Blog Post

Microsoft sells Azure storage like a smartphone: free device with contract

When Microsoft(s msft) bought StorSimple, the storage appliance company in October, you just knew it was doing so to grease the skids onto Azure storage. Well, if you didn’t, you should now.

Microsoft is offering a free StorSimple 7520 appliance “to keep forever (a $138K value!!)” to customers willing to commit to $100,000 a year — or about 100TB of data — to Azure storage. There are strings attached:  you have to pay for Gold service at $7,500 per year for years two and three.

Windows AzureThat promotion shows just how competitive the battle to win people’s data is to cloud providers. In the past two weeks, Google(s goog), Amazon(s amzn) and Microsoft launched or responded to cloud storage price cuts four times.

It’s increasingly clear that these giants see storage as a way to lure customers into their respective cloud and then “upsell” them on higher-level and more profitable services.

StorSimple competes with TwinStrata and to some extent with Amazon’s AWS Storage Gateway — all of which offer an easier way for customers to move business data into the cloud. Microsoft’s acquisition of StorSimple sparked speculation that Rackspace(s rax) or some other cloud player would snap up TwinStrata. These companies and their technologies are seen as an easy on-ramp to the cloud and as such are valuable to big cloud providers scrapping for customer data.

 Photo courtesy of  Flickr user D.Begley

6 Responses to “Microsoft sells Azure storage like a smartphone: free device with contract”

  1. Unstructured file data would be a good fit for these type of Cloud services, StorSimple and S3. Structured and Application data is a very different case, these data sets are much smaller but have greater resource and security requirements that require they are situated close (low latency) to the applications themselves. I’m not sure I see a direct link between these two data sets and although customers are more likely to use the same provider for structured/unstructured data it’s not a requirement for those considering those cloud services. In fact I see more customers selecting individual services from different cloud providers and not sourcing all services from one vendor.

  2. Peter Chang

    What is the cloud? It is just data and apps. If one’s data lives in one cloud, one will most likely do everything else in that cloud. Just look at the success of AWS. A vital strategic difference between amazon and other clouds is the enormous lead in storage. Offering compute with no storage is extremely limiting. It is more effective to keep data and compute together in one cloud.

    It makes perfect sense for Microsoft to compete for developers, but why is a free storage appliance helpful when the point is to use cloud storage? Microsoft should consider giving away a large quantity of free Azure storage instead.

  3. Mirosoft’s aggressive promotion of cloud storage points to a trend that’s advantageous to the company’s prospects. Because of its deep integration with the enterprise, Microsoft could use cloud storage as a loss-leading strategy to win the business of big organizations, who could be upsold a litany of software and services all designed around the Azure ecosystem — far more than are currently on offer by the likes of Google, Amazon, or legacy hosting providers like RackSpace.

    These developments raise several questions. Will Microsoft open up Azure to third-party developers, who could build upon it in a similar manner to AppExchange? Will companies that focus largely on infrastructural needs (AWS, RackSpace, etc) transform into full-scale providers that compete with Microsoft in extracting added value from stored data? Will Google make a deeper push into the enterprise with an expanded Big Data play of their own?