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Microsoft is about to release Azure Stack, after two years and many bumps in the road. Despite the hoopla, it's unclear just how many customers will be there to warmly greet the new arrival.
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Microsoft has said that Azure Stack offers both infrastructure as a service (IaaS) and platform-as-a-service capabilities. As such, it brings the perks of the cloud service down into the data center. This might tempt businesses long frustrated with tangled, difficult-to-manage multicloud setups, said Mike Dorosh, an analyst at Gartner.
Dorosh said that, given the product's complex licensing terms, he doubts many IT shops would opt for an Azure Stack deployment directly from a Microsoft hardware partner -- at least initially. Avanade, Cisco, Dell EMC, Hewlett Packard Enterprise, Huawei and Lenovo offer Azure Stack hardware bundles.
Microsoft designed Azure Stack deployment to be a simple process. Jeffrey Snover, a Microsoft technical fellow, said the installation should be quick and its complexity largely obscured by Microsoft and the hardware vendor. But Dorosh also said he predicts it will test businesses as they attempt to migrate and refactor existing apps and develop and deploy new apps onto Azure Stack.
"Then, the challenge becomes: You don't have the skills and the tools and the knowledge or the staff to work it," Dorosh said.
Other factors will likely slow initial adoption. Businesses that have recently invested in a private cloud or their infrastructure won't replace these new investments with Azure Stack, Dorosh said. He also expects to hear concern about licensing and the speed of Microsoft's updates.
Questions linger on Microsoft licensing
Azure Stack could confuse customers with its different fee models. Microsoft uses a consumption model for five Azure Stack services: Base virtual machine; Windows Server virtual machine; Azure Blob Storage; Azure Table and Queue Storage; and Azure App Service. Businesses can use existing licenses to reduce costs.
A company can subscribe to Azure Stack on a base VM charge of $0.008 per virtual CPU per hour or $6 per vCPU per month. Without a license, a Windows Server VM will cost $0.046 per vCPU per hour or $34 per vCPU per month. There are also options for when there is no public internet connection, called disconnected, and fixed-fee models. An IaaS package costs $144 per core per year, and adding an app service brings it to $400 per core per year.
Dorosh said he expects businesses to get better terms from Microsoft on Azure Stack deployment than with similar offerings, such as Azure Pack, because it will bundled into the product. However, Microsoft must also streamline its licensing terms to avoid confusion. For example, if a service provider has an SQL database with multiple SQL licenses, it will need to translate those licenses to the Azure Stack model.
"[Microsoft used to say] it depends on where you bought it and which programs you bought it under," Dorosh said. "But now, [customers] want to know, 'Can I move my SQL license or not? Yes or no?'"
Customers must also make frequent updates to Azure Stack to continue to receive support. A company must apply a Microsoft update within six months, but service providers want Microsoft to push adopters to stay within two months of the regular patches, Dorosh said. Falling six months behind would leave both service providers and Azure Stack users at a disadvantage.
"The further you fall behind, the less Azure you are," Dorosh said. "You're no longer part of the Azure cloud family -- you're Azure-like."
More Azure Stack coverage
- One size won't fit all for Azure Stack debut: Initially, Azure Stack will only be offered as a one-rack deployment. Microsoft said it might extend to multirack deployments by early 2018. For now, the one-rack deployment could dampen interest in Azure Stack at larger businesses that don't want to extend hosting into the Azure public cloud.
- Analysts say Azure Stack will outpace VMware on Amazon Web Services: Both Azure Stack and VMware Cloud on AWS are expected to hit the hybrid cloud technology market in September. Even though VMware Cloud on AWS targets the world's largest cloud service provider, analysts expect Azure Stack to sell better. A leading reason is that many Azure Stack customers will be migrating data with one vendor -- from a Microsoft-operated data center to the Azure public cloud -- while VMware Cloud on AWS requires you to use technologies from different vendors.
- Azure Stack architect addresses delay: When Microsoft first announced Azure Stack in May 2015, the plan was to release it by the end of 2016. The company then pushed the release to September 2017. Snover, the Azure Stack architect, told SearchWindowsServer in June that the code was not ready for the original launch date. "As much as possible, we are trying to be Azure-consistent," he said, and the effort to convert Azure to work on premises required more time.
- Azure Stack isn't a steppingstone to public cloud: Microsoft anticipates its Azure Stack customers will be businesses that have a long-term plan for hybrid cloud deployment. Although you could use Azure Stack as a "migration path to the cloud," as Julia White, Microsoft corporate vice president for Azure, put it, the software provider's internal research suggests that won't be the case: Eighty-four percent of customers have a hybrid cloud strategy, and 91% of them look at hybrid cloud computing as a long-term workflow. Microsoft expects companies with data sovereignty issues will look to Azure Stack as a way to get cloud computing while keeping data in-house.
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