Editor's Note: Throughout the month of January, we'll be running installments of Marching Orders, our annual collection of advice and predictions from channel luminaries about what to do and what to expect in the year ahead. For today's entry, we invited Jeff Schwartz, an RCP columnist and editor in chief of RCP's sister publication Redmond magazine, to provide his insights on the most important trends in cloud.
As Microsoft's Azure cloud service turns 6 years old on Feb. 1, the company has entered 2016 gunning to overtake Amazon Web Services (AWS) for cloud supremacy. That's far from a sure thing, but it's the first time the mere suggestion of Azure closing in on AWS isn't preposterous.
Various surveys conducted last year suggest both cloud service businesses grew considerably. Thanks to Amazon's decision to break out its revenues for AWS for the first time, we got a clear picture of how robust the business has become. Based on the third quarter earnings report in October, AWS was on a run rate to conclude the year as an $8 billion business. AWS posted revenues of $2.09 billion, a 78 percent year-over-year increase.
Meanwhile, Azure sales grew 121 percent, with gross profit margins for the unit that includes Azure increasing 194 percent, even counting the company's large expenditures on building out datacenters. In a report by Goldman Sachs last month, the brokerage sized up Azure's run rate at $2.3 billion -- Microsoft has a long way to go to nip at AWS' heels. Given Microsoft's history of staying the course and looking at the ground it has already gained, the race is still on. A recent survey by multivendor cloud management provider RightScale showed the number of AWS users grew from 49 percent to 50 percent last year while Azure usage rose from 11 percent to 19 percent.
In addition to aiming to gain ground on Amazon, Microsoft also must contend with a new push from Google, which has brought on VMware co-founder Diane Greene to revitalize its enterprise cloud efforts. Besides perhaps Facebook, there are no cloud vendors that have built out infrastructure at a scale that compares to Microsoft, Google and Amazon.
For its part, Microsoft has big plans for Azure this year. A new iteration of its public cloud service, Azure Service Fabric (ASF), is set to roll out this year. In addition to letting mid- and large-sized organizations build apps that can scale massively, ASF will enable modern apps based on micro-services and containers, and provide a flexible infrastructure that will let organizations deploy an application on-premises and scale it to the Azure public cloud without making any code changes.
ASF aims to make the Microsoft cloud into the Platform as a Service (PaaS) that led to comparisons of earlier components such as Azure Service Bus and Azure Web Sites as just repurposed versions of BizTalk and IIS respectively, according Jacob Saunders, CTO of 10th Magnitude, a Microsoft Azure partner.
"Our developers are super excited about it," Saunders said, when asked about ASF during a presentation given at the New York City Enterprise Collaboration Meetup gathering last month. "There are even dedicated environments that are going to be coming out with it. The Azure app services are even going to allow you to run those dedicated on your own IaaS-like infrastructure, so even if you're not comfortable with shared infrastructure and some of the negative implications of developing for PaaS, you're going to be able to use that. I think the decision by Microsoft to roll [ASF] into both PaaS and IaaS as a foundation for thin applications that allow developers to focus on their proprietary business logic, and not encoding all that crap on the back end, is going to have a big impact. What that will look like? Time will tell once it's widely available."
Patrick McClory, an AWS expert and director of automation and DevOps at Datapipe (a partner of both providers), said Microsoft has an opportunity to position Azure as an integrated offering compared with multiple AWS toolsets such as API Gateway, Elastic Container Service (EC2), Virtual Private Cloud (VPC), DynamoDB and Relational Database Service (RDS), among others.
"What will truly be the measure of success for Microsoft is how good they are at 'keeping the lights on' with respect to the underlying components needed to support micro-services deployments -- these things could include things as base as the hypervisor, OS and possibly even container solutions such as Docker, all the way to the logging, service discovery and routing tools used to stitch [ASF] micro-services together into usable APIs," McClory said.
