Microsoft Resists Short Term Cloud Opportunity

Microsoft this week made a significant announcement impacting the channel’s cloud business; From now on, Microsoft partners can bill and license their customers directly. So why do we care?

One: The channel prides itself on being the primary customer contact. With direct billing & licensing, the channel remains in control and the primary access point.

Two: In the 80s one could make a living on margins, in the 90s on services, in the 00s on relationships. This decade it is all about interaction (mobile, big data, social and cloud). Though the channel does not focus on resale, it needs the resale interaction to remain primary access point.

Three: Most software vendors (Unit 4, Exact, AFAS) are struggling with the direct cloud opportunity versus the indirect channel commitment. How do you as vendor grasp the opportunity, without losing your channel base? Where Microsoft now creates cloud channel opportunity for its partners, other vendors are still struggling to find rules of engagement with their partners.

Four: This move creates an easier way for partners to actually enter the cloud market (for the ones that have not done so already). The Microsoft partner opportunity for add-on cloud services is without boundaries. It starts with Microsoft Office, but the full range of products and services around Exchange, SharePoint, Lync and Dynamics creates an excellent partner opportunity.

Five: For those partners already offering cloud services, it makes it easier to build a Microsoft offering and proposition around their own cloud offering. The applause that was made after the announcement at WPC12 showed the appreciation.

Though there still are many concerns on how this will work out practically, how channel partners can actually transition to other license structures, how it will be incorporated in the partner programs, whether it will be a global program, it is a clear sign that Microsoft was able to resist short term opportunity and favored long term channel commitment.

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About Simone de Bruin