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DENVER—The big-picture message Microsoft executives will try to convey at its annual Worldwide Partner Conference that kicks off here July 10 is that software plus services is the future.
Underscoring this message is the fact that CEO Steve Ballmer will use his keynote to announce a partnering framework for Microsoft around software plus services.
Speaker after speaker will stress that with its own software development and hosting capabilities and its extensive partner ecosystem, the Redmond, Wash., software maker is well-positioned to bring both software and services to partners and customers.
“Well have on-premises offerings, offerings hosted by Microsoft, and a set of offerings hosted by partners, which enables the power of choice for customers,” Allison Watson, corporate vice president of Microsofts worldwide partner group, told eWEEK in an interview ahead of the conference.
“So, while the benefit of software plus services is an industry phenomenon, Microsofts value-add is that we are the only player out there that has the choice across the whole people-ready business,” she said.
The global model going forward will be a mix of services and on-premises software, she said, adding that the keynote speakers will explain how Microsofts Live strategy is about “a set of product platforms, while software plus services is really the evolution of the industry all up.”
While the partnering framework that Ballmer will announce is a work in progress and far from complete, the goal is that it will categorize all of Microsofts technologies across the various on-site, partner-hosted and Microsoft-hosted delivery models.
The contractual relationships around this will also be three-pronged: Microsoft, the partner and the customer.
“Were taking the integrated view on this and looking at it all three ways: partner to Microsoft, partner to customer, and customer to Microsoft. Thats important because, as this unrolls, we want it to be a rich one that is not just about silos like just Microsoft-to-customer scenarios or only partner-to-Microsoft relationships,” Watson said.
Microsoft also hopes that the frameworks design will bring clarity and precision as it announces products that are in the software-plus-services model. “We need to be precise about the business models, the monetization and the contractual relationship around this, and we need to be intentional about our decisions,” she said.
As such, part of Microsofts broader goal with the framework is to set the direction for the company that frames the business models that come together for software plus services as well as the business models around building new applications, and developing, customizing, hosting and integrating them for the software-plus-services area.
“And then well also be precise in terms of saying whether or not there is an opportunity for every business model in this regard,” she said.
But success is about monetization and whether Microsoft should resell these solutions or not, she noted.
“Again, imagine these as on/off buttons, and were going to say yes or no, but were going to be consistent about it and about the concept of how we will do referrals, how advertising ties in, whether there should be a fee-based model and whether there is a subscription model,” Watson said.
Ballmer will also talk about how the concept of a people-ready business, which Microsoft has long talked about, applies in this new world of software plus services.
People-ready involves talking to people about what theyre trying to do and, as the consumer and business worlds start to blend, addressing the changing needs that arise as those people take on different roles, Watson said.
“So, as software and services start to blend, the number of solutions that the industry can enable grows substantially, and we are looking at all these scenarios and all these people,” she said.
Ballmer will also use his keynote to explain more precisely how Microsoft sees its technology adapting to this change. The company has already started to build out part of this vision with Silverlight, while Expression “is a huge opportunity in the development space that starts to unlock a bunch of different partner opportunities, but it really is a key part of the software-plus-services framework because it enables the Web scenario,” she said.
If that is then combined with the Microsoft adCenter platform, Xbox, MSN, and traditional and business search to create a partner scenario on behalf of a customer, the result is a very different framework from what has traditionally existed.
But the software-plus-services scenario is about more than just the technology platform; it is also about the channel framework for enabling and delivering it.
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“We will talk about the delivery, well talk about the on-premises, partner-hosted and Microsoft-hosted scenarios, and we will look at our products and solutions across that continuum, if you will, when we consider building both products and the partner framework. And Steve [Ballmer] will frame up how the products start to have that continuum,” Watson said.
As such, Microsoft plans to explain what the current opportunity is for everything that moves online, as well as where that opportunity will exist moving forward. An element of this model is that the company will start to release key performance indicators for profitability, as well as “movement scenarios or guides for change,” she said.
With regard to the marketplace scenarios, Watson said Microsoft will talk about P2P, P2C, directory promotion and the concepts it is considering around bill on behalf, which it already does in the consumer space today but is now looking at more broadly in the software-plus-services framework.
“So, if we start out with this framework and then we ask the questions about how our commitment to this model means change, we then have to look at how things change and why, and where the new opportunities lie. We have actually had some rich discussions about that particular topic and what is going on with our partners,” Watson said.
“Frankly, if we dont change, there wont be us for partners to have a business model on. Its like this isnt about Microsoft doing something with partners; this is about Microsoft and partners together evolving,” she said.
Another high-level message for attendees will be that Microsoft is preparing an integrated launch and readiness plan for Windows Server 2008, which is expected to be released to manufacturing later this year and which follows the releases of Windows Vista, Office System 2007 and Exchange Server 2007.
So as to leave no doubt as to how seriously it is about these messages, Microsoft is pulling out all the stops and bringing out all its big-gun keynote speakers to address the 10,000 attendees at the sold-out events first day.
Speakers include Chief Operating Officer Kevin Turner; Chris Capossela, corporate vice president of the business division; Mike Sievert, corporate vice president for Windows platform marketing; and Tami Reller, corporate vice president of Microsofts business solutions group.
“You can expect huge momentum around that over this year and into next, and we also have some exciting things coming out for partners with Windows Vista and Office 2008 to continue that wave, so you will start to see some of that here,” Watson said.
There will also be announcements around infrastructure optimization models for Microsofts people-ready business, from business productivity to core infrastructure and the application platform, where there will be a model developed by Microsoft that partners can use to qualify the customers level of business intelligence sophistication, and that will help model how they can achieve their goals, she said.
“Partners tell us this, combined with the ability to demonstrate things to the user, using our demo showcase technology, really, really pays off in terms of repeatability, success and speed. It also pays off on the customer side because they feel like theyve got a road map. So, were continuing to invest in these models, and youll see us roll them out,” Watson said.
In his keynote, Microsoft COO Turner will talk about his top two priorities for Microsoft: meeting its revenue goals and the partner ecosystem.
Turner has been working closely with Watson on ways in which the company can help its partners become even better, and what to tell those partners who want to be the best.
As part of this, Turner will announce an online partner dashboard that will be available at the end of September, which will show partners their performance relative to all aspects of their relationship with Microsoft.
“It will then also give them a target benchmark, if you will, for like partner types. So, if youre in the information worker competency arena, you might be able to compare yourself against a group both in your country and/or around the world. It responds to what partners want to know about what they need to do. It also helps clarify what we expect from partners and what they should expect from us,” Watson said.