Today's AWS approach offers more flexibility, he noted. "I've found that all-in-one packages, in general, have less flexibility and less freedom to make fit-for-purpose types of technology decisions when performance, complexity and partitioning are critically important due to the scale of the solution," he said. "That being said, Microsoft is making a lot of strides in the right direction, and I'm planning on trying it out either way. I think that for organizations who are long-standing Microsoft customers, they're likely to give it a try and find that a solution like this meets their needs for applications that are good fits for this architecture."
Still, he's not convinced AWS will fall from its perch. "Until Microsoft is able to move beyond selling into their current client base, I think that they'll not be an enormous threat to AWS. But with the change in leadership over the last few years, I believe they have all the right things going for them in order to break that mold and get back to being an attractive option for net-new customers."
Historically, a lot of the appeal of Microsoft products for partners was high quality and market strength, in addition to Redmond's commitment to a channel approach. With Azure, it's starting to look like Microsoft is building the type of sturdy bandwagon that partners can jump on and ride.
More Marching Orders 2016:
Posted by Jeffrey Schwartz on January 06, 2016 at 10:44 AM0 comments
This guest blog was written by Lafe Low, an editor for the 1105 Enterprise Computing Group and a former contributing editor to Redmond Channel Partner magazine.
Microsoft partners are intimately familiar with most of the major Microsoft shows. There's the Worldwide Partner Conference (WPC), where partners come together to network and share strategies. Depending on your unique offerings and business proposition, perhaps you've also traveled to Microsoft's Build or TechEd events. Build can certainly help get you up to speed on what's happening in the Microsoft development community. And TechEd, now combined with a number of other IT shows as Ignite, will give you the Microsoft view of how its technology stack fits into current enterprise business models.
There are myriad opportunities throughout the year to expand your professional knowledge and network. If you're ever looking for some higher-level, targeted education on specific development or technology tools, Visual Studio Live! and TechMentor have got you covered. (Full disclosure: These events are produced by the 1105 Media Enterprise Computing Group, which also brings you Redmond Channel Partner magazine and RCPmag.com.)
Here's a look at some highlights of the next Visual Studio Live! in Austin, Texas, coming June 1-4:
- A full-day workshop on ALM and DevOps with the Microsoft Stack
- Building mobile cross-platform apps with C# and Xamarin
- Getting started with universal apps for Windows and Windows Phone
The next Visual Studio Live! event happens in San Francisco from June 15-18. Highlights of this event include:
- Hack-proofing your Web applications
- Solving security and compliance challenges with hybrid clouds
- Load testing ASP.NET and Web API with Visual Studio
Visual Studio Live! and TechMentor also return to the Microsoft campus in Redmond, Wash., this summer. Visual Studio Live runs from Aug. 10-14 while TechMentor runs from Aug. 3-7. Then Visual Studio Live! moves back to New York City in the fall, running from Sept. 28 to Oct. 1.
The flagship event of the year, Live 360! Orlando, brings five events together under one roof. Developers and IT professionals can choose between sessions at SharePoint Live!, SQL Server Live!, Modern Apps Live! as well as the standards Visual Studio Live! and TechMentor. This combined event runs from Nov. 16-20. Check out the agendas for any of these events at http://www.1105media.com/events.html.
Posted by Lafe Low on April 22, 2015 at 8:51 AM0 comments
This guest blog was written by Dave Sobel, director of community for GFI MAX.
The services evolution has driven change in the IT channel for years. Many solution providers started as resellers, where the opportunity for profit came from markup on physical equipment. As the market in physical equipment matured, margins shrank and many discarded their reseller roots and began to focus on providing the services that their customers needed.
In time, those new service providers began exploring ways to make their organizations more efficient and more profitable, and managed services emerged as the leading business model to meet those goals. Managed services transformed the way solution providers did business by combining alignment with customer needs, productivity and efficiency gains, increased margins and business stability.
Today, the services evolution continues as mobility and the cloud add a new complexity to managed services. In a traditional on-premises deployment with a focus on devices such as desktops and laptops, most of which are physically close, this is a natural and understandable engagement model. However, once mobile devices are added to the mix, including smartphones and tablets, the number of devices that need to be managed increases dramatically. Additionally, different devices have varying levels of complexity, and many consumer devices play a role in business environments whether IT administrators like it or not.
