Most of the changes being introduced to Microsoft's channel program are taking effect relatively slowly. But one change is on the fast track. According to a Microsoft news release this week about changes coming in the Microsoft Partner Network, the following was listed as a "need to know" item:
Microsoft Gold Certified Partners enrolling or re-enrolling in the program must have participated in the Customer Satisfaction Index within the previous 12 months. This new requirement will be required for Gold Certified Partners re-enrolling during the 2010 re-enrollment period.
You told us in our reader survey earlier this year that you generally like the idea of having C-Sat data, and Microsoft has been talking about increasing its reliance on C-Sat data on Gold Certified Partners for a while now. Has Microsoft done enough to warn its Gold Certified Partners about the C-Sat requirement this year? Let me know at [email protected].
Posted by Scott Bekker on July 15, 20090 comments
The 2010 Microsoft Worldwide Partner Conference time and location is set: Washington, D.C., from July 12-15. The location continues Microsoft's practice over the last few years of picking hot and muggy places for the July conference (Houston, New Orleans), although the conference seems to be drifting back north. With a disproportionate amount of U.S. IT spending expected to come out of the federal government over the next few years, holding the event in the nation's capital certainly makes good business sense. In any case, the Washington location is sweet news for me -- I'm based near Baltimore.
Posted by Scott Bekker on July 15, 20093 comments
Microsoft announced global availability of Microsoft Communication Services on Tuesday at its Worldwide Partner Conference (WPC).
The program consists of marketing collateral, such as a Ready to Go campaign, aimed at SMB customers who are most interested in having their communications infrastructure hosted by a hosting provider.
The materials emphasize capabilities, such as e-mail, phone, fax and document sharing, versus emphasizing Microsoft products that those smaller customers don't tend to be familiar with. Components of the campaigns are also designed for smaller reseller partners who would act as sales agents for the larger hosters.
Microsoft Communication Services grew out of a pilot program with cable giant Comcast that started in November 2007. Comcast, which won the Microsoft Communications Sector Partner of the Year Award this year, has more than 100,000 e-mail users on Microsoft Hosted Exchange.
At WPC, Microsoft announced that Microsoft Gold Certified Partner Outsourcery Ltd., formerly Genesis Communications Ltd., will use Microsoft Communication Services in the United Kingdom.
If you're looking for more detail on Microsoft Communication Services, we ran a feature previewing the program in our May issue.
Posted by Scott Bekker on July 14, 20090 comments
Partners will get a handful of new tools, programs and benefits around the Microsoft Business Productivity Online Suite (BPOS) this year in an effort that Microsoft officials hope will make the flagship Software plus Services offering more attractive to the channel.
At the Microsoft Worldwide Partner Conference (WPC) in New Orleans this week, Microsoft officials announced partner-specific internal use rights, customer management tools and partner branding on billing to encourage partner adoption of BPOS, which was unveiled a year ago at the WPC in Houston.
Since the program went live in the United States in November and more broadly in April, 5,000 partners have signed up to sell BPOS, which gives customers access to Exchange and SharePoint services for a low monthly price per user.
The headline change was the internal use rights. "Partners will have 250 free seats of internal users for BPOS. Our partners will be the first best users [of BPOS services]," said Allison Watson, corporate vice president of the Microsoft Worldwide Partner Group.
Microsoft also introduced "Order on Behalf," which allows a partner to set up the sign-up process for a customer, both simplifying the customer sign-up process and automatically registering the partner as the partner of record for that order.
Another new feature is a Commerce Dashboard, which allows a partner to view in one place all the customers that have that customer listed as their partner of record. The Dashboard includes partner fee information and renewal dates, Microsoft officials said.
In the third quarter, Microsoft plans to launch a feature called Delegated Administration, through which a customer will be able to hand over administrative tasks for things like setting up new accounts or managing SharePoint sites, to partners.
