As the global pandemic drags on, partners facing Microsoft Partner Network (MPN) renewal deadlines for competencies and advanced specializations in the first half of this year are getting a one-year extension.
During a Microsoft "State of the Partner Ecosystem" session on Wednesday for channel media, Gavriella Schuster, corporate vice president for Microsoft One Commercial Partner, detailed the ongoing adjustments that have been made to MPN deadlines since last March.
"To make sure our partners were getting what they need, we adjusted the deadlines and requirements related to MPN partner programs, the competency extensions, training and exam deadlines, and in fact, we just announced more extensions," Schuster said.
One new extension covers partners with competencies that have anniversary dates between Jan. 1 and June 30 of this year. Those partners are eligible for a one-year competency extension that will last through the next anniversary date in 2022. According to Microsoft, partners will be able to find information specific to their organizations in the Partner Center starting this month. Because of a similar extension last year, that means some partners will be able to maintain their competency for two consecutive years by paying their competency fees but not having to deal with other competency requirements.
A major exception is the Cloud Business Applications competency, which has a distinct Partner Contribution Indicators (PCI) scoring system. While some concessions are being made for those partners, many will still need to meet some adjusted requirements for the new scoring system.
Partners with advanced specializations will also be eligible for a one-year extension into 2022 if their anniversary date falls between Jan. 1 and June 30 of 2021. Those partners must retain the underlying gold competency, in most cases by paying the competency fee to renew but without having to meet other normal renewal requirements.
Schuster also touted the success of other programs that Microsoft launched last year to help partners directly or to spur business among their customers during the pandemic and its associated business downturn.
Highlights from those efforts included:
- Virtual training opportunities delivered by Microsoft and its partners. "Since July, our partners have delivered more than 6,500 workshops worldwide across Azure, business applications and the modern work and security solution areas," Schuster said.
- Trials for remote work-related products. "We extended new offers and trials they could take to their customers for Microsoft 365, Windows Virtual Desktop and Teams," she said. "In fact, with Teams, CSP partners enabled tens of thousands of new organizations to get started with Teams through COVID-response trials, and we've seen significant conversion of those trials as the period ends."
- Digital-on-demand marketing content for partners. "Without sellers in the field, our partners struggled. They needed to get creative with how they were reaching their customers. So our co-branded marketing content has really helped our partners step up their digital marketing."
As far as what else may be necessary, Schuster struck a positive note: "Hopefully the world will return to normal soon."
Posted by Scott Bekker on February 11, 2021 at 8:07 AM0 comments
Microsoft's advanced specialization catalog for partners is getting more extensive by the quarter. The company now boasts two new advanced specializations, bringing the total list to 16.
A relatively new addition to Microsoft's list of badges for partner organizations, the advanced specializations, are layered over a gold competency and demonstrate extra expertise in a particular area.
"In January, we launched our first two advanced specializations for Business Applications, the Small and Midsize Business Management advanced specialization and the Low Code Application Development advanced specialization," said Nick Parker, Microsoft's corporate vice president for Global Partner Solutions, in a blog post Wednesday.
"This means we now have advanced specializations across all five commercial solution areas -- modern workplace, business applications, Azure (apps and infrastructure, and data and AI), security," Parker said. "Advanced specializations provide an opportunity for partners to demonstrate their experience in specific technical scenarios and enable customers to identify the partners that best fit their needs."
Unlike most of the advanced specializations, which are attached to only one or two specific competencies, the Low Code advanced specialization is achievable from five different competencies. A partner can vault to the Low Code specialization from a gold badge in either Cloud Business Applications, Cloud Platform, Small and Midmarket Cloud Solutions, Cloud Productivity or Application Integration.
Requirements include that the partner must have at least five Power Apps customers, must meet a growth metric in customer usage, must have a certain number of individuals who have passed exams or earned certifications and the partner's apps must clear various technical hurdles.
The Small and Midsize Business Management Advanced Specialization is an option for partners with a gold competency in either Small and Midmarket Cloud Solutions or Cloud Business Applications.
The advanced specialization requires five individuals certified as Dynamics 365 Business Central Functional Consultant Associates, 10 customer deployments with five or more monthly active users, a 35 percent increase in monthly active users across the entire customer base over the last year, and at least one consulting service featuring Dynamics 365 Business Central published on AppSource.
Posted by Scott Bekker on February 11, 2021 at 8:29 AM0 comments
Microsoft and partners continue to rack up co-selling revenues, and the company is now looking to the small and medium business segment for further growth.
Because Microsoft reports the figure oddly, as a total of all co-selling since the beginning of the program around four years ago, it's difficult to tell exactly how much revenue partners are generating under the program annually.
Nevertheless, the numbers are on a Microsoft (very large) scale.
"Since we started the co-sell program in 2017, we've been able to jointly sell more than $18 billion in partner services," said Gavriella Schuster, corporate vice president for Microsoft One Commercial Partner, during a Microsoft "State of the Partner Ecosystem" session on Wednesday for channel media. A slide put the figure at more than $18.5 billion in annual contract value.
Whatever the annual figure may be, the new total represents $10 billion more than the number that CEO Satya Nadella provided two years ago during an earnings call. During that January 2019 call, Nadella said Microsoft had generated $8 billion in contracted partner revenue.
As in the past, Schuster emphasized that the revenue is not Microsoft revenue. It is solely partners' services revenue that partners get directly from the Microsoft field taking partner solutions and services to customers.
In a metric related to that field activity, Microsoft also said there have been 166,000 co-sell opportunities and closed engagements so far in the current fiscal year, which started in July. Schuster also noted a few other indicators of the scale of the funnel that Microsoft is pointing toward its partners currently. The company's direct Web stores have 4 million monthly active users and its commercial marketplace has generated more than 3 million leads so far this fiscal year.
Over the last few years, Microsoft has expanded co-sell from a program for Azure ISVs to a program that encompasses Microsoft 365, Dynamics 365 and Power Platform. Additionally, Microsoft extended aspects of co-sell program from its own internal field sales force to its roughly 90,000 Cloud Solution Provider (CSP) partners. In other words, Microsoft was offering ISVs a "channel as a service," removing some of the friction of partner-to-partner engagement and allowing CSPs to more easily sell ISV solutions built on the Microsoft cloud stack.
Now Microsoft is indicating its next frontier in the co-sell program is small and medium business.
"We are increasing our focus on co-selling within the small- and mid-sized business segment (SMB). This includes making targeted marketing investments in top SMB customers, supporting and growing our ecosystem of ISV partners who serve SMBs and streamlining the way we help partners develop their practices," said Nick Parker, Microsoft's corporate vice president for Global Partner Solutions, in a blog post Wednesday.
Describing the effort as "being more intentional with the medium enterprise and small business segment," Schuster called it a huge growth opportunity for Microsoft partners. In addition to the efforts Parker outlined, Schuster said, "We're supporting our ISV partners to help them serve that customer segment with digital sales and marketing."
Even as new attention turns toward SMB, Casey McGee, vice president for Global ISV Sales at Microsoft, indicated that co-sell remains a strategic pillar of Microsoft's overall efforts around ISVs.
"We succeed collectively because we offer our partners both the technology platform and a business platform that consists of go-to-market, co-sell, top-line revenue growth and scaled growth through our partner ecosystem," McGee said during the channel media session.
Posted by Scott Bekker on February 11, 2021 at 8:38 AM0 comments
Acronis will unify its products into a single line on March 31 and roll out significant changes to its partner program throughout 2021, the company told partners Tuesday.
Founder Serguei Beloussov described the design goal of the licensing changes as "one policy, one user interface, one license from one vendor." Acronis is aiming to roll up security, e-mail security, file sync and share, management, notarization, backup and disaster recovery under the Acronis Cyber Protect license.
During a virtual 2021 Acronis #CyberFit Partner Kickoff event Tuesday, Beloussov made several commitments for the year ahead, including roadmap transparency and increased investment in support, partner management and joint events/marketing funding.
He also promised to extend the Acronis Cyber Cloud platform beyond its original MSP focus. "Sometime in 2021, we will make sure that all of our partners can use it," he said.
