The paper chase associated with becoming a Partner of Record (POR) for Microsoft's Online Services Advisor Deploy incentives will end next week.
For the last few years, in order to be eligible for Online Services Advisor (OSA) incentives, partners needed to track down such archaic details as a customer's Enterprise Agreement (EA) ID number, the date of the agreement and the type of agreement; put the data in a form; get an employee at the customer to sign it; and finally send the paper to Microsoft.
Several months later, partner incentives associated with Office 365, Dynamics CRM Online or Windows Intune might start rolling in. That is, so long as one of those details in the paperwork wasn't incorrect, in which case partners began the bureaucratic slog to find any errors in the form and correct them, adding several months to the process of getting that first check.
Change in the form of a new all-digital process is coming March 2, according to a blog post Monday by Osa Elaiho, senior program manager in Microsoft Partner Network Support. "We've heard your feedback that attaching yourself as the Advisor Partner of Record (POR) for Office 365, Windows Intune, CRM Online, and Enterprise Mobility Suite [EMS] using the Online Services Advisor (OSA) form comes with several challenges and takes too much time," Elaiho said. "We're making a change to the Advisor Deploy incentives to automate the partner attach process with a new, online capability."
As of next Monday, a customer's Online Services Global Administrator will be able to attach a partner as the POR for any subscription a partner is actively managing for that customer, Elaiho said. The change can be made in the Office Customer Portal for Office 365 and Dynamics CRM Online and in the Intune Account Portal for Windows Intune and EMS.
"We're definitely excited that it's moving to a digital mechanism, because it has been a significant pain point for us and our customers over the last two to three years," said Reed M. Wiedower, CTO at New Signature, the 2014 Microsoft U.S. Partner of the Year. "The biggest challenge has often been in verifying that all the logistical information is correct. Even the person in charge of the purchasing at the customer is often hard-pressed to know."
One problem New Signature sometimes ran into was a customer might provide a bad or an outdated EA number. "You would be attached, but you'd never make any revenue off of it," Wiedower said.
Don MacNeil, managing partner at Strategic SaaS, said the EA agreement date was another common obstacle. "You'd send in the paperwork, and you'd get the agreement date wrong. That would kick it out," said MacNeil, who is in the process of tracking down customer information for two of the paper forms and added that he was "thrilled to hear" about the change.
"It wouldn't work about 5 to 15 percent of the time, depending on the season," MacNeil estimated of the OSA form process.
Administrative problems weren't the only shortcoming of the paper process. Both Wiedower and MacNeil say their companies lost POR status to licensing solution providers (LSPs). POR is supposed to be for the deployment and management partner; LSPs make a separate percentage on the sale of the license. As Microsoft has reportedly clamped down on the LSP margin and encouraged those partners to offer more services, the LSPs have come into conflict with systems integration partners over POR fees.
"The pain point the LSPs were exploiting was they had a lot of paperwork they had to shove in front of the customer," said Wiedower, who added that the LSPs had the benefit of all the EA information at their fingertips.
"In the digital process, we'll get an e-mail," Wiedower said. "It also ensures that if someone does switch, it's a trivial solution to switch them back. The new mechanism should allow us to have multiple layers of error correction."
The new process will bring some headaches of its own for all concerned. While new OSA forms will be accepted for new EA or Campus Agreement/School Agreement deals until April 30, partners must go back to all of their current customers to attach themselves as the Digital POR for each subscription they currently manage. Elaiho's blog post didn't say when the deadline for converting current customers would hit. Elaiho also said Microsoft will use the Digital POR data to calculate sales goal requirements for Silver and Gold competencies.
The change doesn't affect the related Online Services Advisor Web-Direct POR process, which was already digital. Microsoft previously, and somewhat confusingly, called both programs "Online Services Advisor Incentives." In October, the MPN renamed the EA side of the program "Online Services Advisor Deploy" and called the part for customers with fewer than about 200 seats "Online Services Advisor Web-Direct."
