Trust is key to Microsoft’s APAC cloud play

Having served enterprises longer than most other public cloud suppliers, Microsoft’s knack for selling to large companies – and gaining their trust – has been instrumental to its success, and more so as conversations around cloud computing are increasingly centred on the hybrid cloud.

It is this trust from enterprises that Microsoft hopes to bank on as it expands its cloud footprint across the Asia-Pacific (APAC) region, according to Danette Seward, senior director for intelligent cloud at Microsoft Asia.

In an exclusive interview with Computer Weekly, Seward talks up Microsoft’s cloud momentum in APAC, how it differentiates itself from its rivals, and the company’s priorities in 2019.

How is Microsoft approaching the cloud market in Asia differently from others?

Seward: The first question that CIOs or CEOs often ask me when I sit down with them is: “Tell me why I’m even talking to you?”

Our message in Asia is no different from our broader global message. The first is trust and Microsoft has run on trust for a long time – from our heritage, and from an operating system and productivity suites perspective.

The second differentiator is around developer productivity through our acquisitions, such as GitHub, and more recently Xoxco, a software product design and development studio known for its conversational artificial intelligence (AI) and bot development capabilities. So across the board, we are providing developers with toolkits and open source environments to help them become more productive in everything they do.

The third differentiator is about weaving AI into everything we do. We do have some great internal use cases around what we’re doing with AI that we share with enterprises.

And the last differentiator is our hybrid message. A lot of people talk about hybrid, but I think our differentiator is that we deliver that hybrid experience in a consistent manner – beyond just connecting a private cloud to the public cloud. We offer a consistent cloud environment for developers to build applications and take them into production.

Tell me a little more about the adoption of Azure Stack in this part of the world. Is it being used or tested by customers right now? What are some of the common use cases that you’re seeing?

Seward: Azure Stack been very successful across Asia. We have some great examples in China and Hong Kong, as well as in Indonesia, where it has been used by telcos and managed service providers (MSPs). The recent Asian Games in Indonesia, for example, ran on Azure Stack.

The telcos and MSPs have also lined up a series of use cases to deploy Azure Stack across the region, whether it’s in a disconnected mode running in Indonesia, sitting on Telstra’s floor, or in a connected mode tethered to the public cloud.

I feel like about half of my job is hiring, which is a really beautiful thing because it speaks to the investment that we’re making to bring in the right talent and train them.

Apart from the differentiators that you mentioned, I would think that because Microsoft has been working with enterprises much longer than some of the other public cloud service providers have, you would have more experience selling to large enterprises. Would you say that has been critical to your success in the market?

Seward: Yes, absolutely. I think that’s wrapped into my point on trust, because our customers know we operate at enterprise grade. They know that Microsoft has, at its core, enterprise products and offerings. Our sales force and our engineering team are very connected to large enterprise customers.

Across the APAC region, what would you say would be the sweet spots from an industry and geographical perspective? APAC is a very diverse place, and I reckon you would have different strategies for emerging versus mature markets. There’s never a single strategy that will cover them all, right?

Seward: I think you’re spot on. In every market, customers are moving at different paces. When I’m in Australia, I talk to financial customers, automobile manufacturers and small business startups.

As for sweet spots, I think it’s more dependent on the customer mindset and their willingness to lean into and understand what’s happening from a Digital transformation perspective than it is about regions and industries. Don’t get me wrong, I think you’re spot on that when we talk to customers in some parts of APAC, we would have a connected car story that plays very well in Japan, Australia and Thailand, for example.

But I think it’s more about customer mindset than a specific industry. That seems a little odd, but these days some customers are more willing to digitally transform than others, so they can innovate and not get left behind.

I want to talk a little more about the trust aspect that you mentioned earlier on. We understand there can be downtimes for cloud service providers, and Azure has faced some outages of late. How are you addressing customer concerns about these issues?

Seward: You ask great questions. But I think there’s nothing that our customers don’t ask us as well. And frankly, from our point of view, I think no matter what, we are invested as a company in making sure that the cloud experience for enterprises is a trusted, reliable and stable one.

We build based on what our customers need and we see varying levels of demand. Interestingly, the last few years have been a huge learning experience for me around the gaming industry in South Korea. You would think large enterprises would be the demanding ones, but actually the requirements from gaming companies far exceed what we’ve seen from any enterprise customer.