Under the new licensing plan, all baseline capabilities will be provided under the Acronis Cyber Protect Cloud license. Some elements of the license, such as backup, file sync and share, disaster recovery and notary will be delivered in a pay-as-you-go format under the license. Other components of the baseline product are free cyber protection packs -- security, management, data loss prevention and e-mail security, which will launch in the second half of the year. Additional functionality will be delivered through upgrade add-ons known as Advanced Protection Packs. All of the Advanced Packs can be licensed on a per-GB or per-workload licensing model.
"You basically will be able to use Advanced Packs as Lego blocks...for every particular customer," said Yury Averkiev, vice president of product management for apps and services at Acronis.
The initial set of five Advanced Protection Packs that will be available on March 31 will include Advanced Security, Advanced Management, Advanced Backup, Advanced Disaster Recovery and Advanced Files. Packs on the roadmap for later in the year, Averkiev said, include Advanced Email Security, Advanced Data Loss Prevention and Advanced Security.
As examples of the types of features included in the base license versus the Advanced Packs:
- Security features in the base license include a #CyberFit Score, weak password check, vulnerability assessment, active protection, exploit prevention, anti-virus and anti-malware protection, and device control. The Advanced Security Pack includes local signature-based detection to the AV and anti-malware protection, URL filtering, forensic backup, backup scanning for malware-safe recovery, a corporate allowlist and smart protection plans.
- Baseline backup features are file backup, image backup, application backup, network shares backup, backup to cloud storage and backup to local storage. The Advanced Backup Pack adds support for Microsoft SQL Server and Microsoft Exchange clusters, Oracle DB, SAP HANA, Acronis' data protection map feature and continuous data protection.
Channel Chief Alex Ruslyakov walked partners through the specific changes to the partner program and demonstrated a new partner portal, which he said the company is planning to launch next month.
One major introduction is an Acronis #CyberFit Score that helps determine a partner's level in the Acronis platform. The score operates on a scale of 0 to 33 with up to three points available in each of 11 categories. Registered partners need no points, Authorized Partners need eight points, Gold Partners need 15 points and Platinum partners need 22 points. Meanwhile, a recurring revenue bar for service providers has been newly eliminated at the Gold level, although all Platinum partners must still clear a revenue hurdle.
Other immediate changes to the program for resellers and service providers include an updated referral program, new quarterly performance rebates, increased market development funds, marketing account managers for Platinum partners and enhanced technical support.
Changes planned for later in the year include marketing automation tools, training program enhancements, an on-demand demo lab, leads-sharing for service providers, a partner community forum and the ability to vote to influence the product roadmap.
Posted by Scott Bekker on February 02, 2021 at 11:37 AM0 comments
When a managed service provider installs agents or sets up other tools at a customer site, the customer is trusting them at a deep -- let's call it what it is, an administrative -- level.
That makes it incumbent upon the MSP to ensure the vendor tools they're using are highly secure. How can an MSP, often challenged with a small staff and many other priorities, be confident that their much larger vendor partners are operating in a secure fashion?
During an Acronis virtual partner event Tuesday, Amy Luby, who leads community efforts for Acronis' channel, put that question to Bobby Kuzma, practice director of assessment and testing at the Herjavec Group, a Toronto-based MSP that specializes in security services and training.
Kuzma provided four shortcuts that MSPs can use to assess how serious their vendors are about security.
1. A Leader at the Company Whose Sole Job Is Security
"The CISO role has been around since the late '90s. And there are still organizations that don't believe that security is someone's job. If a vendor doesn't share that belief that that's a responsibility that's worthy of having a dedicated professional for," Kuzma says, it should be a red flag.
That person doesn't have to be listed on the Web site, or in the C-suite or even at the VP level, although any of those attributes would be a good indicator of seriousness. "If you don't see a CISO, ask," Kuzma says. "LinkedIn is your friend. Flat-out ask them, 'Who owns security in your org, and can I get an introduction?'"
