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Microsoft announced today that it plans to invest $5 billion into various programs surrounding the internet of things (IoT) over the next four years, as part of its bid to make the deployment and use of internet-connected hardware easier for its business customers.

This commitment is a major increase for Microsoft, which had spent $1.5 billion to date on IoT initiatives, according to executive vice president Jason Zander. The money will be used primarily for research, development, and partner enablement.

It’s a logical move for Microsoft, considering that IoT applications are a major driver of cloud computing. The elastic capacity, high uptime, and geographic distribution provided by cloud platforms like Microsoft Azure is a clear fit for companies looking to deploy and manage fleets of connected devices. Microsoft also operates a series of managed services designed to simplify deploying and operating IoT systems at scale.

This also fits into Microsoft’s existing investments in Azure Stack, a combined system of software and approved partner hardware that lets customers run what is essentially a private instance of the Azure platform. The tech titan also has a long history of working with embedded devices, going back to the release of Windows Embedded.


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Microsoft is competing closely against other cloud providers in this space, like Amazon Web Services, which offers its own suite of IoT capabilities. Microsoft’s strong existing customer base among manufacturing companies and other large enterprises could give it an edge in the embedded device realm.

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