All about Technology: Azure Stack isn't Microsoft backing away from public cloud

Introduction and positioning of Azure Stack

For the last few years, Microsoft has been calling itself a cloud-first (and mobile-first) company and talking up its hyperscale Azure cloud – so why is it coming out with Azure Stack, a private cloud system?

Because hybrid cloud is what customers want, and ironically, having it will actually get more businesses using public cloud because of the consistency and the ecosystem that will develop around that, says Mike Neil, Microsoft VP for enterprise cloud.

Stepping stone

The reason Microsoft is creating Azure Stack isn't any lack of confidence in public cloud – it's because customers are demanding it as a stepping stone. Neil suggests viewing Azure Stack not as a separate product but as a feature of the Azure cloud.

"It checks the checkbox that says hybrid and allows the customer to make that choice, of being able to run in the public cloud or private cloud. For a lot of customers today, they tell us 'you're knocking down the security issues [I was concerned about], you're knocking down a bunch of compliance issues, you've got the capabilities that I want but I'm still uncomfortable that I have to put everything in your cloud'. This gives them the option to have on-premise control."

That will help public Azure grow, he believes. "If that's the blocking issue for a customer adopting Azure in the broad sense – not just public Azure but Azure on-premise – then we expect that to accelerate adoption."

Standing out from the cloud

Plus, it helps Microsoft stand out from Amazon and Google and other cloud providers, so Azure can reach customers who need more than public cloud. Neil states: "It's a key differentiator for us – if you look at the competition like AWS, it doesn't have anything like this. For customers who want to have that flexibility and control in their on-premise environment rather than just in the public environment, it's a unique offering.

"If your mantra is public cloud, public cloud, public cloud, and that's it, then you've got this myopic view of the world that doesn't match a lot of customers. I know very few customers who are 100% cloud and expect to be 100% cloud."

Azure Stack isn't Azure

The key technology in Azure Stack comes from what runs the public Azure cloud, but businesses need to be clear that running their own version of Azure doesn't get them the scale and savings of public cloud. "We'll have to be very clear with customers so they understand the scale limitations and the performance limitations of running Azure in their data centre."

Some parts of the experience will be the same. "We want the functionality, the top level APIs and the way they experience the portal to mimic Azure as closely as possible," explains Neil. "But the challenge we have – a minimum stamp size for public Azure is about 1,000 machines. How do we take that technology and scale it down to something that's more cost-effective at the entry price option for customers and make that a usable system?"

Hybrid cloud isn't well understood, he admits. "Cloud is relatively new to the market. Hybrid is another term that's been used for a while and it has gotten deformed by various competitors who try to bend that to mean what they have.

"In my mind, and I hope in the customer's mind, hybrid means I can run in the on-premise environment and in the public environment, and that public environment might be a public environment like Azure or that public environment might be other hosting providers, service providers.

"As opposed to 'I can back up your data on-premise' or 'I can Active Directory federate with you' or something like that. We need to set that expectation with customers that hybrid really does mean the flexibility of running workloads in either location, because cloud is not a location, it's a mind-set, and we want to make location an option for customers."

Customer choice and cloud bursting

Customer choice

Running your own cloud is always going to mean more work, and more costs than using public cloud, but some customers want that choice, Neil maintains. "We've heard very clearly from customers that they want to have the option to be able to run an on-premise environment. That is a conscious trade-off, moving away from a fully operated environment, where they don't have to take on the burden, with the elasticity that allows them to grow to very large-scale."

With private cloud, you can only scale up to the amount of hardware you have, but Neil expects OEMs to "get creative" about the way they sell cloud hardware. "Dell has a flexible payment mechanism that looks much more like a cloud subscription than the traditional acquisition of hardware."

The key benefit of Azure Stack is that you get a private cloud that's ready for hybrid cloud, that uses Azure services and scales out to public Azure when you want it to. "Our goal is not that everybody has isolated cloud, but that it is hybrid, that you have the option of using public cloud," Neil emphasises. "You can scale your applications into the public cloud if necessary and the assets, the applications and the artefacts you create, either in public cloud or private clouds, should be transferable between those environments."

That's going to work easily with Azure Stack, he claims, because the applications you're going to run on Azure Stack are built for cloud. "The challenge most people ran into trying to do cloud bursting was that they had inconsistent environments. They had an on-premise environment that looked more like a traditional data centre environment and they were trying to burst into a cloud environment and make the semantics of those two things work together.

"That's one of the goals of Azure Stack, to provide an environment that's syntactically the same, and that's semantically a close environment, so that customers can make that transition more easily."

Not the norm

That's possible today, but it's not yet common, Neil admits. "Even today we have customers in Azure that do a lot of cloud bursting; there are scenarios that do work, but it's probably not the norm – it's probably the edge case of usage."

What he hopes is that customers will grow from private cloud into hybrid cloud. "What we're hearing from the majority of customers today – and we think this changes over time as cloud becomes more widely adopted – but today, one of the advantages they see with Azure Stack is isolation. They want to have their own instance. What we're hearing is the value proposition is 'I want to run this in my own data centre and have control'.

"As their usage matures and they understand cloud technology both on-premise and public, that blending, that hybrid approach is going to become much more interesting – so that bursting and scale out to public cloud becomes very interesting for them."

Data centre

Run your own public Azure

Azure Stack isn't Microsoft backing away from public cloud. Instead it's part of a continuum from public clouds to private clouds – and even third-party public clouds. At the high-end of the scale, Neil points out: "We have public Azure which is a global presence with large-scale data centres. We have a plan in general to bring that to certain markets as a more isolated environment."

Examples of that are the two data centres that Microsoft runs for the US government's version of Azure today, much like the version of AWS that Amazon runs for the CIA. Neil notes: "That provides us with an isolated environment with specific security and compliance credentials that is tailored for the US government. We have a similar instance in China and we also recently announced a similar approach in Germany, where a subsidiary of Deutsche Telecom will be the data steward of that service.

"At the very top-end, those are large-scale deployments that are targeted towards relatively good-sized markets. Azure Stack allows us to come all the way down to running a configuration that's a couple of nodes in a data centre – but we do expect that one of the core target customers is managed service providers and hosters."

If there's a geography that doesn't have an Azure region yet, says Neil, a hoster or a consortium of businesses could create one using Azure Stack. "If a country wants to have public cloud and their GDP doesn't warrant a public Azure instance, there's an opportunity to do that. That means we can reach a broader set of customers."