Microsoft is building its cloud line up with the formal release of Windows Server 2012, which it says has been built from the cloud up and is “a cornerstone of the cloud OS”. With attention focused on Windows 8, Windows Phone 8 and Office 2013, Windows Server 2012 is perceived as a poor relation but is a central component of the overall cloud portfolio. It could shape up to be an important on ramp to the cloud.
Although the server operating system can run in traditional on premise mode, it will also connect to c200 online services via Azure. Virtualization, storage, networking and automation enhancements also feature, which are designed to support flexible server operation and workload distribution. With the virtualization capabilities in particular, it is positioned to allow workloads to shift between private data centres and those of service providers, creating a more flexible environment – businesses or service providers with on premise implementations will have the potential to scale up over the cloud to cater for periods of peak demand for example. Businesses will be able to build and manage their own private clouds. Suppliers will have the scope to exploit opportunities such as peak demand fulfillment to open up new areas of business. The virtualisation focus also has the potential to disrupt VMware’s march on the market – providing Microsoft can persuade existing VMware users to make the switch, which is far from assured.
As for Microsoft, it will be looking to the product to bolster Server division revenue and profits. Equally importantly it will be a entry point to other cloud services (which could range from online data analytics to high capacity computing capability), helping its transition from an on premise to a cloud services based business model. From what we can see, Microsoft is looking to make revenue from usage-based consumption fees (see Microsoft: taking a lead on integrated PaaS/IaaS). Cloud services may work out to be less profitable than license fees but Microsoft knows it has to move into this space, and by making it easier to consume cloud services, it will be hoping for more volume.