Microsoft Cloud Partners Nearly Double Profits, Growth: Study

By Darryl K. Taft  |  Posted 2013-07-08 Print this article Print

Cloudbearing provides consulting and implementation services for Office 365, which includes Microsoft Office, Microsoft Exchange, Microsoft SharePoint and Microsoft Lync, and the company also offers solutions for Windows Azure. Cloudbearing is in the process of becoming a Value Added Reseller to sell Microsoft cloud products, like the Office 365 Mid-Size Business Plan, directly to its customers, Vossburg said.

Partners who had more than 50 percent of their revenue related to the cloud were outperforming on a series of different key performance indicators (KPIs) versus partners who had 50 percent or less of their revenue coming from cloud-related services, Bibby said.

However, “when we did the surveys, the best performing partners had clearly already gone to the cloud first,” he said. “That’s a pretty interesting finding. My main thought on this is not necessarily that cloud has changed their business and made them more profitable. I think cloud has helped. I think the best partners have gone to cloud first – just as they went to virtualization first or they went to client-server computing first. The high performing partners are seeing those trends first and knowing to invest early.”

Historically, partners will sell software in whatever form is going to make them the most successful, Roskill said. This study shows that if you want to be in this fast-growing segment of partners you’ve got to be moving to the cloud, he added.

Harking back to the early days of Microsoft – the company’s legacy – when Bill Gates, Steve Ballmer and Paul Allen started the company, it was a partner-oriented model from the start, Roskill said.

“And Microsoft has always had partner literally in its veins,” he noted. “So I don’t think there was ever a question that we would have a partner oriented cloud model, I do think there was some question, both inside and outside of Microsoft of was where partners could be successful in a cloud business. Would cloud be the transition that caused software to become a much more vendor direct model?”

However, in a discussion with Microsoft CEO Ballmer a couple of years ago, Ballmer told Roskill, “It’s software, and whether it’s running on the private cloud, the company’s servers, whether it’s running in a partner hosted cloud or whether it’s running in our public cloud, you still need partners to sell it, and package it, deploy it and customize it,” he said. “And at that point we had super clarity that we should continue to drive hard on this partner oriented model and we have done so.”

Microsoft now has more than 150,000 partners in the Microsoft cloud programs. That’s a scale nobody in the industry is close to, Roskill claims.

Yet, even with 150,000 partners, “there are still a lot of partners out there that haven’t re-oriented their business,” Roskill said. “So a big part of this is to say the time is now, the opportunity is clear, this is no longer theory and projections. This is a study of 1300 real partners that have been doing business over the last year in cloud oriented workloads and in non-cloud oriented workloads. And you can very easily see what the difference is.”


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