Skip to main content

How can Microsoft ever compete with Amazon?

But Microsoft and other more traditional software companies may struggle with an even more fundamental issue as they move to supplement their standard offerings with software-as-a-service and cloud development platforms.

Ozzie hinted at it with his acknowledgment of Amazon’s success to date. Sridhar Vembu, CEO of AdventNet, the company that created the Zoho suite of online productivity applications, highlights it in a smart blog post.

Amazon is a giant in a business with notoriously slim profit margins, which is likely part of the reason it was so quick to recognize and capitalize on the cloud computing opportunity. Its retail business models are designed around obtaining the maximum amount of efficiency from its operations.

That’s not the case with traditional software suppliers. Companies like Microsoft aren’t particularly eager to make huge infrastructure investments to support what could end up being a low-margin business — especially when at least some of its customers will likely be those who migrate from its own higher-margin on-premise products. Writes Vembu:

… it is hard to see how the economics would work for [Microsoft] against Amazon. It is very hard for companies to go down the value chain for growth, so I am skeptical Microsoft would easily accept Amazon-like margins. On the other hand, for Amazon, cloud services have to deliver only a little higher margin than retail to be well worth the investment. That is not a tough hurdle, because retail is one of the toughest businesses out there



Popular posts from this blog

Get Vyatta Virtual Appliance, now VMware certified!

We all know Vyatta, don't we?

Vyatta, the leader in Linux-based networking, today announced that its open-source networking software has received VMware Virtual Appliance Certification, thereby providing customers with a solution that has been optimized for a production-ready VMware environment. The company also announced it has joined the VMware Technology Alliance Partner (TAP) Program. As a member of TAP, Vyatta will offer its solutions via the TAP program website. With the Vyatta virtual appliance for VMware environments, organizations can now include Vyatta’s router, firewall and VPN functions as part of their virtualized infrastructure.

Vyatta combines enterprise-class routing and security capabilities into an integrated, reliable and commercially supported software solution, delivering twice the performance of proprietary network solutions at half the price. Running Vyatta software as virtual appliances gives customers many more options for scaling their data centers and cons…

3PAR adds native LDAP support to simplify administration

3PAR®, the leading global provider of utility storage, announced today native support for lightweight directory access protocol (LDAP). Support for LDAP enables centralized user authentication and authorization using a standard protocol for managing access to IT resources. With 3PAR’s support for LDAP, customers are able to now integrate 3PAR Utility Storage--a simple, cost-efficient, and massively scalable storage platform—with standard, open enterprise directory services. The result is simplified security administration with centralized access control and identity management.

“3PAR Utility Storage already provides us with a reliable, shared, and easy-to-use consolidated storage platform,” said Burzin Engineer, Vice President of Infrastructure Services at Shopzilla. "Now, with 3PAR support for LDAP, managing security commonly--across all our resources, including storage--is also simple and efficient.”

Press Release

DeepLearningTrucker Part 1