Microsoft's Ballmer Avoids Surface Channel Strategy In Partner Conference Keynote


Microsoft partners Monday said they are shocked and disappointed that Microsoft CEO Steve Ballmer did not address the software giant's Surface channel strategy during his keynote address at the Worldwide Partner Conference.

Ballmer made no mention of the new Microsoft Devices Program, which was announced last week and has riled partners by limiting Surface reseller authorizations to just 10 large account resellers (LARs), including CDW, CompuCom Systems, En Pointe Technologies, Insight Enterprises, PC Connection, PCM, Softchoice, Softmart, SHI International and Zones.

"I am shocked that Ballmer did not address it," said Michael Goldstein, president and CEO of LAN Infotech, a Fort Lauderdale, Fla.-based Microsoft partner who chose not to attend the partner conference. "You figure that with the announcement that Microsoft LARs can sell it, the icing on the cake would be that Microsoft would announce VARs would be able to soon sell it. This is a miscue for Ballmer. Everyone is waiting to find out when we can sell Surface, which has been hyped for the longest time. Surface was a big issue at the last Microsoft conference too. It is just very surprising."

[Related: 5 Tablet Alternatives For Partners Hungry For Microsoft Surface]

Solution providers expected Ballmer to disclose more information about Microsoft's Surface channel play, specifically when the company would permit more partners to sell the tablets. Despite stressing Surface as a key part of Microsoft's total solution set, however, Ballmer gave no indication of when additional Microsoft resellers could expect to be authorized to carry Surface.

"It doesn't surprise me that they didn't discuss the [Surface] strategy, because I don't think they really have a strategy," said Joe Balsarotti, president of Software To Go, a St. Peters, Mo.-based solution provider. "I really feel like the company has lost its way. They don't know what they want to be. They obviously want to copy Apple, but that's not what Microsoft customers or partners want, and it's not what they're about."

Instead of discussing Surface's channel strategy, Ballmer told partners they should use the opportunity this week to delve into the Surface tablets and even suggested they purchase a device direct from Microsoft. "You're going to get a chance to see the Surface," Ballmer said. "Hopefully, many of you will choose to pick one up."

Microsoft is selling Surface devices to WPC attendees at steep discounts this week; Surface, running Windows RT, is available for $99 while the Surface Pro 128 GB, running Windows 8 Professional, is available for $399. Microsoft currently lists Surface RT directly to customers starting at $499 and Surface Pro for $899.

Goldstein said it's ironic that Microsoft is offering solution providers the ability to buy Surface RT and Surface Pro at the conference even though those very same partners cannot sell it. "I don't want to show my clients something that I cannot even sell," he said.

Instead, LAN Infotech has chosen to sell tablets from Microsoft OEM partners like Hewlett-Packard, Dell and Lenovo, Goldstein said.

Microsoft's Surface channel move is the latest obstacle for partners in what has been a turbulent history of the nascent device. Solution providers were disappointed by Microsoft's decision to sell the original Surface tablet running Windows RT through its retail stores and hold it back from the channel. Partners were further incensed when the Surface Pro, running Windows 8 Professional, was launched with the same retail-focused strategy.

Nevertheless, Microsoft has continued to promote Surface as a better alternative than the iPad for business users focused on productivity. Tami Reller, Microsoft's chief marketing officer and chief financial officer for Windows, said during her keynote Monday that Surface devices were the clear choice for business users.

"Surface is hands down more productive than an iPad," she said, adding that it was "a great tablet for business."

Yet partners are still waiting for the opportunity to resell those business tablets.

PUBLISHED JULY 8, 2013