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What To Expect in Microsoft's Fiscal '16: Focus on Cloud

How to navigate Microsoft's shifting attitudes toward the cloud in the coming fiscal year.

As we end the fiscal year for Microsoft in June, many of us get ready for the changes in the new Microsoft fiscal year. Here are some key items to watch for this new fiscal year that might impact your business.

A Focus on Consumption
Microsoft has announced that every field person will have a metric around how much customers are consuming of their cloud subscriptions. This will start to drive a massive change in behavior in the field. Short term, my sense is that for direct sellers, consumption will still play second fiddle to sales revenue produced. For the partner-engaging teams, they will have a much higher metric and focus on consumption.

So, my prediction is that managed partners will see an increased focus on how they're influencing adoption within corporate accounts. How can your business help clients take better advantage of the cloud? Can you package up those offerings for Microsoft to get excited about?

Deployment Center
I predict that this is the year Microsoft gets serious about using the deployment center. The deployment center is Microsoft's internal team and tools used to assist clients with actually doing mail migration to the cloud with no cost to the clients. In my opinion, Microsoft still fails to see how dangerous this offering is to its channel.

Partners should watch for the current migration subsidies -- $15 per seat through the end of June -- to be slowly phased out. Partners will come to the difficult decision to sell with (giving up on the mail migration revenue) or against the deployment center or sell competing solutions. The impact of the deployment center will really come down to one major item: if the sales teams are incented to use it. If they're incented, then when they swoop in to touch a deal at the last minute, expect them to pitch the deployment center's services against yours -- and remember, theirs are free.

Partners will need to find other ways to drive services revenue. Microsoft needs to do a better job of showing where additional revenue opportunities are if it wants partners to pick up new Microsoft-focused revenue sources instead of competitive ones. Watch this space carefully if you have mail migration services revenue as part of your business.

Microsoft Azure/Amazon Web Services Compete
Expect Microsoft to get laser-focused on its Azure cloud platform. This product has matured and is now gaining traction in the market. The smart sales reps realize that they must get customers to consume Azure dollars, not just purchase dollars on an Enterprise Agreement. This should drive behavior to talk, sell and implement Azure-based solutions early in the fiscal year, allowing the field to maximize Azure consumption through the end of the fiscal year.

Look for Microsoft to get tighter around its messaging for Amazon Web Services compete. It simply has lost too many deals to date. As a partner, I would recommend looking at the places where Azure could be a fit for your clients. How can you package solutions and talk about things like Disaster Recovery as a Service versus looking at Azure as just a competitor versus on-site compute and storage?

Google Compete
Look for Microsoft to stay hyper-focused on Google compete deals. Internally, Microsoft employees have seen entire account teams be fired when their clients move to Google. This heavy-handed action has created a sense of fear within the field sellers. This fear will drive them to ask you to put more time into Google compete situations than you normally would for similar-sized deals. How is your Google Apps competitive knowledge? Can you clearly explain to a client why Microsoft offerings for them are superior?

This industry continues to change at a break-neck speed. Please share your thoughts with me on how you're keeping up with the change, and what's keeping you up at night!

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About the Author

M.S. Partner is a pseudonym for a former Microsoft U.S. field rep who returned to the channel and writes this column to help other partners succeed with Microsoft. Let M.S. Partner know your thoughts and questions about how Microsoft works at mspartner@rcpmag.com.