At this point, device-focused management presents two major problems. First, consumer devices are traditionally marketed as, and designed to be, "easy to use," resulting in an end user perception that their management is also straightforward. Where there is a perception of "easy to use," it becomes a much more difficult sales proposition for a provider to demonstrate the value of fees for each device. Managing a single device might very well be "easy" in theory, but managing devices in aggregate in a consistent manner is much more challenging. Add the complexity of the large ecosystem of devices, carriers and infrastructure, and service providers are faced with significant loads to manage. The proliferation of devices can cause customers to overthink how they manage their IT environment, cherry-picking devices for management and excluding others in the name of cost savings. This introduces unneeded complexity to the management process and completely undermines the ultimate goal of managed services to align customer and service provider interests.
The second challenge presented by a device-focused management model is that it excludes the various cloud systems that are now key components of the solutions that end users are demanding. In a device-based billing and engagement model, accounting for cloud systems is problematic. By focusing on the user, providers can alleviate much of this tension and realign the end customer and the service provider's interests. However, this requires much more than a simple billing model change. Rather, service providers need to focus on the user experience in order to increase the value of the services being provided. User experience is not just about the devices a user employs, but about ensuring that their data and applications are delivered in a consistent, reliable and secure manner. It's not enough to simply ensure the user's devices work; a service provider needs to ensure that the user is able to effectively use those devices and systems.
There are a number of questions that an MSP should be asking regularly to create a positive user experience. Is their data available at all times? From anywhere? On any device? Are the user's systems and applications available? Can the user effectively use them in as many environments as possible? And additionally, is this data secure? Are corporate policies being enforced? Is the end user and their company aware of all the required data protection laws that apply?
This is the heart of the user experience. Delivering consistent, easy-to-use, secure access to data and systems while managing the complexity of devices, systems, applications and multiple vendors, including cloud systems, is a challenging task. Placing devices at the center blurs the focus and lessens the value of the service provider's offerings.
A resounding chorus of "This sounds hard" may cause some MSPs to avoid preparing for this next stage in their industry's evolution, but if managing user experience was easy, it wouldn't command higher pricing and deliver enhanced profit. In mystery, there is margin, and by embracing the user and their experience as the center of their business, service providers will continue to evolve alongside their customers' needs, ensuring their own success in the future.
Posted on March 17, 2014 at 8:51 AM0 comments
As part of our 2014 "Marching Orders" feature, Ross Brown, senior principal with The Spur Group, gives his take on what partners need to do to succeed in the new year.
In the coming year, two trends will combine to create a perfect storm for partners. First, there's the increasing focus on virtualizing everything (storage, network, compute, memory, sessions and so on). Second is the increasing need for integration and federation between on-premises virtualized workloads and cloud services.
The ubiquity of virtualization is a bonanza for partners because of two compelling and unstoppable forces:
Virtualization-driven flexibility brings significant value to customers.
As with server virtualization, the shifting of account control from the hardware vendor salesforces to the software and services channel that delivers the virtualization solution.
With the server virtualization wave of 2006-2010, we saw a massive shift in power. We started with direct vendor sales teams owning the server sale as a platform lock-in. We ended with the decimation of the value of server homogeneity and the rise of the virtualization integrator.
In 2014, this wave is coming to hit the storage and networking markets with as much force and will shake up the existing hierarchy of vendor-sell/partner-deliver to partner-sell-and-define/vendor-supply.
Compounding and accelerating all this is the new need to federate on-premises applications with cloud services, including Infrastructure as a Service (IaaS). So virtual workloads can migrate from on-premises to cloud and back.
Another driver is application communication models that let cloud events drive on-premises applications -- for example, a new sale in an on-premises enterprise resource planning (ERP) system triggering the close of a record in Salesforce.com. This area is somewhat nascent now, but there's real opportunity here for vertical applications.
Both of these shift the balance of power back to the competent Microsoft partners who focus on getting from a product-based approach to a practice-based approach to value creation. Partners with repeatable IP, formal methodologies and an integration-centric model will grow faster than the market, take share from hardware-centric channels and gain account positions that are defensible into the rest of the decade.
