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Microsoft Hikes Action Pack Price by up to 44 Percent

One of the best not-for-resale software deals in the channel is getting a hefty price hike, although it's still a relative bargain.

Microsoft this week unveiled the long-awaited changes to the Microsoft Action Pack, one of the most popular components of the Microsoft Partner Network.

One of the biggest changes is the price, which is going up by as much as 44 percent.

Starting Feb. 24, the Action Pack subscription will cost $475 in the United States. The new subscription price consolidates pricing from what was previously two packages -- the $329 per year Action Pack Solution Provider (APSP) and the $429 a year Action Pack Development & Design (APDD). The new cost is a 44 percent increase for former APSP subscribers and an 11 percent bump for APDD subscribers.

Next month, all partners will subscribe to one universal Action Pack, and choose among five tailored business model packages: application development and design, device design and development, hosting, managed services, professional services or reselling.

The core value of the Action Pack is internal-use Microsoft software licenses to support a 10-person partner business. Those include full licenses for Windows desktops and servers, as well as other server products, such as SQL Server, Exchange Server, SharePoint Server and Lync Server.

At the same time, the Action Pack will soon replace Cloud Essentials as the least expensive way for partners to get internal-use seats of Office 365, Dynamics CRM Online and Windows Intune and Windows Azure usage credits. In that case, the Action Pack is an even bigger price jump because Cloud Essentials, which will be discontinued June 30, was free.

Where the on-premise default in the Action Pack is for 10 seats, Microsoft is being slightly stingier with cloud licenses. Subscribers get five seats each of the E3 SKU of Office 365 and of Windows Intune. Dynamics partners are also eligible for five seats of Dynamics CRM Online. The subscription also includes $100 in monthly Windows Azure credits.

However, Microsoft offers a few ways for subscribers to increase their seat counts for Office 365. One is to trade some of the on-premise core benefits for Office 365 seats. Another way is an incentive -- partners are eligible for another five seats of Office 365 if they've sold 25 seats of Office 365 to customers in the last 12 months.

Other benefits included in the Action Pack include technical support, developer tools, marketing campaign materials and services and $100 in Bing advertising credits for the subscriber and $500 for the subscriber's customers.

Posted by Scott Bekker on January 31, 2014 at 11:32 AM0 comments


IAMCP U.S. Chapter Names New Top Officers

The U.S. chapter of the International Association of Microsoft Channel Partners (IAMCP) passed the baton to two new top officers this week.

"Congratulations to the new U.S. president, Jon Sastre, and vice president, Ro Kolakowski. The new leadership team [for] IAMCP US was installed today," wrote outgoing IAMCP U.S. President Rudy Rodriguez in a LinkedIn post Wednesday.

Sastre had served as vice president of the IAMCP during Rodriguez's term. He is president of Conquest Technology Services Corp., a Miami-based company specializing in Microsoft unified communications, Office 365 and managed services.

Kolakowski is a partner at 6th Street Consulting, a Los Angeles area consulting and managed services firm and Microsoft's 2013 Partner of the Year winner for Collaboration and Content.

The IAMCP was formed in 1994 as a peer-to-peer networking organization for best-of-breed Microsoft partners and to give those partners an organized feedback mechanism to communicate partners' needs and concerns to Microsoft in a unified way. The U.S. chapter, one of five country or regional chapters in the worldwide organization, has 36 sub-chapters and 844 members in the United States.

Rodriguez's note also thanked members for more than two years of support at IAMCP and encouraged them to stay tuned. "The new board has an aggressive agenda and will need our support in continuing [to] grow our relationships with Microsoft and helping our partners grow their business," Rodriguez said.

The IAMCP's semi-annual board meeting is scheduled for Feb. 22-23 in Washington, D.C., where Microsoft will also hold its Worldwide Partner Conference in July.

Posted by Scott Bekker on January 30, 2014 at 3:13 PM0 comments


Open Licensing Coming for Windows Intune, Power BI

Partners will have the opportunity to bill their own customers for Microsoft's Windows Intune service and the soon-to-be-released Power BI service starting in April.

"Windows Intune will be available for resale through Open Volume Licensing beginning April 1, 2014.  Intune joins Office 365, and the upcoming Power BI for Office 365 offer, as the latest in our suite of cloud services available for resale," wrote Lori Dennis, senior director, Server & Cloud Breadth Channel Marketing, in a blog post this week.