Josh Waldo, a longtime Microsoft executive whose last job there was senior director of cloud partner strategy before joining Nintex in November as vice president of channel strategy and channel programs, said the move made a lot of tactical sense for Microsoft. While echoing the reasons that Wiedower and MacNeil stated, Waldo also pointed to the internal costs to Microsoft of the old process: "It takes a lot of good, intelligent and expensive people to run a time-consuming manual process like that and takes even longer when something goes wrong with the process."
However, Waldo also sees some strategic benefits for Microsoft. One is moving the customer decision maker from a procurement person, who may not be familiar with various partners' roles in the deployment, to the IT administrator, who knows the partners' roles intimately.
"By making it digital, and by making it something that only the person who has access to the tenancy can do, you can inherently change the person who makes the decision to the right person. I think that's a huge factor here," Waldo said.
Longer term, by digitizing and segmenting the POR even for EA customers, Microsoft could be leaving itself room to tie partner incentives to specific workloads over time, Waldo speculated.
"I have to think that in the future this gives you a platform to incent certain workloads that might not have as much usage as others," Waldo said. "If you're only using Exchange but you have the rights to SharePoint or Lync, you could incent on driving Lync usage or driving SharePoint usage, which is great for Microsoft, great for partners and great for customers as they get even more out of what they purchased."
Posted by Scott Bekker on February 25, 20150 comments
AVG Technologies is doubling down on its channel-centric SMB efforts by rebranding those parts of the company as AVG Business.
"AVG Business is a dedicated business unit within AVG with its own team and engineering, sales and marketing under the same roof," said Francois Daumard, vice president of global channel sales at AVG, in an interview.
Daumard, a former Apple and Microsoft channel executive who joined AVG in December, said the business unit, run by Mike Foreman, will remain part of AVG Technologies.
By products, AVG Business includes AVG Business Managed Workplace, an RMM suite; AVG Business CloudCare, a cloud-based security suite; a network operations center and helpdesk; and AVG CloudCare SSO, a single sign-on offering currently in beta that is a technology partnership with Centrify Corp.
On Wednesday, AVG also released a VMware ESXi service module for Managed Workplace. The VMware integration was a top request of many of AVG's 10,000 partners, Daumard said.
AVG recently completed acquisitions of Norman Safeground and Winco, and the company will continue to expand geographically through M&A, Daumard said. Distribution partnerships are another key part of the company's 2015 geographic expansion plans, he said.
"We'll continue our geographic development in 2015, and we're going to localize our product. We see a lot of opportunity for growth in Europe, for example, in Germany," he said.
In its 2014 financial results release last week, AVG said its small business segment revenues grew 18.7 percent to $58.5 million of AVG's overall $374.1 million in annual revenues.
See this feature for recent RCP coverage of AVG's channel plans and product roadmap.
Posted by Scott Bekker on February 25, 20150 comments
The award ceremony at the annual Microsoft Worldwide Partner Conference (WPC) has always been primarily a celebration of the partners who go deepest with Microsoft's proprietary stack.
But this year, one of the partners called to the stage in July will be recognized for deploying an open source solution on the Microsoft Azure platform.
"At Worldwide Partner Conference (WPC) this year, we will highlight how [our open source] momentum is made possible by our partners, and their delivery of open cloud solutions, by awarding the first annual Open Source on Microsoft Azure Partner of the Year Award," said Mark Hill, vice president for Open Source Sales and Marketing Strategy at Microsoft, in a blog post Thursday.
"This new award will recognize partners who build outstanding open source-based solutions on our cloud platform, Microsoft Azure. This year's winner will have illustrated customer success with an innovative Azure solution that includes a significant, globally recognized open source project," Hill wrote.
The new open source award will be just one among dozens of categories of awards Microsoft will hand out in July. Most will still reward partners for Microsoft-heavy implementations.
Hill put the new award in the context of Microsoft's increased emphasis on openness over the last year, which has coincided with Satya Nadella's tenure as CEO. Among Microsoft's open source milestones, according to Hill, are a 20-percent-plus share for Linux-based solutions of all Azure compute usage and the move in November to make server-side .NET open source.