Posted on January 03, 2014 at 8:51 AM0 comments
As part of our 2014 "Marching Orders" feature, Michael Fraser, CEO and founder of VDI Space Inc., gives his take on what partners need to do to succeed in the new year.
We're in a new era of technology with the cloud. The only way to succeed going into 2014 and beyond is to become a business expert using cloud to solve business issues.
With everything in technology morphing into an "as-a-service" model, partners need a high level of business expertise to ensure customers are getting the right solutions for their business needs. The only way to gain expertise is a balance between learning and experience. This means you must be diligent to keep up with what's going on, as well as leverage experts, be they cloud providers, consultants or peers.
Looking at Microsoft, the company is radically evolving its business model. Microsoft understands that business expertise is driving cloud adoption. This also means technical expertise is being pushed more to the cloud providers, which is why IT service companies are being encouraged to take more of a trusted advisor or business-expert role.
The cloud is ensuring organizations are becoming more efficient, getting more value out of every dollar spent, lowering the barrier to entry, getting exactly the resources they need and eliminating the complacent from the channel. If your traits include being technologically enterprising, relationship-building, problem-solving, value-adding, business expertise-giving, you will succeed with the cloud.
Posted on January 03, 2014 at 8:51 AM0 comments
As part of RCP's annual 2014 "Marching Orders" feature, we asked channel insiders to share their insights into what partners need to do to get ready for the new year. Harry Brelsford, CEO of SMB Nation, shares his tips.
Here's the good news: I predict that Microsoft won't extend the April 8, 2014 deadline
for extended support for Windows XP, all of the Microsoft 2003 server products (including Small Business Server) and Office 2003. Why is that good news? We're dealing with humans. Most customers won't be motivated to migrate until the April 8 deadline arrives and passes.
Much of the evangelical outreach we're conducting in the fourth quarter of 2013 to properly plan for an orderly migration before the deadline is great air cover. The real ground war will start in the second quarter of 2014. And that's good news for partners over the next year. Starting now, you can stake out a leadership position on this migration work. It's good work and, if you buy into my thinking, it's essentially mandated by Microsoft as a "must do."
By the numbers, the Windows XP migration opportunity is easy street. First, discover which of your existing clients have Windows XP assets in their IT infrastructure. Then, use customer-facing events like Microsoft Community Connections to acquire new customers for this work. It could add more than $50,000 per technician to your bottom line in 2014.
Posted on January 02, 2014 at 8:51 AM0 comments
As part of RCP's annual 2014 "Marching Orders" feature, we asked channel insiders to share their insights into what partners need to do to get ready for the new year. Mark Seeley, president and senior partner at Intellinet Corp., shares his tips.
Microsoft systems integrators (SIs) have done extremely well in providing excellent technology know-how for the Microsoft product stack. However, as more platforms migrate to the cloud, SIs will need to adapt their business model to the new paradigm.
Delivering with innovation will be key to standing out in a crowded marketplace.
Proactive consultancies will reshape and reimage service offerings in a way that provides true business solutions versus platform solutions. At Intellinet, we shifted our business three years ago to provide end-to-end solutions to clients. From strategy to solutions to support services, we've found the full lifecycle helps us stay connected to customers and deliver greater impact to both the firm's and client's bottom line.
By moving upstream to strategic and business consulting, consultants can ensure strategy and technology solutions map to their clients' actionable business goals, as well as deliver thoughtful platform solutions. When business goals and strategy are established upfront, client leadership is better equipped to communicate a solution's end goals and justify costs, ensuring a smoother delivery process. Once solutions are delivered, providing ongoing maintenance and strategic insights on a regular basis will enable the firm to stay connected to its clients and ensure the success of their investment.
This new breed will redefine "SI" from "systems integrator" to "solution innovator." The SI's DNA will be rooted in business-process excellence and delivering with a mindset of innovation. By providing end-to-end, value-driven solutions on top of sound platforms, these new SIs will continue to be indispensable partners to their clients.