Windows Intune is Microsoft's cloud-based device management service, which will be getting a minor update next week. Power BI is a suite of mostly online components designed to help Excel users create visualizations from data. Power BI was announced at the Microsoft Worldwide Partner Conference (WPC) in July and is expected to be released early this year. Microsoft revealed Power BI pricing earlier this month.

With online products, the Open Volume Licensing approach allows partners to buy the license for Microsoft products on behalf of the customer and then bill the customers themselves. Partners argued for years for the ability to bill their own Office 365 customers -- saying owning customer billing both gave them more peace of mind that Microsoft wouldn't poach accounts and gave partners the ability to bundle services, including Office 365, together and present customers with one price, which also allows them to set their own margins.

Microsoft granted partners billing capability for Office 365 in the spring of 2013, although it only applied to Office 365 and not to Windows Intune.

Partners have generally responded positively to the Open licensing opportunity with one major caveat: As it's currently constructed, partners must pay for an entire year's worth of the license upfront on behalf of customers who are mostly interested in monthly payments.

Posted by Scott Bekker on January 30, 2014 at 3:10 PM0 comments


Templeton To Step Down from Citrix Within a Year

Citrix Systems Inc. is looking for a new CEO.

Mark Templeton, who has been the public face of Citrix for more than a decade, is returning from a leave of absence, but intends to retire within the next year, subject to naming a successor, the company announced Wednesday.

Templeton went on a leave in October, following the death over the summer of his youngest child, Pierce, 27. Executive Vice President and Chief Financial Officer David Henshall filled in as acting CEO.

Templeton is returning to the CEO role, and the Citrix board of directors has started a search process to find the next CEO. Henshall has been promoted to chief operating officer, and will also retain his previous titles.

"I would like to express my deep appreciation to the board of directors for allowing me time to support my family," Templeton said in a statement. "I remain fully committed to Citrix until my successor is named and the CEO transition is complete."

According to his company bio, Templeton joined Citrix in 1995 as vice president of marketing and became president in 1998 and CEO in 2001.

"Under his leadership, Citrix has been transformed from a $15 million organization with one product, one customer segment and one go-to-market path, to a global powerhouse," the bio states.

On Wednesday, Citrix reported revenues of $2.92 billion and net income of $340 million for all of 2013. The company has also built a powerful channel presence in that time, with an estimated 10,000 business partners.

Posted by Scott Bekker on January 30, 2014 at 10:11 AM0 comments


Lenovo To Buy Motorola Phone Business from Google

Less than a week after reaching a deal to buy IBM's x86 server business, Lenovo turned around and cut a deal with Google for the Motorola Mobility smartphone business.

In a deal announced Wednesday, Lenovo will pay approximately $2.91 billion for the smartphone business.

Google will hang on to a "majority" of the patent assets, which was one of the main reasons Google bought Motorola for $12.5 billion in a deal that closed in May 2012. Google CEO Larry Page had said when the deal was announced in August 2011, "Our acquisition of Motorola will increase competition by strengthening Google's patent portfolio, which will enable us to better protect Android from anti-competitive threats from Microsoft, Apple and other companies."

Lenovo's purchase will involve $1.41 billion at close, including $660 million in cash and $750 million in Lenovo stock, with the remaining $1.5 billion coming via a three-year promissory note.

The fact that Google is selling Motorola's handset business for about a quarter of the price that it paid shows which part of the business (patents versus phone manufacturing) Google values more. Lenovo will receive more than 2,000 patent assets and a license to use the larger cache of patents that Google is retaining.

Last Thursday, Lenovo and IBM reached a $2.3 billion deal for IBM's x86 server business.

If the Google deal closed today, Lenovo would be the No. 3 Android smartphone manufacturer in the United States and also command strong positions in the Latin American and Western European markets, according to Lenovo.

"The acquisition of such an iconic brand, innovative product portfolio and incredibly talented global team will immediately make Lenovo a strong global competitor in smartphones. We will immediately have the opportunity to become a strong global player in the fast-growing mobile space," said Yang Yuanqing, chairman and CEO of Lenovo, in a statement.

Yuanqing said Lenovo's experience at "embracing and strengthening" the IBM Think brand after acquiring IBM's PC business in 2005 will serve the Chinese company well in integrating the Motorola business.

In a statement, Page also indicated that Lenovo's previous experience with the PC business was important to Google, as well. "Lenovo has the expertise and track record to scale Motorola Mobility into a major player within the Android ecosystem. This move will enable Google to devote our energy to driving innovation across the Android ecosystem," Page said.

