Dell is seeing a significant bounce in partner deal registration activity in its security product lineup, the company told attendees at its annual North American Dell Security Peak Performance conference this week.
"With security being a top priority for all organizations, we are delighted to see the success of our partner strategy," said Marvin Blough, vice president of worldwide channel sales at Dell Security, in a blog post from the Las Vegas conference, which drew 650 attendees from 22 countries.
The number of deal registrations increased by 7 percent to more than 4,100 per quarter, and the number of individual partners submitting deal registrations increased by 12 percent to 1,300 per quarter, Blough said.
In the last 12 months, 12,000 partners sold Dell SonicWALL products, including firewalls, secure mobile access solutions and e-mail security solutions.
At the same time, Dell is building out its channel capacity for security solutions. The company reported that 320 partners earned the network security competency in the last 12 months. Dell's total number of Preferred and Premier level partners is now 1,500.
The Peak Performance conference runs through Wednesday.
Posted by Scott Bekker on September 01, 2015 at 10:57 AM0 comments
Windows 10 is off to a jackrabbit start in its first month of availability, according to two major market share tracking organizations.
Released on July 29, Windows 10 was a free upgrade for many Windows 7 and Windows 8 users and Microsoft has been rolling the download out in controlled waves to users who requested it in the subsequent weeks.
Both StatCounter and Net Applications published usage share data for all of August on Tuesday morning. StatCounter put Windows 10's worldwide share at 4.88 percent. Net Applications had Windows 10's global share at 5.21 percent.
The one-month figures compare favorably to previous releases, which is not surprising given that most users had to pay when upgrading to Windows 7 or Windows 8.
"Windows 10 came out of the traps much faster than Windows 8 and also exceeded the launch of Windows 7," said Aodhan Cullen, CEO of StatCounter, in a statement Tuesday morning.
Windows 8 had 1 percent share after its first month on the market, while Windows 7 had 4.05 percent, according to StatCounter. The new operating system is doing better in the United States and much better in the United Kingdom than previous releases, according to StatCounter. U.S. share is 5.64 percent and U.K. share is a whopping 8.45 percent. (See table for Windows 8 and Windows 7 comparisons.)
Internet usage share for first calendar month since launch. Source: StatCounter
Net Applications data shows the field still dominated by Windows 7 at nearly 58 percent share. Windows 8/8.1 is next at 15 percent, followed by the out-of-support Windows XP at 12 percent. Windows 10 and Mac OS X 10.10 are neck-and-neck at 5.21 percent and 4.76 percent, respectively.
Meanwhile, StatCounter also looked at the new Edge browser in Windows 10 and concluded that most people aren't using it and it's gotten less popular over time. Edge usage went from 20 percent of Windows 10 users on July 30 to 14 percent on Aug. 31.
Last week, Microsoft said Windows 10 was running on 75 million devices. The company's stated goal is to get Windows 10 on 1 billion devices by its fiscal year 2018.
Posted by Scott Bekker on September 01, 2015 at 10:25 AM0 comments
The mid-year tech spending estimate revisions are in, and the board is lighting up red.
With the benefit of two quarters of earnings data from the tech majors, IDC now sees worldwide PC shipments falling by 8.7 percent in 2015 and falling again in 2016 before a "modest recovery" possibly starting in 2017.
Tablet revenues are actually falling twice as fast as IDC had expected earlier. Shipment declines for 2015 are now projected at 8 percent, the Framingham, Mass.-based market research firm said Wednesday.
Even smartphones aren't matching expectations, although growth continues at a (barely) double-digit pace. IDC this week revised its year-over-year growth forecast for smartphones in 2015 downward from 11.3 percent to 10.4 percent.
'A Transition Period'
In a statement, IDC pointed to a number of factors that are driving sales downward that mostly boil down to major economic forces, the disruptive model of Windows 10 and the difficult comparables to the Windows XP end-of-life bounce.