2. A Clear Process for Reporting Bugs in Their Code
"If they are a vendor that produces a tool or has a service that is offered, do they have some non-trivial way for people to report vulnerabilities? This isn't necessarily a bug bounty program, although those are nice," Kuzma says. "Is there a way to let them know without blasting it out on the Internet? If a vendor doesn't have a way of doing that, that's a thing that would concern me greatly."
It's OK if vendors outsource triage of bugs to a third-party specialist, and bug tracking can be done through routine service tickets if bug reports are a clearly-defined procedure in the ticketing process, he says.
3. A Way To Get Your Customers' Risk Questionnaires Handled
"In this day and age, you probably have customers that want you as a vendor to them to fill out their risk questionnaires. Let's face it, they're silly [and] repetitive. No one likes doing them. You want to make sure that there's a sane process in doing that that doesn't involve a week in ticketing hell," Kuzma says.
Good enough much of the time, in Kuzma's view, is an NDA-protected FAQ available about the vendor's security operations center.
4. Evidence of a Recent Pentest
"You may want to ask the vendor when was the last time they had their organization itself pentested and the product itself pentested?" Kuzma suggests.
He'll go so far as to ask for a copy, but he views an executive summary as good enough in many cases. "I wouldn't downcheck them if they're unwilling to share the full report," he says. "If they're willing to open the doors and let you peek your head in, that shows a level of maturity."
Kuzma had one final piece of advice for MSPs who may struggle to get answers to their security questions: Leverage your relationship with the salesperson who is trying to get you to sign up for the service. If their commission depends on your satisfaction, you're more likely to get answers.
"Your sales point of contact that you may be in touch with is probably your greatest ally in trying to get information," he says. "They'll start asking questions to make you happy."
Posted by Scott Bekker on February 02, 2021 at 11:36 AM0 comments
Microsoft experienced a lengthy technical glitch during CEO Satya Nadella's comments to financial analysts in the quarterly investor call on Tuesday.
A seven-minute, 40-second stretch of dead air started for at least some users watching the session on Microsoft Teams a little over three minutes into the call. Partway into the outage, Microsoft posted a message from its production studios reading, "We are experiencing technical difficulties. Please standby."
Ironically, as audio came back on around the 11:17 mark, Nadella was highlighting the Teams platform: "...Team's calling globally to 42,000 employees in just four weeks." According to a transcript that Microsoft rushed out faster than usual due to the downtime, Nadella had been talking about Lumen, formerly CenturyLink, undertaking a global rollout of Teams.
The outage came during more widespread Internet problems. Outages across the East Coast on Tuesday morning affected Verizon, Google, Zoom, YouTube, Slack and Amazon Web Services, according to media reports. It was not immediately clear what caused the problem for Microsoft Tuesday evening.
The glitch marred an otherwise very positive quarterly call on an earnings report that saw Microsoft's stock price get a lift in after-hours trading.
Microsoft reported revenues of $43.1 billion and earnings per share of $2.03, for the three-month period ending Dec. 31, 2020. Compared to the year-ago period, that represented a 17% increase in revenues, and both revenues and earnings beat analyst expectations.
"It was a record quarter, driven by our commercial cloud, which surpassed $16 billion in revenue, up 34 percent year over year," Nadella said. "What we are witnessing is the dawn of a second wave of digital transformation sweeping every company and every industry."
Highlights among business-oriented products included a 50% quarter-over-quarter increase in Azure revenues, a 21% increase in Office 365 commercial revenues, 39% growth in Dynamics 365 revenue and a 1% gain in Windows OEM revenues -- a figure that doesn't sound impressive except the comparison was against the frenzy a year ago to replace Windows 7 before the support deadline.
Posted by Scott Bekker on January 26, 2021 at 5:03 PM0 comments
Microsoft this week announced Tyler Bryson as the replacement for the departing David Willis to run the company's U.S. channel operations.
Bryson is officially corporate vice president of the U.S. One Commercial Partner organization.
"As I step into this new role, I look forward to deepening the relationships in our ecosystem and helping us all grow together," Bryson said in an introductory blog post.