Posted by Scott Bekker on February 20, 20150 comments
It was during a conversation with a VAR that Axcient CEO Justin Moore decided there had to be a better way for vendors to pay partners for selling their cloud services.
The VAR professed love for Axcient's Recovery-as-a-Service (RaaS) product, Business Recovery Cloud, Moore recalled. Yet the VAR had only sold Axcient to one customer during a period when the VAR had sold about 40 traditional software-hardware solutions that were twice as expensive, and took 10 times more time to recover.
"I asked the sales guy why," Moore said. "He said it was how sales reps were compensated. If they sold a $10,000 solution with a $2,000 margin, the sales rep gets a check for $200. Conversely, if they sold Axcient for $500 a month, and margin was about $100, the sales rep got $10 a month."
Imagining a 20-something sales rep who may not still be at the same VAR in two years as the cloud margins potentially start adding up, it's easy to see why cloud doesn't get the same focus as legacy systems.
"That was the lightbulb moment when we realized that the entire economic model is broken for VARs and resellers," Moore said. "There is a reason that Salesforce, Box and every other SaaS vendor has a relatively small amount of revenue going through VARs."
"We believe that value-added resellers play a critical role in sales to midmarket and enterprise IT as trusted advisors. Customers rely on the value-added reseller to ensure best practices implementation of the new technology"
Justin Moore, CEO, Axcient
Axcient on Wednesday announced what Moore called "an entirely new economic model for value-added resellers." Calling it "SaaS:FLO," short for Software as a Service: Front Loaded Option, Axcient will cut a check equal to the first five months of revenue from its RaaS. By the company's math, that's equivalent to two years worth of normal partner margin, but all up front. The partner will also get a renewal margin at the beginning of each year that the customer stays with Axcient.
According to Moore, the SaaS:FLO upfront year one margin is better than what a partner would earn on a traditional software-hardware sale.
MSPs, who are more comfortable fitting monthly recurring SaaS revenues into their business models, have been a strong area for Axcient, but Moore said the pricing move is designed to help Axcient build a complementary base of VAR partners. "We believe that value-added resellers play a critical role in sales to midmarket and enterprise IT as trusted advisors. Customers rely on the value-added reseller to ensure best practices implementation of the new technology," Moore said.
About 30 VARs are already signed up with SaaS:FLO, Moore said. Al Chien, executive vice president of sales at Dasher Technologies, and Michael Souza, senior vice president at FusionStorm, each provided enthusiastic quotes about the program for Axcient's announcement.
The program seems like an answer to the problem that Microsoft, analysts and other vendors with the monthly recurring revenue approach have been trying to advise partners to solve for the last five years -- how to make that leap from relying on big deal-based payouts to surviving on the smaller monthly recurring payments that could eventually bring in more money than the big deals.
By putting its money where its mouth is, saying effectively that "if the monthly recurring revenue is going to be better over time, we'll pay the partners up front," Axcient is taking on a huge amount of risk that other vendors may not want, or be able, to match. The risk could sink Axcient, as well.
That's partly why the program is going to be limited to about 100 VARs this year. "We're being picky, very picky," Moore admitted.
What's enabling Axcient to try the upfront payments for cloud services is a new Series E funding round of $25 million, also announced Wednesday, and a new debt facility. "[One] risk is that it consumes a lot of cash. We have mitigated that risk by partnering with people who have extremely deep pockets," Moore said.
The other risk involves customer retention. If partners are paid upfront and customers abandon the platform before Axcient breaks even, the company would be in trouble. "If you don't retain your customers for at least five years, then it's a model you can't possibly afford," Moore said. "We have the benefit of seven years of retention data, and we know and can project that we will keep our customers for at least seven years."
Posted by Scott Bekker on February 18, 20150 comments
When it comes to the baseline security of all those cloud services companies are using for every conceivable business function, there's good news and bad news in Skyhigh Networks' latest quarterly Cloud Adoption and Risk Report.
