When I heard Mark Hurd (HP CEO) and Steve Ballmer (Microsoft CEO) were to speak on a teleconference last week announcing a major partnership between the two companies – involving cloud computing no less – I jumped right on the call. After all, Microsoft is doing some exciting work with its Windows Azure platform. And, conversely, HP has been lacking major strategic announcements in the cloud realm. So I figured an alignment between these two industry giants had the potential to be very significant.

Background

The previous post discussed some of the strategies that can be followed by infrastructure as a service (IaaS) providers. At a high level, IaaS strategies are typically based on some mix of low price (offering lowest prices per unit of value), high differentiation (offering unique capabilities), and focus (selling to a more narrow group of customers). But what is the “right” strategy? Well, there is no single right or best strategy for all IaaS providers. Instead, the question must be answered individually by each IaaS provider. To arrive at a profitable answer, each provider must also first understand customer needs, segmentation of customers, their own unique capabilities, strengths and weaknesses of competitors, and many others.

The infrastructure as a service (IaaS) market is continuing its rapid growth phase, gaining more competitors every month. Some of the companies are fresh new startups, while others – like hosting businesses and communications service providers – existed before the term cloud computing gained widespread popularity in the last few years. Datacenter infrastructure vendors and even booksellers (OK, maybe just Amazon) are also getting into the act. However, all of these varied companies still have one thing in common.