Google Cloud secures $2.6bn quarterly revenues at 53% growth as Alphabet reveals all for first time

Google Cloud hit $2.6 billion (£2bn) in revenues for the fourth quarter of 2019 with a more than $10bn run rate, as parent company Alphabet divulged various individual business figures for the first time.

The cloud business grew 53% year on year, according to CEO Sundar Pichai, with strong uptake noted in multi-cloud offering Anthos and growth in Google Cloud Platform (GCP) moving faster than the wider cloud business.

“We are very confident that there is an enormous opportunity here that plays to our core strengths,” Alphabet chief financial officer Ruth Porat said in prepared remarks. “We’re pleased with the growth trajectory of GCP, which we see in customer momentum, the growing size of the average contract, and of course, revenues.”

Previously, cloud revenues were tucked in under the ‘other’ revenues bucket. For Q3, this totalled $6.42bn at an increase of 38.5% year over year. This time around, other revenues – not including cloud but including YouTube non-advertising revenues – were at $5.26bn. Combined with Google Cloud, this totals at $7.88bn, with cloud revenues comprising precisely one third of other revenues.

It was this time last year that Pichai noted the number of cloud deals exceeding $1 million had ‘more than doubled’ in the preceding 12 months. 2019 saw calls for Google to divulge specific numbers, with the company insisting the time needed to be right.

So why is the time right now? Responding to analyst questions, Pichai noted the roadmap under CEO Thomas Kurian, focusing on specific industry verticals and strong sales expertise, enabled change. As this publication mused last month, Google is playing a long game in cloud and, much like Microsoft, is trying to attract deeper integrations across infrastructure and, crucially, software.

“I think the progress I’ve seen in our customer focus, with our customer success organisation and the contracting framework, have all been great progress for us,” said Pichai. “Especially in one of these larger deals, [customers] are effectively looking for a technology partner. So differentiation is not just what we bring to the table in terms of cloud, where we have differentiated capabilities, but in many cases, it’s what we bring as Google.”

Google Cloud sees its key industries targeted as retail, healthcare, and financial services, while it sees five areas of differentiation. As Kurian put it this time last year in his first major speaking engagement, these were security and reliability for mission critical applications; hybrid and multi-cloud; AI solutions; ‘vastly different’ capabilities for managing data at scale, and ‘integrating a number of Google’s technology advances with Cloud to deliver industry solutions.’

On the retail side, in what was a very busy quarter for Google, partnerships with Lowe’s and Wayfair were announced at the NRF event. Travel is another industry which Google is targeting; last month the company secured airline Lufthansa, as well as a 10-year contract with Sabre, a provider of software for travel firms. Alongside this, Google Cloud announced a partnership with Indian telco Bharti Airtel in an echo of a deal Microsoft Azure announced with Reliance Jio in 2019, as well as launching a new enterprise support offering, and acquiring VMware specialist CloudSimple.

According to figures published overnight by Synergy Research, the needle has barely moved from the most recent quarterly results. Amazon Web Services (AWS), which recorded $9.95bn revenues in its last quarter, maintains 33% of the overall market, ahead of Microsoft (18%), Google (8%), and IBM (6%). Synergy added that, predominantly due to the growth of AWS and Microsoft, the cloud infrastructure services market had doubled in 2019 compared with 2017.

You can read Alphabet’s full financial report here (pdf).

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Telepresence for small businesses on a budget


Nik Rawlinson

4 Feb, 2020

The old ways of working don’t work any more. Now that fast broadband is the norm, city-centre offices are an expensive luxury. New starters fully understand the benefits of remote working and are often put off by traditional cultures of “presenteeism”, where bosses demand that staff be physically on site just to keep an eye on them.

That sort of attitude isn’t merely unhelpful – it’s counterproductive. A study by Stanford University’s Nicholas Bloom split 500 staff into two groups: a control group who continued to work from the offices of a Chinese travel agency, and an equal number who worked from home. Bloom observed that those based at home routinely worked longer hours than those in the office, while taking fewer sick days – and they were 50% more likely to stay with the company. At the same time, smaller offices enabled the agency to save $2,000 per head every year.

