3 out of 5 – not bad at all!


Yup – this is the conclusion and finalization of a series of articles on the path Microsoft took to attach its own hosting channel. Let me just summarise:

Many years ago, in countries not far away from here, Microsoft helped and pushed a segment of its technical partners into what was to be known as “hosting partners”. Business models evolved and as ASP’s become SaaS providers, the hosting providers became service providers (although not many offers a service…). Business grew, new ventures was funded and the market for the hosting providers was not about competition, but harvesting the green fields of customers in need for outsourced services and “IT on tap”, untill…

1 of 5 – Microsoft to deliver Online Services
“Dear partners, to help grow the opportunities and market of hosted services, Microsoft is launching a commoditized solution for Online Exchange, Sharepoint, CRM and Unified Communications”. Microsoft’s field rushed towards their partner channel to calm them down as the message was: “There is plenty of room for us all, and we will help you combine Online Services with ISV based service”. Great! Online Services is just a part of the solution, we can still grow margins on secondary offerings.

2 of 5 – Microsoft to launch Azure!
“Dear partners, Microsoft is launching Azure to help of the next generation of ISV’s built Facebook-a-like applications; we wish to target ISV’s”. Well, didn’t you just tell us to target ISV as this was our opportunity to compete against BPOS? The message was changed. But rest a sure – a solution was to the channel conflict was launched. “Partners! Built dynamic data centers as this will help run business applications and legacy applications, that doesn’t fit with Azure. Virtualization is at its peak – this is a great opportunity and ERP applications form Microsoft will never live in the cloud”.

3 of 4 – Azure VM Role
“Partners, we have listen to customer demand, and customers want’s VM type environments to bridge the gap between now and the future of ho sting platforms.”. This time partners didn’t ask for a solution. Three strikes and you usually are out! But wait a minute! Corporate managers just recently announced that Dynamics ERP products is not to fit with the Azure and Cloud based business model. So maybe, we have a opportunity to drive these products in our costly datacenters? A new business opportunity…

4 of 5 – Microsoft announces Dynamics ERP Online
From http://www.microsoft.com/presspass/press/2009/nov09/11-19ERPOnDemandPR.mspx?rss_fdn=Press%20Releases

Microsoft Corp. today announced a collection of online services that can be attached to its Microsoft Dynamics enterprise resource planning (ERP) solutions, including a new Sites Service built on the Windows Azure platform, a new Commerce Service, and an expansion of its Payment Service. In addition, the company revealed that its Microsoft Dynamics ERP hosting business has more than doubled in the past year, demonstrating strong uptake by partners to deliver Microsoft Dynamics ERP via on-demand and subscription-based hosting models as well as complementary services.

Yes, finally Microsoft again is supporting a business model to allow the ambushed partners to have a value in the partnership – sorry Microsoft Partner Network – and deliver ERP hosted from data center. But looking at the fact that the announcement is target on technology delivered on the Azure platform; and taking in account of the above handling from Microsoft, I will bet $10, that Microsoft will announce Microsoft Dynamics ERP Online within the next Microsoft fiscal year. So 4 og 5, what are you missing?

5 of 5 – Voice is your opportunity for Unified communications
Well, “Dear Partners” 😉 – You have a great opportunity to grow competition against Microsoft’s BPOs offering when bundling voice with the BPO’s suite. That is until Microsoft also serves this demand – as that is what the customers demand! Shall we say $10 again within the next fiscal year?

Am I whining?
As discussed before; Microsoft have to do it. It is our fear of change that causes our frustrations, of a close and trusted advisor becomes our enemy. You built trust in the brand, people and partnership – and when you see this trust and partnership break up, you find it easy to disbelief all news and friendly advice. Microsoft is driving the revolution, and partners have to adopt this. The only channel being disrupted is the hosting channel; the rest of the partner channel only GAIN business opportunities, so you can easily understand the move. Why not give 600.000 partners the opportunity of Cloud Computing; previously only served by 50.000 partners?

Reality is that many of Microsoft’s true competitors (Salesforce, Netsuite, Google etc.) will gain access to those 50.000 partners. Reality is that it is not the act to competition that causes the whining, but the way is was conducted. If I was CEO of a major partnered organization – I probably help those partners, standing to lose, understand the opportunities more clear; and how to transform. Microsoft built a trusted relationship over 10 year with these partners. Redmond removed that trust in just 12 months.

And on a more opportunistic approach; this does tell investors, venture capitalists and business angels that if you wish to invest in the next “bubble”; it is probably within the cloud your will find your rainbow to gold…

Watch out for 4 of 5, and 5 of 5 – they did it before. They will do it again!

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