A sea change of digitization and the era ahead

The following is an excerpt from my remarks at Microsoft Ignite this morning.

Looking back there is no question that the past year-and-a-half has been a catalyst for real structural change in every industry, from the adoption of telehealth in healthcare, digital wallets in financial services, curbside pickup and contactless shopping in retail, and beyond.

The case for digital transformation has never been more urgent. Digital technology is a powerful deflationary force in an inflationary economy. Think about this: Businesses small and large, can improve their productivity as well as the affordability of the products and services by building tech intensity.

How you sell, how you support customers, how you market, how you manufacture, how you connect with your employees – it’s all undergoing a sea change. Fundamentally, we’re moving from a mobile and cloud era to an era of ubiquitous computing and ambient intelligence, an era which will experience more digitization over the next 10 years than the last 40.

The Microsoft Cloud was built for this new era. The Microsoft Cloud is the most trusted and comprehensive cloud. It powers every organization’s digital capability, while ensuring their independence and sovereignty over it. The Microsoft Cloud is built on trust and security. And the Microsoft Cloud is sustainable.

And when we talk about sustainability, it’s not just about the carbon footprint of our own datacenters but creating an entirely new business process category to help every organization address this very urgent need. We want to enable you to set and meet your own sustainability goals, providing you with the tools to track your own carbon footprint across your operations. In the years to come, I believe digital capability building around sustainability will be as critical for businesses as CRM for sales and ERP for finance is today.

And finally, the Microsoft Cloud offers the best integration across the entirety of the tech stack while offering openness at every layer. This is so important: the Microsoft Cloud helps orchestrate all of your heterogeneous digital investments across every layer of the tech stack.

At Microsoft Ignite, we're introducing more than 90 new services and updates to help you innovate. But I want to highlight three emerging areas across the Microsoft Cloud. 

Large-scale AI models as platforms

Let’s start with AI. One thing underlying everything is how large-scale AI models are becoming platforms in their own right, creating ambient intelligence all around us.

Five years ago, we shared with you the world’s first hyperscale AI supercomputer, and today we have the most powerful AI supercomputer in the cloud. We’ve also built the fundamental software capabilities to build and train large scale models.

Just a few weeks ago, together with Nvidia, we announced the Megatron-Turing natural language generation model, the largest and most powerful monolithic transformer model trained to date with 530 billion parameters. It offers unmatched accuracy across a broad set of natural language tasks. And we’ve also trained Z-code, a multilingual model that combines several languages so individual languages can learn from each other with much lower data requirements than ever before. Our partner OpenAI has released GPT3, which is a breakthrough natural language understanding and generation model.

Over the past six months, we’ve taken the power of these models and made them available across our products, giving domain experts access to GPT3 through our Power Platform and assisting pro developers with coding through GitHub Copilot powered by OpenAI’s Codex. And we are committed to turning the world’s most powerful and large-scale models ever built into platforms for you to meet the unique needs of your business.

It’s why today we’re so excited to announce Azure OpenAI Service, a new Azure Cognitive Service that brings together the power of GPT3 with the enterprise capability of Azure. During my keynote, I shared what this might mean in the context of an app built by the WNBA: 

A new trust fabric

The other area that is truly changing is how the entire identity ecosystem is evolving to create a complete new trust fabric that spans organizational boundaries.

In the physical world, identity has always been critical to establishing trust and driving commerce. In the digital world, this is even more important. Think about it: In our interconnected world, we don’t just collaborate digitally within our own organization, but with our customers, partners, and suppliers.

We’re building the identity system of the future, a connective network that enables people, organizations, apps, and even smart things to make real-time access decisions. It starts with Azure Active Directory, which now extends beyond securing and managing access to also defining customer journeys and business collaboration with anyone.

This trust fabric is what makes experiences like Teams Connect possible today. With Teams Connect, powered by our identity platform, you can establish seamless, secure, and trusted collaboration across organizational boundaries in a matter of minutes instead of days or even weeks. People across multiple companies can easily collaborate as one extended team, chatting, collaborating on files, and scheduling meetings with the right access necessary to do their work.

I shared what this might mean for a manufacturer working across partners and suppliers to mitigate a supply chain disruption:

And we’re not stopping there. Just like Teams has transformed collaboration and productivity, Microsoft Loop is the next big breakthrough in Microsoft 365.

Loop is a new application for a communications-first and AI-first world. We’re composing people’s content, comments, chats, reactions, and live business process data together into a new collaborative canvas. And we are reimagining how anyone can contribute directly in the flow of their work, whether it’s from a chat, email, meeting, or document.

The metaverse

And finally, as the digital and physical worlds come together, we are creating an entirely new platform layer, which is the metaverse. We’re bringing people, places, and things together with the digital world in both the consumer space, as well as in the enterprise.  

Take, for example, Dynamics 365 Connected Spaces, which provides a new perspective on the way people move and interact in physical spaces, whether it’s a retail store or a factory, or even how organizations manage health and safety in a hybrid work environment.

And when we talk about the metaverse, we’re describing both a new platform and a new application type, similar to how we talked about the web and websites in the early ‘90s.  

Across the Microsoft Cloud, from Azure IoT to Azure Digital Twins to Connected Spaces and Microsoft Mesh, we’re building the metaverse platform for you to build upon. In a sense, the metaverse enables us to embed computing into the real world and to embed the real world into computing, bringing real presence to any digital space.

For years, we’ve talked about creating this digital representation of the world, but now we actually have the opportunity to go into that world and participate in it. What’s most important is that we are able to bring our humanity with us and choose how we want to experience this world and who we want to interact with.

I can’t overstate how much of a breakthrough this is. It’s no longer just looking at a camera view of a factory floor, you can be on the floor. It’s no longer just video conferencing with colleagues, you can be with them in the same room. It’s no longer just playing a game with friends, you can be in the game with them.

We are taking these platform capabilities and building them into our own first-party applications, like Teams. Features like Together Mode and Presenter Mode in Teams mark the beginning of bringing 2D immersive experiences to collaboration. But human presence is the ultimate connection. When you and I can have a meeting where we are all present together without actually being physically present, that’s the next big breakthrough. And we are approaching this thoughtfully because we have learned from similar transitions in the past. Mesh for Microsoft Teams will allow you to connect with presence and have a shared immersive experience directly in Teams.  

Accenture plans to use it to reimagine work:

And of course, these experiences are just incredible when experienced on any VR or AR headset, from Oculus to HoloLens.

The metaverse is not just transforming how we see the world, it’s changing how all of us actively participate in it, and we can’t wait to see what you build and how you bring people together with this technology.

***  

This is only the beginning. Our economy and our society are undergoing a sea change of digitization across every industry, sector, and country.

We’re emerging into a new era where you and the invaluable work you do will be more necessary than ever, and we are building the Microsoft Cloud to help you accelerate into this new world.

I’m inspired every day by so many examples of people everywhere who have used our platform and tools to transform their businesses, their community, and in the process, expanded their own career opportunity. They're turning the structural change born of this moment into new opportunity. That’s our purpose. It’s not about us, it’s about your passion, your imagination, your ingenuity, and what all of you can do with the technologies we build.

One of my favorite examples is the impact so many people are having with Power Platform. In just the past month, nearly 20 million creators have used it to address their own challenges and opportunities, as well as those of their communities and society at large. Here are some of their stories: