While Oracle (ORCL) insists that a cloud is just Software as a Service, that it can indeed be proprietary and closed, that it's not much different from old-fashioned enterprise computing, Microsoft (MSFT) is seeking to enter the cloud mainstream.
The reason Microsoft was quietly running a Meet Azure webcast the same day Oracle was trotting out its cloud, assuring developers of their support for Linux and open source tools in its Infrastructure as a Service offering was because it has to.
The differentiation Microsoft wants to offer is enterprise surety. So it was important that CentOS, a small Linux vendor, announced at the event it would offer a Service Level Agreement for its software on Azure. Enterprise-quality support and enterprise-standard contracts are bound to be part of any successful pitch.
Microsoft first thought Azure would be a natural transition for its Windows-based enterprise clients. But many of those companies turned out to be more conservative than Microsoft thought. They didn't move toward Amazon, but they didn't move to Azure either.
For those companies that have embraced the cloud, concepts like commodity hardware and open source are basic to the decision. They want to build "hybrid clouds" in which work can move seamlessly from their own cloud-based systems to the public clouds of Amazon (AMZN), Rackspace (RAX) and others to achieve maximum bang for minimum buck.
In short, for cloud buyers, cloud is a commodity. Amazon is the leading cloud vendor in part because it offers commodity pricing, even while cloud is a niche product. The ability of companies to move on-and-off the Amazon cloud is proven. The success of cloud-based, open source applications like Facebook is proven.
If Microsoft is to have any hope of competing in this new architecture, in other words, it has to join the cloud mainstream. The Meet Azure event was its assurance to customers that it has indeed done so, and that it will compete directly with Amazon on price and features.
For customers this is great news. For Microsoft it's a necessary step. For investors it means increased competition and the likelihood that they may have to wait a long time for cloud profits.