Microsoft: Cloud-First Partners Continue to Outperform Others
A new study from Microsoft and IDC shows that partners who have added cloud computing to their mix of services outperform other non-cloud partners.As Microsoft prepares for its upcoming Worldwide Partner Conference (WPC) in July, the company has commissioned a study that shows that partners that have implemented cloud computing into their offering perform better than those who have not. The study, commissioned by Microsoft and conducted by IDC, showed that cloud partners – those with more than 50 percent of their revenue from cloud -- have 1.5 times the gross profit percentage versus other partners. They also have 1.7 times the gross profit percentage versus the bottom group of partners surveyed. In addition, the top two quartiles of cloud-focused partners also grow considerably faster than the bottom two quartiles, the report showed. Moreover, Microsoft said cloud partners have 1.6 times the recurring revenue as a portion of total revenue versus other partners. And they have 1.8 times the recurring revenue compared to the bottom cloud quartile. Cloud partners also have a 1.3 times higher new customer ratio than other partners, and they have a 1.5 times higher new customer ratio than the bottom cloud group. IDC also said public IT cloud services spending reached $47.4 billion in 2013 and will reach nearly $108 billion in 2017, with a five-year compound annual growth rate of 23.5 percent — five times the growth of the IT industry as a whole. Software as a service (SaaS) will remain the largest public IT cloud service category through 2017, while platform as a service (PaaS) and infrastructure as a service (IaaS) will grow faster than SaaS over the next five years. Meanwhile, emerging markets will grow 1.8 times faster than developed markets, and begin to close the gap on the size of the markets. By 2017, emerging markets will account for 21.3 percent of the public cloud opportunity.
This is the third such study IDC has performed for Microsoft. Last year, IDC surveyed 1,300 partners for the study it released at WPC 2013. This year IDC surveyed around 800 partners and went in-depth with 20 of them to take a look at best practices of the more successful cloud practices.