If the deal clears regulatory hurdles, and Microsoft's Nokia deal also goes through, it will leave Microsoft alone as a vendor with both an OEM business model for its smartphone OS and its own handset manufacturing division. When Google acquired Motorola, there had been speculation that the move would scare away other handset manufacturers. However, Android smartphone sales have continued to rocket upward and Samsung, rather than the Google-owned Motorola, has been dominant.

Meanwhile, it could mean that Lenovo, one of Microsoft's most important OEM partners in the PC and, soon, the server business, would be a serious rival to Redmond on smartphones.

Posted by Scott Bekker on January 29, 2014 at 3:40 PM0 comments


Office 365 Tool Tells Partners About Customer Service Outages

Microsoft partners managing the Office 365 service on behalf of customers now have a tool that will help them keep on top of Microsoft service outages, potentially before angry calls from customers start flooding in.

Microsoft unveiled the Office 365 Partner admin center this week and plans to roll it out worldwide over the next few weeks.

The product is not only a service-outage notification service for partners. According to a blog entry by Adam Jung, a senior product manager on the Office 365 team, the tool has four main functions. In addition to being able to view customers' Office 365 service health status and details, the partner admin center allows partners to get a single view of all the customers they have delegated admin privileges for; create, edit and view service requests on behalf of customers; and perform administrative tasks on behalf of customers.

For partners, the tool supersedes an Office 365 admin center that didn't consolidate all of a partner's customers and was more focused on selling new or additional services. "Previously, with Partner tools in the Office 365 admin center, you could perform delegated administration tasks on behalf of customers and create trial invitations, purchase offers and offers for delegated administration," Jung wrote.

[Click on image for larger view.] Drilling into the "service health" tab of the new Office 365 Partner admin center shows the status of various customer services at a granular level.

Assuming the new admin center works as advertised, with accurate and timely service outage updates from Microsoft, the tool could greatly help partners provide the kind of visible value to customers that will help them retain their Partner of Record status with those customers and keep their Microsoft maintenance fees rolling in year after year.

According to screenshots of the interface, a "client management" tab will show all of a partner's customers along with any alerts next to each customer's name about their service health. Drilling into the "service health" tab for each customer shows a granular list of the services a customer uses.

Each service has a green check mark for the day if all is well, or one of a number of symbols if all is not well. Trouble signals include service interruption, service degradation, restoring service, extended recovery, investigating, service restored or additional information.

"This gives you better visibility into events or issues that may be impacting a customer's environment, including existing incidents and upcoming planned maintenance events," Jung said.

Posted by Scott Bekker on January 29, 2014 at 11:26 AM0 comments


It's Awards Season for Microsoft Partners

One of the best ways to get attention from customers and from the key contacts within Microsoft who can really move the needle on your business is by winning a Microsoft Partner Award.

These are the big ones that Microsoft announces in July at the Microsoft Worldwide Partner Conference, bringing the partners across the stage in a long, multinational parade. Behind the scenes, Microsoft organizes press meet-and-greets with the winners and markets those winners to potential customers.

Yes, big, well-connected partners win repeatedly -- but many smaller partners, especially those with tightly focused practices, make the list each year, too.

Eric Ligman posted a lengthy blog entry this week going through this year's categories and rules. Check it out here.

Posted by Scott Bekker on January 27, 2014 at 10:50 AM0 comments


Do the Office 365 Payment Cuts Mark a Sea Change?

Reviewing Microsoft's quarterly results, one analyst is noting that Microsoft's entrenched position with customers and partners gives Microsoft the leeway to change its strategy to Devices and Services while comfortably raking in revenues.

But the analyst, Matthew Casey of Technology Business Research, wonders in a commentary if Microsoft's planned reduction in Office 365 referral payments, scheduled to take effect Jan. 25, marks the start of a new relationship with the channel overall:

"Microsoft's model for engaging with channel partners to distribute software solutions will continually evolve as Microsoft's applications become increasingly cloud based. This evolution was demonstrated in 4Q13 [Microsoft's 2Q14] as Microsoft announced 15-50% cuts to cloud sales commissions for its partner ecosystem, opting to begin rewarding channel partners for value-add innovation and services around solutions such as Office 365 as opposed to a referral based model. While partners will have less monetary incentive to simply resell Microsoft's products, the continued demand for Microsoft solutions as standard core business applications will help sustain the base of channel partners by demonstrating the viability of Microsoft's cloud solutions as sustainable business drivers for partners."

