NEW ORLEANS — July 6, 2009 — There is a large slice of the global economy that technology vendors simply can’t reach due to cost and geography. The solution is finding local experts to effectively assist local customers. Because of this, assembling a network of smaller, local businesses is a key part of the economics of software.
Allison Watson, corporate vice president of the Worldwide Partner Group at Microsoft
Microsoft has worked for years to build its partner channel — a global network of local businesses staffed by experts who sell, distribute, implement, integrate and build upon Microsoft technologies. The partner channel gets the company’s products to market quickly, while also helping local economies around the world by providing the foundation for thousands of businesses.
But as with so many things today, the global economy has changed the dynamics of the vendor/partner relationship. Competition among large vendors for the services of the global community of resellers is tighter than ever. This so-called “battle for the channel” is one of the technology industry’s best-kept secrets.
Amidst this fiercely competitive environment, Microsoft is entering the biggest year of launches in its history, and customers in every industry are turning to the partner network to understand how new technologies can help them compete and win in today’s business environment.
A week before the Microsoft Worldwide Partners Conference 2009, scheduled for July 13-16 in New Orleans, PressPass spoke with Corporate Vice President Allison Watson, chief of Microsoft’s Partner Program. She talked about the opportunity for partners and customers in the market today, and how Microsoft is responding with new technologies and changes to the way Microsoft works with its partner network.
PressPass: Traditionally the partner channel has been viewed as a mode of distribution. Today you’re saying the economy has made the channel even more of a strategic asset. Can you describe that shift? What does it mean for the relationship between Microsoft and its partners?
Watson: We are focusing on three major shifts. The first is that customers are more closely evaluating every dollar they spend on IT, to ensure they are investing to save money as well as drive innovation. That shift may sound like a barrier, but it’s actually a great opportunity for Microsoft and its partners, because of the power of IT to help businesses grow, thrive and compete in a tough economy.
The second thing is, we are in an era of huge technology advancements. Over the next 12 months, Microsoft will have the largest launch wave in the company’s history. That technology is bringing an array of new capabilities for small, medium-sized and large companies in every industry in the world.
But because of this, customers are relying more than ever on partners. Partners must be able to discuss the impact of these new technologies, as well as ensure that they’re taking advantage of current trends in computing that deliver bottom-line business value.
The opportunities run across the spectrum of partner business models. In addition to distribution and resale, there is a huge opportunity for systems integrators to create real value for companies; for ISVs to build on-premises applications, mobile device applications and cloud applications that drive business value; for Web designers who connect companies and customers; for telecommunications vendors who believe there are new opportunities with PCs, mobile phones and software plus services; and for OEMs who will bring new platforms, servers, phones, PCs and netbooks to a large and ever-growing audience.
PressPass: You mentioned the upcoming wave of product releases, which includes Office 2010 and Windows 7. Can you describe the partner opportunity in terms of Microsoft products specifically?
Watson: This will be one of the biggest launch waves in the history of Microsoft, starting with the launch of Windows 7 and Windows Server 2008 R2 in October. Throughout the development of Windows 7, we worked closely with partners across the ecosystem to make sure they have the tools and resources they need for development and compatibility with Windows 7, as well as to effectively plan for its availability. We think the biggest opportunities are based on expanding innovation with new features like Device Stage and Windows Touch that will deliver new possibilities for our customers.
Add to that Office 2010 and related products, which include Office applications, new services such as Office Web applications, and server products such as SharePoint Server and Exchange Server that continue to provide partners with new growth opportunities. SharePoint Server, for example, is one of the fastest growing server products in the company’s history with more than 4,000 partners today. And we expect that number to continue to grow as the next release hits the market.
Windows Server 2008 R2 is a significant jump in our core infrastructure and Web infrastructure platform. Hyper-V and virtualization technology presents a significant cost savings and growth opportunity that partners can present to their customers. In addition, Windows Server 2008 R2 delivers improvements that help customers better secure and manage their networks, and we’re starting to see very strong partner interest in the advancements we’ve made there.
The final major category I’d add is mobility. With the announcement of Windows Marketplace for Mobile as part of the upcoming release of Windows Mobile 6.5, there is real potential for companies to develop interesting applications for Windows Mobile. We’ve all seen the success of mobile applications. This is another area where there is a lot of interest in how to provide the best all-around user experience.
I should also point out that with all these products and product families, each can be delivered on-premises, hosted by partners, or in the cloud, which creates further opportunities for customers and partners to build value with technology.
PressPass: Gartner is predicting that cloud services will soon become a $150 billion business. Can you say more about the opportunity for partners in bringing Microsoft’s software plus services strategy to their customers?
Watson: I would say the opportunity is 100 percent and the time is now. There’s a significant opportunity for customers to develop and extend applications across all kinds of devices — PCs, servers, mobile phones and the Internet itself. Developers can also reuse development and management environments across all those. Software plus services has afforded our partners the opportunity to discuss with customers their needs for messaging, collaboration and meeting environments, and how they can be enhanced for existing workers, or opened up to new workers. This means mobile workers or those who work without PCs can now have access to elements of the company’s IT systems that were never accessible before.
PressPass: You took over Microsoft’s Partner Program in 2002. A lot has happened in the world since then. How do you navigate the constant changes in the industry to stay relevant to partners?
Watson: Partnering is in our DNA. We believe that as long as we listen to partners of all types, understand the businesses they’re in, and help them grow and be profitable, Microsoft and its partners together will win and grow in the marketplace.
To that end, we do a few core things that we’re very rigorous about. We do growth planning in every subsidiary in the world to understand how Microsoft will grow and how we can help customers grow their businesses. We translate that into opportunities for partners such that the ecosystem is able to expand year on year in terms of both new partner types and new products and services.
We also have continued to increase our investment in the Partner Program, because we understand that those investments do drive growth, both for customers and partners, and also for local software economies around the world.
There’s also an incredible growth opportunity in encouraging partners to work with each other. We’ve done studies that show partners can increase their revenues a full 20 percent through a solid peer-to-peer strategy.
At the end of the day, our role is to help partners embrace change in the industry so that they can unlock business value for customers.
PressPass: You’re announcing some changes next week at Microsoft’s
Worldwide Partner Conference
(WPC). What’s next for the Microsoft Partner Program?
Watson: We’ve already shared that the Microsoft Partner Program is becoming the Microsoft Partner Network, with a focus in three core areas. The first is delivering great results for customers, and doing it with very strong ROI for partners. The second is ensuring that our partners are current on our technology and that they’re capable, so they can bring the best to customers and compete well in their markets. And the third pillar is the network itself, the connections among more than 640,000 Microsoft partners and 75 million customers out there in the world today.
We’ll share more details at WPC, July 13-16 in New Orleans.
PressPass: What advice for success would you offer to partners?
Watson: The biggest thing is to make a plan — to grow your business, and to understand where you specialize. Facing the biggest launch wave in Microsoft’s history, partners need to invest the time to understand the platform transformation, the software plus services transformation, and why Microsoft has a winning value proposition for them.
WPC is a great opportunity for partners to learn firsthand, and we’re offering Digital WPC as well for partners to connect leading up to, during and after the event in New Orleans.
We’ve also invested in a core set of tools to help partners plan their business, ready their employees, create demand, do a better job selling and do an excellent job supporting these new technologies. Microsoft will continue to invest in these tools, and in helping partners take advantage of them to take cost out of their business and drive their top-line revenue growth.
Ultimately, when customers are looking to simplify business complexity, there’s partner opportunity. I’d encourage our network of global Microsoft partners to go after that opportunity with the full arsenal of tools we’re providing.