Microsoft is leveraging its growing cybersecurity capabilities to drive additional business for its core productivity suite, a top executive said Tuesday.
Justin Spataro, Microsoft's corporate VP of modern work, told the UBS Global TMT Conference that security, followed by compliance, are the biggest drivers of growth in the Microsoft 365 E5 business.
“So think of what we are doing right now in security is taking on a very fragmented space with a consolidation play,” Spataro said at the conference. “That’s been our play in security since the beginning.”
Microsoft uses its security capabilities to secure email or Teams (videoconferencing and chat) applications as well as other applications, he said during the conference.
Karl Keirstead, managing director of software equity research at UBS, said during the discussion that growth rates at software companies have been under pressure recently.
Rival security providers like Palo Alto Networks and CrowdStrike have discussed the growing trend of customers looking to consolidate the number of security applications they use, as sprawl has become a major concern amid a shortage of qualified operations staff.
Spataro said 12% of the Office 365 install base is in the ME5 category, and the No. 1 driver is security, a trend that is not expected to let up for a number of months.
“Security demand continues to increase for us, and security continues to be more and more complex for companies to administer,” Spataro said.