Campbell, Calif.-based Skyhigh helps enterprise customers manage their use of cloud services with appropriate levels of security, compliance and governance. Over the last year, Skyhigh has been releasing a quarterly report based on analysis of the usage patterns of millions of employees at hundreds of enterprise companies. Skyhigh released its Q4 2014 report on Wednesday (available here, but registration required).
The good news is that more than twice as many cloud service providers (CSPs) encrypted customer data at rest in the fourth quarter of 2014 compared to the fourth quarter of 2013, Skyhigh found. Skyhigh defines CSPs as the companies providing the cloud services employees are using to do their work.
"They're investing more in security," said Kamal Shah, vice president of products and marketing at Skyhigh, in an interview. "That was encouraging to see."
In raw numbers, that means 1,082 CSPs encrypted data at rest in Q4 2014, compared with 470 taking that step in the same period of 2013.
But given the massive number of cloud services in use in enterprise organizations, the services encrypting data at rest are barely in double-digit percentage territory. "Roughly 11 percent of these cloud providers now encrypt data at rest. The risks are still great because you still have 89 percent of cloud service providers who don't encrypt data at rest," Shah said.
A parallel trend is in play for multi-factor authentication -- 1,459 services used in the last quarter of 2014 compared against 705 in Q4 2013.
Use of cloud services is on an upward tear, according to Skyhigh's analysis, with the average employee using 27 of them and the average company using 897.
Shah doesn't think organizations can afford to clamp down on usage too much. "The services are faster, cheaper, better and help them get their jobs done quicker," he said. It's just a clear case of buyer beware. "As enterprises are using cloud file sharing services, it's important that they're choosing ones that are using security."
Posted by Scott Bekker on February 11, 20150 comments
CDW Corp. in its earnings call Tuesday provided a look at how the Windows Server 2003 refresh cycle is playing out for one of Microsoft's largest partners.
Microsoft is cutting off support for Windows Server 2003 on July 14, and many Microsoft partners are focused on the server refresh business, including CDW, which spun up a Windows 2003 migration practice in the middle of 2014.
Tom Richards, chairman and CEO of CDW, said Windows Server 2003 refreshes accounted for a small part of what he characterized as high single-digit growth in server sales for CDW in the fourth quarter of 2014.
"The other thing that we're hearing is the many customers either through virtualization have created capacity and so [they're] not necessarily automatically adding new servers, but maybe expanding the capacity of existing servers, in addition to looking at cloud-based solutions, which, as turned out great for us, it's one of the reasons our cloud business has had such exceptional growth," Richards said, according to a Seeking Alpha transcript of the call.
"I hesitate to use the word tailwind, because of what a big tailwind XP was, but I think it will be a mild tailwind from -- for 2015," Richards said.
The XP tailwind referred to the Windows XP end of support in 2014, which fueled CDW growth well throughout the year and later than he expected, Richards said.
"My expectation for 2015 is we'll return to what I would describe as a more normal rhythm that we have had in previous years," Richards said of client-side demand.
CDW's fourth quarter results included adjusted earnings of 59 cents per share, which was 5 cents ahead of analysts' estimates, and revenue growth of 12.4 percent to $3.05 billion. The company also declared a dividend of 6.75 cents a share to be paid on March 10.
Posted by Scott Bekker on February 11, 20150 comments
In a shrewd attempt to get the next runaway success Silicon Valley startup onto the Azure cloud platform, Microsoft is giving away bucketloads of Azure credits to Y Combinator's current class.
Positioning the move as part of Microsoft's long commitment to startups, Microsoft Chief Evangelist Steve Guggenheimer blogged this week, "In this pursuit, Microsoft will provide Y Combinator's current class access to Microsoft Azure and a broad suite of Microsoft technology, as well as support. This will include $500,000 in Microsoft Azure credit, three years of Office 365, as well as direct access to Microsoft's engineering teams -- for Y Combinator's Winter 2015 batch of startups."