In a nearly 20-year career with Microsoft, Bryson has led sales, marketing and services teams in the United States, India and Latin America. His most recent role was as vice president of the Microsoft U.S. Small, Medium & Corporate Segments. Bryson said he worked closely with Willis in that role on initiatives related to digital transformation.
According to Bryson's LinkedIn profile, he graduated from Brigham Young University in 1992 with a degree in accounting and went to the Wharton School for an MBA in finance in the late 2000s. He also spent six years at QuickStart Technologies in sales and marketing roles.
To U.S. partners, Microsoft's U.S. channel chief is arguably the second-most visible role at Microsoft after the worldwide channel chief job held by Gavriella Schuster. Due to Microsoft's organizational structure, Schuster and Bryson report into different departments and have more of a dotted-line relationship than at many other companies where country-level channel chiefs report to the global channel leader.
Bryson updated his LinkedIn profile with a description of his role and responsibilities:
My team is responsible for Microsoft's US Partner business including strategy, management, and overall partner ecosystem health. The team works with US partners to develop strong practices aligned to Microsoft's workload and industry priorities and delivers these solutions to customers to help them maximize business benefits from their investment in Microsoft technology. My organization is comprised of Partner Management, Channel Sales, Go-To-Market (GTM), and partner-facing Technical Specialists and Architects.
Willis, a fixture of the partner community for much of his 28 years at Microsoft, announced in early December that he would be leaving Microsoft after assisting with the transition to his replacement. While he didn't specifically say he was retiring, Willis said he was looking forward to family time, leisure activity, travel and volunteering.
Posted by Scott Bekker on January 21, 2021 at 9:34 AM0 comments
The PC market was on fire in the fourth quarter.
In its quarterly tracking of worldwide PC shipments, IDC reported preliminary numbers of 26.1 percent year-over-year growth to 91.6 million units.
And the fire could have been hotter.
"Every segment of the supply chain was stretched to its limits as production once again lagged behind demand during the quarter," said IDC analyst Jitesh Ubrani in a statement Monday. "Not only were PC makers and ODMs dealing with component and production capacity shortages, but logistics remained an issue as vendors were forced to resort to air freight, upping costs at the expense of reducing delivery times."
Citing pandemic-related demand factors such as work-from-home, remote learning, gaming and monitors, IDC predicted the boom in PC sales has a ways to go.
For the full year, market growth was 13.1 percent. The research house said the last time PC growth was that strong was 2010, when the market grew by 13.7 percent.
Lenovo led all vendors in worldwide PC shipments for Q4, followed by HP Inc., Dell Technologies, Apple and Acer Group.
Posted by Scott Bekker on January 11, 2021 at 10:04 AM0 comments
In the holding pattern that is early 2021, Microsoft's priority guidance to partners for the new year is for more of the same.
Microsoft channel chief Gavriella Schuster detailed her view of partner priorities and opportunities this week in a blog post that largely echoed earlier guidance from Microsoft Inspire, the annual July partner conference that helps kick off Microsoft's fiscal year.
As the ongoing coronavirus pandemic leads to renewed lockdown calls around the world, sets new daily death records in the United States and brings an uncertain vaccine rollout schedule, organizations and the partners who serve them find themselves in a similar technology circumstance to most of 2020. To wit, an uncertain business environment, ambiguity about when or if all employees can go back to the office, and limitations on IT spending driven by all that uncertainty.
Schuster, nonetheless, strikes a hopeful note about the challenges. "While some of these factors will unavoidably carry over to 2021, I am confident things are headed in the right direction, and I see a bright future on the horizon for our partner ecosystem," Schuster wrote.
In her post as head of the Microsoft One Commercial Partner organization, Schuster identified four key priority areas that Microsoft hopes its partners will focus on and succeed in during the coming year.
Remote work, unsurprisingly, leads the list. "While the initial exodus to remote work occurred early last year, organizations of all sizes are still evolving in response," Schuster wrote. Her post called for additional adoption of Microsoft Teams and other Microsoft 365 components.
Schuster also pointed to new opportunities in business continuity, noting the infrastructural changes organizations have had to make in the last year that haven't all been followed by revised and reinforced backup and recovery plans.