Posted by Scott Bekker on January 24, 2014 at 11:23 AM0 comments


Intermedia Offers Standalone Cloud E-Mail Archiving

Intermedia is uncoupling cloud e-mail archiving from its own version of Hosted Exchange, allowing partners to offer archiving to customers running Microsoft Office 365, Google Mail, on-premises Exchange, IBM Notes, GroupWise and other mail platforms.

"With standalone Email Archiving, our partners have another path to capitalize on a multi-billion-dollar, high-growth market, while helping their customers reduce business, legal and compliance costs," said Michael Gold, CEO of Mountain View, Calif.-based Intermedia, in a statement announcing the offering this week.

Intermedia launched the Email Archiving service about a year ago for its Hosted Exchange solution. Hosted Exchange anchors Intermedia's Office in the Cloud, which also features Hosted PBX, SecuriSync file sync and share, security and mobility services.

In an interview with RCP late last year, Gold was most excited about the SecuriSync technology, a business-grade competitor to Dropbox that Intermedia launched in October. However, he said at the time that archiving was exceeding the company's expectations.

"The compliant-archiving is something we launched earlier this year. We had anticipated that a tiny percentage of our customer base would want that -- law firms, e-discovery. It's turned out that's been attractive across a broader set of our customers," Gold said of the original version, which was tied to Intermedia's own Hosted Exchange offering.

Intermedia has about 90,000 customers and 750,000 users with data spread across 10 datacenters in three countries. Those customers are served by 600 employees and some 13,500 channel partners. Intermedia claims to be the largest provider of hosted Exchange outside of Microsoft.

Partners manage the new standalone Email Archiving service from the same Partner Portal they would use for other Intermedia products.

Posted by Scott Bekker on January 23, 2014 at 4:40 PM0 comments


Third-Platform Drama: BlackBerry Surprises, Nokia Disappoints

Over the last few quarters, Microsoft seemed to be solidifying its position as the third platform in the smartphone world.

All the action is at the top -- between Google's Android platform, with Samsung as the major handset maker, and Apple with its integrated iOS/iPhone combination. But Microsoft had slowly climbed its way past a badly stumbling BlackBerry to grasp the No. 3 platform mantle in terms of new device shipments per quarter -- although it was a distant third.

Now BlackBerry, largely given up for dead, is showing surprising signs of life, and Windows Phone sales mysteriously stalled in the fourth quarter.

BlackBerry enjoyed a stock surge this week after the U.S. Department of Defense said that its new secure network would primarily support BlackBerry devices, with about 80,000 of the Ontario, Canada-based firm's devices eventually expected to be hooked up to that network. New BlackBerry CEO John Chen is recommitting to the original physical keyboards and historical markets like business and government.

As big as an 80,000-seat contract is, that's 1 percent of the number of Windows Phones Nokia sold in the fourth quarter, the Finnish company revealed today in its earnings release (.PDF).

Unfortunately, the 8.2 million new Lumia phones Nokia sold in the fourth quarter of 2013 is a sequential drop from the 8.8 million Lumias sold in the third quarter. That's a big fumble coming in the critical, and usually bountiful, holiday season by the partner whose phone business Microsoft is acquiring.

For four consecutive quarters, Microsoft made big sequential gains, and staying on that trajectory would have put the Microsoft/Nokia combo well over 10 million devices for the fourth quarter of 2013. Microsoft and Nokia, which accounts for around 90 percent of the Windows Phone market worldwide, need to continue at that growth rate to become contenders in the global smartphone market.

One BlackBerry deal doesn't make a turnaround, and one bad quarter for Microsoft/Nokia isn't a disaster. Looked at another way, Nokia sold more than twice as many Lumias in Q4 2013 as it sold in Q4 2012. But suddenly the narrative shifts to whether Microsoft can hang onto the No. 3 spot rather than whether it can consolidate its position and start moving toward No. 2.

Posted by Scott Bekker on January 23, 2014 at 3:59 PM0 comments


IBM, Lenovo Reach Terms on x86 Server Business

Looking to exit a commodity hardware business, IBM turned again to Lenovo.

The computer giants on Thursday said they'd reached a $2.3 billion deal for IBM's x86 server business, confirming reports from earlier this week that IBM and Lenovo were close to an agreement. Lenovo will pay about $2 billion in cash, with the balance consisting of Lenovo stock. The deal will face regulatory reviews before closing.

