Where does Microsoft expect to find its next $1 billion business?

Where does Microsoft expect to find its next $1 billion business?

Summary: Microsoft is looking at its appliance, cloud and big data products and services as its most likely to be added to its billion-dollar business club.


Microsoft sales execs like nice, round numbers, like $1 billion. So it's little wonder that these officials tend to look at budding businesses in terms of their potential to join Redmond's $1 billion business club.


There are already more than a dozen distinct products/services generating more than $1 billion a year in sales at the company. Those include Windows, Office, Xbox, SQL Server; System Center; Unified Communications; SharePoint; Developer Tools; Dynamics (ERP & CRM); and Online display and search advertising. SharePoint actually crossed the $2 billion a year threshold in 2012.

So where does Microsoft's sales team see the next potential billion-dollar contributors? A January 2013 job post on the Microsoft Careers site for the Sales, Marketing & Services Group (SMSG) Incubation sales team -- the group "accountable for building the next billion dollar businesses for Microsoft" -- includes these products and services on the list:

Windows Azure: Microsoft's public cloud business. (I'm kind of surprised Azure isn't in the $1 billion club yet, though maybe those persistent Linux and Windows virtual machines will help push it over the top.)
Windows Intune: Microsoft's device management/security service, which is now key to managing Windows RT and Windows Phone 8 devices
Bing Maps: Microsoft's maps, which got a lot more pricey for developers to license as of last year
StorSimple: The cloud-storage appliance vendor Microsoft bought last year
Perceptive Pixel: Those "Big-ass displays" from the PPI acquisition Microsoft made in 2012
Parallel Data Warehouse: Microsoft's parallel-processing data warehousing appliance, which integrates directly with Hadoop. (Can you say big data bonanza?)

"The WW (worldwide) Incubation team mission is to take these new business and build, accelerate, and mainstream these businesses for Microsoft," notes the job posting.

Microsoft's Server and Tools Business unit -- which is where Azure, StorSimple and Parallel Data Warehouse all live -- is becoming more and more of a launch pad for Microsoft's billion-dollar babies.

I'm curious when Office 365, Microsoft's Google Apps competitor, will become part of the billion-dollar business group.

Topics: Big Data, Cloud, Microsoft, Security, Storage


Mary Jo has covered the tech industry for 30 years for a variety of publications and Web sites, and is a frequent guest on radio, TV and podcasts, speaking about all things Microsoft-related. She is the author of Microsoft 2.0: How Microsoft plans to stay relevant in the post-Gates era (John Wiley & Sons, 2008).

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  • Refuse

    Since their products are garbage anyway why not buy BFI or Waste Management.
    • Just like I did with you

      You put you in the "Waste" already.
      Ram U
    • You are a WASTE

    • you forgot

      to take my trash out
  • Decent point of sale and Car Infor/Entertainment systems

    Automotive are crying out for some sort of Information/ media compuetr standard. Microsoft would look good, if it started working with other partners for automative system standards, and staretd palcing product in there. otherwsie I can see Android hoovering up the Automotove arket like they are doing with Smart TVs.

    And put Scott Gutherie in charge. He gets great stuff done, like (Silverlight, Visual Studio Azure) Put him in charge of WP8/ Windows RT.

    Whatever happened to IBM and Oracle. Microsoft seem to heading in the same direction.
    • +1

      Ram U
    • It is not Google that is driving Smart TVs

      adoption of Android, it is Samsung. They are just big household name in TVs, Home entertainment and Appliances. They are giving Sony a run for Money in that area. Once their Cameras and Camcorders pickup decent momentum, I see a threat to Canon, Nikon etc. in that area too.
      Ram U
    • Ford and Chrysler/Fiat (and maybe others) use Microsoft technologies

      The Ford Sync stuff is built on the MSFT automotive platform. So is the system in my Fiat 500. I think Kia and/or Hyundai uses Microsoft's code as well.

      One of the nice things in my Fiat is that I can sync a USB stick in my computer, plug it into the car, and I have all my music available. However, Fiat's user interface isn't wonderful.

      I'm also able to receive and send texts (via voice) through the car and my phone (a Lumia 920).
      • Interesting, but I was thinking Apps as well

        But I guess I would be expecting such an automative environemnt would be open to user choice of Apps, Map and traffic services, from a Marketplace. not legacy closed embedded system.
  • Where does Microsoft expect to find its next $1 billion business?

    Where ever the trend is. It does look like online services is that next big trend.
  • Microsoft's traditional "Services" business runs in the billion-dollar club

    I think both "Enterprise Services" (in the US) and "Premier Support" (world-wide) are at or near the billion dollar mark. "Enterprise Services" includes both MCS and Premier.
    • Enterprise Services revenues

      They are multi-billion, actually.
  • Next billion $ are Parallels Data Warehouse and Azure.

    If Microsoft can really sit back and reorganize its roadmap and revisit their strategy there, those two will pull more than a billion a year each definitely. Other opportunity is BYOD, with Intune, if they could properly leverage the plan to execute, it is going to be a billion $ opportunity.
    Ram U
  • Surface Pro

    The first day of sales of Surface Pro was either a half a billion or a billion dollar day. No one knows outside of MS knows if there were 500K or 1M units available that day. One million units at an average of $1070 a unit. It would have been a little higher average but they ran out of 128GB units.
  • Skype

    No mention of Skype, Mary Jo? Seems like it must be in the billion-dollar area.

    I'm also curious how close Mediaroom revenue is to that mark.
  • Interesting Article but one error

    I like that the Incubation part of Microsoft is getting some press but there is one inaccuracy. The article points out that Bing Maps has gotten expensive in the past year then points to an article about Bing Search services which is a completely different service. Bing Maps has always been a paid for Enterprise level service which competes and beats Google Maps on a daily basis. The Bin Services are a search based service which where free to developers and then eventually turned into a paid for service. There is still a free option, but that has been capped. Understandable as giving unlimited access to a cloud based service can become expensive to provide as a free service.