We’ve had really explosive growth since we launched our South Korea datacentre in 2017 and we’ve brought on board some of the biggest gaming companies and smaller ones too. That has helped us to make sure we continue to improve the capabilities of our datacentres globally. Our enterprise customers have pushed us to certain levels, but the gaming customers are pushing us even harder.

Speaking of datacentres, are you looking to expand your datacentre footprint in APAC? I know you may not be able to reveal specific plans, but generally speaking, how do you assess whether you want to add an extra region or availability zone? Also, are you able to share more about what you’re doing in the government sector? I understand Microsoft also has datacentres in Australia that cater to government customers.

Seward: Good questions. Let’s start with our strategy for evaluating where we're going to open up a datacentre. Our strategy in Asia is not any different from our global view on our investments and growth. Globally, we’ve grown from 42 regions to 54 regions – 17 of them in Asia – in a little more than 12 months. We continue to invest in the market, and I see no slowdown in our investment.

Is there any more depth behind that? Sure, but not that I’m privy to, frankly. I’m not holding back any major secrets. You know, we continually evaluate and I think from an Asia investment perspective, we’ve done quite well. I feel really comfortable and our clients are comfortable with what we have.

We did just launch two new regions in Australia, which was a big investment and something we’re really excited about. So that was a really positive thing last year. We are also a very partner-centric company. We look to our partners, like some of the MSPs and the telcos in Indonesia. Right now, we have a really good relationship with them and we did deliver to that market very successfully. We will continue to evaluate what the right approach is.

You would think that large enterprises would be the demanding ones, but actually the requirements from gaming companies far exceed what we’ve seen from any enterprise customer.

What is your sense of the cloud pie in the region? Do you see the pie growing at a much faster rate? Do you think what you’re doing right now – with regard to those four key differentiators – is enough to tip the scales and close the gap between Microsoft and the others in the market?

Seward: The pie is definitely getting bigger. Before, customers were just doing development and testing on the cloud, but now they’re going into full production in a lot of cases. So the pie is absolutely growing. Do I think we are doing the right things from an engineering perspective, an investment perspective and a sales perspective? Yes, absolutely I do, and it is all centred on how we engage with our clients and what our clients tell us they need.

One of the beautiful things about Microsoft is that we listen to our customers and then we figure out how to make the right investment and deliver what they need. So yes, I am comfortable that we are doing the right things. We can always do more – for instance, integrating acquisitions like GitHub and really leveraging what they are doing in Asia.

You talked about the end-user customers, but what about the independent software vendors [ISVs]? Singapore’s Infocomm and Media Development Authority (IMDA) recently launched an initiative to get smaller ISVs up to speed with cloud-native development, to either build new cloud-native applications or to turn monolithic applications into cloud-native ones. IMDA sees that as critical for the local tech industry to move forward. What are your thoughts on that?

Seward: For me personally, ISVs are incredibly near and dear to my heart. I’ve spent a large part of my career working with partners and I know how vital they are – even more so in this cloud-first world that we’re in. Those native, born-in-the-cloud ISVs are critical to our success. So we do spend a tremendous amount of time fostering those relationships, which could be through partners and developer communities. We do a tremendous amount of work around those communities.

And that’s why the GitHub acquisition makes sense, right?

Seward: Yes, absolutely. There is absolutely a community approach, from a developer’s perspective, that we’re looking at. That can be everything from individual developers all the way up to the enterprise. So we are definitely engaging with them, not only directly through community efforts, but also through a lot of development organisations. I spend a significant amount of time in Melbourne with ISVs to help them broaden their reach across Asia. So it is a really important and critical part of our go-to-market strategy.

What would be your priorities for the coming year from a business development perspective?

Seward: From a business perspective, I’d say it is flat-out growth. I don’t see this slowing down. I don't see our customers slowing down either, so we’ve got to continue to run fast enough to keep up with them and deliver to their expectations, which I think we can do.

What about getting the talent that you need to keep things going?

Seward: That’s a good question. I feel like about half of my job is hiring, which is a really beautiful thing because it speaks to the investment that we’re making to bring in the right talent and train them.

In Asia, I don’t think there would be anybody saying that talent is abundant here. That said, talent does exist in the market. And from a diversity perspective, it absolutely exists in the market and we’ve made some huge strides in that.

But in addition to that, I think we are not the solution to everything, either. We do what we’re good at, but we also have a great partner community. It’s important that we continue to embrace our partners for their strengths. That’s a critical part of how we will grow our business this year.