"Although IDC had expected the second quarter of 2015 to be a transition period as vendors prepare for Windows 10 systems in the second half of the year, final results nonetheless shrank even more than expected due to a stubbornly large inventory of notebooks from prior quarters, and severe constraints posed by the decline of major currencies relative to the US Dollar," IDC noted. "In addition to economic issues, free upgrades of Windows 10, a relative dearth of newer models in the short term, and channels that are reluctant to take stock also makes the prospect of growth unlikely through 2016."
That IDC take was likely influenced by comments made last week on an HP earnings call by Dion Weisler, who will be CEO of HP Inc. when it splits off from Hewlett-Packard Enterprise.
"We did anticipate a challenging operating system transition to Windows 10 on two dimensions," Weisler said. "One was a free upgrade that was, of course, offered. And the second was the very short transition time, which is normally about three months, which was compressed to under one month. And what that drove was fairly high Windows 8 channel inventory levels, and that will take a little bit of time to flush. I guess the good news is that the Windows 10 feedback is pretty good, and a great operating system is important for the ecosystem in the industry. So once Windows 8 flushes, which may take a little time here in the industry, we should see some stimulation from Windows 10."
'The Space to Watch'
One area within the tablet market is doing well: the 2-in-1 segment pioneered by the Microsoft Surface. It's a fraction of the projected 212-million-unit-overall market for tablets, but it's moving quickly and IDC sees it as poised for 86 percent growth in 2015 to 14.7 million shipments.
"In the past, the biggest challenges with 2-in-1 devices were high price points, less than appealing designs, and, quite frankly, lack of demand for Windows 8, which was the OS most devices were running," said Ryan Reith, program director with IDC's Worldwide Quarterly Mobile Phone Tracker, in a statement. "With more OEMs offering devices in this segment, prices have started to come down significantly. We estimate that over 40 different vendors shipped 2-in-1 products in the second quarter of 2015, which is up from just 14 vendors two years ago. With the launch of Windows 10, the introduction of more Android-based products, and the possibility that Apple will unveil a larger, screen-detachable iPad, this is the space to watch."
The commercial market has been very reluctant to migrate toward tablets, and IDC believes this is largely due to an unclear value proposition. The 2-in-1 segment should find opportunities within the commercial market, but IT buyers have been slow to move toward mobile devices beyond smartphones and do not yet see tablets or 2-in-1s as a true PC replacement.
Jean Philippe Bouchard, IDC research director for the tablet market, sees commercial clients playing a crucial role in 2-in-1 demand after having mainly sat out the tablet craze to date.
"It will take some time but we expect that once IT departments are done evaluating Windows 10 and the awaited iPad Pro, they will start migrating some their portable PC and tablet installed base towards 2-in-1's, which will accelerate the adoption of the form factor," Bouchard said. "So far, this category has been the led by Microsoft with its Surface product line. But with the arrival of the iPad Pro, the launch of Windows 10, which is better suited for the 2-in-1 form factor, and the introduction of Intel's Skylake silicon, we expect a flurry of new devices to launch between now and December 2015."
For its part, Microsoft is priming its channel for Surface. In Microsoft's earnings release in July, COO Kevin Turner said, "We are also expanding the opportunity for more partners to sell Surface, and in the coming months will go from over 150 to more than 4,500 resellers globally."
Smartphones continue to be a two-horse race between the Android ecosystem and Apple iPhones, and the fates of those platforms determine the fate of the overall market, which is facing slowing growth in China. Microsoft is rumored to have a few new Lumias on tap, but its massive writeoff of the Nokia deal cast a cloud over its commitment to the market.
In the meantime, IDC's shipment and market share projection for smartphones for all of 2015 is 1.1 billion Android units (81 percent), 224 million iPhones (16 percent) and 37 million Windows Phones (less than 3 percent). "IDC's view that Microsoft/Windows Phone will remain a marginal challenger at best has not changed," the research firm said.
Posted by Scott Bekker on August 26, 2015 at 11:14 AM0 comments
A day into his job as the global channel leader for Intel Security, Richard Steranka says he sees the biggest opportunities for channel growth in the midmarket and SMB spaces, even as aggressive investment in datacenter solution-based enterprise partners will continue.
