Abs: As the peak of the world’s technology companies, whether it will continue to seize the top spot in the world by AI strategy has always been a topic of great concern to the industry. In past 20 years, the only company that ranked the top ten in the market value of the world’s enterprises, Microsoft, let us analyze its strategic layout in artificial intelligence.
Here is the first article of the series.
The second article of the series: After missing the Mobile, 4 AI scenarios help Microsoft win the world again (2)
On the 24th Nov, Microsoft released the Q1 report for the fiscal year 2020. According to the report, Microsoft’s total revenue for the quarter was $33.1 billion, up 14% year-on-year. Among them, Microsoft Smart Cloud’s revenue was $10.8 billion, an increase of 27%.
Ubiquitous computing, ubiquitous intelligence
The relationship between Microsoft and AI has been around for a long time.
In the 1990s, Microsoft began to develop speech recognition and visual technology. However, due to the dominance of the PC business, this research suffered from the “innovator’s dilemma”. With the lack of computing power at the time, it was difficult to get out of the Microsoft lab.
Until Nadella took office, the situation was reversed. Microsoft began to clearly understand that Microsoft, which missed the era of mobile. Wanted to regain its peak in the world, it is not enough to surpass Amazon in cloud computing.
At the same time, other technology giants such as Google and Amazon have also smelled the AI atmosphere and have proposed AI priority strategies.
“The world of AI priority will bring opportunities. These opportunities will be divided by a few companies. You should understand that it is no big deal to miss the last wave, but if you miss the current tide, it will be big.” Shen, a high-level leader of Microsoft, had analyzed.
As a result, Microsoft began to shift from “mobile first, cloud first” strategy to “smart cloud, smart edge”, and Shen’s interpretation of the transition is the most important point in “smart cloud, smart edge”. Yes, the world is moving forward, and it must be “ubiquitous computing, ubiquitous intelligence.”
It can be seen that AI has become an important piece for Microsoft to win the next era.
Discovery of Microsoft full-stack AI architecture
With strategy, the next step is operation.
Empowering the built AI infrastructure into every product is Microsoft’s first move.
In the most recent example, Microsoft developed a feature called “HomeHub” for Windows10, which enables the combination of traditional PC and AI. Users can control Philips Hue, Nest, Insteon, Winl and Samsung SmartThings through Microsoft Cortana Voice Assistant. Smart home products, such as the traditional Windows 10 to achieve product intelligence.
If the internal products are internal and external, Microsoft wants to become the infrastructure of the global AI enterprise. Microsoft’s positioning of its own AI strategy is to become an infrastructure in the field of “AI” and “Internet of Things”, and this is like Microsoft’s operating system is generally in the PC era.
Different from people’s perception of Microsoft and Cortana, currently, Microsoft has built a complete full-stack AI layout from cloud to system platform to technical service. This layout is not only as simple as hardware and algorithms, and it’s more like an AI infrastructure and ecosystem.
We will analyze the architecture into 4 scenarios:
Scenario 1: Cloud – Azure
Unlike some companies that make AI a separate department, Microsoft’s entire AI strategy is based on the cloud, according to the inseparable relationship between cloud, big data and AI.
Microsoft has created Microsoft Azure – but among small and medium-sized customers Amazon’s AWS “public cloud” has dominated, and Microsoft wants to break through a little more difficult.
So Microsoft adopted a differentiated competition strategy, which launched a complete solution including “hybrid cloud” and “smart cloud” for the needs of large ToB-side enterprises, including public cloud Azure, hybrid cloud AzureStack, IoT AzureIoTEdge and AzureSphere.
According to Gartner’s data, the Magic Quadrant of Microsoft Cloud is at the center of leadership. So far, it has deployed more than 54 regions, and 95% of the world’s top 500 companies are using Microsoft Azure.
So in terms of income, Microsoft Cloud and Amazon AWS, who is the world’s number one?
According to Microsoft’s 2019 annual report, Microsoft’s annual revenue in the 2019 fiscal year reached 125.8 billion US dollars, of which smart cloud revenue was 38.9 billion US dollars, excluding smart cloud servers and other products, Microsoft Microsoft Azure accounted for about 30%, It is expected to be around $12.4 billion and achieve a 72% increase in revenue.
The growth rate of Microsoft Azure is very obvious. It is a veritable “star business”. According to the data, Microsoft Azure has maintained a growth rate of over 70% before the Q3 quarter of Microsoft’s fiscal year.
Back to Amazon AWS, according to its annual report data, Amazon AWS revenue last year was 25.65 billion US dollars, up 47% year-on-year, but because the dimensions of the data disclosure are not the same, Microsoft Smart Cloud also contains server products, both Not in a measurement dimension.
Although it is not possible to tell who is the number one in the world, it is certain that Microsoft has won the position of the giant in the cloud business.