Microsoft already realized that an enterprise through compound server environments would generate a ton of cash for the corporation. However, analysts said that it would struggle to vie against Google.
Microsoft was not doing well in selling cloud services because most of the customers prefer Google's business model. Only 22,000 out of 650,000 international enterprise partners of Microsoft were selling the Office 365, Microsoft's enterprise.
Recently at Microsoft's Worldwide Partner Conference, the company admitted that it could not compete on price with Google. This led to the company's reorganization. With the current changes, Microsoft hoped to sell more products and services.
Before the restructuring, Microsoft was divided with Microsoft Business Division and Server and Tools. Microsoft Business Division sold software license to corporations. In 2011, the division saw 24% increase in earnings but the growth plunged to 7% in 2012 to a total of US$15 billion in profit. Subsequently, Server and Tools observed 17% growth from 2010 to 2011 and an 18% upsurge from 2011 to 2012. However, the company doubted if the growth could continue since corporations concentrate more on the cloud technology. The cloud technology is an entirely foreign concept from Microsoft's servers.
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