When you work on a newspaper you usually get a spanking from a grumpy sub-editor if you use the phrase “the world’s biggest” in a story. Which is why Nomura analyst Rick Sherlund has found himself in hot water by claiming that Microsoft’s Azure is headed to be the largest cloud in the world.
While everyone admits that Azure is doing very well, people were a little surprised when Sherlund claimed that Redmond was on track to make $5.7 billion revenue from Azure.
Apparently his prediction was by adding up some numbers from Microsoft’s last earnings. Redmond said that cloud revenue grew 147 percent year-over-year. This led Nomura analyst Sherlund to predict Microsoft will hold the crown as top cloud by revenue by the end of 2014.
However there are those who have been questioning Sherlund’s maths InfoWorld said that all Azure numbers are impressive but they are a long way from being the world’s biggest cloud.
It said that it is not clear that Microsoft’s “cloud revenue” is “Azure” in fact Redmond has been clear to keep the two things apart. It points out that it is not clear how much of Microsoft’s cash comes from Azure.
Amazon is seeing that slowed growth during its last earnings call, but it also revealed that its cloud business climbed 90 percent over the past year.
Given that AWS offered five times the compute capacity of the other 14 cloud providers in the Gartner Magic Quadrant combined as of August 2013, 90 percent growth is huge. So while Azure might grow like crazy, so is the competition.
This means that Redmond will even be close to having the biggest cloud by the end of the year. It will almost certainly continue to build out public cloud services that enterprises buy – just not the world’s biggest.