We've been wondering aloud here for a while just how significant the opportunities are for Microsoft partners to profit from Redmond's cloud efforts. Microsoft's recent cloud-heavy win in New York City -- accomplished directly, sans channel involvement -- had us pondering that issue again recently. But reader Al offers a thoughtful perspective as to why Microsoft had to go solo in Gotham and why partners can still succeed with Microsoft in the cloud:
"Realistically no partner could have pulled this off except for MSFT themselves. Most partners are not even up to speed on MSFT's latest technologies and have the practice of waiting until the 'first service pack' before even delving into a new technology. No matter how promising it is. The details, promises, guarantees, specifications, support and security concerns are all for MSFT and only MSFT to answer. It's that simple. Bottom line -- ONLY Microsoft could have done 'this' deal. I congratulate them. Very often MSFT stands by the sidelines and watches the teams lose.
This is an opportunity for partners. MSFT will be a 'platform provider.' Now the platform will be there and the smart partners with strong cloud offerings will have opportunities. That part of the deal is not really Microsoft's business model and presents opportunity for the MSFT partner community. That is, for the few, truly progressive MSFT partners.
The cloud is the future. There is no question about it. Government and corporate have done a near-miserable job of deploying and maintaining infrastructure, keeping it fresh and keeping it secure. There is no doubt about this whatsoever. I know for a fact NYC is a litany of disparate technologies, solutions and even platforms. In simple terms, it is a mess and it is dysfunctional. This is an opportunity for the city to reinvent itself and gravitate to the new normal, while providing its citizens with better services than ever. All this while making available interfaces that vendor communities could use for excellent information and saving huge bucks.
This is BIG!"
Al, we're totally with you on the notion that the cloud is the future, and you make a very good point about Microsoft being ahead of most partners in this area. Our main concern is that Microsoft had made no secret of the fact that it intends to actually compete with partners on cloud deals. That, combined with what appears to be in Redmond a movement toward favoring larger partners, still leaves us wondering how many channel players will have a real shot at making money in the cloud with Microsoft. There's no question, though, that the NYC deal is huge and that it's a move in the direction in which Microsoft and IT must go. Partners need to go in that direction, too -- to the greatest extent that they can. As you said, for the progressive Microsoft channel players out there, the cloud should rain opportunities.
Have anything to add to any of the discussions you've seen on RCPU lately? Add it at [email protected].
Posted by Lee Pender on November 04, 2010 at 11:56 AM0 comments
OK, OK, so "ravaging" might be an overstatement. But for users of IE 6, 7 and maybe 8, the latest zero-day mess could cause some problems.
Posted by Lee Pender on November 04, 2010 at 11:57 AM0 comments
Boomi sort of sounds like something your editor's six-week-old son would do in his diaper, but whatever...
Posted by Lee Pender on November 03, 2010 at 11:56 AM0 comments
It's an e-commerce software company (remember those? Commerce One, anyone? Ariba?), not some massively expensive piece of Art or a guy named Art. We'd change our name to Art for $1 billion, though.
Posted by Lee Pender on November 03, 2010 at 11:57 AM1 comments
Don't you just love headlines? We adore headlines. Some of our favorites so far this week include: "Google Sues US Government over Microsoft Favouritism" (complete with superfluous British "u" in "favoritism"), "Google Sues Agency over Microsoft-Only Cloud Deal" and "Google Sues US over Unfair Cloud Contract".
Well, that's that, then. Obviously, some U.S. government agency has jobbed Google by showing blatant favoritism toward Microsoft in the process of awarding a contract. Right? That's what the headlines say. So, case closed; Google can wipe the floor with the U.S. government -- the Department of the Interior in this case --in court and move on.
Or maybe not. Check out this little tidbit from our own RCPmag.com story, which has something of a more sophisticated headline:
"Google is suing the Interior Department for allegedly excluding Google's products in a request for quotation the agency issued on Aug. 30. The RFQ, for hosted e-mail and collaboration services, specifies that the proposed solutions must be part of the Microsoft Business Productivity Online Suite.
According to the court filing, Google officials had met with the Interior department several times, and pursued discussions in correspondence, in an effort to convince the department that Google's applications were capable of handling Interior's needs, and that they should also be considered as a possible solution.
Ultimately, however, Interior limited its scope to Microsoft with the requisite Limited Sourcing Justification document, telling Google officials that Microsoft offered unified/consolidated e-mail and better security than Google Apps."
