You can build on their stuff but you won't scale and you won't grow, not because their technology doesn't scale, but because their licensing doesn't scale.
What about their licensing for Azure? Does that scale or is it more of the same?
I don't think it's entirely clear yet what direction Azure will take. The base offering using only .NET and Windows with simple storage is priced almost exactly the same as google app engine. It's difficult to compare to Amazon because the architecture is so different. Google and Azure (I believe) won't let you do any serious computation in memory whereas Amazon does support that very well.
However, look at SQL Azure. Microsoft thinks that their SQL offering is worth paying 66 times what you pay for google's database (or Azure BLOBs&Tables) and that's just for storage alone ($1 per GB, maxing out at 10GB right now). Add data transfer and you may get to 100 times.
Yes SQL Server has vastly more features than google's db, but does it make me 100 times more productive or profitable? I don't think so. If I need more SQL features I could run Postgres on Amazon or use Amazon's MySQL service for roughly 10% of what SQL Azure costs.
So if SQL Azure is the model of what's to come then I think it's indeed more of the same.
What about their licensing for Azure? Does that scale or is it more of the same?