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Chart of the day: Microsoft keeps burning hundreds of millions online

by Volker Weber

Microsoft just turned in strong earnings, but once again, there's a big ugly blotch on the report in the online division. Microsoft had a $726 million loss from online operations, the second biggest lost since March 2006.

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It's a huge investment to build up datacenters as you ramp up for this type of business. My (slightly educated) guess is that this is where the huge costs are coming from as Microsoft prepares for Office365 launch in June and the influx of new cloud customers for Lync & SharePoint in addition to the millions of Exchange mailboxes we're already hosting.

Amy Blumenfield, 2011-04-29

I believe so. But this chart looks like Msft has been trying to figure something out, that the company hasn't found yet. For five years.

Volker Weber, 2011-04-29

Maybe they should use Amazon Web Services for their data centres. My bill is about $0.11 per month. A little down-time is a fair trade off.

James Bliss, 2011-04-29

What do you get for 11 ct a month?

Volker Weber, 2011-04-29

Amazon S3 storage, for example. No kidding.

Simon Fellmann, 2011-04-29

As long as you don't move anything in and out. :-)

Volker Weber, 2011-04-29

True, it becomes pretty fast pretty expensive :-)

Paul Newman, 2011-04-29

To provide an example of the actual cost of S3: I use it to store and sync my files with an app (Jungle Disk). For about 27 GB of storage use in the US Standard region, weekly backup transfers through JungleDisk, and continuous data syncing across multiple PCs, I have been paying less than USD 5 a month for the last few years. In the same timeframe, I have had 4 laptops that had either hard drive crashes or had to undergo repairs, and the backups have served me well every time. S3 has never failed to be available in that time. Happy customer here.

Jan Tietze, 2011-04-30

@Jan - I agree completely - I have a similar use-case, but only about 5 GB of data on S3. I pay about 3 EUR/month using JungleDisk and think it is a very fair price. Also for several years without any outages that I have noticed. It-just-works. I'm very happy too.

John Keys, 2011-05-01

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