Editor’s note: Matthew Casey is an analyst with research firm Technology Business Research. He offers insight into Microsoft’s third quarter results which were announced Thursday.
HAMPTON, N.H. – In the new age of enterprise IT, characterized by mobile lifestyles and cloud-based IT environments, the importance of providing a seamless, flexible end-user experience cannot be understated for IT vendors.
Regardless of whom the end-user is, whether an IT developer, sales executive or marketing associate, clunky, inefficient IT solutions are no longer acceptable within businesses in the new, consumerized IT landscape.
Embracing this realization that traditional, point IT solutions are no longer the norm, Microsoft delivered record third quarter revenue (15.7% year-to-year revenue growth to $18.5 billion) as new solutions and a reinvigorated corporate vision are delivering early results. Delivering products that touch end-users across IT, lines of business, consumer, mobile devices and cloud environments, the unification and simplification of Microsoft’s solutions under “One Microsoft” can build on the established businesses in each of these areas.
Demonstrating these potential benefits during 3Q13 were Microsoft’s core software brands, including SQL Server, Lync, SharePoint and Exchange which all grew double-digits as Microsoft increasingly integrates functionality of these disparate solutions and provides seamless IT environments.
Microsoft CEO, Steve Ballmer’s quote in the 3Q13 earnings press release summed up the company’s new vision and early success, stating “Our devices and services transformation is progressing and we are launching a wide range of compelling products and experiences this fall for both business and consumers”.
TBR believes this focus on end-user experiences, regardless of device and delivery model, is the focal point of Microsoft’s strategy that will enable the company to continue this growth trend and reaffirm its position as a leading provider of enterprise and consumer solutions.
Microsoft Unifies Platforms to Boost ISV Development
Re-emphasizing Microsoft’s focus on end-user experiences were announcements during 3Q13 around the integration of application development and deployment capabilities for ISVs [independent software vendors]. Part of Microsoft’s difficulty in the mobile and cloud spaces can be attributed to the company’s compartmentalized development environments across devices and platforms, a problem that created rifts in terms of user-experiences for developers and customers.
To combat this issue and break down barriers between its various platforms, Microsoft announced in October that it is unifying SDKs, APIs and development tools to provide a single application development and a unified Windows Store for deployment of applications across Microsoft devices.
With the addition of Nokia in 3Q13 and traction of the Surface tablet, unifying developer capabilities across these emerging delivery models will help re-establish the viability of Microsoft’s development platforms for ISVs.
Cloud Solution Certifications to Help
While improving end-user experiences remains a focal point of Microsoft’s newly formed corporate vision, retaining traditional customers through cloud integration is essential for Microsoft to maintain its established sources of revenue.
During 3Q13, Microsoft achieved multiple government certifications within its cloud business, establishing opportunities for increased revenue growth as well as solidifying its ability to retain public-sector customers already standardized on Microsoft solutions.
With vendors such as AWS and Google threatening Microsoft on multiple cloud fronts, the 3Q13 certification of solutions including FedRAMP for the recently announced Azure US Government Cloud, JITC certification for Lync, and US Department of Defense approval for Office 365, Microsoft is better positioned to fend off competitors and expand engagements with existing government customers.
(C) TBRI