The challenge that remains is communication. When staff aren’t in the same building, they need ways of communicating as easily as possible. That’s led to a growth of telepresence services and hardware, but until recently the cost has put these out of reach of smaller businesses.

Today, small firms that haven’t been able to invest in telepresence facilities find themselves in an enviable position. There’s a boom in free or low-cost solutions that are resource-light and feature-rich. Open standards are driving increased competition and direct integration, with software and services already in use in businesses around the world. And with no existing investment in proprietary on-site equipment, there is no imperative for small companies to continue with their current solution until it’s been fully depreciated – or until the board can be convinced to sign off on its replacement.

It’s possible to set up telepresence facilities within a small business at no cost, and without a dedicated team to oversee its roll-out and maintenance. For those that decide that a paid-for solution is the best option, meanwhile, the savings made in rent, travel, staff turnover and sickness could well see those costs recouped in short order.

Here are some of the best free and low-cost solutions for bringing a diverse, remote workforce together.

3CX

The most flexible of these solutions are provided by companies for whom messaging and presence are just part of a wider offering. Office and Windows are Microsoft’s cash cows; social networking is how Facebook makes its money. However, 3CX is different. Its core focus is a unified communications system built largely on the Session Initiation Protocol (SIP), which underpins most VoIP applications. Its service can live in the cloud or on-premise, running under Windows or Linux. It can even be hosted on a Raspberry Pi.

3CX’s offering delivers voicemails to inboxes, faxes as PDFs, and lets users see at a glance which colleagues are available. This is more intelligent than it sounds, allowing staff to tag their status with messages like “back at five”, so team members can avoid chasing them when they’re not free.

“Click to Call” extensions for Firefox and Chrome transform phone numbers on web pages into clickable links, which dial out automatically. But perhaps the smartest integration, works in the opposite direction, integrating the company’s website with its back-end systems so staff can chat with web visitors directly, not just by text but also voice or video call.

Pricing is determined not by how many users you want to connect, but the number that needs to connect simultaneously. Keep that number below eight and the standard service is free, after which Pro and Enterprise plans charge on a per-seat, per-month scale, which gets cheaper per user as your company grows. These plans also include features such as call recording, Office 365 integration and up to 250 web conferencing participants.

Jabber 

Cisco’s Jabber communications platform is perfect for a BYOD organisation. It can be installed on all types of consumer hardware, and includes phone integration, videoconferencing and visual voicemail. Participants can even control far-end cameras to show specific parts of the room to which they’re talking, as well as the room in which they’re sitting.

Jabber clients are available for Windows, Mac, iOS and Android, and in 2019 it underwent a redesign to bring it into line with Cisco Webex Teams. The two are fully integrated, allowing different parts of the firm – and members within a team – to use whichever they prefer, seamlessly.

If the name sounds familiar, the original Jabber protocol – now renamed as the Extensible Messaging and Presence Protocol (XMPP) – has been a significant player in presence and messaging since the early 2000s, and the technology on which Cisco’s implementation is based is open-source, with all transactions encrypted using industry standard SSL/TLS connections.

Cisco isn’t the only player in this market. Polycom is also building powerful telepresence conferencing products specifically aimed at smaller players. Its RealPresence Desktop Video Conferencing Software provides on-the-fly conferencing tools on a regular PC, saving businesses the capital outlay of equipping meeting rooms with screens and cameras. It incorporates acoustic fencing to isolate participants’ voices, backlight compensation, and simple provisioning for up to 50,000 users at a time. It will also connect to room-based video hardware for teams in which some work remotely and others are office-based.

Slack

Perhaps the best-known business collaboration tool, Slack began life as an internal project for game developer Tiny Speck, which needed an online space where its team could virtually meet to work on a game called Glitch. The game wasn’t a huge hit, but the collaboration tool was so successful that it was spun off as a separate product, and the company renamed itself Slack Technologies. 

Alongside persistent messaging, Slack allows users to share files and participate in video calls, and boasts useful integrations with Google Drive, Trello and more than 150 other services, including Outlook Calendar and OneDrive. A big part of the appeal is that anyone can use it for free – there’s officially no limit to the number of users a business can register without paying a penny. This has helped the platform grow to more than ten million daily active users.

