BRENT THILL: Thanks everyone for joining. I think we've saved many of the best presenters
for last. So thanks, Rajesh Jha, from Microsoft, we're really excited to have you with us today.
He joined Microsoft in 1990, actually shortly after that I became a Microsoft developer, and that's
how I got into this business. So it's not exactly the same path, but thank you and Microsoft for
helping out early on.
You report directly to Satya running the Office business, a really important role and a big business. Maybe
you can just tell us a little bit about the kickoff, and before I start I have to wear my IR hat, which
just in terms forward-looking statements Microsoft may make, you need to look at the SEC filings on the
website for potential disclosures. If you need any of those disclosures, Microsoft's representatives
here in the front row, they'll hand those out to you. So just in terms of the disclosures.
So with that, maybe you can just tell us a little bit about your journey from 1990 to now?
RAJESH JHA: Sure. I mean, how much time do we have? I mean, I came to Microsoft
straight out of school in 1990. I thought I was going to be there a couple of years. But it
was great to actually be there at these early days when I mean the vision was incredibly bold to democratize
computing and put a computer on every desk and in every home. I was not as obvious as it seems today.
We forgot to say a computer in every pocket, but you get the idea. It was about democratizing
And I've been in and around Office, so working on productivity, communications collaboration, cloud services
and actually specifically the cloud services for more than a decade. The last five years I've been
working on and leading the Office 365 effort for Microsoft, which brought together all the different teams
in Office, but also Azure and the Windows guys.
And then in my new role as the Executive Vice President for the Office Product Group, I lead all things Office,
the products, services, experiences.
BRENT THILL: Office is a big banner for many things.
RAJESH JHA: It is.
BRENT THILL: Can you help us unpack what's in that Office box?
RAJESH JHA: Yeah, sure. I mean I think the heart of Office is what people perceive as
the product that runs on their desktops today, Word, Excel, PowerPoint, Outlook, OneNote. But now
Office, of course, exists on all the platforms, whether it be iOS, Android, Mac, web.
But Office is more than just the client experiences, the user experiences. We've got a bunch of services
or backend services, cloud-hosted, and these are Exchange providing enterprise mail, and calendaring, Yammer
providing enterprise social. You've got SharePoint doing portals and team collaboration. Skype
that does conferencing and meetings and voice and then we've added Microsoft Teams.
So the best way to think about Office is it's all experiences, end to end, that run on all the devices and
delivered either on-prem or in the cloud. And the thing that we've done now is expanded Office even
more into areas like security and analytics and voice and so on. So it's a lot of things, like you
BRENT THILL: There's been a lot of changes in terms of product. There's also been a lot
of change, at least from our perception, in the culture and with Satya coming in now and running. Can
you just talk about how things have changed, and what you felt maybe over the last couple of years as he's
taken the head leadership role?
RAJESH JHA: I think Satya did a really good job when he came into his role. He first spent
some time building deep conviction about our unique mission and our sensibility, because you've got to
start there and then figure out the culture that gets you towards that mission. And so I think we
have a bold mission today, empowering every individual, every organization to achieve more to get to their
best potential. So you start with that clarity, then you figure out what are the ambitions, what
are our strategic thrusts that get us there.
So from a culture perspective, I would say perhaps the biggest impact was bringing the mindset, learning
mindset, or growth mindset, where it's about being humble, it's about being open-minded, about intellectually
curious, trying stuff, not being afraid to fail, learn quickly from failure. That was a pretty big
shift, you know, it seems really an obvious thing for us to do, but it was a pretty big shift that he brought
to the table.
And then brought a much sharper perspective on customer obsession, being connected to the customer. And then
I would say under his leadership the third aspect I would add is probably more than ever before working
as One Microsoft. So building on each other and getting the efficiencies from that.
And as you guys know, things, the business models change so quickly, the technology changes so quickly that
you've got to have a resilient culture. And so I do feel pretty good about where we are today.