"Even as of yesterday, I had an opportunity to talk with all of the sales leaders across the globe and the current channel team," Steranka said in an interview Tuesday. "It's pretty clear that we've made great strides in the enterprise space. The midmarket and SMB have seen high growth but [we] feel there's still further potential there for our partner community."
Steranka was named to the post on Monday, and came to the job from a similar role as vice president of the worldwide partner organization at Avaya. Steranka also held numerous channel roles in nearly 20 years at Cisco.
For Intel Security, which rebranded itself from McAfee in January, Steranka's appointment marks the end of a six-month period without a worldwide channel leader. The job's former occupant, Gavin Struthers, took a role as president of Intel Security's Asia Pacific sales in March.
Identifying stability as a key ingredient of a successful channel program, Steranka said that he plans to continue with the channel program updates rolled out in two phases, the first in October 2014 and the second in July of this year. Last October, the company relaunched the McAfee SecurityAlliance Program as the Intel Security Partner Program, which changed the focus from product competencies to solution competencies, and introduced a Managed Services Specialization and an Authorized Support Specialization. Last month, Lisa Matherly, head of Worldwide Partner Programs, Marketing and Operations at Intel Security, unveiled a second phase of changes focused on improving partner profitability and reducing conflict among partners for deals.
Steranka said he will continue to work with Struthers and Matherly, who remains in her role, to continue rolling out those changes.
"[The changes] tend to recognize partners that were making the investments back in Intel Security. That program continues. But we'll continue with [Gavin's] efforts in rolling out the future changes of the program," said Steranka, adding that he's eager to get feedback in the next few weeks from partners about what they like so far and where they would like to see future changes.
As part of the program updates, Intel Security changed the old Elite, Premier and Associate partner level names to the more straightforward Platinum, Gold and Silver. Of Intel Security's 30,000 registered partners and 15,000 active partners worldwide, 250 are Platinum and 760 are Gold.
Asked if that was the right mix moving forward, Steranka said he'll be looking at it. "I think it's probably just too early for me to answer that. The recognition right now is based on individual specializations [and that] is the right way to do it. How partners have been grandfathered in or allowed to move into those levels, that's what I'm not completely up to speed on."
Another factor in his analysis will be the way that the security market is shifting.
"The one thing I do know is the security space in terms of channel partner coverage, how they define themselves, is changing from the pure-play security partner to those where it's the full datacenter offerings -- compute, storage, virtualization and, most importantly, securing all of that. That is a set of partners that we're very interested in working with. Then we also have, clearly, the move to those that want to be in the managed-services business, cloud business and selling complete turnkey services to customers," he said. "As I look to how to cover this market in the most effective way possible, one of the things will be how the program aligns partners to do that, rewards them, and if we can increase our number of medaled partners as a result, then that's acceptable."
Posted by Scott Bekker on August 25, 2015 at 4:00 PM0 comments
SHI went public Thursday with a customer education program designed to position the Microsoft partner for a share of the Microsoft FastTrack Adoption Offer budget.
SHI, based in Somerset, N.J., is one of about a dozen U.S. Licensing Solution Providers (LSPs), the only Microsoft partners able to transact licensing agreements with enterprise customers.
Microsoft introduced FastTrack in its 2015 fiscal year and renewed it for FY16, which began July 1. The FastTrack offer is closely affiliated with the Microsoft Onboarding Center, an internally-staffed center for getting customers started with and using cloud products, such as Office 365.
"In essence, customers that purchase at least 150 eligible O365 licenses, and in that two-month window, can work with a Certified Microsoft Partner to manage their deployment of O365 workloads, and in doing so can offset the total cost of moving to an O365 environment," wrote Jim Sheridan, SHI senior project manager, in a post on The SHI Blog. "Once the customer and partner complete the due diligence of the deployment, the partner will submit a funding claim to Microsoft to partially offset the costs of the organization's O365 adoption -- a process that could save organizations five figures off the total expense, for example."
