In a bid to conquer the markets of cloud and container services, Microsoft Corporation (NASDAQ:MSFT) has sent its Windows Server out in full swing. Major tech companies have come to realize that the key to boosting their cloud businesses lies in offering more efficient and diverse solutions. Microsoft will use its platform to do exactly that and cement itself at the core of these online segments. Going forward, MSFT revenue is set to rise significantly. This will come from the more sophisticated, innovated and diversified container solutions of Windows Server 2016.
The battle against web giants like Amazon (NASDAQ:AMZN) and Amazon Web Services is about to heat up as Microsoft works to take the lead in cloud and container markets. But Jeff Bezos and his company won’t allow this to be an easy feat. Amazon recently made a deal with VMware (NASDAQ:VMW), a move that will help secure its advantage over competitors who provide virtual machine (VM) services.
Amazon Web Services may lose to Microsoft
Microsoft recently rolled out it latest server operating system, Windows Server 2016. It allows users to make use of both remote and local tools with equal efficiency. This is enabled through Azure, the company’s leading cloud service. Combining the benefits of cloud and server will make Microsoft a formidable provider of hybrid cloud solutions in the IaaS market.
Containers hold an advantage by providing virtual solutions that use less system resources than VMs. They only need a portion of an operating system to function. Containers can also house more applications. On the other hand, VMs carry the bulk of an entire operating system with less applications. However, the advantage of VMs is that they are more security since containers share the base of their host operating systems.
The small and medium business market currently sees a rapid adoption of container services. Although MSFT’s primarily pushes its cloud service at large organizations, web giants like Amazon and Google are noticeably deriving more revenue for smaller corporations and private users. Microsoft (NASDAQ:MSFT) is keen to rake in a greater share of that segment. The company plans to extend its containers to SMBs and individuals via Nano Server. The move also promises to enhance its cloud presence in the segment.
MSFT gains new markets
Nano Server was introduced alongside Windows Server 2016. It is a compact variant that is a around 20 times smaller than the latest Windows Server OS. It essentially offers smaller businesses a number high-end corporate solutions.
Opening up a platform for container-based virtual tools could see Amazon lose a significant share of the cloud infrastructure market to Microsoft. A report by Alpha Max claims data centers are bound to take notice of Windows Server 2016 due to its newly extended and improved support for Docker containers. Cloud industry analysts expect containers to gradually become the norm for light, web-based services, surpassing VMs.
Microsoft (NASDAQ:MSFT) was recently given a rating boost from “neutral” to a “buy” from Goldman Sachs. The equity researcher also pushed its price target up from $60 to $68. Sachs expects a speedy increase in gross profit from MSFT. It believes the Azure cloud service will grow the company’s profit margins as well.