Like almost every year, security earns a place on the opportunity list. "The mass shift to remote work has made this even more critical for every organization worldwide," she said.
Finally, cloud migrations are another key opportunity area, Schuster said. She highlighted the way Microsoft has been simplifying the migration process for customers to turn to cloud adoption.
The post gives lip service to the term "digital transformation," the major theme of the last few years from Microsoft to its partners. However, what's called "digital transformation" now is dialed back substantially from the heady definitions of 2019 and earlier, when it referred to unlocking massive business potential by reinventing processes through innovative new applications and application modernization. The term now seems to refer more to the survival-oriented operations of supporting remote workers, reducing datacenter expenses and rejiggering business continuity/disaster recovery coverage.
That said, many of these more limited projects can be a stepping stone toward more ambitious projects in the future. When the pandemic recedes, organizations with more robust cloud infrastructures may be more ready to invest in and execute truly transformative projects than they had been before the crisis.
With luck, it's "digital transformation lite" in 2021, involving the types of priorities Microsoft is recommending, followed by "digital transformation heavy" in 2022.
Posted by Scott Bekker on January 07, 2021 at 9:50 AM0 comments
Microsoft U.S. Channel Chief David Willis announced Friday that he would be leaving Microsoft in January after 28 years at the company.
He didn't use the word "retire" in a blog post on the official U.S. Partner Blog, and some of his phrasing left open the possibility that he might emerge as an executive somewhere in the future. However, Willis suggested that his focus in the near future would be on family time, leisure activity, travel and volunteering.
"Personally, I've always lived life with a 'work hard, play hard' mentality, and I'll be shifting my balance from less work to more play, as I spend much more of my time on passions that include snowboarding, playing hockey, my guitars, spending more quality time with family & friends, and eventually some fun travel experiences once COVID-19 eases up. I'm also looking forward to participating in more volunteer opportunities and giving back to the community. I thank Microsoft for making it possible for me to be in this position," Willis wrote.
Willis said that it wasn't an easy decision to leave Microsoft, and that he was proud to have spent most of his career there.
Willis joined Microsoft in Canada in 1992 and held a number of marketing and sales roles in his first decade with the company, according to his LinkedIn profile.
He's been a fixture of the partner community since becoming the vice president for Small and Midmarket Solutions & Partners (SMS&P) in Canada in 2003. Later he held the positions of VP of U.S. East Region for SMS&P and VP of U.S. Dynamics.
In 2013, Willis became Microsoft's U.S. Channel Chief, when the full title of the role was corporate vice president of U.S. SMS&P. In the major reorganization of 2017, when the partner organization became One Commercial Partner (OCP), Willis essentially maintained the same function as CVP of U.S. OCP.
A successor has not been named. Willis plans to stay through January to assist with the transition.
Posted by Scott Bekker on December 04, 2020 at 1:47 PM0 comments
Sirius Computer Solutions snapped up Boca Raton, Fla.-based solution provider Champion Solutions Group and Champion's cloud practice, MessageOps, which was one of the pioneering toolsets for Office 365.
With the acquisition, Sirius expands its national IT solutions integration business into the southeastern United States and strengthens its Microsoft cloud capabilities in both Microsoft/Office 365 and Microsoft Azure.
Sirius is a privately held company with 2,600 employees based in San Antonio, Texas. Terms were not disclosed for the deal, which closed on Monday and was announced Tuesday.
Joe Mertens, president and CEO of Sirius, described the MessageOps unit with its intellectual property around the Microsoft cloud as a competitive advantage for Sirius, which also has cloud partnerships with Amazon Web Services (AWS), Google Cloud, IBM and VMware.
"Joining forces with Champion provides an opportunity for Sirius to gain valuable intellectual property assets and expertise related to Microsoft Azure cloud services and Microsoft 365 productivity and collaboration tools, which will add value for our clients," Mertens said in a statement.
MessageOps solutions handle functions within Microsoft 365 environments such as monitoring, managing, reporting, synchronizing passwords and migrating data across environments. Originally a private company that was later acquired by Champion, MessageOps was among the first ISVs automating migrations and other tasks related to the Office 365 predecessor, Microsoft Business Productivity Online Suite (BPOS).
