Microsoft has kicked off Inspire 2019 in Las Vegas by confirming its decision to “walk back” on its previously announced changes to internal use rights (IUR) for partners.
This means partners won’t see experience any changes this year and won’t be subject to the reduced IUR licences or increased costs next July as previously announced.
Corporate VP of Microsoft’s One Commercial Partner Organisation, Gavriella Schuster, said the partner ecosystem’s “overwhelmingly negative” response caused Microsoft to re-think its decision: “We clearly underestimated the value of those benefits and the impact that that would have on you and your businesses,” she told partners.
“Your partnership means more to us than anything. And we value the relationship and the trust that we've built in that partnership because it is based on commitment, integrity, and trust. And it requires us to have ongoing communication, collaboration, and accountability.”
Schuster also gave her commitment that Microsoft “will continue to listen, to learn, and though we may stumble, we will grow together, and we will celebrate our wins together.”
Schuster later outlined six market opportunities that she said Microsoft and its partners should be pursuing this year. “In modern workplace, it is all about teams and security. Business applications, Dynamics 365 and Power Apps, applications and infrastructure, this is the year of Azure Cloud migrations. And in data, it’s all about analytics and AI.”
To do this, the exec said the company will be investing about $3 billion in partners this year.
“We now have over 12,000 applications and services in the marketplace. We are delivering over 350,000 leads every single month on those solutions out to you. And we're doing about $90 million a month in the Azure marketplace, which is really enabling services,” she said.
“Not only do you want to be listed in the marketplace, but you actually want to have a transactable offer because that enables us to activate three additional channels to market for you,” she told partners.
“One is the marketplace itself, where the customer can buy directly on your paper. The second is enabling us to pull your services through our sellers on our paper, our Microsoft paper. The third is to enable all of those partners’ transactions CSP to be able to pull your services through their paper in CSP. So, that is not only activating 22,000 Microsoft sellers all around the world, but the 70,000 Microsoft partners that we have transactions through CSP on your behalf.”
Schuster said Microsoft is going to incentivise its sellers on partner services, as well as its partners through CSP on their behalf. “And we will put more go-to-market dollars in for every service that you have listed in App Source as a transactable offer.”
She continued: “The flip side of marketplace is CSP. If you are delivering services, CSP is the way that you want to deliver those services into the marketplace because CSP enables you to embed not only Microsoft's first-party services, but any of those third-party marketplace services into the packages that you offer to your customers. So, you can make them completely unique and differentiated out to your customers, and then provide managed services on top of that.”
Schuster said this year Microsoft has already crossed the $4 billion mark in CSP together with partners and has more than three and a half million customers under contract in CSP now. Those partners transacting CSP are seeing 40 percent year-on-year growth, she added.
This year, she said, Microsoft is moving CSP onto the modern commerce platform, “which enables us to actually collapse that delta in the Azure engineering roadmap so that we can deliver all of those Azure services to you through CSP; and it enables the customer to be more mobile on their purchasing. And we are building in, by design, security and data privacy through multifactor authentication and Azure Active Directory.”
“When you take those two investments, what it enables us to do is to co-sell even more together in the market. We've had some tremendous success together in co-sell. We have sold almost 99 and a half billion dollars of your services, in annual contract value, through our sellers,” she said.
“When we do co-sell, we find that our deals close almost three times faster, the initial project size grows almost six times larger, and the Azure consumption grows almost eight time higher. That’s something we want to continue to invest in, and we want to expand it. So not only are we going to expand it out to our CSP partners, but we're moving beyond Azure into Teams applications and Dynamics 365 applications, as well.”
However, Schuster acknowledged that Microsoft needs to make the even process easier for partners. To this end, the firm has made changes to Partner Sales Connect to enable partners to use their own CRM systems to manage their opportunities, leads, and pipelines.
“And through these APIs, you can pop up lead sharing and we will funnel it all the way back to our specific sellers through our MSS CRM, and our sellers can pop up their lead sharing all the way out to you through those same APIs right into your sellers, so that we can have a much stronger connected experience without all that overhead,” she said.
If you’d like to know more about Microsoft Inspire, as well as the opportunity to ask both ourselves and Microsoft questions, register for Inspired today! Held in both London and Dublin this August, it’s going to be a brilliant morning.