Why Microsoft is launching data centers in France

Dive Brief:

Microsoft on Monday announced plans to offer Microsoft Azure, Office 365 and Dynamics 365 from multiple datacenter locations in France in 2017.
The company already has data center hubs in the Netherlands, Ireland, Austria and Finland.
With extra emphasis placed on the company's cloud computing capabilities, CEO Satya Nadella said Microsoft's Azure Cloud is "on its way" to becoming the first artificial intelligence supercomputer.

Dive Insight:

Data center expansions in Europe will allow Microsoft to meet anticipated customer demand on that continent and help the company adhere to strict new EU data privacy requirements. After the Safe Harbor Agreement was struck down by the EU's top court last year, both AWS and Microsoft have been looking for more datacenter capacity in Europe.

Nadella said his company has invested over $3 billion across Europe to date. AWS also recently announced plans for several new data centers in Europe.

During a European tour with stops in Dublin, Paris, Berlin and London, Nadella discussed how Microsoft's cloud computing offering "underpins a new wave of applications that use AI technologies," according to a ZDNet report. Microsoft hopes its early investments in IoT and AI will become will set them apart for customers.

"When we look at this current generation of applications that people are building, the thing that is going to define these applications, that characterizes these applications, is machine learning and artificial intelligence. Therefore we are building out Azure as the first AI supercomputer," said Nadella.

On top of the new regions, Microsoft is also pushing for competitive cloud pricing. Nadella and Microsoft president Brad Smith announced lowered prices on the company's most popular virtual machines starting October 1.

In July, revenue in Microsoft’s overall cloud business, including its Azure cloud platform and server software, rose 7% year over year in the fourth quarter to $6.7 billion. Azure, saw revenue more than double last quarter, growing 102% year over year. The company is also gaining ground on its closest competitor.

Last month, Scott Guthrie, Microsoft's executive vice president of Cloud and Enterprise, said it is gaining on Amazon Web Service, with more than 120,000 new Azure subscriptions each month and 1.6 million production databases now hosted in Azure.