A Lesson to Learn
The Microsoft story of channel partners engagement and policy revision that created ripples, also highlights the need for the partners to forge new pathways
About a month ago, Microsoft proposed changes in its Partner Network Policies, which included removal of internal use rights (IUR) for product licenses for partners and the access of on-premises product support incidents as part of the Microsoft Action Pack and competencies.Microsoft announced that from 2020, it was to no longer provide free internal use association for product licenses for the channel, meaning they will now have to be purchased out of the partners’ own pockets via a commercial arrangement.
The second proposal that Microsoft planned to retire on-premises product support incidents currently included with Silver and Gold competencies and in the Microsoft Action Pack, the latter which is used by smaller partners. These changes were to be effective when partners renew their existing competency or subscription from August this year. In addition, from 1 October the core product licenses included with competencies were to be specific to the competency partners attain, meaning licenses included in memberships will have to be purchased in full. This churned up a tornado in the channel sector and soon there were signature campaigns going on against Microsoft by the channel partners.
THE SHADOW OF CLOUD
In a recent issue of DQ Channels, we had discussed how the channel partnership was an unstable profession in the IT industry,
“Our decision to rescind these changes required a thorough review, and a key determining factor was the connection and trust we have with you, our partners valuable assets whom we do not take for granted. Together, we can continue to be a catalyst for digital transformation industry-wide.” — Gavriella Schuster, VP, Partners Commercial Programme, Microsoft “The new Business Applications ISV Connect programme will enable the ISVs to market faster through being able to publish their solutions across both AppSource and Azure Marketplace.” — Steven Guggenheimer, VP, AI & ISV Engagement, Microsoft “We are proud to be the only vendor participating in this launch with an integrated SD-WAN offering, setting the stage for a more cohesive and easier to consume service. The advantages of this new managed offering include an optimized architecture that permits enterprises to better scale their Azure VNET deployments, provides a simplified branch to Azure VNET connectivity and offers a faster response to service activation and change.”
—Shashi Kiran, CMO, Aryaka
because the principal companies used the channel partners to gain entry in a growing market, but once they established themselves, they preferred to deal directly with the end customers. This is exactly what happened with Microsoft. Its changes in the partner policies reflected an intention to focus more on end customers in a direct relationship. Microsoft’s evolution of Azure was a major catalyst in this policy change.
In a statement, a Microsoft spokesperson admitted the programme changes were due to the wide-ranging impacts of cloud computing, claiming the moves will help partners capitalise on the opportunities possible with cloud. The channel partners also felt that Microsoft was no longer promoting its Service Provider Licence Agreement. It was more interested in promoting Cloud Service Provider.
In the aftermath of the outcry from the reseller community, Microsoft had to roll back its new policies. The partners’ free access to the software was restored for the time being. Gavriella Schuster, VP, Partners Commercial Programme, Microsoft, acknowledged the value of the sentiments of the partners and apologised for the confusion caused.
However, it’s clear that this compromise is only temporary as Microsoft moves more in the direct of AI enabled cloud and direct selling to the end customers. As Schuster said in her statement, more than 7000 partners joined Microsoft’s Partner programme every month and it was no longer possible for Microsoft to support every single partner organisation.Instead of scrapping free use of software, Microsoft is thinking of ways to help the partners migrate to AI Azure. Itproposed the Azure Migration Programme that offers partners proactive advice, tools to help mitigate risks and address ‘common’ issues with moving workloads to the cloud.
New advanced specialisations for Microsoft Azure migrations will also be installed for Windows Server and SQL Server; Linux and Opensource Databases; Data Warehouse; Modernisation of Web applications in Microsoft Azure and Kubernetes on Microsoft Azure. Also, on the Azure front, partners will have access to Azure Lighthouse, which provides a single control plane to view and manage Azure at scale across all their customers, offering higher automation and efficiency, and makes way for cross-tenant management of customer estates. This allows partners to service more customers, larger workloads and mission critical apps.
AWARDS FOR INDIAN PARTNERS
Microsoft has shown its appreciation for and by way of motivating its partners in India. It has announced its Partner of the Year Award. G7 CR Technologies India has won the Indian Partner of the Year Award. The company was recognised for its solution GreenMatters that enables approximately 21% cost saving for organisations. The application is currently being used by over 100 Azure customers and has been successfully implemented in 300+ customer organisations across different industry verticals, namely, BFSI, ISV, E-Commerce, Education etc. The partner’s revenue growth through Microsoft practices is pegged at over 600% in 2019.
Also, Quadrasystems.net (India) and Reverie Language Technologies India havewon the Customer Experience and Diversity and Inclusion Changemaker awards, respectively.
Quadrasystems has delivered Customer Success Services that help its customers to identify the most important business needs and build a technology blueprint to respond to these needs, all the while handling the individual persons in their work with detailed descriptions and experiences across the business. Reverie’s LaaS (Language as a service) solution enables integrated inclusion practices through real time, contextual on-demand language translation for digital and mobile content in 11 Indian languages. The company in partnership with India’s National Agriculture Market, has enabledapproximately 10 million farmers across 600 crops wholesale markets in 14 states to get information about important factors, so that they could plan production and timing of agricultural goods and services.
Aryaka, a SD-WAN provider, announced that Microsoft has selected the company as one of the first partners for its new Microsoft Azure Networking Managed Services Provider (MSP) Programme. As a result, Aryaka will leverage Azure Networking Services Virtual WAN (VWAN) for an offering launched, timed with Microsoft Inspire. The new offering combines the best of two worlds; sophisticated SD-WAN technology and a global managed service that will help accelerate and simplify SD-WAN connectivity to Microsoft Azure as the market reaches an inflection point.
It is worth noting here that instead of promoting traditional partnership businesses, Microsoft is promoting partnerships that are engaging with cloud and emerging technologies. This is a message to the partners that they need to evolve with the changing times. Further, it shows how unstable the channel sector has becoming with the emerging of new technologies and with more and more selling being done online. Principal vendors are reluctant to spend on developing a long-term relationship with the partners. Microsoft may have made the compromise this time, but it quickly devised other means to make the partners migrate to AI Azure. In the long run, it may try to connect directly with the customers. Hence, the IT channel world has to devise new ways of selling IT products. It also has to engage more in training and selling via the emerging technological media. For the time being, the storm has passed, but it may come again.