Microsoft buys Israeli cloud management company Cloudyn to incorporate Cloudyn's cloud management products into its portfolio; sources say price was $50M-$70M
Jun 29, 2017, 7:04 amJun 29, 2017, 7:30 am — Back in April, we began hearing that Microsoft was in the process …
Context & Ripple Effects
Cloudyn is not a security deal, which is what makes it notable inside Microsoft's Israeli buying streak: the company had already paid around $320M for Adallom, roughly $77.5M for Secure Islands, and, three weeks before this report, about $100M for Hexadite's threat-detection technology. Cloudyn extends the same pipeline from protecting cloud workloads to metering and managing them.
It also lands in a live market for cloud orchestration and management tooling — Dell's later purchase of Tel Aviv-based Cloudify for a reported ~$100M shows infrastructure vendors treating this category as worth acquiring rather than building.
First-order effects
- Azure customers gain native cost-management and optimization tooling instead of relying on Cloudyn as an independent third-party product spanning multiple clouds.
- Cloudyn's team and products are absorbed into Microsoft's portfolio at a reported $50M-$70M — a fraction of what Microsoft paid for its Israeli security acquisitions like Adallom.
Second-order effects
- AWS and Google face pressure to match built-in spend-analytics capabilities, since a hyperscaler bundling cost management with compute shifts pricing power toward whoever owns the billing relationship.
- Israeli cloud-infrastructure startups gain a proven repeat acquirer in Microsoft, likely lifting asking prices across the local ecosystem — a dynamic Dell's Cloudify purchase reinforces.
Third-order effects
- If the pattern holds, hyperscalers systematically absorb independent multi-cloud management layers, converting neutral cost-visibility tools into features of their own platforms — and narrowing the space for standalone vendors.
- Israel consolidates as a structural M&A pipeline for Microsoft, moving from security (Adallom, Secure Islands, Hexadite) toward broader cloud operations, with CyberX's later IoT-security acquisition extending the run.
The trend: Hyperscalers are acquiring their way into cloud cost and operations tooling, with Microsoft's Israeli acquisition pipeline widening from security into cloud management itself.