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Microsoft Cloud Rains Free Services on Nonprofits

By David Jones
Jan 21, 2016 11:54 AM PT

CEO Satya Nadella on Tuesday took the occasion of the World Economic Forum in Davos, Switzerland, to announce that Microsoft plans to donate US$1 billion worth of cloud services to serve nonprofits and university researchers over the next three years.

The company's recently formed Microsoft Philanthropies unit will manage the contribution as part of a three-part effort to provide cloud services to worthy nonprofits, boost access to university researchers, and increase last-mile Internet access to communities that lack basic services.

"Microsoft is empowering mission-driven organizations around the planet with a donation of cloud computing services -- the most transformative technologies of our generation," Nadella said, noting that more than 70,000 organizations will gain access to cloud services through the initiative.

Microsoft plans to make Microsoft Azure, Power BI, CRM Online and its Enterprise Mobility Suite more available to nonprofits through the Microsoft Philanthropies unit. The company already has been providing Office 365 cloud software through a similar program.

Microsoft will expand the availability of its Azure for Research program by 50 percent. It provides free storage and computing services to faculty members and currently is in use in more than 600 research projects worldwide.

Philanthropy With Benefits

In addition to burnishing its corporate image, Microsoft's move could nurture a potential new client base for its cloud business, which is a hotly contested area right now.

"Bill Gates and the Gates Foundation have made significant investments in development over the years so it's only fitting that Microsoft get into the game by providing supporting technology," said Rebecca Wettemann, vice president of Nucleus Research.

"This shows Microsoft's commitment to the space but also evidences the evolving maturity of the Microsoft cloud platform," she told the E-Commerce Times.

The program is aligned with competitors' efforts to offer their cloud services to nonprofits and NGOs in a way that can help those organizations operate more efficiently.

Salesforce.com, for example, has a number of high-profile nonprofit clients, including the American Red Cross, Teach for America, and Kiva, a firm that specializes in microloans for entrepreneurs in developing countries.

"Microsoft is seeking to create goodwill and generate new business leads from this initiative," observed Jeff Kaplan, managing director of ThinkStrategies.

"It also knows that many businesspeople with nonprofits could be exposed to Microsoft's cloud services through this program," he told the E-Commerce Times.

Existing Partnerships

Microsoft previously has embarked on efforts to work with nonprofits to use its technology for research, development or other purposes.

A partnership with the University of Texas at Austin uses Microsoft technology for Project Catapult, a program that delivers lower-cost power using advanced cloud services.

A project in Brazil, the Sao Paulo Research Foundation Biodiversity Research Program, uses 700 wireless sensors and cloud technology to understand how cloud forests work.

Nadella, in a blog post Tuesday, referenced an op-ed he wrote on the subject in the Financial Times. He referenced the U.N. meeting in the fall when At a UN meeting last fall, world leaders pledged to tackle 17 sustainable goals by 2030 -- including poverty, hunger, health and education, Nadella has emphasized.

Microsoft plans to donate $350 million in services in 2016 alone, according to President Brad Smith.

A program called "TV White Spaces," part of the Internet access initiative, provides connectivity to rural Kenya through the Mawingu project, he pointed out. Microsoft plans to support 20 of these projects in 15 countries worldwide by the end of 2017.

"This a way for Microsoft to secure their role in the cloud needs going forward," analyst Jeff Kagan told the E-Commerce Times. "After a while, these nonprofits will eventually have to buy more, so Microsoft wants to be in the catbird seat."

David Jones is a freelance writer based in Essex County, New Jersey. He has written for Reuters, Bloomberg, Crain's New York Business and The New York Times.

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