Microsoft has acquired cloud billing startup Cloudyn for a reported $50 million – $70 million, allowing it to potentially offer cloud cost management services.
Cloudyn helps customers to manage and organise their cloud billing across multiple clouds, and as a Microsoft partner has supported cost management for Azure and other clouds to help customers improve their cloud efficiency.
Jeremy Winter, director of programme management at Microsoft, said in a blog post yesterday: ”I am pleased to announce that Microsoft has signed a definitive agreement to acquire Cloudyn, an innovative company that helps enterprises and managed service providers optimize their investments in cloud services”.
Founder and CEO of Cloudyn, Sharon Wagner, added: “Cloudyn will be joining Microsoft to continue our mission of optimizing cloud efficiencies and investments. The Cloudyn solution will be incorporated into Microsoft’s product portfolio – offering customers the industry’s broadest set of multi-cloud management, security and governance solutions.”
Quocirca founder and analyst Clive Longbottom told Cloud Pro the deal is “a decent acquisition” for Microsoft, but its success will depends on how Microsoft uses the service.
“If it just layers it as a tool on Azure for showing a customer’s costs of Azure, or as a tool for prospects to play ‘what if’ scenarios around Azure usage, then that is fair enough – but won’t give the best returns. If Microsoft uses (and builds on) the full capabilities of Cloudyn, then it could do various other things,” he said.
For instance, Microsoft could provide a service using Cloudyn “where users can input their existing cloud usages and the Cloudyn system can then calculate costs and identify low-hanging fruit cost savings if the user should move over to Azure,” Longbottom suggested. “This could be a major means of nudging people over to the Azure platform – as long as Microsoft can beat other cloud providers’ costs, of course.”
He also said a large cloud vendor using Cloudyn could start a “pricing war” between cloud providers as they attempt to keep customers.
However, Longbottom did say that Microsoft has not proven itself to be the best acquirer of companies, pointing at examples such as the acquisition of the various companies that formed Dynamics, as well as Skype as users continue to find problems with it.
He said: “Microsoft will have to detail what it is going to do with Cloudyn rapidly and concisely – and then make sure that it does it in a way that makes both usability and economic sense to end users.”