Microsoft adds Azure VM controls to Virtual Machine Manager

"System Center and VMM users are, it seems, considered more deserving of attention by Microsoft."

Funny how actually having competition that's notably superior can motivate even Microsoft to deign to add minor additions. A few more years of this and they might even stop behaving as though they are an inevitable monopoly!

The big question yet to be resolved is how Microsoft is going to react to the changes that have been happening of late. "Cloud first, mobile first, customers/partners/staff last" has succeeded in it's original goal: drive cloud adoption. The cost of this, however, has been a gut punch to on premises revenues in all segments.

Where the lines cross a little is that Microsoft is losing customers. There are a significant number of companies that simply don't want to go cloud, and for all the critical markets (except traditional desktop OSes) there are viable alternatives. In addition, some of those convinced to go cloud are choosing vendors other than Microsoft for their cloud services.

In and of itself neither of these two things is negative. Not all customers are equal, and it remains to be seen if Microsoft's approach is driving away the valuable customers or the burdensome ones.

At some point, however, there will be a massive shift. Unless Microsoft changes it's approach to on premises customers the decline will accelerate. As it does, Microsoft will reach a point where merely treating on premises users as second class citizens isn't enough, and they simply retire the whole concept.

When will that occur? What will the revenue fallout of that look like? And in the intervening months/years will Microsoft successfully convert the holdouts to their American controlled public infrastructure?

Microsoft used to be purchased by companies for two reasons: 1) Ease of use and 2) predictability. They were a stable, predictable, comfortable option. Sure, they were more expensive, but you know what they were up to and surprises were few.

That isn't the Microsoft of today. There is a constant feeling that on premises customers are one bad quarter away from getting PlaysForSured. That's before we get into discussions about development stacks and the ever shifting sands underneath them.

Microsoft are smart, capable and make products that are - for the most part - competitive with what's on offer from others. But the existing strategy of herding customers towards the cloud had led to some pretty bitter alienation and it is starting to show in revenue.

Can Microsoft continue to be reactionary; doling out only the bare minimum of updates (such as what has been presented for SCVMM on premises customers in this article)? Will playing silly buggers with products where they think they have a monopoly still be a viable approach as Silicon Valley's startup engine roars ever louder, and Microsoft's customers eye its empire ever more hungrily?

Or will Microsoft's arrogance and belief that it can control its customer base lead to a perpetual negative CAGR for the company as a whole and a slow fade to being nothing more than an American public cloud provider, with a politics-limited TAM and an increasing inability to differentiate itself from other American public cloud providers?

Can Microsoft win on merit with it's current approach? If not, what changes are required for it to do so? If there are changes required, can the body corporate make them, or will Microsoft fall to its own corporate hubris?

I am no longer certain Microsoft has mastery over the art of pricing the cost of staying loyal below the cost of moving away, and I am absolutely positive that the desire to move away is mounting. Interesting times. 15 years ago, who would have thought this day would ever have arrived?