Delegated Administration will be offered first to partners who sign up for what Microsoft is calling an Accelerated Initiative. Partners will become eligible for that program by committing to sell at least eight BPOS deals of 25 seats or more. Other benefits of joining the Accelerated Initiative will include deeper technical training on things such as complex migrations from Lotus Notes or Novell Groupwise and comarketing dollars for putting up Web sites with the partner "Order on Behalf" feature.
While Microsoft has 5,000 partners signed up, the number is less than it seems. Microsoft officials suspect a large percentage are partners who signed up to try the BPOS service out and haven't made any customer sales. The internal use rights will give partners a way to try out the service before signing up to sell it, and the Accelerated Initiative should help Microsoft identify its cadre of partners who are committed to selling BPOS.
Microsoft also announced its intention to include partner information on customer invoices by the end of the 2009 calendar year.
Putting partner information on customer bills is an attempt to address one of the two major complaints partners have had about the BPOS business model. Partners have expressed serious concerns about Microsoft's ownership of customer billing, which provides Redmond with direct access to customers for potential upselling opportunities that could cut partners out. Having partner information included on the billing is more of an acknowledgement of that issue than a way to address the fundamental problem. Nonetheless, at least partners will retain some customer mindshare if their information at least appears on the invoice.
The other main partner complaint is about the business model itself. Partners say the margin opportunity is too small to cover the costs of getting a new practice ramped up.
The BPOS changes announced at WPC don't include any adjustments to the partner payment model laid out a year ago. Those who resell the service get a 12 percent referral fee plus 6 percent of the fees for every year that the customers remains subscribed -- effectively an 18 percent margin in the first year and 6 percent every year thereafter. The fees are paid quarterly, so partners start getting the recurring fees throughout the year rather than only at the end.
John Betz, director of product management for Microsoft Online Services, contends that the 18 percent and 6 percent recurring is a reasonable opportunity, but he says the real opportunity remains for partners to add services on top of the base subscriptions.
"Five and six times the subscription fee is available to [partners] as professional services fees. It's important to realize that what you get with SharePoint Online is kind of a blank slate [for customization]," he said.
But Betz adds that partners who are relying on non-S+S deployment and migration will be operating in a shrinking pool of opportunity. "Money that they make today doing deployment and management, that practice is going to slowly go away over time. We think that five years from now, 50 percent of the Exchange seats will be online as opposed to on-premises. This is an opportunity for partners to uplevel their game."
"The services transformation is happening in the market no matter what Microsoft does. I think what you hear from us is deliberate dependence on partners. As a company with 640,000 partners in the world and 95 percent of our revenues is that we would be foolish for us to try to do it without partners," Betz said.
Posted by Scott Bekker on July 14, 20090 comments
The Microsoft Dynamics unit will take the Microsoft Worldwide Partner Group's new Microsoft Partner Network and add elements to it for Dynamics partners.
"We're snapping into what the Microsoft Partner Network is doing," explained Doug Kennedy, vice president, Microsoft Dynamics Partners.
Already Kennedy is pleased that the Microsoft Partner Network's new Competency structure will give Dynamics partners some much needed differentiation. Even though the overall number of Competencies and Specializations is being reduced, it's going the other way for Dynamics partners, who will now have one Competency for ERP and one Competency for CRM.
"Never before have we had the delineation of CRM and ERP -- it's been down to the Dynamics level. The partner ecosystems for CRM and ERP are completely different," Kennedy said.
In the Dynamics industry, though, vertical specialization is key. So Microsoft's Dynamics' team is planning to dive even deeper into categorizing partner with its own vertical specializations. Major industries being looked at now for such branding include manufacturing, distribution, retail, public sector, professional services and financial services.
Microsoft is also working with a third-party vendor to provide the industry-based stamp of approval for Dynamics partners, Kennedy said. The concept would be similar to the way Veritest certifies Microsoft applications.
The result could be extremely specialized labels in the Dynamics community. For example, a partner might be an Microsoft Advanced ERP Partner for Manufacturing in the Heartland region.