There are a few catches: the free plan only keeps the most recent 10,000 messages, only allows for one-to-one video calls and up to 5GB of storage, and doesn’t have screen-sharing capabilities. Those are enabled in the Standard (£5.25 per user per month) or Plus (£9.75 per user per month) plans, and you can include up to 15 participants on any video call.

A key strength of Slack is the way it minimises digital noise by dividing conversations into separate channels. These can be organised by subject, project, client and so on, and new channels can be opened up for specific issues. As Slack points out, members “can join and leave channels as needed – unlike lengthy email chains”. Integrated direct messaging also helps to keep exchanges focused. 

While most communication will be internal, Slack can also facilitate external collaboration, with team members sharing access to channels with participants outside of the host organisation. Perhaps the most attractive thing about Slack is that it’s a solely software-based solution, with clients for Windows, macOS, Linux, Android and iOS. This makes it effectively free to deploy.

Microsoft Teams

Teams is self-evidently positioned as a competitor to Slack; it emerged after Bill Gates and Satya Nadella reportedly nixed a plan to acquire the latter for $8 billion. This was likely a smart move, as Microsoft already owned Skype, which contains much of the technology needed for business communications. Indeed, Microsoft plans to retire Skype for Business in 2021 and replace it with Teams.

The tool brings together multiple core business tools in one interface. VoIP is a given and it’s supplemented by regular telephony, allowing users to dial landline and mobile numbers from within the client. Both public and direct messaging are supported, and hosted meetings can be set up on the fly, with plugins for Outlook allowing meeting administrators to invite other members to participate. Other plugins, known as Connectors, draw in data from third-party services such as Twitter and Mailchimp.

A big attraction of Teams is its close integration with Office and the Office 365 subscription platform. That doesn’t mean you need to be an Office subscriber to use it: the free version is available to anyone. But sign up for free and you’ll get not only the Teams app, with full support for online audio and video calls for up to 300 users, but also access to web versions of Word, Excel, PowerPoint, and OneNote. 

Upgrade to the Office 365 Business Essentials package (£3.80 per user per month) to get web-based Outlook access and scheduled meetings, as well as OneDrive storage. For £9.40 per month, the Business tier includes web and desktop versions of Office applications. Teams is available as a web app, or a locally hosted app on Windows, macOS, Android and iOS.

Workplace from Facebook

Workplace from Facebook started out in a similar way to Slack: originally an in-house product used by staff to discuss projects, it was shared with the public in beta form in 2015, and became an “official” product just over 18 months later. The Royal Bank of Scotland was one of the first big companies to sign up, and it’s now been joined by Starbucks, Spotify and 30,000 other organisations.

For Facebook, Workplace is a logical brand extension. The company already has plenty of experience of bringing users together, helping them share status updates and running a newsfeed. That newsfeed, which sits at the heart of the system, uses AI to make sure users see what it believes are the most important updates, while the people directory is analogous to Facebook’s profiles and Workplace Chat offers a business-focused alternative to Facebook Messenger. There is also automatic content translation and live video (as found in Facebook), along with multi-company collaboration, letting users liaise with suppliers and other contacts outside their corporate workspace.

When you’re using a free account, each member gets 5GB of storage and there’s no limit to the number of staff who can sign up. What’s more, like Slack, Workplace features built-in integration with OneDrive and Google Drive. Microsoft Office isn’t included by default, but these integrations and dozens more are available to paying users. Paid accounts start at $4 per user per month, but the Advanced tier is available to nonprofits and education establishments for free. The Advanced ($4 per user per month) and Enterprise ($8 per user per month) plans also increase video chat participants from 20 to 50, and lift the per-user storage limit to 1TB and unlimited respectively.

And if you’re worried about privacy, Facebook emphasises that Workplace has achieved certification against ISO27001, ISO27018, SCO2, SCO3 and is fully GDPR-compliant. The platform also undergoes an annual security verification audit, and the company pledges that customer data will never be used to serve ads.

How cloud software companies can cut costs – without impacting on quality

When evaluating the value of any business, one of the most important factors is the cost of goods sold (COGS). To put that another way, for every pound that a business makes, how much does it cost to deliver?

For a traditional business, there are many ways to minimise costs. A company could optimise its supply chain, find cheaper raw materials, or negotiate better rates with its suppliers.

