Microsoft on Thursday introduced Azure Functions, a "server-less compute" service designed for Internet of Things and other event-driven applications.

Azure Functions allows developers to create apps that automatically respond to events, useful in IoT as well as web, mobile and big data apps, company officials said at the Microsoft Build 2016 developer conference in San Francisco.

Microsoft is open sourcing the runtime for Azure Functions, Scott Guthrie, Microsoft chief of cloud and enterprise, said at a keynote Thursday morning.

Microsoft also announced general availability of Azure Service Fabric, its next-generation platform-as-a-service (PaaS) platform. Service Fabric lets applications be decomposed into microservices, for increased availability and scalability. And, it unveiled Service Fabric for Windows Server, Linux and Java APIs, for private and hybrid clouds, and said it will open source the Linux software later this year.

Enterprises looking to get started with Azure for IoT can buy an IoT Starter Kit, unveiled Thursday, for $50 to $160.

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Also, Microsoft launched its Power BI Embedded service for Azure to let developers embed interactive reports and visualizations for applications.

Functions will compete with AWS Lambda, a similar service that allows cloud apps to automatically respond to events. Like Lambda, Functions is pay-as-you-go -- users are charged nothing when applications aren't running, and cost scales up with the app.

Microsoft is streaming the developer conference live on the web. Azure CTO Mark Russinovich is scheduled to speak at 6:30 p.m. PDT.

— Mitch Wagner, , West Coast Bureau Chief, Light Reading.