"It'll help customers find the right partner faster, which will help everyone," Kennedy said.
Posted by Scott Bekker on July 14, 20090 comments
Market researchers at IDC are out with their predictions for the channel impact of Windows 7, which is set to become generally available in October.
In a research profile sponsored by Microsoft and released at the Microsoft Worldwide Partner Conference (WPC) this week, analysts John Gantz, Al Gillen and Amie White wrote that IDC's forecast for Windows 7 uptake is brisk: 177 million unit shipments by the end of 2010.
"For every dollar of Microsoft revenue from launch in October 2009 to the end of 2010 from Windows 7, the ecosystem beyond Microsoft will reap $18.52," the analysts write.
Broken down by types of revenues, IDC projects that every $1 of Windows 7 revenue will bring $10.21 in hardware sales, $4.43 in software revenues and $3.88 in services revenues.
IDC projects that the worldwide Microsoft ecosystem will sell $320 billion in products and services revolving around Windows 7 from October 2009 to the end of 2010. IDC's forecast for the U.S. ecosystem is $110 billion during the same period.
Posted by Scott Bekker on July 14, 20091 comments
During online registration for the Microsoft Worldwide Partner Conference (WPC), Microsoft gave attendees a chance to assist in some projects to rebuild New Orleans, a city still reeling from the effects of Hurricane Katrina nearly four years ago.
According to figures provided by Allison Watson, corporate vice president for the Microsoft Worldwide Partner Group, participation was impressive. "We had over 500 partners participate with us from all over the world," she said.
Microsoft organized two projects for Sunday, the day before the WPC officially started.
One group of volunteers stayed at the Ernest Morial Convention Center and helped local teachers, students and artists paint pre-designed murals that will be combined into a "Wall of Hope" that will be installed at Carver High School. Another group headed to an elementary school in the 9th Ward to re-wire computer labs, install a wireless network and do some painting and landscaping.
"We were able to give back to the city of New Orleans," Watson said. Kudos to all those partners who took time out of their busy schedules to help such a great city rebuild.
Posted by Scott Bekker on July 14, 20090 comments
Allison Watson formally launched the new Microsoft Partner Network on Monday at the Microsoft Worldwide Partner Conference (WPC). The new network will eliminate the longstanding and popular Gold Certified level in the Microsoft Partner Program, as well as the Certified and Registered Member levels.
The new program will have four main partner "landing areas": Advanced, Standard, Subscriber, and Communities and QuickStarts. Microsoft will continue the use of the Microsoft Competencies, but is paring the list substantially from 17 competencies and 46 specializations now to about 30 in the near future. The Competency system will also encompass some previously free-standing programs, such as the Microsoft Small Business Specialist Community.
The name "Microsoft Partner Network" became official immediately, but partners will have some time to make adjustments.
"You have a full 18 months to understand where you want to go so you can make the plans [that will help] you get there," said Watson, corporate vice president of the Microsoft Worldwide Partner Group. Using Gold Certified partner Quilogy as an example, Watson said Quilogy would be able to migrate to the new competencies in the next year, then would re-enroll into the new program at a new level next year.
In an interview, Julie Bennani, general manager of the Microsoft Partner Network, provided more detail on the four levels of the new program, which will take effect some time in Microsoft's 2011 fiscal year.
Advanced will replace Gold. Bennani said the Advanced level will be more exclusive than the current Gold level, but Advanced status will come with specific commitments from Microsoft. Those include both partner account management, at least at the telePAM level, and opportunity support.
"That's a much bigger extension of contact with partners," Bennani said. "This is best-in-class. [Partners at this level can say,] 'I am the best partner in CRM based on customer evidence, Customer Satisfaction, a case study and participating in training.'"
The Standard level will be for partners who achieve a competency. "They'll get into brand. We'll align incentives. This is the point where coverage for opportunities will start," Bennani said.