Posted on January 02, 2014 at 8:51 AM0 comments
As part of our 2014 "Marching Orders" feature, RCP asked channel experts to share their best partner tips for the new year. Here are some insights from Keith Lubner, managing partner of Channel Consulting Corp.
Mobility is here. Cloud has been here. What's next?
"Who cares what's next?" should be your mantra. In 2014, those companies who prepare their business to succeed will be successful regardless of the technology flavor of the day.
The old saying, "If you have a solid foundation, you can build anything," was never as true as it will be in 2014. There are three things we see that every solution provider should focus on in order to be well positioned next year, and the year after that:
Turn your sales people into consultants. We preached this last year and actually implemented a tool called Business Guidance which helps accomplish this goal. It's important that sales folks make this change because it will let you focus on quality in your pipeline instead of quantity. Who wouldn't want more quality opportunities? Invest in a program that will help you change your sales culture.
Think of unique ways to partner in order to expand your portfolio in 2014. Here's an example: If you need mobility expertise, there's a risky way to go about it. You can invest in hiring talent (which is tough these days) and invest in the time to spin up a mobility practice. On the other hand, you can partner with custom mobility development firms who are establishing unique channels of their own. I'd recommend the latter, because you can immediately offer mobility specialization to your customers without incurring the tremendous uncertainty in doing it yourself. Partner to buy yourself some time and immediately offer a valuable service to customers.
Reinforce. I can't tell you how many times I hear the line, "We tried that, it didn't work." Well, often the reason a program or initiative or training didn't work was because it wasn't reinforced. That is, there weren't mechanisms put in place to ensure that what is taught is retained. It's just like school. Invest in training but reinforce it in 2014. Your organization will thank you.
A solid business foundation can accommodate any technology trend in 2014 and beyond.
Posted on December 30, 2013 at 8:50 AM0 comments
As part of our 2014 "Marching Orders" feature, RCP asked channel experts to share their best partner tips for the new year. Here are some insights from Mike Harvath, President and CEO, Revenue Rocket Consulting Group.
For the 2014 Marching Orders, I wanted to hear directly from IT services executives about their outlook for the year. I wanted to know where they felt they were well positioned for growth and where they weren't.
We conducted a brief, informal survey among IT services firms. It's very much in keeping with what we hear every day:
- IT Industry in 2014: Two-thirds of executives are optimistic going into the year, while 29 percent are looking to an average year.
- Company Growth Rate: Fifty-three percent are anticipating a healthy growth rate (15-25 percent), 29 percent are looking to be OK (5-15 percent) and 12 percent are expecting a bountiful year with growth over 25 percent.
- Company Net Profit: Forty-four percent are looking for 10-15 percent net profit, 29 percent are anticipating 5-10 percent net profit, and 21 percent are looking for net profit of more than 15 percent.
- Challenges: Respondents ranked their companies' challenges from most to least important: 1) revenue/profit, 2) talent, 3) new customers, 4) competition and 5) vendor relationships.
- Key Growth Strategies: Respondents ranked their companies' key growth strategies from most to least important: 1) organic growth, 2) entering new verticals, 3) M&A, 4) new software partners and 5) entering new geographies.
- Company Rating: Respondents rated their companies in different categories on a scale of 1 (excellent) to 5 (troubling): 2.2 for talent, 2.3 for market position, 2.4 for delivery prowess, 2.7 for financial position and 3.3 for sales and marketing prowess.
- Vendor Impact: When assessing vendor impact, 59 percent of respondents don't expect any impact negatively or positively, while 35 percent expect positive impact.
- Cloud Impact: When assessing how they feel the move to the cloud will affect their businesses, 53 percent expect a positive impact, while 41 percent expect a negative impact.
- Talent Impact: When assessing the technical talent shortage, 50 percent say it's a big problem, 26 percent say it won't have an impact and 24 percent see it as an opportunity.
So from these firms' perspectives, most of the marching orders for 2014 are people-oriented. The most important challenge, as always, is generating incremental revenue and profit. Partners need to get new customers organically, improve the sales and marketing apparatus, and pursue and upgrade technical talent.
