The Changing Channel

Below the Surface: Ignoring the Danger of Ignoring the Channel

In which Howard draws a link between a series of unfortunate Microsoft Surface-related events.

One of the things I love to do most is to put significant events together and see just how consistently some things lead to the same place.

So Microsoft quietly decides to develop its own tablet, steal the name from its really cool table computer and call it the Surface.

Despite 38 years of building an enormous partner channel and exclaiming how partners are Microsoft's only way to sell its products, Microsoft decides to build a chain of notoriously empty retail stores around the country and, initially, only sell the Surface in each of its incarnations through those stores and online. Microsoft does not allow any member of its beloved partner channel to do so. Later, the company invites Best Buy and some other chains in, but the partners are no longer the mainstream.

Despite the fact that the majority of channel partners still cannot sell the device, Microsoft suddenly turns around and offers it to its channel partners to buy for themselves at $99 for the toy ARM version and $399 for the underpowered Surface "Pro." Being someone who bought the RT on day one for $699, boy, do I feel like a fool.

Then, Microsoft takes a $900 million write-down for an "inventory adjustment" to Surface RT and related stuff.

OK, so the link here is insanely obvious: Ignore the channel and it will cost you. If Microsoft wanted to bring a serious product to market, it should have turned where it's always turned -- to its partner channel. Why would it not? What did it think it was saying to the channel? Why does Microsoft seem surprised at the backlash?

What questions or comments do you have about this obvious stumble? Leave them below or drop me a line at [email protected].

I'm hoping that some of my good friends at Microsoft who are great channel advocates will read this and respond with comments. I'm sure they're as unhappy with this as anyone, but I'd love to hear their honest take on why Microsoft would shoot itself in the foot once again by ignoring the partners who brought it to where it is.

About the Author

Howard M. Cohen is a consultant to IT vendors and channel partner companies and a board member of the U.S. chapter of the IAMCP. Reach him at [email protected].


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