SHI is playing up a few new elements of FastTrack this year, including the ability to have Microsoft conduct the data migrations and a round of bridge funding that allows customers who bought their seats between July 1 and Aug. 31 to leverage the benefit rather. Last year, eligibility began Sept. 1.
For more detail of Microsoft's changes to FastTrack and other incentives for FY16, see "Microsoft Expanding In-House Cloud Deployments."
Posted by Scott Bekker on August 20, 2015 at 11:25 AM0 comments
Here at RCP, we've often covered the inflammatory things Microsoft executives have to say about VMware. (Mostly COO Kevin Turner in his annual Worldwide Partner Conference keynote.)
In the Satya Nadella era, Microsoft has turned down the temperature on such statements a bit, and even eliminated a blacklist of companies, including VMware, that were previously banned from attending WPC.
Keith Ward, editor of RCP's sister site, Virtualization Review, got a 1:1 with VMware CEO Pat Gelsinger and took the opportunity to ask, "Microsoft: friend, foe or frienemy, and why?"
Here's what Gelsinger had to say:
"It's no secret that we have offerings that compete with each other. That said, we support our customers and partners on any platform. VMware has numerous offerings that help enterprises get the most out of their Microsoft applications, platforms and devices. We are a committed and active contributor to the Microsoft community through our support of Windows enterprise customers, including IT groups developing, testing and deploying Windows-based applications. And as Windows 10 is rolled out across enterprises, AirWatch can best secure and manage all Windows devices -- desktop, notebook, tablets and phones, along with devices from other platforms."
A classy response from Gelsinger, but also one that makes clear that VMware has no intention of ceding market share, not just in virtualization but also in the emerging and strategic category of enterprise mobility, where AirWatch and the Microsoft Enterprise Mobility Suite (EMS) both play.
Check out more of Keith's lengthy and revealing interview here.
Posted by Scott Bekker on August 20, 2015 at 10:19 AM0 comments
One of Microsoft's remaining handful of U.S.-based Licensing Solution Providers (LSPs), SoftwareONE, this week announced an infusion of growth capital from global investment firm KKR in exchange for a 25 percent minority stake. The amount was not disclosed.
SoftwareONE, which does business in 115 countries and is based in Stans, Switzerland, with U.S. headquarters in Waukesha, Wis., provides software licensing and procurement services for more than 9,000 software publishers. The privately owned company has been a longstanding Microsoft LSP, a category of partners formerly known as Large Account Resellers or LARs, and listed Microsoft first among the software publishers it works with in a statement about the deal.
The once-lucrative LAR business has come under pressure both from shrinking payouts by Microsoft and from the industry shifts away from software licenses to cloud services. SoftwareONE, like many of its competitors, now defines itself as a technology consulting and cloud services company, in addition to the licensing-related services.
"The software industry is changing, and together with KKR, we see a unique opportunity to capitalize on those changes and continue to increase the value we bring to our customers, in particular in the areas of cloud and value-added services," said SoftwareONE CEO Patrick Winter in a statement, after making clear that the company would continue "serving our customers and supporting our software publisher partners all around the world."
New York-based KKR's investment will come primarily from the KKR European Fund IV, and the transaction is expected to close this fall. KKR, best known for the landmark 1989 leveraged buyout of RJR Nabisco and the 2007 TXU buyout, said in the statement that the investment company sees promise in SoftwareONE's complete lifecycle expertise and that the investment is intended to spur further organic expansion and M&A, with a particular focus on growth in the United States and Asia.
Although Microsoft is steering LSPs in different and often painful directions with its incentives changes, Microsoft publicly recognized SoftwareONE's ongoing importance to its strategic aims with three global awards this year. SoftwareONE was a finalist for the global Volume Licensing Competency Partner of the Year Award, as well as a Country Partner of the Year Award winner for both Honduras and Singapore.
SoftwareONE had been aggressively pursuing growth in the months leading up to the KKR investment. While the company has been quiet in public about its moves, the company bought the software business of fellow LSP CompuCom in March and has reportedly been in talks with other LSPs.
