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
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
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
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.
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
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
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 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
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
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
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
Bill Gates is open to spending more time on the Microsoft campus to help the person who becomes the new CEO, but he will not devote 100 percent of his time to being chairman, he said in a wide-ranging interview late Tuesday night.
Gates appeared for the full hour on the "Charlie Rose Show" to discuss his new 25-page report and planned speech at the Davos conference predicting there will be almost no poor countries by 2035.
Toward the end of the interview, Rose spent several minutes asking Gates about the search for the next Microsoft CEO to follow Steve Ballmer, who will step down by next August.
Gates deflected a question aimed at eliciting the profile of a leader who would fit the current demands of Microsoft. "That's not a fruitful speculation," Gates said, then joked both about the board having a "mysterious process" and likened that process to Papal succession by talking about waiting until "the smoke comes out."
Gates expressed his willingness to help and his unwillingness to become a full-time chairman:
ROSE: Are you spending more time at Microsoft now because of the changeovers that are taking place?
GATES: Well, we're in a CEO search, so the board is more active right now, making sure that goes well. Once there's a new CEO, then it'll be up to that CEO if they want me to up my time there a bit for a while.
ROSE: If the new CEO says, 'I need you on campus,' would you be willing to be there and spend full time?
GATES: Not full time. My biggest job is going to be the foundation work, but I would make tradeoffs and spend more time if that was...
ROSE: Now, is it productive for you to spend more time? Because some would say you don't want the guy who founded the firm around. Others would say, yes, you do, because you want a CEO who is strong enough to be his own person to be able to have that.
GATES: It's up to them.
Later in the interview, Rose challenged Gates about Microsoft's lack of succession planning, and that back-and-forth ended with both laughing about the CEO succession problems at Hewlett-Packard:
ROSE: You and I know that often executives are admired if they plan well for succession. It doesn't seem like there's been smart planning for succession at Microsoft.
GATES: Well, I think tech companies are very challenging to run. The rules of what works in one era, that will change. I can't think of a tech company that had some textbook case of succession going on, so I apologize.
ROSE: I was trying to think about Hewlett-Packard, whether that worked?
GATES: Oh my God. (both laughing)
Later in the conversation, Gates answered a question about whether Microsoft needed a young Bill Gates to run it now.
"Microsoft's success was always a team of people. To sort of mythically say I alone did something and now that's missing, that oversimplifies the past and so I think it's a dangerous model for the future. It needs a mix of people. It has wonderful people there. The new leader's going to pick the new direction. That can either be somebody who draws on the technical strength of the people in there or themselves, they might be technical. There are multiple models that you could go down," Gates said.
He also started with the pronoun "she" in describing the next leader, which was probably an artifact of the "he or she" way that Rose phrased the question, but was interesting because few women have been named in public speculation so far about the next leader of Microsoft.
"She has to love, or he has to love, technology and either be good at orchestrating deep technical thinkers or bring some of that themselves," Gates said.
Posted by Scott Bekker on January 22, 2014 at 10:17 AM0 comments
IBM appears to be shopping its x86 server business again and could be within weeks of a deal with Lenovo, according to several reports.
Lenovo, which bought IBM's PC unit in 2005 and has since turned itself into the world's highest-volume PC manufacturer, is in talks with IBM about buying the x86 server unit, according to anonymously sourced reports by Bloomberg and The Wall Street Journal on Tuesday. A few days earlier, the WSJ also reported that Dell was in talks with IBM about the server business.
Lenovo and IBM discussed a potential deal last year, as well, according to both media outlets, but ultimately were unable to agree on a value for IBM's low-end server unit.
According to analysts, IBM is looking to focus on its more profitable service and software businesses, while Lenovo is seeking to diversify into servers for growth as the PC market struggles.
Posted by Scott Bekker on January 22, 2014 at 9:00 AM0 comments