Mertens added that Sirius plans to offer expanded services and solutions to Champion's client base in Florida and the southeastern United States. Champion has also been part of Microsoft's National Systems Integrator (NSI) program and was a Tier-1 Cloud Solution Provider (CSP) for Microsoft.
Sirius planned to immediately integrate Champion's employees into the Sirius organization, which includes a Cloud Center of Excellence (CCoE) model that brings together cloud solutions practices with consulting and services that include migration, data analytics, security and compliance.
Champion President and CEO Chris Pyle called Sirius a great fit for Champion's employees and clients, and added that he was excited about new investments in MessageOps and Inscape.
"We will also have the ability to invest more resources into the ongoing development of our IP, enabling us to deliver leading-edge cloud monitoring, management and security tools," Pyle said.
Posted by Scott Bekker on December 02, 2020 at 9:45 AM0 comments
Microsoft released its first quarter earnings on Tuesday afternoon, reporting revenues of $37.2 billion and earnings of $1.82 per share. The company beat analyst expectations on the back of strong cloud growth.
However, the centerpiece of the Satya Nadella-led earnings call on Tuesday evening was the Microsoft Teams collaboration platform, which keeps surging to new highs due to COVID-19-related remote work.
Microsoft Teams now has 115 million daily active users (DAU), Nadella told analysts during the call. That's a 475 percent increase over the 20 million DAU that Microsoft reported for Teams in November 2019, before a huge portion of the global workforce started logging in from home offices rather than their companies' office space. It's also a 53 percent jump over the last number Microsoft released -- 75 million DAU in April.
Unlike some metrics that Microsoft reports consistently, the Teams DAU figure is revealed sporadically and only when the company has a milestone that fits a positive growth story. For example, Microsoft reported DAU in March of 44 million, and then a month later released the 75 million DAU figure for April to show the 70 percent growth of users in about a month of global work-from-home decisions. Since then, growth has slowed and the company went quiet for six months.
"We are seeing increased usage intensity as people communicate, collaborate and co-author content across work, life and learning," Nadella said before tossing out a few more momentum metrics:
- Referencing Teams as a part of the larger Microsoft 365 suite, Microsoft reported that Microsoft 365 users generated more than 30 billion collaboration minutes in a single day in the quarter.
- Nearly 270,000 educational institutions are using Teams.
- A large deal with PepsiCo will include a rollout of Microsoft 365 and Teams to 270,000 employees worldwide.
During a question portion of the call with analysts, Nadella answered an inquiry about the Teams opportunity by describing how he views Teams. "Teams is very exciting to us because, unlike anything else that we have done at the application layer, it's literally like a shell. It has a platform effect because meetings, chat, collaboration, as well as business process applications, integrate into Teams so that scaffolding richness makes it a very robust platform," Nadella said.
Nadella also highlighted for analysts the pace at which Microsoft is adding new features to Teams. He claimed more than 100 new capabilities in the last six months, and specifically called out breakout rooms, meeting recaps, shift scheduling and events with up to 20,000 participants.
During a separate question about artificial intelligence, he called out how heavily Teams is drawing upon Microsoft's AI research and development. "Every Teams session is full of AI because of the transcription services, the speech recognition services and so on that it incorporates," Nadella said.
Other positives in the quarter for Microsoft were Azure growth of 48 percent and 20 percent growth of the larger Intelligence Cloud segment generally, which includes Azure. Negatives included a 5 percent drop in licensing revenues from Windows OEMs and a 10 percent drop in search advertising business compared to the year-ago quarter. Contributing to the Windows decline is a comparable against a quarter that benefited from the end of support for Windows 7, but it also comes in a quarter that Canalys, Gartner and IDC all reported as a boom time for PCs.
Microsoft stock rose by about 1 percent in after-hours trading on the earnings news but moved 2 percent lower after Microsoft shared second-quarter guidance that was more conservative than analysts expected.
Posted by Scott Bekker on October 28, 2020 at 10:14 AM0 comments