Keep an eye on the LSP market as the new KKR cash comes to SoftwareONE.
Posted by Scott Bekker on August 19, 2015 at 11:12 AM0 comments
Tech services giant Computer Sciences Corp. (CSC), in the midst of splitting itself in two, just announced two "tuck-in" acquisitions.
One is Fruition Partners, which CSC describes as the largest ServiceNow-exclusive service management consulting firm. Fruition Partners is based in Chicago and does business in the United States, Canada, the U.K. and South America. The company brings 300 ServiceNow practitioners and 800 clients to CSC. Fruition Partners will become part of CSC's Global Enterprise Solutions Consulting Group, and beef up CSC's ServiceNow practice, while joining other practices, including SAP, Oracle, Workday and Salesforce.
The other of the two deals announced Tuesday is for Fixnetix. London-based Fixnetix bills itself as a managed services provider to financial companies, providing a high-efficiency trading appliance and 40 co-location and proximity hosting centers worldwide for mission-critical trading systems.
Terms of the deals were not disclosed. CSC President, CEO and Director Mike Lawrie said in an investor call that the company's schedule requires closing the deals in September or October.
The announcements came as the 70,000-employee CSC released financial results for the first quarter of its fiscal year 2016. Earnings rose nearly 10 percent to $160 million on a 15 percent drop in revenues to $2.76 billion. Those results beat analysts' expectations on profits but missed on revenues.
Falls Church, Va.-based CSC plans to separate into two companies later this year -- a commercial business and a North American public sector business.
In response to analyst questions during the earnings call, Lawrie provided some context about this week's acquisitions, as well as possible future deals.
"These businesses that we bought today are what I'd classify...as tuck-ins. These aren't huge acquisitions by any stretch of the imagination. But they're examples of new offerings that we think can grow fairly rapidly over this period of time and help shrink that gap between our traditional business and these new businesses," said Lawrie, according to a Seeking Alpha transcript of the call.
Lawrie also hinted at a possibility that CSC's public sector business might be acquired after the separation is complete. "I think once we separate the business, obviously, it's a publicly traded company, so it's going to take advantage of opportunities both as an acquirer or as an acquiree," Lawrie said. "I do think the general landscape in the federal government business will be consolidation over time."
Posted by Scott Bekker on August 12, 2015 at 12:11 PM0 comments
Attempting to quantify what it's been preaching for the last few years, Microsoft published some internal research numbers on what partners spend on managed-services employees versus project-services employees.
Project-services employees cost about 17 percent more on average than managed-services employees, according to Microsoft.
As Microsoft moves its products to the cloud, the company's channel-facing executives have been urging partners to transform their businesses from the project-services approach that has worked so well for the channel in the days of Exchange migration projects and SharePoint implementations. Now, Microsoft wants partners who offer managed services to their customers that bundle things like Office 365, Dynamics CRM Online, Azure services.
One of the arguments is that managed-services employees, with a heavier help-desk orientation, are less expensive to hire and employ than the project-services experts who can design or implement comprehensive solutions.
Microsoft released some data on pay as part of a huge recent data dump on cloud opportunities and business models. (See Barb Levisay's recent coverage here.)
The data came from 1,260 surveys in March through April of this year of English-speaking members of the Microsoft Partner Research Panel. Due to currency adjustments and wide geographic differences, the figures themselves are too broad to be too meaningful, but the percentage differences are instructive.
According to the survey, average annual spend on one project-services employee is $54,350. That's 17 percent higher than the average annual spend of $46,430 on a managed-services employee. See the chart on this page from the Microsoft report, "Microsoft Cloud Profitability Scenarios," for more detail, such as breakdowns for partners serving SMB versus enterprise customers, and for sales and marketing employee details. The SMB customer-focused partners spending per employees is 13 percent higher for project services versus managed services, while the enterprise premium is 15 percent.
This is just one example of the reams of information Microsoft provided in the recent data dump. The whole data set is well worth checking out here and here.
