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Azure adoption gets a boost, but challenges remain

Microsoft's hybrid focus is boosting Azure adoption within Windows shops. But not all Azure customers are using the cloud platform to its fullest.

When Microsoft introduced Azure five years ago, many corporate IT shops were skeptical of its advantages. Unlike Amazon Web Services (AWS), which at the time was focused on infrastructure as a service (IaaS) and had a plethora of Web offerings, Azure was platform as a service (Paas), with only a handful of services.

"[Azure] was hard for IT departments to understand," said Rob Sanfilippo, an analyst at Directions on Microsoft, a consulting firm. "You couldn't easily migrate on-premises apps without refactoring a lot of things. Amazon Web Services, with IaaS and its migration strategy, made a whole lot more sense."

Microsoft, however, has a long history as a fast follower.

In recent years, Microsoft broadened Azure with IaaS and reached out to other platforms, Sanfilippo said. It copied Amazon's approach and delivered a handful of IaaS products, including Azure Virtual Machines.

And Microsoft didn't stop there. In an unprecedented move, the company began offering key infrastructure products that worked with Windows Server and Linux -- knowing IT pros were increasingly transferring workloads to the Apache Web Server.

Microsoft's hybrid strategy, which lets Windows customers better integrate applications that run on local servers with counterpart applications in the cloud, has also encouraged adoption of its cloud platform. Microsoft says this approach resonates with its customers -- with about 10,000 new Azure subscriptions being added every week.

"Many customers already use our [on-premises] infrastructure products like Windows Server, System Center 2012 or SQL Server, so [we] offer them the same consistent platform in the cloud that they can run in their own environments," said Mike Schutz, a general manager on Microsoft's cloud tools team. "This is more about bringing the cloud to [customers], as opposed to dragging them to it."

This approach lets some IT shops move at their own pace, especially if their ultimate goal is to migrate some of their most important applications to the cloud.

A hybrid strategy lets users test the cloud without having to commit to it, said one IT professional at a manufacturing company based in St. Paul, Minn. "We can see what makes sense for the cloud and what to keep on-premises. It also helps with migrations across divisions," he said.

The shady side of Azure adoption numbers

A close look at Azure's rapid adoption numbers over the past year or two shows that many of the user accounts listed as having "adopted" the platform remain in the evaluation or test stage, according to sources close to Microsoft. Not all of those numbers reflect Azure use in a production environment.

"My definition of adoption includes the fact that meaningful workloads are being deployed to Azure, and I can tell you the amount of unconsumed Azure is huge among larger accounts," said one source familiar with Microsoft's internal operations.

So what's the holdup? One stumbling block is that not every corporate infrastructure is properly set up or tuned to take advantage of Azure's core capabilities.

"Many times users are trying to layer [Azure] on top of something that is not set up to handle it, which undermines [Microsoft's] hybrid cloud approach," the source said. "When this happens, some just put the implementation project aside until problems can be resolved."

And yet, IT shops are keenly aware they possess unused Azure licenses acquired through long-term enterprise agreements. This, according to some, is also artificially boosting adoption numbers. Microsoft gives large customers up to $150 per user, per month for Azure as part of some contracts.

"A lot of users have credits for Azure they signed up for and are not using," Sanfilippo said. "But I think more IT departments are coming around to the realization they should start using what they are paying for, which is helping adoption."

Where Azure goes from here

To flesh out its hybrid strategy, Microsoft continues to deliver a steady stream of cloud-based applications and services. Azure Active Directory and the Azure SQL Database are two of the more notable cloud-based products that have been released in recent years. Both products have proven popular among corporate users because they sync up with features within existing on-premises versions, making it easier to work on- and off-premises.

"We depend on [on-premises] Active Directory for some important things, especially security and authentication," said a network administrator with a large transportation company in Jacksonville, Fla.

"So if we were going to take [Active Directory] to the cloud, we needed transparency between the two."

The Azure SQL Database, a relational cloud-based service that competes against Amazon's Relational Database Service, allows users to carry out relational queries against stored data. The service helps improve scalability, business continuity and data protection.

While Microsoft delivers hybrid IT offerings for Azure, it seems eager to do more. In early 2015, the company released Azure Machine Learning, a cloud technology designed to eliminate the heavy lifting involved with creating and deploying machine learning technologies. The product makes it possible to create an analytics Web service out of a data science workflow in only a few minutes.

"Azure is clearly the future for Microsoft," said Dana Gardner, president and principal analyst with Interarbor Solutions, LLC., in Gilford, N.H. "[Microsoft needs] to make it easy for users to develop and deploy [Azure] and its applications in the cloud, while maintaining all the backward compatibility. It is the best way to make sure Windows shops become Azure shops."

Ed Scannell is senior executive editor for TechTarget's Data Center and Virtualization media group. He can be reached at [email protected]

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