Sam Altman, president of Y Combinator, separately blogged, "This is a big deal for many startups -- it's common for hosting to be the second largest expense after salaries."
Altman said Microsoft's donations also include a year of free enterprise services from CloudFlare and DataStax.
"This brings the total value of special offers extended to each YC company to well over $1,000,000," Altman wrote. "The relentless nagging from partners to grow faster we throw in for free."
Among the 700 startups funded by Y Combinator since 2005 are reddit, Dropbox, Docker, Airbnb, Coinbase and Codeacademy.
Posted by Scott Bekker on February 10, 20150 comments
Enterprise collaboration vendor PGi bought a substantial Microsoft Lync practice with the acquisition last week of Modality Systems Limited.
PGi, an Atlanta-based publicly traded company with $527 million in 2013 revenues and 2,100 employees selling and supporting solutions in 25 countries, will maintain the acquired company as a wholly owned subsidiary doing business as Modality Systems, a PGi company.
"In our account base over the last few years, we've seen increasing momentum toward unified communications in general and Microsoft Lync in particular," said Sean O'Brien, executive vice president for strategy and communications at PGi, in an interview. "Catering to the large enterprise, Lync is a force to be reckoned with in the market. We've seen a lot of opportunity, and embracing Lync is a key tenet in our strategy."
After a lengthy process of evaluating Lync partners, including consultation with Microsoft, PGi pursued Modality, O'Brien said. "We are buying Modality and its platform because they have a vision of the future of Lync that we think is very complementary with our vision," he said.
Terms of the deal, which PGi funded through a credit facility, weren't disclosed. Modality is an international practice with 75 employees and offices in London, Seattle, San Jose and Sydney. Staff include 45 Lync certified professionals, six Lync MVPs and three certified Lync Masters. The company was a finalist for Microsoft 2014 Communications Partner of the Year.
O'Brien said Modality's 100 percent focus on Lync, through enterprise consulting services and software development, was key for PGi.
John Lamb, president of Modality Systems and co-founder of the company with James Rodd in 2007, said PGi, with its iMeet and GlobalMeet products, will give Modality's current and future customers new options. "We really see it as a service continuum. You might use Lync for five- to six-party conferences and collaboration. You're really going to want to use a company like a PGi for the critical components [above that]," he said.
O'Brien said the new ownership by PGi will also give Modality access to corporate resources that will help the Lync practice to continue "growing like a weed."
While PGi has a broad market focus, O'Brien said the company is not new to the Microsoft partner community. The company supports Lync Online clients in its collaboration products and was an early industry conferencing partner for the Lync server platform.
Posted by Scott Bekker on February 09, 20150 comments
Cloud security and compliance solution specialist Qualys Inc. is adding progressive scanning capabilities to its Web Application Scanning (WAS) product.
Making custom Web apps more secure has gotten increased attention recently as attackers have come to view Web app code as low-hanging fruit for intrusions.
The existing Qualys WAS solution is a cloud service designed for automated crawling and testing of custom Web applications. The idea is to catch common problems that are difficult to find manually, such as cross-site scripting vulnerabilities, SQL injection vulnerabilities and, later, malware infections. The defensive automated tool races against attackers' automated offensive tools to discover problems.
New with this week's announcement is a progressive scanning algorithm constructed to scan only parts of the Web site that have changed between scans.
The Qualys WAS now includes progressive crawling that expands the testing coverage over time; progressive testing that automatically starts, stops and resumes scans; and new report templates.
Posted by Scott Bekker on February 05, 20150 comments
Privately-held Veeam Software booked $389 million in revenues in 2014, a 40 percent increase compared to 2013, the company declared in a press release this week.
Veeam, which has been selling software since 2007, released the Veeam Availability Suite v8 during 2014 and upgraded more than a third of its customers within 60 days, CEO Ratmir Timashev said in a statement. Veeam positions itself as a datacenter availability vendor and helps users manage virtualization, cloud and storage technologies.
