Microsoft's Building Blocks

Kurt Kolb, general manager of system builder marketing at Microsoft, Redmond, Wash., recently met with Editor in Chief Michael Vizard, Editor Heather Clancy and Senior Editor Edward F. Moltzen on topics ranging from preparations for dual-core processing to the success of Media Center Edition 2005. Here are excerpts:

CRN: 2005 is going to be the year when dual-core technology rolls out. It will have significant implications for the system builder channel. What are you doing to ready your channel for dual-core? Do you see that changing any of the business models you've had?

Kolb: With dual-core, it requires Microsoft to support it through the product. And when Microsoft supports it through the product, that's when we actually have to begin our education and launch effort. Whatever product we support dual-core in, that's where we actually make the channel readiness effort happen.

In terms of some of the trends I actually see in the channel—one of the strongest is around notebooks. There is increasing distribution strength in the notebook market; I think over time the real interesting issue in the white-box channel will be around whitebooks. There are standardization efforts going on with the major component vendors that are really interesting and helping whitebook efforts develop over time. And it's happening at a pretty good clip.

CRN: Just to be clear about it: If I'm a reseller of Windows who supports dual-core, will that be priced as if I had two copies of Windows to run on dual-core?

Kolb: For Microsoft to ready the channel around dual-core, we have to have a product around dual-core. Typically, when you see new technologies come through, they are tied to whatever product that supports it.

CRN: Philosophically, do you view it as two processors, or a single processor that happens to have two cores?

Kolb: I'm not the Windows guy. I'm the channel guy—I don't know what the Windows group is going to say publicly or nonpublicly.

You were asking about the channel. Typically, in the channel we tend to focus our efforts around tech- nology when we have products that support those efforts.

CRN: Intel has had a significant reorganization. They based their reorganization around the platformization of products as well as technologies. Part of that was to create a separate Channel Products Group. Is Microsoft organized right now to get the best leverage out of your system builder channel? Is there anything on the drawing board in terms of changing your approach?

Kolb: We have invested significantly in the system builder channel over the last seven months, eight months. So we now have over 200 people that are focused on the system builder channel on a worldwide basis. Allison [Watson, vice president, worldwide partner sales and marketing] has talked about the increase in partner marketing efforts we are doing. We've talked about the emphasis we actually have around OEM competency—the system builder program. You're seeing a very strong system builder/OEM emphasis through the partner program on system builders. And we work very closely with Allison's team and the Windows team to make sure that happens. The story about increased investment is a story that we have begun to bring to you a few months ago.

And I think in the channel you are starting to see the realization of that investment. That investment is not just around go-to-market activities, but it's also around some of the other things we need to do to provide channel integrity and to provide value continually. And that's another thing system builders told us we need to do and we're out there doing it.

CRN: What is the status right now in terms of your approach to the system builder channel, commercial and consumer? What kind of momentum are you seeing as of early 2005?

Kolb: Another question is, what are we going to be doing in the next couple of months in 2005 to increase that momentum? The first thing I would say is we've been surprised by the support and enthusiasm by the system builder channel around Media Center Edition 2005. When you talk to system builders, their enthusiasm is actually translating into sales for the product. When we made the announcement about it at the partner conference, they actually broke out into spontaneous applause.