Posted by Scott Bekker on August 10, 2015 at 12:22 PM0 comments
Microsoft this week laid out some of its partner enablement efforts surrounding Windows 10, including the inclusion of Windows 10 Internal Use Rights into the Action Pack and competency license grants.
"We know that partners who exercise their Internal Use Rights (IURs) sell more because they're often more knowledgeable about and comfortable with the solutions they're selling. We want all our partners to feel comfortable with Windows 10, so we've made the Windows 10 Enterprise upgrade available to all Action Pack and Competency partners," said Gavriella Schuster, general manager of the Microsoft Partner Network (MPN), in a blog post.
The update to the Action Pack and the competencies was announced this week, following the general availability of Windows 10 on July 29, and the volume licensing availability of the new operating system on Aug. 1. The IURs are available on Microsoft's partner download portal here (password protected).
Partners can qualify for the Action Pack, if they confirm to Microsoft that they sell more than 75 percent of their products and services to customers outside their own company, among other restrictions. The $475-per-year subscription gets a partner enough client and server software licenses and cloud seats to run a 10-person business. The Action Pack includes 10 upgrade licenses to Windows 10 Enterprise edition.
Competency partners also get IURs. In the case of Windows 10, partners with a Silver competency can use 25 licenses, while Gold competency partners are entitled to 100 licenses. Those programs are more expensive to join than the Action Pack and carry revenue commitments and heavier training requirements.
The IUR move also gives partners the ability to use the most functional version of Windows 10, the Enterprise Edition, a volume licensing OS which includes a number of business-friendly features not available in other versions.
The Enterprise Editions of Windows 7, 8.1 and 10 aren't part of the high-profile, free upgrade from Windows 7 or Windows 8.1. Under that free program, current users of Windows 7 Starter, Windows 7 Home Basic, Windows 7 Home Premium, Windows 8.1 and Windows 8.1 with Bing can upgrade to Windows 10 Home. Users of Windows 7 Professional, Windows 7 Ultimate and Windows 8.1 Pro are eligible for the free update to Windows 10 Pro.
Meanwhile, Microsoft will also push partners forward with the IUR update in the Action Pack and competencies. The IURs do not include the downgrade rights to older versions of Windows that are allowed in other types of Microsoft licenses.
Schuster also urged partners to encourage their customers to take advantage of the 90-day Windows 10 Enterprise Evaluation to start getting familiar with the operating system and plan their deployments.
Posted by Scott Bekker on August 06, 2015 at 1:18 PM0 comments
Microsoft on Monday acquired a company with a gamification platform for motivating sales teams through robust contests. It also disclosed plans to bring the platform first into Dynamics CRM and eventually into more Dynamics products.
Terms of the deal to acquire Incent Games Inc., the Austin, Texas-based maker of FantasySalesTeam, were not disclosed.
FantasySalesTeam combines sales contests with fantasy sports league concepts to help sales managers generate contests that allow non-salespeople to get engaged and draft teams of salespeople who score points for the team via multiple metrics.
"While incentive programs and contests are leveraged in almost all sales organizations, most suffer from common shortcomings: the same top performers almost always win and the rest of the team tends to disengage fairly quickly once they realize they've fallen behind or out of contention," wrote Bob Stutz, corporate vice president of Microsoft Dynamics CRM, in a blog post announcing the acquisition. "FantasySalesTeam creatively addresses these problems with a tailored approach that drives amazing results."
The gamification application currently has hundreds of customers, including Service Corporation International and Wireless Zone.
"We believe that motivating users of Dynamics CRM to focus on their most important metrics while simultaneously increasing usage and adoption can help drive tremendous impact on our customer's success," Stutz said.
He said integration with Dynamics CRM would occur in the coming months. While promising to continue to support FantasySalesTeam customers on other CRM platforms, Stutz sketched general plans to integrate and evolve FantasySalesTeam into the other parts of the Dynamics ecosystem.
In a separate blog post, Incent Games CEO Adam Hollander said, "This acquisition is a testament to the power of gamification when designed and implemented the right way."