The revenues included $288 million in new license bookings, a 33 percent year-over-year increase, and $101 million in renewals bookings, a 66 percent increase.
"We fully expect our momentum to continue, carrying us toward our goal of $1 billion in annual revenue by 2018," Timashev said.
The company also released some channel stats. It now has 29,000 ProPartners worldwide, and the Veeam Cloud Provider (VCP) program added 2,500 service and cloud providers in 2014 to bring total VCP partners to 6,800.
Paid customers number 135,000 worldwide, with 44,000 customers added in 2014, the company said.
Posted by Scott Bekker on February 05, 20150 comments
The cloud successes that peppered Microsoft's most recent financial earnings report are helping Microsoft rack up higher growth rates on cloud revenues than any of the other major cloud infrastructure vendors.
Yet new industrywide data released by Synergy Research Group this week show that market leader Amazon's own consistently high growth rate, despite its comparatively huge market share, make Amazon Web Services (AWS) a tough-to-catch target.
In earnings statements and calls last week, Microsoft reported that commercial cloud revenues grew by 114 percent year-over-year, for the sixth straight quarter of triple-digit growth. Sales of its cloud products, including Office 365, Azure and Dynamics CRM, are at an annualized revenue run rate of $5.5 billion.
Synergy, which looks strictly at IaaS, PaaS and private and hybrid cloud, put Microsoft's year-over-year growth for the quarter slightly lower, at 96 percent. That was still good enough for the highest year-on-year revenue growth among the leaders. For the quarter, and for the year, Microsoft's share was 10 percent of a market Synergy valued at $5 billion and $16 billion, respectively.
Yet AWS remains in a league of its own. Amazon's share for the quarter hit 30 percent and for the full year was 28 percent. Despite enjoying triple the market share of its next closest rival (Microsoft), Amazon still managed 51 percent year-over-year growth for the quarter (see figure). The next three contenders after Microsoft were, in order, IBM, Google, Salesforce.com and Rackspace.
[Click on image for larger view.]
"The momentum that has been built up at AWS and Microsoft is particularly impressive," said John Dinsdale, chief analyst and research director at Synergy, in a statement. "They have an ever-broadening portfolio of services and they are also benefitting from a slowdown in the super-aggressive price competition that was a feature of the first half of 2014."
Amazon's position remains strong, but the company is less dominant than it was earlier this year. After slipping in the second quarter of 2014, Amazon could no longer claim to be bigger than its four closest rivals, Dinsdale pointed out at the time.
Microsoft's 96 percent growth rate and Google's 81 percent growth rate in this latest quarter has to have Amazon focused on the rearview mirror in the IaaS/PaaS world. At the same time, Amazon is trying to turn the tables in the overall cloud market with the recent debut of Amazon WorkMail, which allows the company to come after Microsoft Office 365 and Google Apps.
Posted by Scott Bekker on February 05, 20150 comments
Salesforce.com this week unveiled a new partner program with an elaborate scoring system designed to evaluate the comprehensive value of each partner, but the online CRM giant also introduced an annual partner fee.
The Salesforce Partner Program now involves a Partner Value Score, or PVS, that determines the tier for consulting partners -- either Platinum, Gold, Silver or Registered.
"Every partner receives a PVS based on the total contribution they make to Salesforce's business across three primary 'categories': ACV, Expertise, and Customer Success," Salesforce.com explained in a blog post. The ACV, or annual contract value, category counts for 45 percent of the PVS and is determined based on ACV and ACV growth. Expertise, at 35 percent of the score, includes ratings for certifications and specialization. The remaining 20 percent comes in the Customer Success category, which is based on customer satisfaction surveys and customer stories.
The new fees start for the Registered level at $1,000 in mature markets and $750 in emerging markets. Current partners have until April 30 to pay for their highest eligible tier, while new partners submit payments when they join, according to the blog post.
Other enhancements to the program include onboarding resources, updates to the Partner Community site, more partner development resources, sales and marketing aids, training resources and co-marketing funding.
Posted by Scott Bekker on February 05, 20150 comments