Posted on December 30, 2013 at 8:50 AM0 comments
As part of RCP's 2014 "Marching Orders" feature, Ken Thoreson, principal at Acumen Management Group, gives his advice for how partners can succeed in the new year.
As I write this, many of my clients are working through their business-planning process for 2014. Done right, it expands past the one-page business plan and an Excel spreadsheet to a quarterly planning process by department with specific quarterly revenue goals. It also includes specific tactical plans for each partner's various sectors: sales, marketing, delivery and administration. I like to suggest this is their "Business Pizza" -- lots of ingredients broken in to digestible slices.
Focus on talent. Proper human ingredients will make all the difference in your business. It's also the hardest part. Hiring sales, marketing and delivery talent must be your No. 1 focus in 2014. To elevate your performance, you must have quality. Make it a goal to upgrade your talent level. It may take you four months to find the right salesperson who can professionally consult with your prospects by bringing the right mix of business expertise, savvy and a commanding presence.
Test your message. I've spent an enormous amount of time this past year with clients on learning to separate themselves from their competition by developing their marketing messaging and offerings. From thought leadership marketing ideas to vertical knowledge to new value propositions, Microsoft partners must be service-focused and offer levels of expertise that competitors can't match. Keep it grounded, though. Whatever messaging you create, you must be in a position to prove it during the sales process.
Posted on December 27, 2013 at 8:50 AM0 comments
As part of RCP's 2014 "Marching Orders" feature, we asked channel insiders for their best tips for what partners can do to get ahead in the new year. Here are some insights from Howard M. Cohen, senior resultant for The TechChannel Partners' Results Group and an RCP columnist.
The core message of the MPN is to focus, specialize, make big bets and invest in the competencies that really drive your business. Of course, the next question is, "But what about all the other services?"
This is when people bring out the familiar line, "You can't be all things to all people." But you can provide all things to all customers...if you partner.
It's true that you'll stretch yourself too thin if you try to be the best at everything, but you can absolutely provide the best of everything if you take the time to find the right partners. The best way to do that is to join and participate enthusiastically in partner communities. There are several great ones out there:
The International Association of Microsoft Channel Partners (IAMCP) is committed to helping members get the most value out of their Microsoft relationships and learn how to best partner with other members to make more money.
SMBNation has unified the many partners who serve small businesses with one voice and great guidance.
CompTIA is the industry association, the voice of the computer technology channel.
There are others, as well. The most important thing I can tell you is that my own participation in these communities has always helped build the success of my business, and that's the most important thing of all.
Posted on December 27, 2013 at 8:50 AM0 comments
As part of RCP's 2014 "Marching Orders" feature, Jenni Flinders, vice president of Microsoft's U.S. Partner Group, gave some advice to partners regarding the "Devices" part of Microsoft's new "Devices + Services" strategy:
In the New Year, computing will continue to be everywhere and vastly more integrated. Not only will our devices talk to one another, the range of "devices" will expand greatly to include cars, buildings, roads, cities and homes. Our interactions with technology will be more natural and intuitive. Modern devices that enable productivity on-the-go and connect to all the important information you need is one of the key demands from your customers.
The experience of combining Windows 8.1 and the many amazing devices shipping from our original equipment manufacturers (OEMs) is positioning the U.S. channel for great success. Partners must listen to the needs of their customers and find the right devices and services that will work best for their businesses. I encourage all partners to become familiar with all the devices available to offer a customized experience.
When the right devices are paired with how businesses want to work, partners have more opportunities to deliver a complete mobile experience by developing mobile applications. This is an area I believe our partner organizations are poised to lead. It's time to help businesses tackle the mobile adoption curve and help integrate mobility into traditional application-business models.
Resources available to support our partners with this include our MPN disclosure guide, which is a comprehensive look at upcoming changes to programs to support our partners to integrate more closely with us.
We've also developed learning paths aligned to new tracks and updated requirements for the MPN competencies.
Posted on December 26, 2013 at 8:50 AM0 comments