Microsoft Industry Clouds: More than just a collection of service packages

microsoftindustryclouds

Credit: Microsoft

When Microsoft officials talk about “Microsoft Cloud,” they are referring to a growing number of business cloud services which include Azure, Office 365 / Microsoft 365, Dynamics 365, and more. (Just last month, Microsoft added Additional GitHub Cloud Revenue and Windows 365 Revenue to Microsoft Cloud Group.) In order to grow the Microsoft Cloud business faster and more consistently than simply rearranging revenue numbers, the company is increasingly focusing on selling customers not just one of its cloud services, but an integrated suite of them. Microsoft refers to these groups of cloud services as “Industry Clouds”.

In 2020, Microsoft launched the first of what would become a growing family of Industry Cloud offerings called Microsoft Cloud for Healthcare. As of October 1, 2022, there are now seven Microsoft Industry Clouds, with more expected in the coming months and years.

When Microsoft execs first outlined their strategy for these vertical cloud packages, it felt like we were back to the old Microsoft “Better Together” strategy. More than a decade ago, Microsoft officials pitched customers the idea that by sticking with their software, from start to finish, they would get a better, more seamless, and less problematic integrated suite of products. How and why Microsoft Industry Clouds pay is more complex than that, but it’s still certainly rooted in the idea that the Microsoft Cloud enterprise outperforms anything else out there.

At Microsoft’s Fall Ignite conference, which kicks off October 12, The towing industry will be a big topic. And over the past two months, several Microsoft officials have spoken about the company’s thinking about Industry Clouds during several tech conferences.

Microsoft Industry Cloud Seven (and counting)

Microsoft is hardly the first or only cloud supplier to stick to the idea of ​​horizontal and/or vertical integration. a Forrester Research Report 2021 He points out that as early as the 2010s, companies were using Industry Clouds at every layer of the stack to fuel growth.

Microsoft Industry Cloud builds on Azure, Microsoft 365, Dynamics 365, Power Platform and other Microsoft tools and services. Together they bring together common data models, connectors across the cloud, workflows, APIs, components, and industry-specific standards. Microsoft officials say their Industry Clouds are intended to connect front-end productivity tasks with back-end data management.

There are productivity and security services shared across Microsoft industrial clouds, such as Teams, Office apps, and Power BI analytics. But there are also a number of integrations, interfaces, templates, and other capabilities unique to specific industries. Microsoft Cloud or financial services, for example, include a pre-built loan manager and bank customer engagement. The cloud for nonprofits includes donor management, volunteer management, and fundraising functions. Microsoft is also promoting AI capabilities Offered on Azure, Microsoft 365, and Dynamics 365 platforms as a key to Industry Cloud’s efforts.

The Microsoft Industry Cloud portfolio currently consists of: Microsoft Cloud for HealthcareAnd the retail cloudAnd the Cloud for Financial Services, Cloud for Manufacturing, Cloud for NonprofitsAnd the The Cloud for Sustainability And the cloud dominion. Cloud for Sustainability and Cloud Computing for Sovereignty are not an industry specific; It is more horizontal than vertical. The Sustainability Cloud provides customers with a framework to measure and manage their environmental sustainability impacts. Cloud for Sovereignty is a suite of compliance, governance, security, and other services for customers who need to comply with certain government requirements about the location of data.

Microsoft officials have acknowledged that the way to think about this cloud industry is a layer of functionality on top of the Microsoft Cloud. By design, they are not intended to provide a deep set of capabilities.

Dave O’Hara, Microsoft’s commercial chief financial officer, told attendees at the Deutsche Bank tech conference in September:It’s not like we’re making a vertical product that aligns with and competes with the ecosystem. It’s really only an industry, some industry functionality runs on Azure and attracts people (on Azure) within our cloud. ”

Microsoft relies on distributors and integration partners with experience in some vertical industries to fill in the missing pieces of its Industry Cloud portfolio by integrating it with other software and services. O’Hara said Microsoft will also look for future acquisitions that complement its industrial cloud strategy the way it does. Acquisition of Nuance Communications Do. O’Hara explained that Microsoft executives view Nuance as both an application and a platform, with a number of healthcare providers and other software vendors including Nuance technologies in their offerings.

“The thing we loved about (Nuance) is that it’s not a vertical app. It’s really a very industry specific platform app,” Awara said.

Industry cloud is also central to Microsoft’s sales approach, which encourages salespeople to view customers as Microsoft partners. Microsoft prefers to sell customers on the idea of ​​a ready-made set of subscription services rather than just selling a single product as a single transaction. Its industry cloud, which requires customers to obtain licenses not only for Azure, but also for other Microsoft cloud services, aligns with this approach.

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