Microsoft's hybrid cloud strategy will gobble up more corporate IT budgets - while companies like Oracle, Cisco, and Dell stand to lose the most

• Microsoft has the largest expected IT budget gain over the next three years, according to results of a Morgan Stanley survey of technology executives.
• VMware, Cisco, Hewlett-Packard Enterprise, Oracle, and Dell stand to lose the most.
• Morgan Stanley predicts overall IT budget growth to slow in 2020
• Microsoft's gains are expected to be driven by the company's hybrid cloud investments, which CEO Satya Nadella talked about this week.
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Morgan Stanley expects Microsoft to gain the largest percentage of IT budgets through the next three years, while VMware, Cisco, Hewlett-Packard Enterprise, Oracle, and Dell stand to lose the most.

The expectations, released Wednesday, are the conclusions from Morgan Stanley's fourth-quarter survey of chief information officers from 100 US and European companies, which also expects overall IT budget growth to slow in 2020.

CIO surveys are a common measure financial firms use to predict where companies plan to spend their money when it comes to enterprise technologies such as cloud computing.

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VMware, Cisco, Hewlett-Packard Enterprise, Oracle, and Dell are expected to lose the largest incremental percentage of IT budgets over the next three years "as a result of the shift from on-premise workloads to the cloud," the survey found.

Microsoft's expected gains over the next three years are "driven by an increasing proportion of customers citing Microsoft as their preferred hybrid cloud vendor."

Morgan Stanley's CIO survey results follow a similar survey from Goldman Sachs, which found more CIOs from large companies say they use Microsoft's Azure cloud now and expect in the future, compared to rivals Amazon Web Services and Google Cloud.

Microsoft's hybrid cloud strategy

The results are a good sign for Microsoft's hybrid cloud strategy.

Microsoft's approach to computing, CEO Satya Nadella told reporters at a media event earlier this week, emphasizes a balance between public and private resources.

Analysts have said the hybrid cloud is Microsoft's biggest opportunity to overtake industry-leading Amazon Web Services, which only relatively recently began investing in the space.

Nadella also said he believes Microsoft's hybrid cloud investments are the reason the company won the Pentagon's $10 billion JEDI cloud computing contract over AWS. AWS, meanwhile, is challenging the decision and alleging political bias interfered in the process.

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