Top Stories
Top Stories
Enterprise

Microsoft touted something called the Power Platform at its big event this week — here's what it is

Key Points
  • Microsoft's Power Platform includes Power BI for visualizing data and PowerApps for writing custom business applications.
  • Satya Nadella promoted the product collection as one of the platform opportunities available to software developers, alongside the Azure cloud and other services.
Satya Nadella, chief executive of Microsoft, speaks during a panel session on day three of the World Economic Forum in Davos, Switzerland.
Jason Alden | Bloomberg via Getty Images

Microsoft CEO Satya Nadella has used his company's strengthened position in cloud computing through services like Azure and Office 365 to drive a five-year stock rally since he took the helm. Now, he's giving businesses the opportunity to customize cloud products as he looks for another avenue for growth.

On Monday, at the annual Microsoft Build developer conference, Nadella highlighted a collection of products called the Power Platform, which adds services for business intelligence, app development and app connectivity. It's Microsoft's effort to not just provide Azure for cloud computing and storage and Office 365 for productivity, but to let customers get deepening value out of Microsoft's investments as it competes with Amazon Web Services and Google's growing cloud platform.

Nadella said this was the first Build conference with discussion around "business process automation as a first-class platform." That category refers to the Power Platform, alongside Dynamics 365, a group of cloud-based applications for managing sales leads, field service jobs and other operations.

"One of the hardest challenges for business applications has always been — because there's no such thing as a canonical business process," Nadella said in his keynote. "It always changes by industry, and more importantly, it changes in time, because the businesses are not constant. So how do you deal with the customization?"

The Power Platform was rolled out in 2018 and the products aren't generating major revenue yet for Microsoft. But Microsoft sees plenty of promise, particularly with cloud demand pushing the growth of the company's commercial cloud — including Dynamics 365, Office 365 and Azure — to 41% in the latest quarter and briefly lifting the company's market capitalization past $1 trillion.

The Power Platform includes three components:

  • Power BI, a business intelligence tool for visualizing data with different kinds of charts. It competes with products from companies like Amazon, IBM, MicroStrategy, Oracle, Salesforce and Tableau.
  • PowerApps, a tool that people can use to more easily create business applications. Google and Salesforce are among the companies that have their own so-called low-code app development platforms.
  • Flow, a tool for connecting various applications, which makes it possible to have data from one system show up in another. Other options come from start-ups like IFTTT and Zapier.

Nadella still sees Azure, Microsoft 365 (including Office 365, Windows 10 and security tools) and gaming as growth drivers and strong platforms for outside app developers. The Power Platform is the newest addition to the mushrooming platform opportunity and provides more customization.

"For the first time in fact, in our own Microsoft history, we have an extensibility model that is the same for Office 365 and Dynamics 365," Nadella told analysts on an earnings call last year, referring to the ability to customize both. "This has been a dream of mine for, I don't know, for 15 years probably. And we are finally here and we are executing super well."

Users of Power Platform products today include Adobe and media buying company Advvy. While the platform is new, Microsoft has had services like Power BI available for years.

Nadella discussed the platform in an interview with Ben Thompson of Stratechery that was published on Tuesday. Thompson describes it a platform as a service, as opposed to Azure, which provides the underlying infrastructure. Nadella said the tools can be useful for many people and is not limited to technically savvy developers.

"The thing that I'm most bullish about there is this is not just the hipsters in San Francisco, ISVs [independent software vendors], but it's about every ISV in every country who really is trying to build solutions for their economies and their communities and so on," Nadella said.

In a report on Tuesday, James Cordwell, an analyst at Atlantic Equities, referenced the Power Platform as part of a broader summary of the keynote. He said Microsoft still has a long way to go to prove that its cloud can be a one-stop shop.

"We believe there remains a major opportunity in facilitating the unification of an enterprise's data that is stored across multiple SaaS [software as a service] apps, though we are not convinced Microsoft has a sufficiently compelling proposition here as of yet," wrote Cordwell, who recommends buying the stock.

WATCH: We're still in the early days of cloud, fund manager says

VIDEO2:3202:32
We're still in the early days of cloud, fund manager says