The world's largest software maker
) acquired cloud-monitoring startup MetricsHub for an undisclosed
Bellevue, Wash-based MetricsHub was part of Microsoft's
Accelerator program for Windows Azure, through which Microsoft
funded 10 startups.
MetricsHub offers cloud-based tracking and monitoring systems,
which reduce cloud hosting bills, the time spent on server
administration and also improves business operations. Users can
also keep track of storage capacity, uptime, response times, the
number of requests and projected costs among others.
Microsoft is already offering MetricsHub's expertise free to
its Windows Azure customers through the Windows Azure Store.
Customers are drawn toward cloud-based services as it is cost
efficient, comes with unlimited storage, and backup and automatic
software updates. Also, data recovery is easier than in
traditional methods of data storage as the information can be
easily accessed. However, sometimes customers fail to manage
their applications efficiently, which leads to operational
bottlenecks. MetricsHub helps solve the problem by sending alerts
to customers to scale up or manage their applications better.
Thus, this automated monitoring system is likely to benefit
Microsoft in the long run.
) was one of the major pioneers of cloud computing. It modernized
its own data centers and launched a cloud-computing business for
external customers called Amazon Web Service (AWS) in 2006.
Microsoft's aggressive acquisition strategy has proved
beneficial in the past and is largely responsible for the
company's market position. In fiscal 2012, the company closed the
Skype acquisition and picked up an enterprise social networking
company Yammer for $1.2 billion in cash. Further, it acquired
cloud-based storage business StorSimple for an undisclosed
Currently, just like other PC makers, Microsoft is also
battling the slump in the PC market caused by the sluggish
economy. In addition, the popularity of smartphones and tablets
) has been cannibalizing its core PC market. Thus, it makes sense
for Microsoft to venture into new businesses like cloud
IDC predicts that the cloud market may witness 130% jump and
reach $43.0 billion in 2016. Further, Gartner predicts that
around $677.0 billion may be spent on cloud services within
2013-2016. Thus, Microsoft should be able to tap this
opportunity, which may boost its top-line going forward.
Microsoft remains one of the best positioned software vendors,
given its wide range of products, emerging markets strength,
continued technology deployment at data centers and growth in
cloud computing. We believe that Microsoft's current investments
are supported by its strong balance sheet and expect these to
drive the next growth phase, improving prospects of market share
Microsoft reported revenues, excluding deferrals, of $21.46
billion in the second quarter of fiscal 2013, up 34.0%
sequentially and 2.7% from last year, in line with our estimates.
All except the Entertainment & Devices segment grew both
sequentially and from the year-ago quarter.
Microsoft has a Zacks Rank #3 (Hold).
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