Posted by Scott Bekker on August 03, 2015 at 12:43 PM0 comments
Microsoft gave partners a lot to chew on last week during its Worldwide Partner Conference (WPC). Here's a recap of the major themes of the show through 11 notable quotes by Microsoft executives that highlight implications and opportunities that will reverberate through the channel for Microsoft's fiscal 2016.
"I hope you realize this is the single biggest investment we're making in expanding our channel for cloud, and we hope you participate with us."
--John Case, Corporate Vice President, Microsoft Office
It would be impossible to overstate what a big deal Cloud Solution Provider (CSP) is going to be over the next year. Although it got a soft launch a year ago, CSP had its real debutante's ball at the Orlando WPC last week. The amount of support in the vendor community is impressive, with companies like Odin, AppDirect, Tech Data and Ingram Micro making serious pushes to enable broad partner participation in CSP. Many of the Office 365 syndication partners are all-in already, as well.
For many Microsoft solution providers, CSP is the cloud program they've been asking Microsoft to provide since about 2009. The partner can control the customer billing, unlike the Advisor model, and the partner pays for the seats on a monthly basis just like the customer, unlike with Open.
For more detail on CSP, see RCP's July cover story.
"As a community, it's important for us to have, I think, a conversation this morning about this: What's going on around the world when it comes to this issue of trust? What do the events of the last year mean? And most importantly, what together can we do to advance the cause of ensuring that the world can trust the technology that is being created?"
--Brad Smith, General Counsel and Executive Vice President
The Snowden revelations have put major U.S.-based technology companies on their heels with consumers, business customers and governments, especially outside the United States. In his first WPC stage appearance, Smith, Microsoft's top lawyer, tackled the issues involved in a balanced speech that was well-received by the partner audience, which included a large contingent of non-U.S. partners. Going through specific examples that illustrate the tensions in Microsoft's responsibilities to governments, businesses and consumers, Smith laid out principles and commitments for Microsoft going forward. He also provided details about three Microsoft lawsuits against the U.S. government in the last two years.
"There is no other ecosystem that is primarily and solely built to help customers achieve greatness."
--Satya Nadella, CEO
Nadella set a high bar for what distinguishes the Microsoft ecosystem from other partner programs. He spent much of his keynote explaining what Microsoft stands for. Some of the principles he set for Microsoft provided the foundation for Smith's speech later in the week.
"In Outlook 2016, there's a very cool feature that I love now, and it basically utilizes the 'most recently used' across Office right in your attach segment here. So if I click this, you can see these documents are right there that I just worked on." [Huge applause break.] "I know! It's crazy."
--Bryan Roper, Executive Demo Lead at Microsoft
Roper was the breakout star of the WPC keynotes. In his hipster hat, Roper stole the show as the demo guy during Windows and Devices Group Executive Vice President Terry Myerson's keynote. Partners cheered highlight after highlight during Roper's detailed walkthrough of the best features of Windows 10 and Office 2016.
"There seems to have been some question about our commitment to SharePoint in the past year. ... [At the Ignite conference] I saw a lot of comments that said, 'I didn't hear a lot about SharePoint. Julia only said SharePoint a couple of times, what's that mean?' Today, I'm here to say, 'SharePoint. SharePoint, SharePoint, SharePoint, SharePoint, SharePoint!' We are absolutely committed. We have a fantastic SharePoint Server 2016 coming out."
--Julia White, General Manager, Microsoft Office Division
White effectively put any doubts about Microsoft's commitment to on-premises SharePoint to rest with a flare reminiscent of Steve Ballmer's famous bit about "Developers! Developers! Developers!"
Specifically, White called out use of the same codebase for SharePoint on-premise as in the cloud, hybrid-optimization, data loss prevention, e-discovery and the ability to tap Office Graph cloud capabilities.
"And you know what, Microsoft has really big ambition for what we can achieve, and we have really big ambition for what you can achieve with us. And that last point is really important, because...92 percent of all Microsoft revenue is through our partner ecosystem versus 39 percent for the rest of the IT market."