The Subscriber level is an evolution of the Microsoft Action Pack Subscription and Empower programs and will cover a large portion of the existing Registered Member community.
The Communities and QuickStarts will be very basic. "This is a toe in the water. [For example, someone who says,] 'I'm an individual interested in Windows 7.' We're going to be very simple and clean on what we ask them to do there," Bennani said. The only requirements to enroll at that level will be an e-mail address, the role in the organization and the name of the company.
Posted by Scott Bekker on July 13, 20093 comments
As part of the new Microsoft Partner Network launched Monday, Microsoft is streamlining the Competency system that partners use to differentiate their expertise.
Microsoft released a list of the 29 Solution Competencies that will replace the current set of 17 Competencies and 46 Specializations. Partners will have 12 to 18 months to switch into the new categories.
The new Solution Competencies are:
- Server Platform
- Desktop Platform
- Systems Management
- Identity & Security
- Virtualization
- Content Management
- Search
- Portals & Collaboration
- Unified Communications
- Business Intelligence
- Web Development
- App Lifecycle Management
- Data Platform
- Software Development
- Application Integration
- Small Business
- Digital Home
- Licensing
- Learning
- CRM
- Software Asset Management
- ERP
- Digital Marketing
- Project & Portfolio Management
- Mobility
- Solution Provider
- OEM
- Authorized Distributor
- Hosting Platform
Posted by Scott Bekker on July 13, 20090 comments
There was never much doubt that attendance at the Microsoft Worldwide Partner Conference (WPC) would be down in New Orleans 2009 compared with Houston 2008.
Microsoft officials rejected the recession-inspired outright cancellation option that many other companies have chosen for their conferences this year. Microsoft hustled to open registration for WPC several weeks early this year and held registration open right up until last week. In previous years, the conference sold out long before the start.
The moment of truth came Monday morning, when Microsoft posted its WPC attendance. Like the U.S. housing market, WPC is back at 2003 levels. The official number for partners in attendance is 5,500. That's the same number of partner attendees as 2003 -- coincidentally, also in New Orleans.
The last two years, in Denver and Houston, Microsoft had about 7,000 partner attendees.
In all, there are 7,700 attendees this year because Microsoft brought 2,207 employees to New Orleans for the show. Microsoft is also saying attendees are here from 115 countries, down a little from the 130 countries represented in 2008.
So, probably a little less energy on the floor this year, but a great ratio of partners to Microsofties for 1:1 interactions.
Posted by Scott Bekker on July 13, 20090 comments
Jenni Flinders, a nine-year Microsoft veteran with deep channel experience whose most recent role involved leveraging distributor relationships to reach the breadth of Microsoft's 640,000-member global channel, on Tuesday became vice president for U.S. Partner Business Development and Sales.
Flinders replaces Robert Deshaies, who will be focusing on an unspecified "key strategic initiative" for the Microsoft U.S. Leadership Team, a company spokesperson said in an e-mail laying out a number of moves within Microsoft's channel organization.
The move takes Flinders from the Worldwide Partner Group (WPG), where she reported to Corporate Vice President Allison Watson. She now will report to Phil Sorgen, corporate vice president, U.S. Small and Midmarket Solutions and Partners (SMS&P).
Under various titles, including general manager and global business leader, Flinders has run the channel incentive and transaction channel operations within the Worldwide Partner Group for the past three years. Presumably, the move also gives Watson a close associate in the critical U.S. partner subsidiary.
Of the 394,000 partners who are formally registered in the Microsoft Partner Program, nearly a third (122,000) are in the United States. Flinders had served as Watson's chief of staff before her promotion to managing the transaction channel, which includes distributors, Large Account Resellers and other resellers. Flinders' previous Microsoft experience included stints as the marketing lead for SMB in South Africa and a regional role lead with Microsoft Latin America. (Click here for a September 2007 RCP Q&A with Flinders.)
