Office 365 Success Validates Microsoft's Big Cloud Play

By Laura Stotler
TMCnet Contributing Editor

Microsoft (News - Alert) has been steadily shifting its business model toward the cloud over the past few years, gearing up to take on AWS in the infrastructure arena as well as on the SaaS (News - Alert) front. The company recently made headlines for its participation in this week’s groundbreaking Iowa caucuses, providing an app to enable easy reporting of voting results and storing those results in the Microsoft Azure cloud.

Now it looks like Microsoft’s cloud push may be saving the company from serious financial trouble. Redmond’s overall revenues fell in the last quarter, while revenue from Azure jumped 140 percent. And the Office 365 suite increased by 70 percent to 20.6 million consumer subscribers, a significant boon for the company. Office 365 falls under an umbrella productivity category at Microsoft, bringing in $6.7 billion in revenues. The rate of growth is greater than Amazon’s during the same period, validating Microsoft’s increased focus on all things cloud related.

Office 365 has also been steadily siphoning customers from Google (News - Alert) Apps, with Microsoft reporting twice the amount of Google’s market share. Some were previous Microsoft customers that are moving back to the company’s familiar features and strong levels of customer support. Other customers are making the migration from outdated on-premises solutions to the cloud, choosing Microsoft based on its name and reputation.

The massive success of Office 365 can be largely attributed to Microsoft’s broad network of solution provider partners. Companies like CloudRoute, an authorized Microsoft Cloud Solution Provider, are driving the implementation and management of Office 365 throughout SMBs. CloudRoute, which recently earned a Silver Data Center competency designation from Microsoft, handles all aspects of customer deployment of Office 365, including billing and technical support.

“When customers look for an IT partner to meet their business challenges, choosing a company that has attained Microsoft competencies is a smart move,” said Phil Sorgen, corporate vice president, worldwide partner group at Microsoft Corp.

As Microsoft continues to strengthen its cloud infrastructure reach and reputation, the company’s partner network will grow as well, paving the way for even more Office 365 deployments in SMBs and the enterprise.