BRENT THILL: When you think about this big move that you had to the cloud, tell us about this
journey, tell us about kind of where you think you are, what's ahead? There' obviously a hybrid world
that you guys are still envisioning. How do we think about the balance between the cloud and the
RAJESH JHA: Well, I mean for many years now we've been all-in on the cloud, and for a bunch
of different reasons, the rate of innovation, now you have Microsoft investing in upgrade, migration, deployment,
and you take the friction away from customers to get to your newer stuff. So the rate of innovation,
the ability to provide the best user experiences, because your customer is always up to date. The
ability of democratizing the availability of our product, so SMBs, small and medium businesses, where I
describe Office as being so many things. It's super hard for a small business to go put all of that
together, and with cloud delivery you make that possible for them to actually get to the same experience
as that a big enterprise might get to. So there's a lot of stuff that is amazing about cloud and
we are all-in.
But the reality is, customers are going to have different constraints on how fast they can move to the cloud.
We've had some customers that say, hey, you know, I would like this regulated entity inside my organization
to stay on-prem, and everybody else can move to the cloud. So they think about hybrid setups more
on a user basis or a department basis or a side office basis. There are other customers that say,
you know, it's great, let's get calendaring and mail and conferencing to work from the cloud, but I want
to keep my portals on-prem. So with Office 365 we let you do hybrid that way, too.
So I mean, look, if you're in the business of serving enterprises, you know one size doesn't fit all. We
want to provide the best possible stuff in the cloud, but we have and we fully support hybrid configurations
both in Office 365 and Azure. And so we continue to build on-prem versions of our products. The
reality is that our cloud versions are getting progressively richer and richer and so the gap does exist.
But we are servicing our on-prem customers as well.
BRENT THILL: Back to your one size doesn't fit all, you've also taken different SKUs in Office
and given low level features. I subscribe to Office 365 for $9.99, I believe, or $10 roughly a month.
I don't have the enterprise E5 SKU, which I think brings the price point up to $35 per user per month,
with a lot of new feature sets. Can you just talk about how you think about the go to market in terms
of the availability and I think E5 is relatively new, how is that doing?
RAJESH JHA: Yeah, it's a great question. So with Office 365 we have, I would say, a very,
very competitive product within communication, collaboration, security infrastructure for all our customers,
and for enterprises we call that E1. And it is our best set of experiences. We think that's
an area we will continue to add value over time. So like we recently launched Microsoft Teams, and
that's available in E1. So we are committed to our E1 customers.
But one of the great things that we've seen happen with our business is how customers are opting in into
our premium SKUs. E3 has been in the market for a few years now, and if you take a look at all our
premium SKUs, I think our SKU mix today, our premium SKU mix, is upward of 60 percent. And so they
see the value in E3.
And what do we have in E3 that's not on E1? Well, we've got the Office client. You know, in E1
you get the web client, so you bring your own client. In E3 you get always up to date, cloud updated
Office client on all the endpoints. You get security and compliance features. And then E5 is
something that we are very excited about, too. It's still early in E5. Our customers are trialing
it and we've seen early interest in all the three key pillars of E5, which is advanced security and compliance,
advanced analytics, and voice and lots of capabilities in voice.
So that's how we have set up our SKUs commercially. You could buy a given workload, but most of the
customers tend to get the entire suite. They may start workload, but they get the entire site and
then we have the we add value to our premium tiers.
BRENT THILL: The role of AI has been a popular topic in the valley, at this conference, and
when you start to think about all the different applications that you're powering kind of knowing what
each other is doing, what's the role of AI in your initiative going forward?
RAJESH JHA: It's huge. I mean look, the first thing when people tell you they do AI, the
first thing you've got to wonder is do they have unique data, do they have unique signals. In Office
we have billions and billions of data points as our users interact with our products. They are signaling
us. When I share a document with you, Brent, that's a signal. If I e-mail if somebody
sends me e-mail and I dwell seven or eight minutes on that e-mail versus my typical minute or two, that's
And all these signals and all the data what we do with Office 365 is we treat them as a customer's data and
customer's signals. So then what do we do? Now we've got lots and lots, billions of endpoints
of data and signals. Then we bring in machine learning and AI techniques and natural language processing
to give back the end user or the customer unique insights.