But in the age of the cloud, a digital company’s costs might grow 10 times overnight as a result of a sudden increase in traffic volume, or a one-line configuration change. For every surprise event, a cloud company’s profit margin can be significantly eroded. 

As a result, keeping on top of COGS is a key focus area for any digital company. Here are some tips for reducing your costs and improving your bottom line:

Measure first

To cut costs, you first need to understand where inefficiencies are creeping in – after all, you can’t change what you can’t measure. 

Start by agreeing how you are going to model your company’s costs, and whether that’s something you intend to break down across each of your products. Generally, it can be useful to go product-by-product, as this can give you a more granular view of your company’s cost drivers and help to identify the ‘low-hanging fruit’ that can be cut without impacting overall performance.

Getting a clear view of the inefficiencies in your cloud set-up will help you figure out what will really move the needle, rather than making vague guesses at performance improvements. Once set in motion, this will also enable you to see whether the changes you’re making are having the desired effect.

To help monitor the raw cloud infrastructure that powers each of your products and understand the cost of your cloud configuration in real time, there are plenty of monitoring tools you can use such as CloudHealth, AWS’s billing CSV, and Tableau. 

Make a plan and rally your teams

Once you’ve identified the efficiencies you want to make, it will be key to put a plan in place to make sure the cost-cutting process is done efficiently. A plan helps unite your engineering team around shared goals and processes, with clear deadlines.

When laying out your plan, consider starting small and then building up. The best approach is to begin by tackling the lowest-hanging fruit you identified in the monitoring stage, and then steadily work towards more complex and time-consuming changes.

For each project, assign an ‘owner’ to drive it to completion – this can be done with a simple spreadsheet laying out who owns what, and when it’s due.

Once owners have been assigned, ask them to bring their team together once a week to ensure their cost-cutting effort is on track, and targets and deadlines are being met.

You will likely see the biggest cost savings by getting rid of unneeded processes, redundant effort and “dead” code. Every little counts, and having dedicated owners for each individual area – no matter how big or small – will combine into a huge collective effort that could save your company millions.

Other key areas to evaluate include your company’s CPU, disk and network costs, along with the cost of data transfer to and from the cloud. All of these can be brought under control with a little thought, and in some cases, new third-party solutions. 

Build a repeatable monitoring process

Once you’ve invested in reducing costs, you want to make sure inefficiencies don’t start creeping back in. It wouldn’t do your company any good to have to repeat the whole cost-cutting process six months down the line.

To get ongoing visibility, it’s a good idea to automate a daily report into your key cost drivers. If you visualise this through a graph or table, you can easily see spikes and catch them early. With some monitoring services, you can even set up automatic alerts whenever a cost driver jumps over a certain threshold, so your team is able to dive straight in and fix the problem. 

A worthwhile long-term investment

Though reducing your COGS is a serious undertaking, it’s well worth the effort. 

For every redundant piece of code you remove, and every efficiency you build into your cloud infrastructure, you’ll be driving up your company’s profit margin. 

And the better your gross margin, the better your company’s valuation – the ultimate reward for strong unit economics, and a great reflection on your business.

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IBM CEO Ginni Rometty to step down: Analysing the cloud strategy and in-tray for the new boss

Analysis IBM chief executive Ginni Rometty is to step down in April after more than eight years at the helm, with senior vice president for cloud and cognitive software Arvind Krishna taking over.

Krishna, who was a contributing factor in IBM’s acquisition of Red Hat in 2018, will become only the 10th CEO in the Armonk giant’s 106-year history. Jim Whitehurst, chief executive of Red Hat, will become president, while Rometty will serve as executive chairman until her retirement at the end of the year.

“Arvind is the right CEO for the next era at IBM,” Rometty said in a statement. “He is a brilliant technologist who has played a significant role in developing our key technologies such as artificial intelligence, cloud, quantum computing, and blockchain. He is well-positioned to lead IBM and its clients into the cloud and cognitive era.”

Rometty’s eight-year tenure oversaw IBM’s entry into the cloud as a serious player and continued leadership in R&D, particularly around emerging technologies; IBM’s run of being awarded the most patents now stretches to 27 consecutive years. In an era where cloud events have become supersized – the last re:Invent attracted 60,000 attendees – Rometty’s oratorial skill will be missed. Yet the storytelling around the entirety of the company did not quite match.

