4 ms·

Is the cloud a low margin business in general? Looks like very few companies are prepped to handle that (read AMZN/GOOG). I'm not sure if I should be holding on

Is the cloud a low margin business in general? Looks like very few companies are prepped to handle that (read AMZN/GOOG). I'm not sure if I should be holding onto my MSFT stock anymore though :). Seems like just a matter of time.

sz4kerto 12y ago
MSFT is currently way bigger in the cloud business than GOOG (it's a lot behind AMZN though), so I'm not sure why you think that AMZN/GOOG is going to handle this better. Azure has a very strong momentum now and looking at how quickly that department of MSFT adapts, this is going to continue I think (they are really trying to accomodate all platforms, etc.)
- xorcist 12y ago
  There is some truth to that Microsoft is less prepared for the slimmer margins than Google and Amazon is, who are veterans of this space. Their cloud services has higher overhead simply because they stick with Microsoft tech for obvious reasons. Microsoft also has more focus on their sales force which may not be such a good idea when/if Office dies. Time will tell.
smackfu 12y ago
A cloud service where you just spin up your own server instances is a commodity service which will have low margins. In contrast, a cloud service where you use an API to have the cloud do something for you instead of running your own servers will have much better margins. An examples of this would be Azure Mobile Services.
mnglkhn2 12y ago
In your assessment I would switch out GOOG with MSFT. To me Microsoft is the better one at doing retail cloud than Google. Even Apple is using MSFT for their cloud backbone. Apple is not selling cloud directly to consumers, but every app/device sold has iCloud backing, which developers can use for their apps for a ton of services.
wmf 12y ago
Migrating legacy shit to the cloud has much higher margin than the cloud infrastructure itself.

4 ms·

Is the cloud a low margin business in general? Looks like very few companies are prepped to handle that (read AMZN/GOOG). I'm not sure if I should be holding on

by curiousDog 12y ago

sz4kerto 12y ago
MSFT is currently way bigger in the cloud business than GOOG (it's a lot behind AMZN though), so I'm not sure why you think that AMZN/GOOG is going to handle this better. Azure has a very strong momentum now and looking at how quickly that department of MSFT adapts, this is going to continue I think (they are really trying to accomodate all platforms, etc.)
- xorcist 12y ago
  There is some truth to that Microsoft is less prepared for the slimmer margins than Google and Amazon is, who are veterans of this space. Their cloud services has higher overhead simply because they stick with Microsoft tech for obvious reasons. Microsoft also has more focus on their sales force which may not be such a good idea when/if Office dies. Time will tell.
smackfu 12y ago
A cloud service where you just spin up your own server instances is a commodity service which will have low margins. In contrast, a cloud service where you use an API to have the cloud do something for you instead of running your own servers will have much better margins. An examples of this would be Azure Mobile Services.
mnglkhn2 12y ago
In your assessment I would switch out GOOG with MSFT. To me Microsoft is the better one at doing retail cloud than Google. Even Apple is using MSFT for their cloud backbone. Apple is not selling cloud directly to consumers, but every app/device sold has iCloud backing, which developers can use for their apps for a ton of services.
wmf 12y ago
Migrating legacy shit to the cloud has much higher margin than the cloud infrastructure itself.