It appears that Microsoft is planning to shift more—and maybe even all—of its first-party services, such as Bing, Office 365 and Xbox Live to Azure.
Nowadays, Wall Street analysts are focused mostly on the company’s cloud storage. Why? During Microsoft’s quarter earnings calls, officials of the company talk a lot about “the intelligent cloud.” It includes revenues generated from Azure (a public cloud), which is mainly operated for private and hybrid server products and services. It contains mainly products and services under the Cloud & Enterprise domain, but it contains Windows Server, SQL Server, System Center, Azure, and Enterprise Services, notes ZDNet.
The executives of Microsoft said that its Fiscal 2016 third quarter reports had stated that its intelligent cloud segment has scored $6.1 billion, which can be said that 3.3 percent increase has been seen in a year. However, to note that the Office 365 consumer and business services are not included in the intelligent cloud number. They are under Productivity and Business Processes.
Microsoft’s officials expect that the “commercial cloud”, which is a part of the company, will reach $20 billion annual run rate at the company’s fiscal 2018. According to the firm, the revenues would come from its Office 365 business services (Exchange Online, SharePoint Online, Skype for Business Online), Azure, and Dynamics CRM Online and its Enterprise Mobility Suite (EMS). However, it excludes on-premises server, and cloud hosting services.
As of its fiscal 2016 third quarter, the run rate of commercial cloud was at $10 billion annually, said Microsoft. Today, officials have repeated that the company is on the way to hit its $20 billion run rate goal.
The commercial cloud bucket in Azure contains a number of Microsoft’s own services that includes Office 365 business, Office 365 consumer, Bing and Xbox Live.