--Phil Sorgen, Corporate Vice President, Worldwide Partner Group
Sorgen quoted IDC figures tracking how much revenue in the industry goes through the channel versus direct. The percentage is lower than during the heyday of the late 2000s, when the quoted numbers for Microsoft were 95 percent or higher. Yet the number is still extremely respectable considering Microsoft's recent direct pushes with first-party hardware products. Meanwhile, the percentage now applies to much higher overall revenue numbers than it did back then.
"So I've gotten this request from many of you all year: We are eliminating the requirements to track unique MCPs per competency." [Applause break.] "I'm glad you like that -- and the tracking of sales assessments, so that we can focus more on the outcomes through your performance, which means I need to give you better ways to track your own performance."
--Gavriella Schuster, General Manager, Microsoft Partner Network.
Competencies have been a big deal since Microsoft transitioned the Microsoft Partner Program into the Microsoft Partner Network a few years ago. Microsoft seems to be de-emphasizing competencies now. The main competencies you hear about now are the four, soon to be five, cloud competencies. (The fifth, an Enterprise Mobility Suite competency, is slated for late September.) The CSP program will, in many ways, function as a new landing place for many partners, and, on the Azure side, certifications are bringing a new way for partners to declare hybrid solution expertise. The move to remove unique training MCP requirements unwinds much of the forced partner specialization that was engineered into the MPN competencies.
"So what Office 365 represents, what Dynamics represents, we want to bring these different products today into one set of services, which are extensible."
The word "Dynamics" there in Nadella's keynote was significant. Many partners heard a new emphasis on Dynamics, both CRM and ERP, at WPC, and then again this week in the Microsoft fourth quarter earnings call. After a period of uncertainty about how strategic Dynamics was as Microsoft partnered with Salesforce.com and apparently considered buying the company, the message from the top is that Dynamics still matters.
"With Azure and the Azure stack, we now provide a consistent hybrid cloud platform that can be used to run any workload, whether it's Windows Server or Linux. With our new Operation Management Suite, you can now manage those workloads no matter where they run, whether it's on-premises in an existing customer datacenter, in a service provider datacenter or in our public cloud."
--Scott Guthrie, Microsoft Cloud and Enterprise Group
As he worked his way through a long list of Microsoft cloud services intended to illustrate how uniquely thorough a set of offerings Microsoft has, Guthrie mentioned what might have been a jarring word in any other year: "Linux." But Linux and other open source workloads were stars of the 2015 WPC. Microsoft had an open source pavilion in the expo center and recognized open source partner award winners.
"In our commercial business we continue to transform the product mix to annuity cloud solutions and now have 75,000 partners transacting in our cloud. We are also expanding the opportunity for more partners to sell Surface, and in the coming months will go from over 150 to more than 4,500 resellers globally."
--Kevin Turner, CTO
This quote is actually a cheat. It didn't come from the WPC. Turner issued the statement a few days later for Microsoft's fourth quarter earnings statement. In some ways it's more significant than anything Turner said in his WPC keynote, which was the usual mix of fiery exhortations to partners to sell more Microsoft products and digs against Microsoft's competition.
The quote above was a rare mention of the channel in an earnings release, suggesting that Microsoft's push via CSP to get partners more involved in cloud sales is strategic enough to mention to investors.
Turner also provided specific numbers for how many resellers will be brought into the new, much broader Surface reseller program. It's about 30 times as many partners.
"We are re-orienting all our cloud competencies and our partner incentives to be based on active usage as opposed to the sale, which is an incredible shift."
Active usage, a.k.a. consumption, is a key term for partners in Microsoft's FY16. New dashboards on the MPN portal will show it. Account managers will track it. Incentives will pay based on it. Microsoft is under enormous pressure to convert many of the cloud seats that were bundled into Enterprise Agreements and other licensing arrangements into a vital part of customers' businesses, so that those same customers don't cancel the services. That pressure is being transferred to partners and will get more intense as the fiscal year progresses.
Posted by Scott Bekker on July 23, 2015 at 2:43 PM0 comments