Suggest that readers look at cloud revenue from a business model perspective, not a technology one.
Cloud revenues between Amazon and MS are comparable from an investment point-of-view:
- sticky (unless something bad happens, if you're a paying customer in month 1, you're probably still a paying customer in month 2)
- service delivered "in the cloud" (neither vendor needs a local brick/mortar storefront)
- fixed cost: data centers, variable cost: "things" in data centers
- for enterprise accounts: high-touch salesforce and dedicated contacts
- for end-user / SMB accounts: primarily self-service via online tools
Yes, one of them gets more revenue from IaaS and the other from SaaS. Each of these, and the specific submarkets that the two of them play in, will have different growth rates and potential and affect their respective valuation.
Still, from an investment standpoint, based on the above characteristics, I'd feel reasonably good about comparing the two of them on financial and valuation metrics for the "cloud" parts of their respective businesses.
Cloud revenues between Amazon and MS are comparable from an investment point-of-view:
- sticky (unless something bad happens, if you're a paying customer in month 1, you're probably still a paying customer in month 2)
- service delivered "in the cloud" (neither vendor needs a local brick/mortar storefront)
- fixed cost: data centers, variable cost: "things" in data centers
- for enterprise accounts: high-touch salesforce and dedicated contacts
- for end-user / SMB accounts: primarily self-service via online tools
Yes, one of them gets more revenue from IaaS and the other from SaaS. Each of these, and the specific submarkets that the two of them play in, will have different growth rates and potential and affect their respective valuation.
Still, from an investment standpoint, based on the above characteristics, I'd feel reasonably good about comparing the two of them on financial and valuation metrics for the "cloud" parts of their respective businesses.