Let me give you a couple of examples. Let's say you're editing a document in Word and you're preparing
a report and then you think maybe I want to reuse a chart from a report I had seen somewhere in my work
group and you didn't quite remember who had shared this with you, but you want to use one of those charts.
So what we have today as a feature now in Office 365 is called Word Tap.
So you'll literally one tap onto the ribbon and we use the AI technique to bring all the relevant documents
that you've seen in the past that may be interesting to the content that you're writing now, and we auto-bring
those things into you right pane. You can scroll in the right pane. You can tap on the chart
that you see, and boom, it's in your Word document. And so instead of going leaving Word, going
and doing a search, find the filter you searched on, remember who sent you that thing, the AI signal brings
it back into Word.
I can give you lots and lots of examples of these things. So I think with AI we are helping the users
get time back, get value back, whether in terms of efficiency or automating the tasks, but I'm also excited
about AI from the IT's perspective. You know, a place that we use AI now in Office 365 is what I
call the Security Graph. Again, we see ton and tons of some malware thrown at our customers. And
I see that in Office. My colleagues see that in Directory in Azure, we see that in Windows. We
triangulate all of these signals and then we overlay that in giving our customers, the IT guys, insights
into what the threats are, who are the most targeted users, which devices may have been compromised, suggesting
So when you have lots of data and lots of signals then you have the opportunity to use ML and AI to give
value back to the users and customers. I'm really excited about what we are doing here and we've
got a bunch of ideas here.
BRENT THILL: You've scared a lot of business intelligence users with your Power BI bundle and
that into some of the broader solutions. So when you think about the stand-alone BI player and what
you're doing, can you talk about the role of Power BI.
RAJESH JHA: Yeah, I mean I think there's lot of interesting work happening in this area of analytics
in the industry. And I mean our vision with Power BI is data science, everybody should be a data
scientist. We want to democratize what it means to analyze data, to filter it, to draw insights.
And so Power BI is in many ways you should think of that as the next logical step from Excel, you
know, I mean you do a lot of analysis in Excel. With Power BI you can do rich dashboarding and you
can bind that to the Office data, you can bind that to line of business data. And the spirit of our
investment in analytics is time back, money back, value back to end users, democratize data science.
BRENT THILL: Any stats you can give us just in terms of that initiative, I think over the last
year have been pushing it pretty hard? Are there any other kind of broad data points you have to
kind of support what's happening with Power BI adoption?
RAJESH JHA: I mean Power BI today is a part of E5. And we are still early with E5. We're
just over I would say a year in the market. So we are very pleased with the, like I said, the three
key vision pillars for E5, one is around advanced security and compliance, the other is around analytics,
and a third one is around voice. And each one of these three pillars are resonating with our customers.
I would say probably security is the one that we've seen the most early adoption, but I'm really
pleased with the customer feedback and the opportunity, the market opportunity that each of these three
pillars resonate for us today.
BRENT THILL: Well, we've been watching kind of the formation of Dynamics for quite some time,
with some acquisition and organic build and it seems like a really exciting business. It sounds like
you're spending a lot more time on that business and doubling down. Can you talk about the relationship
between Office 365 and Dynamics family?
RAJESH JHA: Yeah, I mean there's a lot I'm really exciting about Dynamics 365. And
to your question about how do they build on each other if you are in the context of a Dynamics application
you still want to be using the productivity tools that you're used to. So in Dynamics you can embed
Excel, you can bind to SharePoint, right inside of the Dynamics experience, or get an Office experience,
or you can be in Office and have those things reach out to Dynamics data.
Another thing that we've done, which I think is going to be it's going to be super-beneficial to our
users and customers is this common notion of collaboration. So what we have done in Azure Active
Directory we have plumbed in the notion of a group. All of us work in the context of different groups.
Nobody today in modern society works alone. You're always working in the context of groups.
