Why is Everyone Scared of Microsoft Becoming the Next IBM?
Microsoft is a company that has been evolving during the past decade and it’s future, while still bright, is not what some expected from a company who dominates the home-pc market with its Windows operating system. As the company refines its strategy going forward, many keep wondering if the company is going to become ‘the next IBM’?
Every time that question is posed, I keep wondering somewhat aloud if that’s really a bad thing? IBM, who is still a significant player in the IT space, has survived its own transition periods and Microsoft is uniquely positioned for the next generation of computing.
The company is slowly exiting the consumer space by shutting down its mobile OS platform, closing its music service, and Cortana is falling far behind Alexa and Google Assistant but for Microsoft, this isn’t a significant impact to their operations. The company’s bread and butter has always been in the corporate segment and the future looks to mimic the past.
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There is little doubt that cloud computing is the future and that the data center is going to become a monument of the past. Yes, there will always be a need for local metal but for new companies that haven’t been birthed and older giants looking to modernize, moving to the cloud is a logical move.
Microsoft is going to live on in the cloud, even if all other business initiatives fail, the cloud hardware will survive because of the significant barrier to entry in this market. That’s a pessimistic view of Microsoft’s future as I do think other lines of revenue will live on for long-term, like Office and Server, but until a new technology comes along that can disrupt the cloud market, Microsoft isn’t going anywhere.
Microsoft and Amazon are the primary cloud players right now but you can’t count out Google who is investing heavily in this space as well. While Amazon has the clear lead at this time, Microsoft’s cloud is slowly clawing away market share and closing the gap with Amazon which further asserts that Azure is Microsoft’s future and frankly that’s ok.
As more companies decide to move to the cloud, the amount of growth in front of Azure is significant and is likely why the company’s stock price continues to climb.
While there are many Microsoft fans who want the company to be a dominant force with consumers and corporations, the reality here is that the company will once again survive another market-shifting change that will likely take down a few older players. If you look back at the big Internet brands of the 90s, nearly all of them are gone today and yet Microsoft has found a way to survive and adapt to each market-shifting change.
For those that have based their career on building and supporting Microsoft platforms, the future continues to look bright as long as you are adapting skills from on-premises to cloud as the days of swapping hard drives in servers will eventually come to an end.
Microsoft, as a back-end services company, is not a bad thing. That is their strength and will continue to be so as long as their AI and Azure investments continue to grow at their current rate and Windows will stick around for the long-haul but its importance will diminish over time. With cloud data centers costing a billion dollars or more to construct, Microsoft’s future is in its own hands.