The bottom line will be where many of the think pieces point; IBM only broke a run of 22 straight quarters of declining revenue in January 2018, and it will ensure something of a mixed legacy for Rometty. Comparisons can certainly be made between Krishna’s ascendance and Satya Nadella taking the helm at Microsoft in 2014 – and look what has happened there.

But things are a little more complicated than that.

Speaking to this publication earlier this month, Nick McQuire, senior vice president enterprise at CCS Insight, noted how enterprise organisations were increasingly looking to deeper integrations with Microsoft and Google’s clouds by combining SaaS and other services with infrastructure.

IBM’s different business units, which are legion, do not have quite the same symmetry. Where else for instance explores all kinds of emerging tech, from blockchain to quantum, while still having a thriving mainframe business?

Bill Mew, a 16-year IBM veteran who now heads up cybersecurity consultancy Crisis Team, describes the continued balance sheet decline as a ‘sorry legacy’ for Rometty. Yet this should not be taken personally. Rather, it is indicative of where IBM is today.

“It shouldn’t be taken as a criticism of Rometty herself,” Mew tells CloudTech. “She was an enormously driven person who had a winning mentality, and she did her darnedest to turn the machine around and make it capitalise on some of the opportunities it had – but that didn’t enable her to do so.”

McQuire argues the new leadership team looks good on paper. “The combination is a good start and a good decision in terms of the next phase for IBM,” McQuire tells CloudTech. “It’s a good mix of having an individual [Krishna] who had been instrumental in some of the more important emerging areas of IBM strategy over the last number of years. Equally, having Whitehurst in there, almost an outsider looking in, is also quite valuable.

“It is an important next chapter – the role we’ll see in the market as not only the cloud market changes, but also as IBM changes,” adds McQuire.

As we have already seen, turning a ship the size of IBM around is no easy feat. For Mew, the fact that SoftLayer and Watson were opportunities which fell by the wayside exemplifies that virtually any executive could be placed in charge and they would struggle, although he notes his ‘enormous respect’ for Krishna and Whitehurst, and admits his view may be portrayed as cynical.

“They’ve spent an absolute fortune on Red Hat and it has to start to deliver soon,” says Mew. “You’ve seen growth in one quarter, but a large amount of that was for the latest mainframe. The question still exists about how credible [their] turnaround strategy is, and is the change in leadership going to make much difference?

“I have enormous respect for the guys stepping into her shoes,” Mew adds. “Again they are very capable, but again the question is – is IBM as an organisation going to innovate at the pace of AWS and others? I just don’t see it happening.”

McQuire notes comparing IBM directly to AWS’ mammoth growth, as a way of summarising Rometty’s legacy, is a ‘little bit unfair.’ Yet he does argue SoftLayer was a ‘victim’ of IBM not fully committing to the cloud when it should have done.

As a result, IBM remains firmly a second-tier player, behind the hyperscalers. Yet there are major customers out there. AT&T is an example, although the telecoms giant is also using Microsoft, given the latter stole IBM’s thunder somewhat in July by announcing their partnership within hours of the initial news.

McQuire believes the big-ticket clients will react to the move positively overall, noting the strategy behind the transition. Indeed, listening to Rometty’s keynotes offered a sense of this transition. At Think in February, the message was around the second wave of cloud; one which is open and has hybrid and multi-cloud at its core, but is secured and managed properly.

For IBM to succeed in this second wave, the corporate story has to tie together more seamlessly. “Ginni Rometty put some foundations in place – and some of the latest numbers, looking at the services side of the business, specifically around Red Hat as well, you’re starting to see a flywheel effect happening between the hybrid and multi-cloud and Red Hat capabilities that IBM has to market, with the services business,” says McQuire.

“The question there is – how can they create a cohesive vision that combines both the cloud business and the services business?”

Whether you see your glass as half-full or half-empty, the answer to that question is going to be an intriguing one as Krishna sets up for his new role.

Picture credit: Screenshot/IBM

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IT Pro 20/20: What the year ahead holds for technology


Cloud Pro

31 Jan, 2020

Welcome to the first issue of IT Pro 20/20, a brand new digital magazine that brings all of the month’s most important tech issues into clear view.

