Microsoft's Watson: Coming Launch Wave Spells Channel Opportunity

In a Webcast released Tuesday, Watson said Microsoft this June will embark on the "biggest nine months of launches" in the company's history, led by Windows 7 and Windows Azure. And as this launch wave progresses, Microsoft's strategic direction will continue to crystallize into opportunities for the channel, she said.

Windows 7 will arrive "soon," according to Watson, but Microsoft still recommends that customers using Windows XP migrate to Vista SP1 first. When Windows Azure arrives later this year, Microsoft's Software Plus Services vision -- which blends cloud services with software running on clients and servers -- will really begin to take shape, Watson said.

"The value proposition for Software Plus Services starts coming together if you start spending some time with Windows Azure," Watson said. "Azure will be a platform that complements Microsoft's on-premises platform."

Watson sought to dispel some misconceptions that have cropped up around Software Plus Services. "Microsoft Software Plus Services is not SaaS. It is not a cloud-based offering. Software Plus Services is an opportunity for choice," Watson said.

Microsoft's Business Productivity Online Suite (BPOS), which includes Exchange, SharePoint, Office Communications Server and Office LiveMeeting, is a prime example of how Software Plus Services generates revenue opportunities for partners, Watson said.

When Microsoft unveiled BPOS at last year's Worldwide Partner Conference, some VARs balked at the notion of giving up control of customer billing relationships, while others wondered if Microsoft might start approaching their customers directly. Microsoft's message since then has been that partners who move higher in the stack will find plenty of services revenue opportunities around BPOS.

"[BPOS is] a big partner opportunity. It's not a self-service offering. Our small, midmarket and enterprise customers are not going to decide to flip the bit and become direct Microsoft customers," Watson said. "They're going to go to it if you're selling it to them and earning the fees associated with our new partner model for Business Productivity Online Services."

In the last six months, Microsoft has completely repositioned its sales force around the dual goals of saving customers money and driving innovation, Watson said. That effort, combined with the $9.5 billion Microsoft will spend on R&D this year, is beginning to trickle down to the channel.

For example, Microsoft's Partner Sales Management system (PSM) gives VARs the opportunity to engage with Microsoft's sales force to work together on deals. Partners can share information with Microsoft PAMs (Partner Account Managers) by accepting, entering and updating opportunities directly into the PSM system, which serves as a single repository for deal-related information, Watson said.

Partners also have the option of using offline templates and portal-based upload and download capability, or can connect their CRM systems to the PSM via Web services, Watson added.

Brian Jaenisch, product development manager for Marco, a St. Cloud, Minn.-based solution provider, says Microsoft has provided technical resources, presales support and opportunities to work directly with Microsoft engineers, all of which have contributed greatly to his business.

"Many newer Microsoft products are more technically advanced than ever before, and we have to show customers ROI right away because we're selling directly to C-level executives now," Jaenisch said.

In the coming weeks, Microsoft will launch an entirely new set of support offerings based on its social community platform, which will allow partners to support customers more effectively, Watson said.

"We're all going to be different on the other side of this, and our ability to respond to change will make all the difference," Watson said.