News

Microsoft's Partners Are Up for SaaS, Survey Suggests

• By Kurt Mackie
• December 13, 2007

Microsoft's channel partner community apparently understands that there will be impending challenges posed by the software-as-a-service (SaaS) business model. A survey conducted by research firm IDC found that 76 percent of partner respondents thought that SaaS will "dramatically impact the partnering landscape," according to an announcement issued by IDC.

The finding is part of an upcoming study called "The Channel View: SaaS Capabilities and Opportunities." IDC derived its findings by surveying members of the International Association of Microsoft Certified Partners in September of this year. The announcement didn't specify how many responded to IDC's survey.

SaaS, or, in Microsoft's parlance, Software Plus Services, affects the delivery of enterprise software. Rather than being installed by partners at the customer's premises, SaaS solutions are hosted over the Internet cloud. While that suggests a lesser role in the provisioning of software by Microsoft's partners, more than 70 percent of respondents to IDC's survey saw SaaS as an opportunity.

Respondents described the most profitable opportunities with SaaS as "implementation services" and "business services related to SaaS deployments," according to the announcement.

Moreover, "many of the surveyed firms are already engaged in SaaS-related activities," the announcement stated.

"The survey results clearly show that partners are very optimistic about the potential opportunity that lies ahead and that they expect to link with other firms to realize this potential," concluded Stephen Graham, group vice president of Software Business Strategies at IDC, according to the announcement.

Microsoft has consistently highlighted its Software Plus Services effort in public announcements, without spelling out exactly how its large partner community will be engaged, much less compensated. Microsoft's view appears to be that the SaaS option will depend on the particular business case. Recently, Microsoft associated its Software Plus Services effort with its model-driven development effort called Oslo.

An earlier Software & Information Industry Association (SIIA) report more generally tried to spell out potential compensation numbers for IT support under a SaaS delivery model. That report also suggested that the new model for IT partners under SaaS will be supporting specific vertical market business needs, rather than just providing technical tweaks for organizations.

IDC's report, "The Channel View: SaaS Capabilities and Opportunities," includes information for partners on "how to build a partner chain" as well as "overall essential guidance," according to IDC's announcement. It can by ordered by e-mailing sales at IDC.