Each month, we will shine a spotlight on the content that we feel every IT professional should be aware of, only in a condensed version that can be read on the go, at a time that suits you.

This month’s issue is all about the year ahead. We put to you our predictions of what the industry is likely to face over the next twelve months, including the technology likely to dominate news headlines.

We’ve also got a handful of exclusive articles for you that you won’t find online:

  • First, we take a look at whether 2020’s job candidates really need a degree to get ahead in the IT industry.
  • We’ve also commissioned our own postmortem examination of the now sadly departed Windows 7 to see what made it so successful.
DOWNLOAD THIS MONTH’S ISSUE OF IT PRO 20/20 HERE

We hope you enjoy reading this month’s issue. If you would like to receive each issue in your inbox as they release, you can subscribe to our mailing list here.

The next IT Pro 20/20 will be available on 29th February.

AWS secures $9.95bn in Q419 revenues to beat expectations – and maintain market share

Amazon Web Services (AWS) posted revenues of $9.95 billion (£7.59bn) in its most recent quarter, beating analyst expectations.

The results represent a 34% increase on Q418, while the full-year figure, of $35bn, are 36.5% up on 2018. The third quarter saw revenues of $8.99bn, with AWS contributing 11% of Amazon’s total pot, a figure remaining conistent with previous quarters.

As with previous quarters, Amazon does not go in for self-aggrandising prepared remarks, with chief financial officer Brian Olsavsky again taking questions. Most of the questions were on the subject of AWS and wider growth patterns.

“As we see it here, we grew from a $30 billion revenue run rate at the end of 2018 to a $40bn revenue run rate at the end of 2019 – so we continue to be happy with our top line growth,” said Olsavsky. “We had a larger dollar increase in revenue both year-over-year and quarter-over-quarter – so we’re very happy with the progress of the revenue and our adoption and acceptance by customers.”

The three letters of AWS saw a grand total of 68 mentions in the press materials. This represented a downturn from 79 this time last year. Many of the quarterly updates came as a result of the releases from re:Invent at the start of December, including new products for machine learning training kit SageMaker, as well as Amazon Braket, a service for developers to experiment with quantum computing facilities.

Alongside this, the general availability of hybrid cloud offering Outposts was announced, as well as a major partnership with Verizon. The latter was seen as a showcase for AWS Wavelength, a service which aims to offer ultra-low latency applications for 5G devices. Primary customers announced this quarter were the Bundesliga, going all-in on AWS and adding to the firm’s cadre of sporting clients, as well as Best Western Hotels, again announced at re:Invent.

The primary news from the past three months, however, was a blow from AWS’ perspective, with the awarding of the $10 billion-rated JEDI government cloud computing contract to Microsoft. AWS has confirmed it is appealing the ruling.

While slowing growth is to be expected given the speed at which AWS rose – and it was a cause for concern for analysts last quarter – Synergy Research argues that at 34% growth, AWS still holds a steady one third of the market. Microsoft, for whom Azure grew 62%, has risen by up to three percentage points year over year, according to Synergy estimates.

You can read the full AWS earnings report here.

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Dropbox finally fills vacant COO role amid company transformation


Roland Moore-Colyer

31 Jan, 2020

Dropbox has named former Google Cloud executive Olivia Nottebohm as its chief operating officer, filling a job role that has been vacant for more than a year.

The appointment of Nottebohm comes at a time when Dropbox is undergoing a major overhaul of its company and services. It’s looking to centre its business around a workspace app called Spaces, which can facilitate the file synching and sharing of Dropbox, and will work closely with other productivity tools such as Slack.

Effectively, Dropbox is working towards becoming an enterprise collaboration workspace designed for use across multiple devices and enable better task management, and thus see it evolve from beyond a cloud-based file storage platform.

Some elements of the new Dropbox could see the company compete with Google’s G Suite, which would mean Nottebohm would be helping Dropbox challenge her former employer.

But Nottebohm seems prepared to help lead a new Dropbox into the 2020s.

“As a mother my whole day is fragmented, and I am constantly switching frames,” she said, Reuters reported. “The vision of de-cluttering in a work environment is a very powerful message. We see in our customers that they are constantly changing frames and topics.”

