Microsoft releases Dynamics AX ERP as a cloud-first service in 137 markets and 40 languages
Microsoft's new Dynamics AX ERP-as-a-service offering is truly cloud-first — Microsoft is making generally available its latest Dynamics AX ERP service offering in 173 markets.
Context & Ripple Effects
This March 2016 release is the opening move in Microsoft's rebuild of Dynamics around Azure: the company takes its flagship ERP general-available as a cloud-first subscription rather than an on-premises license, pushing it out across 173 markets and 40 languages at once. Within months Microsoft goes further, having combined ERP and CRM into a single cloud-based product, Dynamics 365, with the Azure-hosted suite starting its rollout on November 1 that same year.
First-order effects
- Enterprise customers in those 173 markets can now deploy Dynamics AX without on-premises infrastructure, buying ERP as a metered Azure-hosted service instead of a licensed server product.
- The Dynamics partner ecosystem shifts from selling perpetual licenses and upgrade projects toward recurring-revenue implementation and support work tied to subscriptions.
Second-order effects
- Hosting ERP on Azure turns every Dynamics AX customer into an Azure consumption account, giving Microsoft a second revenue stream and a reason to keep business applications exclusive to its own cloud.
- Once ERP runs as a service, merging it with CRM into one suite becomes practical — the consolidation Microsoft executes later in 2016 with Dynamics 365.
Third-order effects
- If the pattern holds, business applications stop being standalone products and become components of cross-cloud bundles — the trajectory that leads to Microsoft layering AI services onto Dynamics 365 by 2019 and packaging everything into vertical offerings like Microsoft Cloud for Retail.
- ERP incumbents face pressure to match cloud delivery economics, shifting competition from feature checklists to data-center scale and subscription pricing.
The trend: Enterprise software is migrating from licensed, on-premises deployments to cloud subscriptions, with Microsoft using Dynamics as the wedge to bind ERP, CRM, and eventually AI services to Azure.