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Microsoft CEO: Buyer beware for digital technology platform choice

At Microsoft Ignite 2018, CEO Satya Nadella issued a 'tech intensity' challenge, as the company launched or announced updated offerings in the cloud, IoT and AI domains.

Microsoft CEO Satya Nadella issued a challenge and a warning to CIOs and other IT managers attending the company's Ignite 2018 event: Gear up for "tech intensity," and pick your digital technology platform partners wisely.

Microsoft Ignite 2018 drew some 30,000 attendees in Orlando, Fla. It generated more than 80 product announcements from the software giant and still more from partners in its ecosystem. Thematically, the annual event for enterprise customers, IT professionals and developers focused on the "intelligence cloud and intelligent edge" -- the catchphrase Microsoft uses to describe the ongoing technology shift toward ubiquitous, embedded computing infused with AI.

"We need tech intensity" to deal with this emerging IT environment, Nadella noted during his keynote address at Microsoft Ignite 2018.

Nadella said he views tech intensity as having two facets: First, organizations need to make sure they are adopting "the latest and greatest technology." And, second, they must build their own, unique digital capability.

"Irrespective of which industry you're in, you are a digital business," he said.

Digital technology platform perils

Adopting tech and building a digital technology platform has its perils, however. Nadella suggested businesses be wary of the strategic blunder of building a "unique" digital capability that is already available as a commodity.

"You want to make sure you are focusing on the things that truly make you unique," he said.

Satya Nadella, CEO, MicrosoftSatya Nadella

Nadella warned attendees about another digital technology platform pitfall.

"If you are dependent on a provider who ... is providing you a commodity on one end only to compete with you on another end, you could be making another strategic mistake," he said. "Picking your partners well is where I think the strategic definition of being smart will really come through."

Ned Bellavance, director of cloud solutions at Anexinet Corp., a systems integrator and technology management firm based in Blue Bell, Pa., said Microsoft has been advancing the trust-your-partner message for several months. He suggested Microsoft may be responding to a concerted effort by Amazon Web Services to court enterprise customers.

"Microsoft is saying ... if you are an ISV or an enterprise trying to build a product on the Azure platform, Microsoft is not going to swoop in and release the same product and start competing with you," Bellavance said.

The same argument applies to acquisitions, he added.

"Microsoft is saying, if you are a pharmacy delivery business and have built a platform on Azure, we are not going to buy a pharmacy delivery business and start competing."

Amazon announced plans to purchase PillPack, an online pharmacy, earlier this year.

"Microsoft is more firmly and clearly focused on developing and delivering technology solutions that don't directly compete with its customers' businesses," added Jeff Kaplan, managing director at THINKstrategies Inc., a strategic consulting firm. "This makes many of corporate customers much more comfortable working with Microsoft, rather than Amazon."

Cloud, IoT offerings

Beyond Microsoft's discussion of digital technology platform philosophy, Microsoft Ignite 2018 was notable for its range of product debuts and updates. Microsoft's technology barrage emphasized security and previewed soon-to-be-available offerings, such as SQL Server 2019, which is slated for general availability in October.

Cloud, IoT and AI were at the center of a number of new product initiatives unveiled at the conference. The technology rollouts aim to help Microsoft stand out, as it vies for market share with top cloud companies, such as AWS and Google.

"I see the announcements this week from Microsoft as the latest in the battle for differentiation amongst the 'big three' hyperscale cloud providers," said Grant Kirkwood, chief technical officer at Unitas Global, a Los Angeles-based managed hybrid cloud provider.

Irrespective of which industry you're in, you are a digital business.
Satya NadellaCEO at Microsoft

"Providing on-demand scalable compute and storage has been considered table stakes for a long while now, so the various cloud providers are placing bets on what they think will be winning use cases, with capabilities unique to each provider," he said.

At Microsoft Ignite 2018, the company announced a public preview of Azure Digital Twins, which will be added to Microsoft's IoT platform. Among other things, the new offering will provide a "virtual representation of a physical environment that models the relationships among people, places and devices," according to Microsoft.

The Azure Digital Twins service, Kirkwood said, "makes it clear Microsoft is betting big on IoT. Microsoft is building an entire ecosystem of services around IoT, including data processing, analytics and modeling."

Kirkwood said potential enterprise use cases are limited only by the number of devices and the variety of functions they can perform, noting IoT applications are used in industries as varied as farming, manufacturing and energy.

Azure Machine Learning gets automation

On the AI side, meanwhile, Microsoft took the wraps off a machine learning capability that automates the data transformation, model selection and hyperparameter tuning elements of AI development. The automated machine learning feature will become part of the Azure Machine Learning service and is now available in preview.

The goal, Microsoft said in a blog post, is to make Azure Machine Learning an end-to-end offering for "anyone who wants to build and train models that make predictions from data."

Kirkwood said Azure Machine Learning is similar to Azure Digital Twins, because it makes "the ability to process and analyze massive unstructured data -- generated by IoT or other large data streams -- available to anyone."

From the enterprise point of view, making machine learning available as a consumable service moves the technology out of the data scientist domain and makes it available to nondata scientists in the organization, Kirkwood explained.

"Enterprise organizations are very much evaluating and exploring the capabilities of [machine learning] and AI in the cloud," he added.

But enterprises, for the most part, are not quite ready to adopt the AI technologies on offer.

"Microsoft and the other leading AI vendors are well ahead of their customers in developing solutions that their customers are not yet able to implement and fully utilize," Kaplan said. "This is not a new phenomenon. Over the past 50 years, tech vendors have often introduced new solutions that customers weren't prepared to adopt, because they didn't fully understand their potential or they faced organizational obstacles, which slowed the deployment process."

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