And so we plumbed that at the lowest layer in Active Directory and now I have a group for my direct
reports, I have a group for a product launch, or I have a group dedicated to a given customer.
Whether you're in Dynamics, whether you're in Outlook, whether you're in Yammer, or whether you're in Word,
the same group namespace shows. So when I go to OneDrive I can quickly filter all the documents that
are related to that group. When I go to Dynamics I can still see my entire context filtered to the
So some of the work that we're doing across Dynamics in Office is at a pretty deep layer, but I think it's
foundational in how experience might change as much as it is where we make the experience just super-well
integrated across the two.
BRENT THILL: Skype, it's been a it's a great asset. You obviously purchased it for
a large sum of money. There's been a lot of questions from investors have you been able to truly
take the value of that asset and make it the value that you could. Can you walk through your ultimate
vision for Skype?
RAJESH JHA: Yeah, actually if you think about our economic engine with Office 365, I would say
our core workloads today are enterprise messaging and calendaring with Exchange and Outlook. We've
got, of course, the productivity suite Office and SharePoint for storage and portals. And Skype is
a big one for us.
I mean we are I mean today, with E5 especially, what you get with Skype is you get a single experience
that's spans voice, video, conferencing, application sharing, presence and if you look at some of the innovation
that has come out recently where you've seen where today it's an Office 365 feature, which is you can do
a Skype broadcast, you can broadcast something out of Skype to your entire organization, but we are doing
to do transcription, so natural language transcription, translation for different languages. And
so I'm actually quite pleased with the rate of innovation and adoption that we have had with Skype and
how deeply it is integrated into our Office go to market.
BRENT THILL: The Teams launch, a lot of interest obviously here. Your CEO showed up to
that presentation, which I liked, it's probably a really important thing. There's been a lot of talk
about other collaborative solutions in the market, whether it's Slack or HipChat, or other solutions. Maybe
tell us a little bit how is Teams different than some of the other products you've had in the past or relatively
differentiated to some of the competitors that are out there?
RAJESH JHA: That's a great question, Brent. I mean I would first say communication and
collaboration is a basic human need. All modern productivity, all economic activity starts with people
working together. But then you start to think about how do people work together? And there
is no one-size-fits-all. If you are an account team that's trying to connect to a bunch of customers
and a select set of people inside of your company that's one set of interaction models. If you're
a CEO and you're trying to reach your employees and give your feedback that's another kind of collaboration
and communication pattern. If you're a bunch of folks getting together, high energy, trying to launch
a product, a bunch of developers writing code, so with Office 365 what we want to do is we want to give
you the complete toolkits for collaboration.
And we believe that with I talked about the notion of groups that was being plumbed at the common level.
And so we want to recognize that people collect together in groups, some groups are open, some groups
are closed, some groups are super-large, some are more private, and so we have a common notion of groups
and whether you're collaborating through mail, you're sharing a calendar or a notebook, whether you have
a set of documents you're sharing, we've got the common plumbing.
Yammer understands the same set of groups. It lets you connect across your network in an open way.
And then with SharePoint we have the ability to go and have an intranet portal. With teams
what we are doing is we're adding to that toolkit of collaboration with a common fabric and the team effort
is focused on a bunch of people, bringing a bunch of people together, the content together, the applications
that they work in together.
And what's differentiated and look, I mean Slack has done amazing work. And HipChat has been
around a long time and has a loyal following. But what we are doing with Teams is actually building
out the collaboration toolkit in Office 365 and it benefits from Office. Day one it's going to be
in 18 languages in 180 countries. Day one it is going to be compliant and we've got ISO, CJIS, HIPAA,
we've got full compliance. But most of all, from an end user perspective it brings the tools right
into that experience. When you're in the teams experience you can send a SharePoint page, you can
pin in an Excel document. We have 150 different integrations that are possible, including Hootsuite
and Zendesk and Asana and many others.
