a coherent mobile and cloud strategy - but where does BBC Dragons' Den star Kelley Hoppen come into it?

Kelly Hoppen

For the past few weeks, Microsoft has been entertaining clients at a swanky duplex apartment in London's Covent Garden borrowed from interior design entrepreneur Kelly Hoppen, one of the 'dragons' in the BBC's Dragons' Den TV show.

In the show, the dragons listen to pitches for venture finance from aspiring entrepreneurs and decide whether to invest their own money. On those occasions when a dragon deigns to make an offer, it's typically achingly far below what the supplicants had hoped for.

Oh to have been a fly on the wall when Microsoft was negotiating the price for its six-week sojourn at this dragon's Covent Garden den! The deal was clearly not done at Airbnb rates.

What the vendor got for its money was a venue to show off some of the fruits of its platform convergence strategy to prospects, customers and (in my case) a skeptical media posse. Would it persuade hard-bitten enterprise buyers to buy into its future vision? Or would they refuse to part with any more of their money?

As a long-term Microsoft watcher I'm intrigued by how radically the company has changed its pitch over the past year or so, crystallizing with the appointment of Satya Nadella as CEO.

Microsoft owes its market dominance to a history of constraining personal computer users to what was once called the 'Wintel' platform — the Windows operating system running on PCs with Intel processors inside them.

Today, Microsoft has broken any allegiance to a specific hardware platform. Instead, it is aiming to protect its grip on the market by extending its reach at three separate layers.

Azure cloud fabric

The battle with Amazon for a share of the rapidly commoditizing public cloud infrastructure market is far from being the main rationale for Azure's existence. Much more strategically crucial is its role as a cloud fabric that provides middleware services to Windows clients and servers. It provides the pervasive, always-on connectivity glue to keep enterprises bound into the Microsoft software stack.

For example, Azure taps into the near ubiquitous presence of Active Directory to help manage users and applications across the on-premise, cloud and mobile universe. In tandem with the Microsoft account user identity infrastructure, it gives people the ability to instantly sync all manner of settings across multiple devices they use — everything from applications and passwords to themes and even the ability to transfer open browser tabs in Internet Explorer. These conveniences are designed to keep the user population locked into the Microsoft environment as they move from desktop to tablet to mobile and back again, all within the same identity infrastructure.

Office 365 collaboration

The apartment

It's remarkable how strongly Microsoft has adopted the cloud as the platform for delivering its market-leading productivity suite, which also now doubles as a collaboration platform. It has good reason for doing so: Office is not only its most valuable cash cow, it's also the stickiest, ingrained in the daily productivity habits of millions. Many countries even teach all their schoolchildren how to use Office as a core part of computer studies.

There was a time when Office fell short as a cloud application suite due to its lack of real-time collaboration capabilities. I once lampooned it as 'Microsoft Cubicle' for its emphasis on solitary labor. All that has now changed. Teamed up with OneDrive, real-time collaborative editing has become a reality in Word, Excel and PowerPoint (as it already was in OneNote).

Now that Office has acquired these cloud-enabled capabilities, it can safely decouple itself from the Windows environment. Making Office available on Apple's iOS platform is no longer an admission of defeat; instead it's a play to embrace and extend to a broader market share.

Multi-device app development

Microsoft is even fighting a surprisingly effective rearguard defensive action in the mobile sphere. While Windows Phone may still be trailing badly in the overall market (though already in third place ahead of Blackberry, which continues to sink), it is already the number two vendor in the B2B market. This is largely due to Android's failure to make significant headway as an enterprise mobile platform.

Microsoft's enterprise mobile strategy is twofold. First of all, it offers a mobile platform that has none of the fragmentation of Android but offers more handset choice (and at lower prices) than iOS. Secondly, it gives developers a familiar .Net environment for app development, one where the same app can be deployed across phones, tablets and PCs. In addition, the vendor is open-sourcing .Net with the aim of encouraging third parties to extend it to support iOS and Android.

Remembering the way Microsoft used to fume against 'lowest common denominator' browser applications in the late 1990s when it was trying to corral the Web back into the Wintel environment, I was amused to hear Microsoft last week celebrating its ability to build universal applications that supported "90 percent overlap" in functionality across devices. The company has come full circle and instead of trying to protect a specific platform it wants its applications, middleware and development tools to reach across every platform.

Microsoft is now working hard (and spending liberally) to make sure popular applications are available on Windows Phone. A few years ago it had to invest in getting popular apps like BBC iPlayer on the platform. More recently it has been working with the likes of banks to make sure their mobile apps are there too.

The next obvious step is to get the most popular enterprise application development platforms to prioritize support for Windows Phone. Right on cue came last week's announcement of a new alliance that will ensure Salesforce1 includes support for Windows and Windows Phone 8.1. Office 365 is also part of that new deal.


In some ways, the apartment was an odd choice of venue to promote a very enterprise-focused, B2B message. I had arrived half-expecting some sort of Internet of Things pitch but we were not even shown into the kitchen during the tour and there was no talk of connected fridges or toasters. I guess Microsoft's glasnost towards other vendors does not yet extend to the Google-owned Nest thermostat and its ilk. Though there was a Makerbot 3D printer incongruously whirring away in one corner.

The point of the exercise was all to raise awareness of some of the less well-known aspects of Microsoft's evolving strategy to leverage its investments in Azure, Office 365 and the Mobile Phone platform — along with recovering from some of the missteps in the original launch of Windows 8, now partially redeemed in the update to 8.1.

It's too early to say whether it's all going to work out, but I suspect enterprise buyers will have been generally receptive to the message. What stands out is that Microsoft has recognized the importance of having a strong and coherent cloud and mobile strategy, and that will encourage enterprise IT buyers and developers to keep faith. Not all established enterprise software vendors are handling the current landscape with as much aplomb.

Disclosure: is a diginomica premier partner.

Image credits: Kelly Hoppen by @BBCDragonsDen; apartment detail by @philww

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