As Microsoft opens its annual Worldwide Partner Conference this week, it’s a good time to ask: How is Microsoft doing in its relationships with its 640,000 partners? And what role might the partners play as Microsoft transforms itself into a devices-and-services company?
I asked the CEOs of two locally based companies for their perspectives.
Birger Steen is a former Microsof exec and current CEO of Renton-based Parallels, which offers virtualization and automation software.
Majdi Daher is CEO of Redmond-based Denali Advanced Integration, an IT services and solutions provider.
Both will have teams from their companies at this year’s WPC, which opened Sunday and runs through Thursday in Houston. About 16,000 people, representing resellers, consultants, systems integrators, developers and others who have built businesses based on Microsoft platforms and services, are expected at this year’s conference where they’ll get updates on Microsoft’s roadmaps for the year ahead, and have opportunities to network.
(For those not attending, the keynotes will be streamed here and on-demand footage will be available afterward at www.digitalwpc.com. Today’s keynote starts at 6:30 a.m. PT and will feature CEO Steve Ballmer, Server & Tools President Satya Nadella, CVP of Worldwide Partner Group Jon Roskill, and Windows Chief Marketing and Financial Officer Tami Reller. Wednesday’s keynote starts at 7 a.m. PT and features Roskill, COO B. Kevin Turner, Microsoft Chief Storyteller Steve Clayton and CVP of Worldwide Public Sector Laura Ipsen.)
Steen says that in the last seven or so years that Parallels has been working closely with Microsoft, this year stands out for Microsoft having “an unequivocally partner-centric and partner-friendly strategy,” especially regarding its cloud offerings.
In the past three years, as Microsoft has become “dead serious” about the cloud, Steen believes, its approach has been to go directly to customers with its cloud offerings rather than try to leverage its partners.
That’s in line with other companies who also thought the emergence of the cloud, as a separate business model, meant that they could serve customers directly and eliminate intermediatries, Steen says.
“I think it’s taken a bit of time to realize that these intermediaries — resellers, integraters, support (people) — are the ones who make sense of IT for small businesses and end users,” he said.
In the past year, Microsoft has focused more on “making use of and sharing of the cloud with partner resources,” Steen said.
Indeed, Parallels is unveiling today support for a Microsoft Azure Pack for Hosting Providers, which it developed in collaboration with Microsoft, as well as updates to several of its cloud service delivery offerings.
“In the years we’ve worked with Microsoft at Parallels, we’ve never seen such a consistent partner-friendly approach across all of Microsoft’s businesses,” Steen said.
On the other hand, Majdi Daher, CEO of Denali Advanced Integration, says there’s been a lot of uncertainty and lack of clarity coming from Microsoft lately. In addition, he believes, there is “not a consistent strategy to go to partners and say: Let’s drive value with partners and our portfolio.”
For instance, Microsoft earlier this month launched a program that allows business buyers to purchase Surface tablets and commercial services through authorized resellers. But the companies named by Microsoft as the initial group of resellers are all large-account resellers, not value-added resellers such as Denali that add their own services or solutions to Microsoft’s offerings.
“I’m disappointed,” Daher said.
Letting the large resellers sell Surface is a good first step in opening up the various channels from which businesses can buy Surface, Daher said. (It was previously only sold through Microsoft retail or online stores or through big-box stores such as Best Buy or Staples.)
But “that’s too little an effort,” Daher said. “It needs to be opened up, with a clearly defined program that invites partners who want to engage.”
Microsoft said the program is only in its first phase and that the company plans to sign up more resellers in more countries in the coming months.
For Daher, it all points to a larger issue of lack of clarity in what Microsoft tells its partners about how to qualify to sell certain Microsoft products.
Microsoft is pretty clear on some things, including making sure engineers in companies such as Denali understand products such as Windows Azure or System Center, he said.
But Microsoft is unclear on others, including what resellers need to do in order to be able to resell mobile devices such as Windows Phone, Windows RT tablets, and the Surface Pro and Surface RT tablets, Daher believes.
“It is concerning to us to see a great product like Windows 8 not making the headway that it should be making,” he said. “I really believe the reason it’s not getting the traction it should is because Microsoft did not go to partners like us and say: ‘Let’s figure out how to deliver the Windows 8 experience to your customers.’ Microsoft has been trying to do that all on its own.”
It’s a lost opportunity for Microsoft since it’s the value-added resellers who advise their business customers on which operating system to use, whether it’s Windows 8, Windows RT, iOS or Android, Daher said.
But, he added, “I think Microsoft will eventually get it right.”