According to this article in ETCIO, Microsoft's secret weapon to beat Amazon in the cloud is "Azure Stack, a product that lets you build your own version of the Microsoft Azure cloud on your own servers or data center."
They describe Azure Stack as a solution that for all intents and purposes works like Azure, including its efficient resource utilization and developer tools. Since it's the same set of tools and infrastructure, Neil says, it makes it simple to pick up and move an application or a swath of infrastructure and move it from an Azure Stack installation in a local data center and into the Azure public cloud.
The article summarizes the opportunity by stating that this service will be in high demand for enterprise customers to transition their on premise infrastructure to the cloud and even smaller customers might be interested in taking advantage of a service like this. It also states that Google and Amazon don't have any products in place today or in the near future that can provide the capabilities of Azure Stack.