Microsoft Announces IoT Solution for Partners and Early Adopters

Archived Published: 18 April 2014 ID: G00263959


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Microsoft's limited public preview of a new cloud-based Internet of Things platform integrates Azure functions so its partners can build industry-oriented IoT market solutions. General availability for users is not expected until 1Q15.

News Analysis


On 15 April 2014, Microsoft CEO Satya Nadella announced the limited public preview of its Azure Intelligent Systems Service (ISS), a cloud-based platform for Internet of Things (IoT) applications. Microsoft did not announce pricing and exact dates for general availability. The limited public preview runs through July 2014. Gartner expects to see its public preview this summer and general availability by 1Q15.


Azure ISS represents a major expansion in Microsoft’s enterprise strategy for IoT. Gartner believes Azure ISS is the most integrated enterprise partner offering for heterogeneous IoT environments announced to date, but we caution that this is not a fully tested or realized product. Since Azure ISS is in its early stages of development, there is no real solution for enterprises to buy. This announcement focused more on Microsoft system integrators (SI) and independent software vendor (ISV) partners that will help develop an IoT ecosystem. Type A enterprises (rapid technology adopters) with strong developer teams and enterprises with specific IoT projects may also benefit without a SI.

By leveraging its Azure cloud platform, Microsoft is the first Tier 1 software vendor to offer a preview of an integrated solution for the IoT that extends from managing heterogeneous edge devices to the visualization of the data — using a gateway-based security architecture. This platform-as-a-service initiative establishes a customer-focused operating expense model with ongoing support and updates. The initiative will also provide Microsoft and its partners with a revenue annuity stream as demand grows with IoT adoption.

Smaller vendors have created platforms with capabilities in key vertical markets, but no one vendor has a complete platform. Other Tier 1 vendors have yet to implement integrated strategies or management teams for the IoT at the same level as Microsoft. With so few established IoT standards, any IoT project has to be customized for industry-specific use cases and specific local and heterogeneous environments. Microsoft and its competitors will have to continue to evolve platforms with the market.

Success in the emergent IoT market depends on a solid set of ecosystem partners. Microsoft already has IoT experience through its embedded business, “channel-class” partners and ISVs, but this ecosystem will need to expand to OEMs, semiconductor companies, developers, makers and other IoT players. Microsoft begins the Azure ISS preview with three main SI partners — CGI, Cognizant and Infosys — but is rapidly growing from its current base of 77 partners.

The current Microsoft Windows Embedded Business management team has established IoT leadership inside Microsoft and appears to have Nadella as a champion. By placing ISS under the Azure umbrella, Microsoft has started to align incentives for its global sales force to sell ISS. This move may allow Microsoft to track IoT sales and allocate resources effectively, thereby putting Microsoft ahead of the other Tier 1 software vendors.


Microsoft IoT partners:

  • Evaluate and experiment with the Azure ISS platform. Focus on building your expertise and on developing solutions for key industries such as manufacturing, healthcare and insurance.

Enterprises implementing IoT solutions:

  • Experiment with Azure ISS only if you are an early adopter with a strong developer team or partner that can manage a solution that will not be fully tested and launched until 1Q15. Assess and rate SIs by: Azure ISS certification, additional IoT platform experience and relevant industry competency.

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