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 Microsofts cloud strategy Product offerings Potential market segments in India Challenges and risks in Indian markets Microsoft advantage Gartner hype cycle Recommendations 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 Operati ng system Window s Operatin g 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 community Academia 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 Microsofts Cloud Strategy: G o v e r n i n g
P r i n c i p l e s
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 Microsofts 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 didnt 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 SMBs 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 introduced Emphasize on Azure value proposition Diversify revenue stream with hybrid business model There should be more agility in products and services offered Benefits of leaner operating systems to be advertised Focus 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 amazons 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!