New Microsoft Corporation CEO Ramps Up Its Strategy in the Cloud

Microsoft's (NASDAQ: MSFT  ) SkyDrive, renamed OneDrive, received more than a name change when it rolled out globally yesterday. The cloud storage service was bolstered with a number of new features, making the product more competitive among a plethora of competing alternatives. As one of the company's first major moves under CEO Satya Nadella, is the company's increased focus on software and services a sign of things to come? After all, Nadella previously held the position of executive vice president of Microsoft's Cloud and Enterprise group.

Image source: OneDrive official blog

"Our goal is to make it as easy as possible for you to get all of your favorite stuff in one place -- one place that is accessible via all of the devices you use every day, at home and at work," said Chris Jones, Microsoft corporate vice president of Windows services, in a blog post announcing the rollout. Sounds a bit like Dropbox, doesn't it? It might also sound a bit like Google Drive, Amazon Cloud Drive, and Box. The space is littered with competitors.

Despite clear competition, Microsoft's new features suggest the company plans to take consumer cloud storage seriously. New features include, automatic camera backup for Android, the ability to share and view videos just as easily as photos, 500 MB of incremental storage for every referral (on top of 7GB of free storage initially), and 3GB just for using the camera backup feature.

A good move?
Monetizing users that initially opt for the free features in cloud services and software isn't easy work. A number of cloud companies have faced troubles with this tricky business -- LogMeIn, SugarSync, and Droplr to name a few. Why, then, can Microsoft expect to get any profits out of OneDrive?

Perhaps OneDrive's close ties with Office, SharePoint, and other Microsoft products the company has ushered into the cloud means more opportunity to turn free into sales through interdependent products. But even if it can't, there is still an argument for OneDrive as a prerequisite for a company that clearly aims to capitalize on opportunities in the cloud. Whether OneDrive translates into sales directly, indirectly, or not at all, services like these improve the whole picture of Microsoft's cloud services and software. Over the long haul, convenient cloud storage is a good investment for Microsoft -- not because it may make money, but it's a necessary step in serving customers.

As one of Nadella's first moves as CEO, could the executive who once oversaw Microsoft's cloud services be giving investors an early look into Microsoft's plan? Is cloud software and services going to continue to take an increasingly larger role at Microsoft at the future?

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Read/Post Comments (5) | Recommend This Article (5)

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  • Report this Comment On February 21, 2014, at 8:57 PM, mwherman2000 wrote:

    Windows 8.1 SkyDrive/OneDrive is the most failure-prone, unreliable, unsupportable, untested software technology that Microsoft has shipped in it's 35+ year history IMHO. ISK.

  • Report this Comment On February 24, 2014, at 3:14 AM, CraigWPowell wrote:

    Why Nadella Will Lead Microsoft In The Right Direction

  • Report this Comment On March 04, 2014, at 4:30 PM, whatfools wrote:

    If they are not honest with their shareholders, how can we invest?

    1) They already lied about his age.

    2) They are broadcasting images of him that are photoshopped. He is not that young looking and not that light skinned. He is alot darker on campus.

    3) Nobody is investing in webhosting companies because this is something that was done twenty years ago.

    The direction of the company is strange, the only ads you see since his arrival have been "nothing but" web hosting server stuff. Complete bore to the consumer market and teh business market. They are targeting a demographic that doesnt exist. Who wants to store there files on skydrive? Nobody. He has taken the wrong road and the fools who follow will lose. Most importantly is the United States peoples dont support the company anymore. You talk to the highschool kids and they say that MS is not cool anymore, so why care. The company turned its back on the American people and youth of today. Is sad to think that it really happened, the only thing now is not care or divest.

  • Report this Comment On March 18, 2014, at 4:28 PM, factsanalyst wrote:


    the cloud has no excitement at all. Its as if they were going back to 1980 to do it all over again.

    Seems almost worthless to reinvent the wheel.

    So Microsoft went from software dominant leader to getting in line with millions of people hosting and making websites?

    Like the internet is on its last leg and nowhere to go but back making the digital phonebook. Millions of intelligent people with massive amount of energy and skills making a digital phonebook. Upsetting and comical at the same time.

  • Report this Comment On March 21, 2014, at 10:24 AM, jackfleming wrote:

    Market lost to those cloud based alternatives and other alternatives for MS Office will be inclined to revert back

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Daniel Sparks

Daniel is a senior technology specialist at The Motley Fool. To get the inside scoop on his coverage of technology companies, follow him on Twitter.

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