And so overall just the framing is it's not about Microsoft Teams alone, it's about making Office 365 the
best collaboration toolkit. And for our customers who have bet on Office 365 I want to make sure
they've got all the different ways that their teams may be collaborating to have the full toolkit there.
BRENT THILL: OneNote is a great product. Maybe it hasn't had the same level of light on
it. There's a lot of Evernote groupies. How do you get the Evernote groupies to use OneNote?
RAJESH JHA: Let me just start pushing that a little bit. Look, Office has got a billion
users. It's hard to compare something like OneNote or something like Delve with something like Word
or Outlook with a billion, half-a-billion users. But OneNote is actually I mean we are seeing
great adoption of OneNote in all segments. I mean let me just take EDU, for example. I mean
if you see the level of inking support in OneNote where you can do math problems it auto-recognizes formulas.
We allow teachers now to auto-provision a notebook for every classroom. So they are bringing
OneNote into their organization, actually introducing the rest of their organization to the full Office
If you think about the Surface Hub, our new not so new anymore, but our collaboration big screen interfaces,
OneNote is the hero whiteboard application in there. And in terms of the migration from Evernote,
we released a toolkit some time earlier this year, or maybe late last year and a lot of our users have
actually taken advantage of that to move their digital memories forward into OneNote. So OneNote
is a pretty key pillar of Office today, the Office line business.
BRENT THILL: This probably ties more into the Dynamics business, but Adobe was here earlier
and talked about the partnership with moving their infrastructure to your backend, and that you think about
even marketing automation, in terms of you helping users use them. Can you maybe talk a little bit
about what's happening with Adobe and that partnership?
RAJESH JHA: Yeah, let me just make a broader on partnerships. I mean look we always start
with in all of these discussions we always start with a couple of things, I mean obvious things.
First is what's the best thing for our mutual customers and the second thing is is there a better
together opportunity for us to go build out an experience better for both the partners and with Adobe that
was obvious, an obvious case for us to go do that.
Another one I would point to is Red Hat. What we have done with Red Hat is we have allowed our enterprise
customers and given them more choice in how they do hybrid environments. And what is really cool
is, and you know, Microsoft and Red Hat got together and we gave our customers a completely unified support
experience. They don't know whether the support call is being taken by Microsoft or is being taken
by Red Hat.
In the same vein I can talk about the stuff that we have done with DocuSign, or SAP, Salesforce.com. Salesforce
is well integrated into our products. So I think I would a broader look at partnerships and I mean
actually just to build on that a little bit, Brent, I would say with Office especially we have a renewed
commitment over the last three or four years to have modern extensibility. Office was always extensible.
But we added modern extensibility. We allow partners to plug in their experiences to our new
add-in interfaces. We have REST APIs for Microsoft Graphs that connects to Office 365. And
so I mean it's a place where you should expect us to continue to do more.
BRENT THILL: There's a handful of question and there's a common theme around LinkedIn. I
know it hasn't closed, so you can't probably say too much. But it's pretty powerful when you think
about the things you guys can do together and the impact to the Office family and I look at the impact
to my Outlook application as an example of some leaves a job perhaps get it to auto-populate the data,
if someone changes their phone number or their e-mail, you're not saying this. I'm saying this.
RAJESH JHA: I love this kind of an interview where you're asking the question and answering
about it, too.
BRENT THILL: I guess just one example, but maybe just your perspective on where you think that
will have the biggest impact in your franchise?
RAJESH JHA: Look, I'm very excited about LinkedIn. I really can't say a lot. I mean
I'm happy to come back once it's closed. We have to let the process play out and be respectful of
the process. But I'm very excited about what we could do.
BRENT THILL: Okay. I can keep talking about the benefits. (Laughter.)
Maybe a little bit about the E5 adoption. What's driving it? How important has voice been?
RAJESH JHA: Yeah, I'm not sure I did a good job explaining the tiering Office all up. So
say a customer moves to our cloud, let's say they start with mail and calendar. What that does is
generates a lot of their data and their content their own cloud. And if we do a good job serving
their needs, and we build confidence with them, they may end up moving something like SharePoint or Skype
into the cloud with us. That generates more data that we are the custodians of for them in the cloud.
