Microsoft Chief Executive Officer (CEO) Steve Ballmer has one clear assignment for the company's partners: Go out and win deals!
"We're growing faster than anybody else out there and together we can really grow our businesses in important ways," Ballmer told an audience of about 5,500 partners from around the world on the final day of the Microsoft Worldwide Partner Conference in Toronto on Tuesday.
"I don't care who it is, if we have an opportunity together, let's go win, win, win," Ballmer said, clapping his hands, rallying partners in his trademark, high-energy style.
Microsoft sells most of its products through partners. The company's recently revamped Microsoft Partner Program has about 800,000 members worldwide, with about 40,000 at the elite Certified and Gold Certified levels.
At the partner event, Microsoft shared its view of the market and shared with partners where it sees the biggest opportunities. Two "unique opportunities" are converting Novell users and IBM Lotus Notes users, Ballmer said.
"I think those two installed bases are ripe for a little winning time for our partner base," Ballmer said. "Let's go out and really get after that Novell base and help them come into the modern world."
For IBM's Lotus Notes, Ballmer said that he has seen more interest in a Notes-to-Exchange migration than in the past five years.
Microsoft is putting its money where its mouth is and announced a US$200 (AU$276) million increase in its investment in partners to US$1.7 (AU$2.3) billion this fiscal year compared with last year. The software behemoth also said it has earmarked more money for co-marketing campaigns with partners.
The extra financial resources will be used so Microsoft can better support its partners. The vendor's plans include additional technology specialists in the field who can help partners with things such as joint demonstrations to potential customers.
All Microsoft partners will benefit from the budget boost, though a slightly larger portion of the money will go to benefit partners who sell Microsoft Business Solutions products, said Don Nelson, general manager of partner sales and marketing at Microsoft. Microsoft Business Solutions sells ERP (enterprise resource planning) products.
In addition to increasing its partner budget, Microsoft has instructed its subsidiaries to reallocate 35 percent of their budgets for direct marketing to joint marketing with partners. This is a substantial change for some Microsoft subsidiaries, especially in Europe, but it is not a big shift in other areas, including the U.S., Nelson said.
Microsoft at the partner conference also announced other ways in which it hopes to help partners make more deals. One is a repackaging of its services offerings in an effort to better cater to systems integrators, resellers and independent software vendors, or ISVs.
The overhauled services offerings come in the form of two plans, Microsoft Services Partner Advantage Standard and Microsoft Services Partner Advantage Plus. The plans are available to partners of all sizes, starting at US$8,000 a year and offer access to Microsoft experts and tools to help partners develop on the Microsoft platform or implement and support Microsoft products.
Some partners at the event expressed fears that Microsoft will compete with them in the services space, but Ballmer promised that the Microsoft services group exists only to help partners. "We are not in the services business," he said.
Aside from converting Novell and IBM Lotus Notes customers to the Microsoft platform, Microsoft also spotlighted upgrading existing customers as a significant market opportunity.
"There is a lot of opportunity to think about, there are 2.1 million (Windows) NT 4 Servers still left on the planet," said Paul Flessner, senior vice president of the Server Platform Division at Microsoft, in a presentation at the partner event.
With support for NT 4.0 Server set to end this year, Microsoft anticipates a lot of demand for upgrades. Many of the NT servers host the Exchange 5.5 mail server, which Microsoft also wants customers to upgrade. A migration also means implementation of Active Directory, which translates into more work for Microsoft partners, Flessner said.
The desktop is also a major upgrade target. Many still use older version of Windows on the desktop. Research firm Gartner Inc. in a poll last year found that only 14 percent of attendees of its U.S. Symposium had upgraded to the three year-old Windows XP. The poll, answered by 186 people, represented more than 1.7 million PCs.
Microsoft is making $50 (AU$69) million available to channel partners to help get users to upgrade to Windows XP and Office 2003 from older versions of the software. Additionally, Microsoft has added 57 new desktop deployment experts worldwide who will work with the software maker's partners on the upgrade persuasion effort.
The move is part of Microsoft's key sales strategies for its 2005 fiscal year, which started July 1. Ballmer in his annual strategy missive to Microsoft employees earlier this month week said that Microsoft must "work to change a number of customer perceptions, including the views that older versions of Office and Windows are good enough."
Microsoft is adding two new subcompetencies to its Microsoft Partner Program that focus on desktop deployment. The Desktop Deployment Solution is targeted at midsized businesses as part of the Networking Infrastructure Solutions competency and Desktop Lifecycle Management is aimed at enterprises as part of the Advanced Infrastructure Solutions competency.
Visibility is important for many partners. The additional marketing spend will help customers find them, but Microsoft also announced other initiatives. The company Web site will be changed to link to a new partner search engine so potential customers can find Gold Certified Microsoft partners.
Also, to help partners with marketing Microsoft will make available a marketing tool later this year. The online tool will allow partners to create and manage marketing campaigns using standard Microsoft ads on which the text can be customized and a partner company logo can be added.
Microsoft will also make a low-cost training program available for partner organizations. Up to 40 sales and marketing people can receive online "Microsoft Solutions Selling" training for a single US$500 (AU$691) charge, the company said. A new Channel Builder tool will allow partners to find each other and share information.
For ISVs, Microsoft announced several enhancements to its partner offerings. These include:
- an ISV Royalty Program to provide a simple way for ISVs to embed Microsoft technology into their products.
- a new ISV buddy program that links ISVs with a Microsoft employee to improve technical support and access to resources throughout the development, sales and marketing process.
- Windows Error Reporting for ISVs, allowing ISV's to use Microsoft's error reporting tools in Windows to collect information on user issues with their applications.
- ISV Community on MSDN, a special part of the Microsoft Developer Network (MSDN) Web site for ISVs.
- ISV Community Days, quarterly seminars in over 25 countries at which Microsoft will deliver technology road maps.
"It is good to hear Microsoft's plans for the future so that we can adapt our business and take advantage of those plans," said Mathias Täubrich, CEO of SoftEd Systems GmbH in Dresden, Germany. "Attending this event also gives me an opportunity to benchmark my business."
Helmuth Stobbe, CEO of SPC GmbH in Berlin, agreed. "We get a big picture story here that you can only get here," he said. "It would be good if Microsoft would find more possibilities to communicate with partners. In Germany, sometimes it is difficult to sort out what Microsoft is doing."
Both Täubrich and Stobbe run training companies. SoftEd also does some development work on the Microsoft platform for its customers.
Microsoft has scheduled its next partner event for July 8-10, 2005, in Minneapolis.