The arrangement echoes IBM's sale in 2005 of its PC manufacturing business to Lenovo, which has turned the acquisition into the world's largest PC business by shipments. That PC deal involved $1.25 billion in cash and an 18.9 percent equity stake in Lenovo for IBM, which Big Blue gradually sold down.

IBM, which just reported a double-digit year-over-year decline in x86 server sales in its most recent quarter, has been thought to want to get out of low-end server sales and was also rumored to be in talks with Dell about selling that part of the business.

"This divestiture allows IBM to focus on system and software innovations that bring new kinds of value to strategic areas of our business, such as cognitive computing, Big Data and cloud," said Steve Mills, senior vice president and group executive for IBM Software and Systems, in a statement. In explaining the deal, IBM pointed to its own recent investments of $1 billion in the new IBM Watson Group for cloud cognitive computing and a $1.2 billion expansion of its global cloud computing infrastructure.

Lenovo, meanwhile, is looking for ways to expand beyond the global PC business, a shrinking category over the last few years as tablets and smartphones have out-competed PCs for much consumer and substantial corporate spending. Lenovo also has a division for manufacturing tablets and handsets.

"This acquisition demonstrates our willingness to invest in businesses that can help fuel profitable growth and extend our PC Plus strategy," said Yang Yuanqing, Lenovo chairman and CEO, in a statement.

Lenovo will acquire IBM's System x, BladeCenter and Flex System blade servers and switches, x86-based Flex integrated systems, NeXtScale and iDataPlex servers. IBM will keep its System z mainframes, Power Systems, Storage Systems, Power-based Flex servers and appliances under the PureApplication and PureData brands.

Lenovo will assume customer service duties upon closing of the transaction and will gradually take over maintenance in a handover process from IBM. According to the companies, approximately 7,500 IBM employees around the world are expected to be offered jobs at Lenovo.

The companies also plan to enter a storage and software partnership. Lenovo is supposed to become a global OEM and reseller for IBM entry-level and midrange disk storage systems, tape storage systems, General Parallel File System software, the SmartCloud Entry offering and some system software.

As fits its now-sharper focus on software and services, IBM said it plans to continue to develop its Windows and Linux software portfolio for the x86 platform.

Posted by Scott Bekker on January 23, 2014 at 2:24 PM0 comments


Microsoft's Head Fake on Windows XP Support

Did Microsoft just blink on security support for Windows XP?

Windows XP's extended support phase officially ends on April 8. The company has used a lot of tough talk over the last few years to make sure that all customers know that deadline is coming and that it means that from April 9 onward, keeping Windows XP PCs online is an invitation to cyberattacks because there will be no more security updates from Redmond.

Beyond that, Microsoft has been running customer and partner campaigns with the messaging that no amount of patching would make the dozen-year-old Windows XP as secure as more modern OSes like Windows 7 and Windows 8, anyway.

Then comes the odd decision unveiled last week that Microsoft will continue to provide signatures for malware on Windows XP through July 14, 2015. Those signatures will be delivered through Microsoft security and management products like Forefront Client Security, Forefront Endpoint Protection, System Center Endpoint Protection, Windows Intune and the free Microsoft Security Essentials.

I'm concerned that Microsoft's least sophisticated customers will misinterpret this move as an extension of Windows XP support. It's not.

Security experts order the priority of security steps very clearly. It's operating system and application patches first, virus/malware protection software installation with regularly updated signatures second.

What Microsoft has not done is change its decision on whether to keep patching Windows XP after April 8. So far, all indications are that it won't -- and it will be open season for the creation of zero-day attacks for Windows XP. All that signature support through July 2015 won't help much with that. (See Kurt Mackie's in-depth report here for more.)

Microsoft's announcement of the decision acknowledged as much. "Our research shows that the effectiveness of antimalware solutions on out-of-support operating systems is limited," the Microsoft Malware Protection Center blog post stated. In explaining the strange decision, the blog post said the move was intended "to help organizations complete their migrations."

The bottom line is that Microsoft hasn't blinked on the most important part of Windows XP support. But it has done a head fake that's probably going to fool some of the reported 29 percent of remaining Windows XP users into thinking that it's OK to procrastinate a little bit longer.

The longer all those laggard organizations wait, the more dangerous the Internet is for them and, because of their infected zombie computers, for the rest of us.

Posted by Scott Bekker on January 22, 2014 at 9:40 AM0 comments