Competition among Australian Azure resellers heating up as migrations ramp up

azure, cloud, isg, microsoft, services

Competition among Microsoft Azure service providers in Australia is “intensifying” with smaller local players posing a challenge to global system integrators, research from technology research and advisory firm ISG revealed.

ISG, or Information Services Group, specialises in research on digital transformation services, including automation, cloud and data analytics; sourcing advisory; managed governance and risk services; network carrier services; strategy and operations design; change management; market intelligence and technology research and analysis.

The increased competition comes as more Australian public sector and commercial enterprises continue ramping up their use of hyperscaled cloud platforms, even if many enterprises already have mature cloud implementations.

The increase is also fuelled by migrating more complex applications like SAP on Azure, overcoming what ISG calls the “fear factor” that has caused some to resist these high-impact migrations.

ISG said the move to the cloud has been driven by a need to do more with less, cut costs and become more agile, and was especially accelerated further by the impact of the COVID-19 pandemic even if Australia was not hit as hard as other countries.

Additionally, the Australian government’s announcement in 2020 to move to an Azure-based records management system also played a role in that push, the research firm added.

“As Microsoft’s product set evolves, the opportunities for both its global and local ecosystem partners in Australia are growing,” ISG Asia Pacifc partner and regional leader Scott Bertsch said.

“Several major providers of implementation and support for Microsoft solutions, including Azure, Office 365, Dynamics 365 and SAP on Azure, are emerging from the local market.”

Azure resellers however faced some challenges over the past year, including the need to rapidly scale up Azure implementations amid organizations’ wholesale moves to remote work.

“A growing fear of ransomware attacks is driving many enterprises to migrate to Azure for better data protection, yet the country has a shortage of Azure-certified resources and expertise in some areas, including cybersecurity,” ISG said.

“At the same time, the report finds most Australian organizations still want to pick and choose which applications to shift to the cloud.”

ISG also noted Australian enterprises’ increased interest in the Internet of Things, artificial intelligence and advanced data analytics, and that managed services providers should invest in more AI-related capabilities and training to remain qualified to implement such features as Microsoft continues to evolve its AI development and implementation strategy for Azure.

How Australian Azure partners stack up

ISG released its 2021 ISG Provider Lens Microsoft Ecosystem report for Australia last month, evaluating the capabilities of 46 providers across four quadrants: Managed Services for Azure, Office 365 – Modern Workplace, Dynamics 365, and SAP on Azure.

azure, cloud, isg, microsoft, services

The report has three providers listed as “leaders” in all four quadrants, namely Accenture (Avanade), DXC Technology and Wipro.

IBM, Tata Consultancy Services and Tech Mahindra are leaders in three quadrants, while Empired, Fujitsu, Logicalis, Telstra and Unisys are named as Leaders in two quadrants each. Rounding out the leaders are AC3, Data#3, Dicker Data, HCL and Infosys in one quadrant each.

ISG also named a number of rising stars, or companies with “a promising portfolio” and “high future potential” in one quadrant each, namely Cognizant, LAB3, Macquarie Telecom, SoftwareONE, Velrada and Veritec.

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