Smart Move Plucking New Microsoft CEO from the Cloud

It doesn't come as too much of a surprise because he’s a known quantity within Microsoft circles and has a proven track record of success in previous roles.  The Microsoft I’ve always known likes to promote from within. More than that, it sends a signal of where Microsoft sees the key battles being fought over the next five years or so.

Satya Nadella becomes the third CEO of Microsoft, having previously held the position of Executive Vice President of Microsoft’s Cloud and Enterprise group.

I was asked to share my views on the appointment of Satya Nadella as new Microsoft CEO with The IndependentThe Evening Standard and The New Zealand Herald so I thought I'd take the opportunity to expand on what I told them here.

Despite the success of Xbox, the acquisition of Nokia and other consumer-oriented initiatives, Microsoft's heartland is undoubtedly in the enterprise.  Microsoft is in the early stages of a major shift from the provision of on-premise licensed software to subscription-based Cloud services. The die is cast in terms of the steady shift of enterprise IT investment into the Cloud so it makes sense that Microsoft embraces this shift. But what makes it even more critical is that the Cloud is in Google's DNA not yet Microsoft's.

So the stage is set for a monumental battle for the hearts, minds and dollars of the world's enterprise CIOs.  Microsoft has the market share and the track record in serving this audience but Google is making inroads. For much of Microsoft and its partner network, this is a time of great creative change and opportunity.

Satya Nadella has shown that he’s able to grasp the nettles and drive the Cloud agenda at Microsoft. The stakes are high and Google, Apple and a raft of start-up organizations own significant Cloud mindshare now.

Will Microsoft succeed?  We believe it’ll win with apps and back-end business services because such a huge percentage of the enterprise base has been well served by Microsoft's technologies over the years, and the first choice for most of these organizations will be to migrate to the Microsoft Cloud with as little disruption to end users as possible.

Will it succeed with devices? I think it’ll need to pick its battles. Microsoft used to have a clear lead on the end user operating system and to the extent that its future strategy might rely on recreating this scenario it’ll certainly have a tough fight. Future work surfaces will be a diverse set of devices and it’s hard to imagine Microsoft evicting iOS and Android from these markets. So I think the front-end operating systems are going to need to be less important to Microsoft and perhaps that’s something that comes more naturally to Satya Nadella than it might have to Steve Ballmer.

But it won't be easy. One of Microsoft's advantages has traditionally been its extensive network of partners, both in terms of channel and software vendors like Mimecast.  It’s crucial, as Microsoft seeks to move its customer base to the Cloud, that it continues to partner in order to provide the best possible Cloud experience to demanding enterprise customers.

Certainly from our point of view we’re strongly backing the Microsoft horse and optimizing our services for Office 365, the company's Cloud version of Exchange. We’re looking to help customers and prospects build their short, mid and long-term plans to move all their email services to the Cloud.

Ultimately, Mr. Nadella's appointment is all about Microsoft's commitment to the Cloud. Given that Mimecast has been a catalyst for Cloud adoption since we started ten years ago, we’re very encouraged that Microsoft has appointed a CEO who shares our view on the future of IT.