Please ensure Javascript is enabled for purposes of website accessibility

To Boost Windows 10 Adoption, Microsoft Corporation Is Getting Serious About Cybersecurity

By Sam Mattera - Apr 5, 2016 at 6:07PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Windows Defender Advanced Threat Protection is a new service that businesses may find quite valuable. But if they want it, they'll need to upgrade to Windows 10.

Windows 10 logo. Source: Microsoft.

Microsoft (MSFT -0.37%) is becoming increasingly interested in cybersecurity.

The Redmond tech giant has been involved in the creation of antivirus software for more than a decade, but in recent quarters it has begun to step up its commitment. The company's latest product provides a cloud-based security service aimed at enterprise customers. There's no telling how big the business could be for Microsoft, but it serves to underscore two of the company's major initiatives.

More services, more subscriptions
Microsoft announced Windows Defender Advanced Threat Protection early last month. It's a new product aimed at Microsoft's enterprise customers that leverages Microsoft's cloud computing technology to help detect, investigate, and respond to advanced cybersecurity threats. It's built directly into its Windows 10 operating system, but also utilizes a network of servers and a team of cybersecurity experts -- it's a service, not a simple piece of software. Microsoft has yet to disclose any pricing details, but it could be sold to businesses in the form of a subscription.

Windows Defender Advanced Threat Protection in action. Source: Microsoft

Microsoft has shifted its focus toward subscriptions in recent years, and its growing slate of enterprise offerings plays an increasingly important role in its financial success. In particular, Microsoft's management has placed heavy emphasis on its commercial cloud annualized revenue run rate, a hypothetical figure that quantifies potential annual commercial cloud revenue if all current subscriptions were maintained for a full year.

Last quarter, it exceeded $9.4 billion as businesses purchased a growing-number of Office 365 and Dynamics CRM subscriptions, along with an increasing amount of cloud-computing resources. Microsoft's management, however, is not satisfied, and wants the figure to hit $20 billion by its 2018 fiscal year.

Windows Defender Advanced Threat Protection wouldn't be the first time Microsoft leaned on cybersecurity to drive additional cloud revenue. Last year, it announced E5, a premium version of Office 365 that augmented its productivity software suite with advanced security features. Microsoft charges businesses about $8.25 per person to use the basic Office 365 service. E5 costs $35 -- more than four times as much.

Aiming for a billion
But perhaps even more important is what Windows Defender Advanced Threat Protection could do to drive additional Windows 10 adoption. In a blog post announcing the product, Windows head Terry Myerson noted the growing number of enterprise users upgrading to Windows 10. "From the Department of NASCAR to Virgin Atlantic to schools all over the world -- we're excited to see customers with the most demanding requirements move to Windows 10 faster than ever before," he wrote.

Enterprise customers often take many years to move from one version of Windows to the next. Most consumers can handle the switch, experiencing few, if any, inconveniences, but for organizations with large IT departments and hundreds of thousands of machines, it's often a complex and costly process. By adding advanced threat protection, Microsoft is making the prospect of upgrading much more enticing. Windows Defender Advanced Threat Protection is exclusive to Windows 10; enterprise users with older versions of Windows can't access it.

"We encourage our customers to upgrade to Windows 10 for our most advanced security protection, with the opportunity to take advantage of Windows Defender Advanced Threat Protection," Terry added.

Microsoft wants Windows 10 installed on at least 1 billion devices within the next two years. Eight months in, it's running on more than 270 million machines -- a nice start to be sure, but Microsoft still has quite a ways to go. On the company's earnings call in January, management detailed how it would target enterprise customers for Windows 10 adoption in the second half of 2016.

For some businesses, Windows Defender Advanced Threat Protection may be the push they need to upgrade to Windows 10.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Microsoft Corporation Stock Quote
Microsoft Corporation
$253.14 (-0.37%) $0.94

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/20/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.