Deshaies came to the partner role from the sales side. He was a regional vice president of the U.S. SMS&P East Region for several years before becoming vice president of the U.S. Partner Group in 2006. In July, 2008, Deshaies' title changed to vice president of U.S. Partner Sales and Business Development. A colleague, Cindy Bates, became vice president of Partner Strategy, Marketing and Programs at that time.
Bates' role was not mentioned in the e-mail, although Flinders' assumption of Deshaies second, more limited title, implies that Bates remains in the same position. In joint interviews last year, Deshaies and Bates said their roles involved working together extremely closely, basically as co-chiefs of the U.S. channel.
Two other executives will take up the torch for the distribution channel. "We will continue our deep focus on the Worldwide Distribution channel as a key mechanism for reaching SMB customers as announced earlier with the appointment of Birger Steen as vice president, Worldwide SMB and Distribution, and Thomas Hansen as general manager, Worldwide Distribution," the Microsoft statement said.
On Watson's team, 12-year Microsoft veteran Allen Boone will lead the Channel Incentives team, coming to the WPG from the Server and Tools Business Group, where his role involved pricing and business models for Software + Services.
Ross Brown, the WPG's vice president of Solutions and ISV Partners, will also expand his duties to include some of the transaction channel responsibilities previously handled by Flinders.
In other WPG management changes, Karl Noakes joins Watson's leadership team from further down in the multi-thousand employee group. Noakes has focused for the last year on Web design, Web developers, custom developers and ISV communities. Another of Watson's direct reports, Julie Bennani, continues in the same role, but with a new title reflecting the changes coming to the Microsoft Partner Program, which is to be renamed the Microsoft Partner Network. Bennani is now general manager, Microsoft Partner Network. Watson also named Caroline Goles, who formerly worked in Flinders' Channel Incentives team, to be her new chief of staff.
Management shakeups are common just before Microsoft's Worldwide Partner Conference (WPC) as Microsoft begins a new fiscal year July 1. Partner organization changes tend to be announced right before the partner conference when such changes would be noticed by the thousands of influential attendees at WPC. This year's conference starts Monday in New Orleans.
Meanwhile, the one channel position that isn't shaking up is Allison Watson's. Named to run the WPG in August 2002, Watson has helmed the organization for nearly six full years, bringing a stability to Microsoft's channel organization that is remarkable for a company that moves people around incessantly.
Posted by Scott Bekker on July 08, 20092 comments
The number of Microsoft partners boasting Gold Certified status has been booming, both in the United States and worldwide.
According to the latest Microsoft Partner Program enrollment figures provided to RCP by Microsoft, Gold Certified partners have been going up both globally and in the United States. The number of Gold Certified Partners worldwide is up 17 percent this year to 16,000. In the United States, the number of Golds is up 67 percent to 5,000. Worldwide, the number of Certified Partners is up nearly 5 percent to 18,000. In the United States, Certified Partner rolls dropped 17 percent to 6,000.
Stepping back to look at the Microsoft Partner Program over the last few years shows a program skewing heavily toward Gold certification. In 2005, there were 3,500 Gold Certified Partners compared to 16,000 today – a 350 percent increase. At the same time, the size of the overall program has increased only about 68 percent.
Put another way, in 2005 there were seven Certified Partners and 59 Registered Members for every Gold Certified Partner. Today there is roughly one Certified Partner for every Gold Certified Partner, and there are only 23 Registered Members for every Gold Certified Partner.
While the market may feel tight to the Gold Certified partners out there, here's one thing to keep in mind: When Microsoft created the Gold Certified level in October 2000, the idea was to highlight the top 10 percent of partners. Even with the explosive growth in Gold Certified Partners, fewer than 5 percent of partners are Gold Certified.
It will be interesting to see if the changes coming through the Microsoft Partner Network will be designed to change these ratios at all. What do you think? Is the Gold field too crowded, OK or too sparse? Send me your thoughts at [email protected].
Posted by Scott Bekker on June 18, 20090 comments