Read that middle paragraph again; that's the money bit. Google officials had met with the Interior Department... and got shot down. That's how we read it. So, Interior is stipulating a Microsoft-only contract because it... prefers Microsoft's product offering. Shocking! Well, that certainly is "favouritism" if we've ever heard of it. It's called choosing one product over another. Of course, in today's America, that's ground for a lawsuit -- and for shocking headlines. Good luck with all that, Google.
What's your take on Google crying foul? Send it to [email protected].
Posted by Lee Pender on November 03, 2010 at 11:56 AM4 comments
This is the way of the future, and not just for Microsoft Dynamics. Mark our words: Microsoft is moving toward rewarding larger partners and sloughing off smaller ones, starting with the policy that will soon be in place for Dynamics compensation.
We're not saying that this is all bad, just that it's reality. Check out how Jeff Edwards, director of Microsoft Dynamics Partner Strategy, explained some of the changes to RCPmag.com:
"A new Dynamics Incentives Program, which will go into effect in January 2012, will add growth into Microsoft's calculations of partner margins, in addition to total revenues. Partner margins will go up by up to 20 percentage points if license revenue growth hits one-year and two-year targets, and if customer additions hit certain targets. Conversely, if growth isn't hitting Microsoft's targets, margins can go down by as much as 15 percentage points, Edwards said.
"Additionally, Microsoft will be separating license revenue targets from maintenance targets. 'Larger portions of contracts renewed will get paid more, smaller portions of contracts renewed will get paid less,'" he said.
"'The high-level message is pay for performance. A partner can make more than they do today selling Dynamics software. A partner can make less than they do today selling Dynamics software,'" Edwards said.
Simple, right? Well, yes...depending on what those revenue targets are and how they will play out in firms of various sizes. Larger firms with bigger sales forces and more consultants would seem to have an advantage here, and smaller partner shops that rely on deep relationships with a few customers might be in trouble. Remember that quote: "A partner can make less than they do today selling Dynamics software."
That hasn't been Microsoft's policy in the past, but it's likely to start permeating other aspects of the forthcoming Microsoft Partner Network, which, of course, is replacing the Microsoft Partner Program. It would be a bit harsh to say that the free ride is over for some partners, but growth is clearly going to be a much more important metric than it has ever been in the past.
For the smaller shop that's more about maintenance than aggressive growth, that's not good news. It is however, exactly what Microsoft wants. The days of Microsoft rewarding partners for treading water and opening its partner program more or less equally to bigger and smaller firms are ending. Microsoft's stock price is stagnant, and the company's future of growth is in doubt. Microsoft needs pit bulls, not lap dogs, in its partner program. And instead of letting the lap dogs feed, it's going to start kicking them to the curb.
Of course, the flipside of that is opportunity for any firm that can meet Microsoft's revenue numbers. Microsoft folks and other observers in the Dynamics area say that the key is for partners to move into microverticals -- really small slices of vertical markets. That's easier said than done, of course, and to some extent larger firms with more access to experts in specific fields are once again at an advantage there.
In any case, Dynamics looks like the test case for the direction of the Microsoft Partner Network in general. It will pay to be aggressive and, in all likelihood, larger rather than smaller. Failure to move in Microsoft's new direction will, in a fairly literal sense, not pay at all.
How comfortable are you with the changes in Dynamics compensation? How will this sort of change affect your business? Sound off at [email protected].
Posted by Lee Pender on October 28, 2010 at 11:56 AM2 comments
Microsoft reports earnings Thursday afternoon, and with big announcements like Windows Phone 7 and Office 365 still creating flotsam and jetsam in various parts of the pundisphere, this week is a quiet one on the Microsoft news front.
So, it'll be a quiet one here at RCPU, too, as we take this opportunity to focus on a few other projects -- not that we don't love and appreciate you, dear readers, because we do. Anyway, the news this week is that HP has released Windows 7 tablet PC.
That might sound like a big deal, but it's really not. This isn't exactly an iPad killer; it's a slate targeted at particular vertical industries and not really meant for consumer use. Actually, it's pretty much exactly the kind of thing Microsoft should be doing -- uncool, useful, enterprise-focused and fairly niche oriented.
This, then, counts as good news in RCPU world, even if it's not big news. Honesty, we could do without big news for a few days, anyway.
Posted by Lee Pender on October 27, 2010 at 11:56 AM2 comments
The title of this entry pretty much says it all, apart from some details about the product, such as Outlook and some collaboration stuff being part of it.
Posted by Lee Pender on October 27, 2010 at 11:56 AM1 comments
The weird thing here is that IBM's stock is at a high, not a low...but whatever.
Posted by Lee Pender on October 27, 2010 at 11:56 AM0 comments