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Could the switch from Microsoft’s Azure Blockchain to ConsenSys’ Quorum Blockchain Service be a positive thing? Is this the future of the corporate blockchain industry?
Similarly to how the bitcoin business is continuously growing and evolving, the corporate blockchain business has recently seen a number of advancements. Enterprise blockchain solutions have lately shifted from private, locked networks to public, open platforms. This is partly owing to Ethereum network advancements, which provide improved privacy, scalability, throughput, and other benefits to commercial customers.
A new industry analysis report demonstrates this shift, noting that the global blockchain technology market size is expected to reach $72 billion by 2026, rising at a market growth of 51.8% CAGR during the forecast period. Interestingly enough, findings from the report show that during 2020, the public enterprise blockchain market segment emerged as the leading model with the highest share in the global market.
As more commercial blockchain solutions migrate to public networks, Microsoft has stated that its Azure Blockchain Service is transferring users to alternative options. It’s worth noting that Microsoft’s Azure Blockchain began as a sandbox-style service on Ethereum in 2015, in collaboration with ConsenSys. The system was made available in 2019 as a fully managed blockchain-as-a-service, or BaaS.
Fast forward to 2021, and a recent blog post from Microsoft states that Azure users must now “migrate ledger data from Azure Blockchain Service to an alternate offering.” The article further recommends for users to move to the Quorum Blockchain Service, or QBS.
QBS is a managed product on Azure by ConsenSys that supports Quorum as a ledger technology. Quorum enables corporate clients to create blockchain solutions on both the public Ethereum mainnet and private networks.
ConsenSys’ global president of sales, Emmanuel Marchal, told Cointelegraph that given ConsenSys’ ownership of Quorum and the company’s long-term partnership with Microsoft, it makes sense for Microsoft to join ConsenSys:
“ConsenSys is providing migration from the Azure Blockchain Service to the Quorum Blockchain Service offered on Azure. This has always been a part of our strategic relationship, to make sure that Azure customers have an enterprise-grade managed blockchain service with Quorum.”
Marchal went on to say that ConsenSys has been focused on bringing unique technologies to market since acquiring Quorum from JPMorgan last year. Having a managed service for Quorum is part of this. Marchal stated that “It makes sense to transition the Azure Blockchain Service users to QBS as the recommended migration strategy.” based on the strong partnership between ConsenSys and Microsoft.
As a result, Marchal stated that ConsenSys has been actively engaging with dozens of Azure Blockchain users to assist them in planning their migration to QBS. “The goal is for a collaboration between Microsoft and ConsenSys to ensure a seamless migration from one service to the other,” he explained. Microsoft declared that its Azure Blockchain Service would be “retired” on September 10, and that users must be transferred to QBS or another service before that date.
Is this good news for Microsoft?
Although the closure of Microsoft’s Azure Blockchain Service may appear to be a setback, Marchal sees it as a step forward. “ConsenSys continues to use open-source Quorum technology. Moving forward, Azure Blockchain Service users that utilize that private technology will be in excellent hands with ConsenSys, and we are confident in this move.”
Moreover, from the Microsoft Azure Blockchain Service user perspective — which includes major corporate customers such as JPMorgan, GE Aviation, Singapore Airlines, Starbucks and Xbox — the migration to QBS may not have much of an impact. For instance, global blockchain lead at Ernst & Young (EY) Paul Brody told Cointelegraph that the Big Four firm’s program with Microsoft and Xbox remains unchanged:
“The Microsoft program to migrate software contracts for the Xbox ecosystem to Ethereum-based smart-contracts continues to gain steam, with over 300 companies now integrated.”
Azure SQL adds an immutable ledger
Coincidently, Azure SQL — a managed cloud database provided as part of Microsoft Azure — is incorporating a ledger feature. This development was recently announced at Microsoft’s Build 2021 developer event.
According to a Microsoft blog post published on May 25, the “Azure SQL Database ledger” will add tamper-evident capabilities to Azure SQL databases. The post further states that the Azure SQL Database ledger will provide a “simpler solution for centralized systems where strengthening trust between parties is required.”
It should also be highlighted that the Azure SQL Database’s ledger functionality does not necessitate any data movement or adjustments to user applications. “You can enable ledger functionality on tables in your database and interact with them the same ways you would for any other tables,” according to the post.
While significant, the Azure SQL Database sounds strikingly comparable to Oracle’s recently announced crypto-secure data offering. According to Juan Loaiza, executive vice president of Mission-Critical Database Technologies at Oracle, the company has developed a crypto-secure data management product that makes use of “blockchain tables” within the Oracle database. Loaiza further pointed out that this functionality differs from Oracle’s blockchain technology, which is based on Hyperledger Fabric and is frequently used for supply chain management.
This in mind, another possible enterprise blockchain trend moving forward may be the incorporation of immutable ledgers to enterprise-grade databases, as already demonstrated by both Oracle and Microsoft.
Will more enterprises shift to public systems?
Regarding Microsoft’s move to a solution powered by enterprise Ethereum, Brody noted that EY is witnessing a general trend in which firms are turning their attention toward public blockchains and closing down their private-blockchain-centric hosting operations. “With nearly 15,000 nodes for Bitcoin and Ethereum running out there,” he continued, “everyone is seeing the much larger public business as the priority.”
Although this is the current trend, it is important to highlight that certain corporate solutions continue to rely on private networks. According to Kareem Yusuf, general manager of IBM AI Apps and Blockchain, corporations are continuing to invest in blockchain networks, and many choose permissioned blockchains to tackle difficult industrial challenges:
“Among enterprises, collaboration and trusted data sharing are essential, and for many, permissioned networks provide the assurance they require. In the future, we expect that we’ll see more intersection of public and private networks.”