While she was at Google Cloud, Nottebohm was the vice president responsible for selling to small and medium-sized businesses, so it wouldn’t be surprising to see her take that expertise and use it to help the redesigned Dropbox target that market.

Nottebohm will be taking the place of Dennis Woodside, the former COO who left the company in September 2018. Woodside helped grow Dropbox’s sales force and helped the company pursue larger customers.

He also helped oversee the creation of Dropbox’s own cloud infrastructure to help the company become less reliant on Amazon Web Service’s cloud storage services.

After Woodside left, the position of COO was vacant for some 16 months, with Dropbox showing no intention to fill it at the time of Woodside’s departure.

IBM CEO Ginni Rometty steps down


Bobby Hellard

31 Jan, 2020

IBM has promoted Arvind Krishna to CEO after Ginni Rometty announced she was stepping down from the role and will retire at the end of the year. 

The change marks the end of a 39-year career for Rometty, eight of which were at the top as its CEO. She will stay on as executive chairman of the board until the end of the year before retiring. Red Hat’s Jim Whitehurst will replace Rometty as the company’s president.

In a statement, Rometty said that Krishna and Whitehurst were a “proven technical and business-savvy leadership team”.

“Arvind has grown IBM’s Cloud and Cognitive Software business and led the largest acquisition in the company’s history,” Rometty said. “He is well-positioned to lead IBM and its clients into the cloud and cognitive era.”

“Jim is also a seasoned leader who has positioned Red Hat as the world’s leading provider of open source enterprise IT software solutions and services, and has been quickly expanding the reach and benefit of that technology to an even wider audience as part of IBM.”

Virginia ‘Ginni’ Rometty’s career at IBM started in 1981 as a systems analyst. She spent her first ten years working in many technical positions and went on to led the integration of PricewaterhouseCoopers Consulting. She spent the 1990’s working in sales before taking on a number of leadership roles in the next decade.

On New Year’s Day 2012, Rometty became IBM’s ninth CEO as well as its first female chief executive. During her time at the helm, the company set up a number of partnerships with the likes of Apple, SAP and Box, reportedly taking it into higher-growth areas such as cloud and AI.

“Ginni has provided outstanding leadership for IBM, substantially transforming the company and ushering in a new cloud and cognitive era,” said Michael Eskew, lead director of IBM’s Board. “She has taken bold strategic actions to reposition IBM for the future, shedding businesses and growing new units organically and through acquisition, all while achieving record diversity and employee engagement and setting the industry standard for responsible technology ethics and data stewardship.”

She steps down as CEO with the company recently reporting its first-quarter growth since 2018, fueled largely by its cloud division.

Microsoft posts more strong financials and 62% Azure growth – with differentiation key to success

Microsoft saw its Azure business grow 62% in its most recent quarter after posting total revenues of $36.9 billion (£28.2bn) – yet chief executive Satya Nadella was keen to note the breadth of Azure’s stack as well as the bottom line.

The company’s Q220 figures, as ever divided into three primary revenue buckets, saw its ‘intelligent cloud’ stream increase 26% year over year to $11.8bn. ‘Productivity and business processes’ also hit $11.8bn at a yearly rise of 17%, while the ‘more personal computing’ category saw a negligible 1.6% yearly growth to $13.2bn – although a 19% quarterly rise. Total revenues were up 13% on Q219.

“In terms of the Azure momentum, it’s the sort of thing that we have seen even in the previous quarters,” Nadella said in response to an analyst question. “We have a stack that is, from infrastructure to the PaaS services, fairly differentiated.”

Among the products Nadella brought into focus were Azure Sentinel, a cloud-native security information and event management (SIEM) tool, and Azure Synapse Analytics, formerly Azure SQL Data Warehouse and rebadged in November. Maersk and Vodafone were cited as key of the more than 3,500 Sentinel customers – “recent CIO surveys affirm our leadership and strong structural position”, Nadella said – while Synapse was praised as a ‘very competitive product’.

Microsoft has had a very busy three months. On the product side, the launch of Azure Arc at MS Ignite in November took the headlines, following on from AWS Outposts and Google Anthos. At the time the company noted hybrid cloud capabilities ‘must enable apps to run seamlessly across on-premises, multi-cloud and edge devices.’

