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Four Quotes on Partners from the Nadella Memo

We'll be watching Satya Nadella closely next week in his first Microsoft Worldwide Partner Conference (WPC) keynote as CEO of the company, but he surely previewed some of his themes in the major employee memo released to the public Thursday.

In addition to redefining Microsoft's mission statement and telegraphing upcoming organizational and engineering changes, Nadella also made a few comments about where partners fit in the new Microsoft in the 3,000-plus-word memo.

Here are four partner-related quotes from the Nadella memo (emphasis mine):

1) Dual Users and a Platform Mindset
"Microsoft will push into all corners of the globe to empower every individual as a dual user -- starting with the soon to be 3 billion people with Internet-connected devices. And we will do so with a platform mindset. Developers and partners will thrive by creatively extending Microsoft experiences for every individual and business on the planet."

Dual user is a major priority for Nadella. His memo repeatedly uses the phrase, which means people who expect to use their devices and an array of cloud services for both work or school and play or personal. (I hope someone is sending his memo to the Microsoft licensing team. Case in point: You can't legally use Office apps on the Surface RT for business.) Nadella's quote suggests that he believes partner buy-in to this dual user concept is critical for its success.

That platform mindset is an allusion to Microsoft's new core vision, which Nadella stated earlier in the memo: "Microsoft is the productivity and platform company for the mobile-first and cloud-first world." Platform, of course, is a good word to partner ears.

2) Customize and Extend
"Our cloud OS will also run all of Microsoft's digital work and life experiences, and we will continue to grow our datacenter footprint globally. Every Microsoft digital work and life experience will also provide third-party extensibility and enable a rich developer ecosystem around our cloud OS. This will enable customers and partners to further customize and extend our solutions, achieving even more value."

If you look closely, the first quote mentions extending, too. It's a theme. Nadella hasn't spent a lot of time in his tenure so far talking about implementers, resellers or licensing partners. This former engineer's attention seems reserved for those partners who can make Microsoft products do more than work, even if it sometimes takes substantial skill to get Microsoft products working effectively in a customer environment.

3) Stimulate Demand and Make the Market
"Our first-party devices will light up digital work and life. Surface Pro 3 is a great example -- it is the world's best productivity tablet. In addition, we will build first-party hardware to stimulate more demand for the entire Windows ecosystem. That means at times we'll develop new categories like we did with Surface. It also means we will responsibly make the market for Windows Phone, which is our goal with the Nokia devices and services acquisition."

This dog whistle goes out to the OEM community, one of Microsoft's longest-standing partner categories. The Surface launch, along with the tepid market response to Windows 8 and overall declines in PC sales, caused tension to come out into the open between Microsoft and some major OEMs. Nadella, who cut the word "devices" out of the new company mission statement, is further clarifying here for OEMs that products like Surface are really about stimulating demand for everyone's PCs. The sentiment is similar for smartphone manufacturers.

4) New Partnerships
"New partnerships will be formed."

This statement comes in a paragraph of similarly phrased, blunt statements intended to knock any complacency out of Microsoft employees. In some ways, it's an acknowledgment of things that have already happened. The decision under Nadella's watch to move ahead with the Office on iPad is effectively a partnership with Apple. Then there's the recent deal with longtime flame war foe It serves as an additional heads-up to partners selling non-market-leading Microsoft products that Nadella's Microsoft might not be as willing to sacrifice strategic platform revenues and positioning for tactical product advantages.

Stay tuned for RCP's Twitter (@scottbekker), blog and in-depth coverage of WPC all next week, including Nadella's keynote Monday morning.


Posted by Scott Bekker on July 10, 2014