So the next thing our customers want to do is they want to do things like e-discovery or put a legal hold,
or they want to protect the data, they want to do analytics of the data. And that is what leads them
into E3. We do some basic level of data leakage protection and conditional access, and of course
operational security is built into Office 365. But you want the advanced analytics, you want the
advanced security, well, that's what gets them into E3. And then there is stuff like Advanced Threat
Protection or voice or Power BI that gets them to E5.
So I guess what I'm saying is the more usage we have and the more users we have, the more data we have. The
more data we have, the more right we earn to give them premium value as a part of E3 or E5. So that's
the basic pieces of how we are adding E5 value.
And, like I said, with E5 we have three thrusts, we have security and compliance, and I'm really excited
about the set of stuff that we've been able to bring to our customers there. And then we have Power
BI and something we call My Analytics on the analytics side. So if you, for example, I don't know
if you guys have seen this capability, but in Office, if you're an E5 user, what you'd be able to see,
one of the insights is who are you losing touch with. So we auto-suggest that to you.
If you sent out a piece of e-mail -- tell me if you have sent out a piece of e-mail with a large audience,
let's say more than 30-40 people, many of you. Wouldn't you want to know how many times that got
read and what is the read rate on those things? We do this in a super respectful of privacy. So
if it was less than five people, we won't give you that insight. But let's say you send it to 20-30
people, you'd be able to see what the read rate, how many replies and forwards are there on your mail.
So these are the kind of analytics and insights. That's the second pillar.
And the third one, let me talk a little bit about voice in Office 365 E5. We have lots of voice capabilities
that we're excited about. The first thing that we do is, we have conferencing in E3 in Office. But
the conference, we had our customers, you could do VOIP conferencing completely based on our cloud, but
your customers will have to bring their own PST in conferencing, and now that is built into E5. So
a one stop shop for all your conferencing needs. Another one that were doing is PBX systems, complicated
to manage, complicated to update, can now be run completely into the cloud. So that's the other proposition
of voice in E5. A third one is now Microsoft will actually give you phone numbers and calling plans
in many countries. So if you think about those value in voice, those are the three components of
BRENT THILL: And when you say give you a phone number?
RAJESH JHA: You can get a phone number from Microsoft in E5 if you do BSDM calling, that's a
feature that we have.
BRENT THILL: This is a good question. The role of the file system, so you launch -- I
did this with my new Windows 10 machine, I launched it, login, all of a sudden OneDrive pops up and it
has all the authentication saved. Can you talk a little bit about that and the importance of OneDrive
and where that's headed?
RAJESH JHA: So one thing we haven't done a lot is we haven't talked about Office 365 consumer
business. We are quite happy with our consumer business. We have 24 million subscribers today
for Office 365 in the consumer space, and the value that our users get there is they get a terabyte of
storage in OneDrive, and OneDrive is a great integration as you just mentioned back into the core devices.
And then an always up to date client, all the AI features I talked about start to show only for our
subscribers. AI features are the kinds of things that we can't easily do for our on-prem customers.
And so that's one of the differentiation for us to actually put more value into our cloud.
So I think about OneDrive as a core part of the value proposition for an Office user. If you are a
consumer, you get a terabyte of storage and an up to date client as a part of the 365 consumer subscription.
If you're in the enterprise, you get OneDrive for Business that has all the compliance capability,
reliability -- not reliability, but geo distribution. So if you're a multinational, you can choose
some set of users' OneDrive to be in Europe, some set of users' OneDrive to be in North America. So
those are the capabilities we offer in OneDrive in the commercial space.
BRENT THILL: Now there have been several questions around security and specifically around e-mail
security and what you're doing there given that many of these breaches do happen via using e-mail.
RAJESH JHA: E-mail, as you know, is the universal communication dial tone. And so there
is always a risk of abuse through e-mail. So one of the features that's really resonating for us
in E5 today is something called Advanced Threat Protection. And the idea of Advanced Threat Protection
is actually quite simple, which is, look, Office 365 will protect you against malware. Of course,
that is part of E1.