Hence emphasis on the breadth of portfolio. “The fact that we have a control plane for hybrid computing that is multi-cloud, multi-edge… that’s a pretty differentiated aspect of it,” said Nadella, answering a question on Azure momentum. “The data side, both on the transactions, on the OLTP (online transaction processing) side, as well as on the analytics side, we now have cloud-native databases… that’s what you see play out in terms of customer adoption and the growth there.”

On the partnership side, three deals stood out. In October, Microsoft and SAP struck an agreement featuring SAP’s Embrace project, which aims to help customers become ‘intelligent enterprises’ by utilising the hyperscaler public clouds. It was written as a ‘preferred cloud’ deal, signifying a big win for Microsoft; Nadella described it in the earnings call as ‘exclusive’. A month later, Microsoft expanded upon its partnership with AT&T, running Azure services on AT&T’s burgeoning 5G network, while Salesforce said it was migrating various suites in another ‘preferred cloud’ tie-up.

With regard to customers, the announcement in October that Microsoft had secured the $10bn JEDI government contract – pending AWS’ appeal – was the natural standout. Nadella referenced it alongside the SAP partnership as an example of winning customers through the ‘differentiated approach across the cloud and edge.’

Speaking with Nick McQuire, VP enterprise at analyst firm CCS Insight, earlier this month, it was evident how Microsoft’s wider strategy was beginning to blossom. Microsoft’s decision to not publish specific cloud revenues – alongside Google – was previously a sign of weakness; now, while the obfuscation may frustrate the financial analysts, many accept the wider strategy at play.

“You see companies, typically from the CEO down, that are all-in on transformation, seeing the workplace environment and internal side of the house as part of that,” McQuire told CloudTech at the time. “That’s typically where you will see companies go a little bit deeper with a Google or Microsoft; they will embed the entirety of their SaaS applications capabilities in and around decision making for their infrastructure as a service as well. That approach very much favours Microsoft.”

You can view the full Q220 financial results here.

https://www.cybersecuritycloudexpo.com/wp-content/uploads/2018/09/cyber-security-world-series-1.pngInterested in hearing industry leaders discuss subjects like this and sharing their experiences and use-cases? Attend the Cyber Security & Cloud Expo World Series with upcoming events in Silicon Valley, London and Amsterdam to learn more.

Check Point spots two flaws in Microsoft Azure


Nicole Kobie

30 Jan, 2020

Check Point security researchers spotted flaws in Microsoft Azure that could have let hackers take control over the cloud servers.

The work was part of a wider project looking at cloud infrastructure, dubbed “Attack the Cloud”, in which Check Point wants to “break the assumption that cloud infrastructures are secure”.

With Microsoft Azure, the researchers spotted two flaws. The first was in Azure Stack, and could have let criminals take screenshots or see other sensitive information by taking advantage of a vulnerability in the “DataService” function, which didn’t require authentication.

“This security flaw would enable a hacker to get sensitive information of any business that has its machine running on Azure,” the researchers said. “In order to execute the exploitation, a hacker would first gain access to the Azure Stack Portal, enabling that person to send unauthenticated HTTP requests that provide screenshots and information about tenants and infrastructure machines.”

The second flaw was in the Azure App Service, where businesses provision and deploy apps and business processes, and could have allowed hackers to take control of a server.

“The end result would be that a hacker could potentially take control over the entire Azure server, and consequently take control over all your business code,” the researchers said.

The researchers could get into applications, see data and take over accounts by creating a free user in Azure Cloud and running malicious functions.

“Exploiting this vulnerability in all of the plans could allow us to compromise Microsoft’s App Service infrastructure,” the researchers explain. “However, exploiting it specifically on a Free/Shared plan could also allow compromising other tenant apps, data, and account.”

Check Point disclosed the findings to Microsoft in January and June last year, with patches for both issued at the end of 2019. The first flaw was awarded $5,000 from Microsoft’s bug bounty programme; the second earned $40,000.

The researchers emphasised in a report on the second flaw that while the cloud is “considered safe”, it can still have vulnerabilities: “The cloud is not a magical place.”

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