But there are a lot of threats that are zero day that the malware signatures are not updated for, or people
will send you a bad link, but when the link wasn't bad when you got it, the link turns bad later, after
the fact. So after the malware has worked through it, they will go and hack the website and then
if you click on the link, that's when you get phished.
So what the Advanced Threat Protection does is, it basically detonates, I use the word detonate in kind of
symbolic way, every attachment and every link in a virtual machine to try and see that there's nothing
malicious. But the other thing that only we can uniquely do, ATP is available in the market as another
offering from a couple of other vendors. But what is something we can uniquely do. Today the
problem with Advanced Threat Protection is if I send you a phishing mail, your mail is probably going to
be delayed five minutes, sometimes seven minutes because a detonation takes time.
What with Office 365 we can do is, we'll give you the mail right away. And if you're reading a bunch
of mail, and you can read the mail right away. If you click on the attachment before we have been
able to detonate and test it, it will say this is being scanned. If the mail attachment was the third
thing you were looking at, chances are we'll be finished detonating it and we've gone and updated your
inbox so your message in your inbox now has the attachment, too. So we call this instant delivery.
So we deliver it right away. We detonate in the background, and we update and rewrite your
inbox as soon as we've got it.
This is the kind of integration of security, why are we in the security business in Office 365, because we
have your data, and we have your experiences. Let me give you another example, threat protection,
it's easy for IT to tell all of us, hey, you shouldn't do this, you shouldn't do that. But because
we have the Office surface area, if I'm in Outlook and I'm sending a mail and I'm forwarding an attachment
from somebody who is not in my organization, Outlook can detect those business rules and right there tell
you, hey, this is not what your IT wants. Do you still want to send this anyway? You'll be
audited. Those are the kinds of things we can do.
So there are lots and lots of examples of security value that we've added in Office at all tiers, E1, E3
BRENT THILL: And I guess there are a number of questions as it relates to the potential partnership
and opportunity to work closely with third party security vendors like Proofpoint, Limecast. How
is that relationship working?
RAJESH JHA: Well, mail is, if you're a customer and you have some other security vendor that
you want to filter your mail, you can do that. You can point your MX record to that other vendor.
And then have the mail be routed after the vendor has finished and then get routed through Office
365. So that kind of integration is already possible.
What is not easily doable, of course, is things like I talked about the instant delivery where because you
have to be operationally close, whether detonation is happening and where the mail is being delivered has
to be physically close in the given data center. Those are the kinds of things that I think we can
uniquely do. But base level of integration with other vendors is totally possible today through just
routing the MX record.
BRENT THILL: The question around statistics around Dynamics CRM attaching to broader Office
RAJESH JHA: Yeah, I don't have that off the top of my head. That's a good follow-up for
BRENT THILL: And the question around subscription versus product. How should we think
about this going forward with 365?
RAJESH JHA: You mean cloud versus on-premise? It's a really good question. So let
me just give you some anecdotal data first. About four years ago I would say maybe four years ago,
I was talking to a bunch of CIOs and they were thinking about moving to the cloud. And their biggest
feedback to me was, well, I can't move to the cloud because you don't have feature X, Y or Z in the cloud
and I get it on-prem.
Today the discussion is entirely different. Today they look at things like Microsoft Teams. They
take a look at Delve. They take a look at the AI, the threat intelligence graph, and none of that
accrues to them if they're not in the cloud. So today the cloud is so clearly better in terms of
a complete solution.
Like I said, we are committed to our customers to serve them on-prem and allow hybrid. It is just that
there's as bunch of AI and ML stuff that's incredibly hard. AI and ML requires a lot of compute and
a lot of access to the data, lots and lots of signals. It's super hard to lift that cloud infrastructure
and move it on-prem.
So I think the whole discussion has changed now. When I talk to customers the issue is, could you not
bring some of that cloud value to me on-prem, and we point to hybrid integrations there.