Microsoft Partner Network changes spark uproar
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When selling SKUs, a reseller model is great. They do the hard work of finding and converting long-tail leads, and all you have to give up is a little margin. When selling cloud subscriptions it becomes a burden — you have to continually pay overhead for your partners to manage your customers. Customer support expectations are low in the cloud (AWS provides minimal support, so MS can too).
Microsoft has been investing in customer-facing solution architects for this reason. They are investing dedicated resources in their big accounts, and are driving their partner strategy through the big consultancies rather than small MSPs. Their strategy seems to be one of landing a lot of “big fish;” which isn’t hard to do with a lot of big customers backtracking G-Suite to Office 365. From what I’ve seen, it’s working: Google simply doesn’t have the kind of relationships in the enterprise IT world that Microsoft does.
What.
Last I checked anyone with any substantial cloud deployment pays at least the 7%-3% of the bill for AWS support tier.
Which is excellent support usually.
The big shift here is the customer now pays Microsoft directly rather than the reseller. They now own the customer relationship, which is everything in software sales.
Their sales is high-touch too.
Is this anecdotal or is there some data on this? I'm kind of amazed how little attention G-Suite seems to get when there is such a huge gap in functionality between their office suite and Microsoft's. It seems like Google could be growing it by leaps and bounds if they wanted to.
The vendor/reseller has full admin access to your O365 account ("subscription advisor"/delegated administrators). They can also transfer this access. If your vendor gets purchased or otherwise decides to transfer your rep' they'll just unilaterally grant some unknown person/company admin access to your whole O365 account.
But you're forced to work through a vendor for any discounts. You're penalized for working directly with Microsoft. And if you revoke this access, don't be surprised if your partner tells you they cannot support you until it is re-granted (even buying more licenses, because they need to "confirm your license allocation" or similar).
It is a huge HIPAA nightmare.
Years ago, if you bought O365 licensing through a reseller, it was very hard to add licenses yourself with direct purchase. That hasn’t been the case for a while now though. You can use redeemed licenses from a reseller alongside directly purchased licenses.
We encourage our customers to buy direct anyway, although I don’t see anything in the article talking about shutting down the reseller program anyway. They’re dropping internal use rights and support incidents for partners.
> Microsoft Partner Network or MPN [...] is designed to make resources available to a wide variety of technology companies so they can build a business around Microsoft technologies.
I suspect the matter of the "worst move in 30 years" article will get straightened out, and won't seem nearly as bad as the title suggests.
A backstab would be SOP for much of the last 30 years of MS, but I'd be surprised if they're going to throw away a lot of the developer goodwill they've been acquiring recently.
Right now, I get the impression that a sizable chunk of HN think of MS as good-natured fellow developers who run GitHub and share an IDE, and that chunk has little awareness of earlier history (and how relieved a lot of people were by the escape route that the Web and Linux provided).
Why would MS spoil that goodwill, by alerting all those developers to the proven business pattern of waiting until your partner/customer has built their business around you, before you do whatever you want to them?
Whether MS will someday lose their current goodwill, I don't know, but the timing doesn't seem right (unless someone is really desperate for short-term numbers).
Not sure what this is a reference to. Microsoft STILL supports running VB6/COM/C++/etc from the 1990s today. Only Visual J++ disappeared, but a court of law required that. I'd go so far as to claim that their success is in no small part because their backwards compatibility game is top notch.
IE6 was a nightmare, but that wasn't "pulling the rug" rather just being lazy and not developing the browser at all (because it competed with their proprietary platform -- Win32). Once Microsoft deploys something and developers start using it, typically they support it "forever" (even IE compatibility modes remain to support IE5/6 code).
I tend to prefer software that works everywhere I do. I use Windows, Linux and Mac on a daily basis. Though haven't done desktop Linux in close to a decade at this point (next desktop will likely change that).
On the flip side, I actually appreciate that MS has done a number of apps with web and electron focus. VS Code shows you can do a well performing editor in a browser, I almost didn't even try it after atom and brackets. That it's on all three, I really appreciate. WTF the Teams app isn't available on Linux irks me to no end. The Azure SQL Studio is also progressing nicely. I also happen to like the relative ease of using Azure's services, but it's more than I'm going to pay on hobby projects.
[0] https://en.wikipedia.org/wiki/Millennials#Date_and_age_range...
The root issue was that Microsoft preinstalled the (free) Internet Explorer at a time when other web browsers were commercial. Netscape Navigator in particular was free for personal use, but Netscape wanted a fee for business use.
That was the original sin of the monopoly: Microsoft used its dominance in the operating system market to take over the browser market at a stroke. They compounded on this with "embrace, extend, and extinguish" practices, where they would introduce and maintain IE-only web extensions to the detriment of existing and upcoming standards.
You still see the modern legacy of this with Internet Explorer 'compatibility mode' hacks, since it turned out that Microsoft itself became stuck in its own morass.
There's no reason Apple should be allowed to force Safari exclusively on iOS. We had an entire anti-trust decision about this - https://en.wikipedia.org/wiki/United_States_v._Microsoft_Cor.... It should be bog-standard-illegal, and Apple deserves an equally bad rep for this.
* Using secret API calls to make sure their software ran faster than the competition. If you had a database server or spreadsheet application you could had a myriad of choices in the early 90s but the fastest, stablest one was always from Microsoft.
* OEMs could not change the default browser. Even when given money to install an alternative the default OOB browser was required to be IE.
Early Macs had no browser at all and at <5% of the PC universe they had no monopoly status. Before Safari Apple used MSIE as the first browser. Firefox and Webkit weren't ported over until ~2005. And long before the Apple App store the only application on iOS1 and 2 was the browser. It didn't have apps as we know it today. It would be hard to prevent them from including the browser since it shipped with the device day 1.
Microsoft's toxic and manipulative partner program has been used to extract excessive license fees from customers for years. Engineers and consultancies have been encouraged to "level-up" in the system, while customers and casual users are shut out. A whole proprietary ecosystem has been allowed to develop which requires a large financial buy-in just to provide simple services like databases and email.
Its clear that this has to change, and Microsoft is right to reduce partner dependency and vendor lock-in, painful as it may be for those who have heavily invested in these ecosystems.
In what way is the partner programme toxic and manipulative? (asking genuinely)
For example selling a customer a Windows server licence with SQL 2017 installed to run as a backend for a simple website that 10 people a day are going to visit when a centos box with postgres would be far more cost effective (and reliable) for the customer.
Now this isn't unique to Microsoft, literally all the big vendors do this (eg Cisco, VMware, every single antivirus company, etc) so not sure what makes Microsofts one particularly toxic, other than the fact that the free stuff they provide is genuinely valuable to the partners which is not always true for the other vendors.
I get the point you're trying to make, but this isn't really a good example. If a customer is already a Windows user, introducing linux and Postgres may not be the best solution. A basic windows license, sql server express, and iis should work fine though.
The point is that the partner was incentivized to not do something simple like this. I think many would, but many did not especially in the mid- and enterprise spaces where this stuff eventually caught up.
Microsoft once saw MPNs as necessary to get the sale. Now they don't, and they'd rather just cut MPNs out and make the sales themselves (more for them), and begrudgingly let it continue to exist in a minimal fashion.
That's the biggest blunder they've ever had.
Under Ballmer, Microsoft focused on core business and reached into cloud - successfully. As a result, Microsoft is now stronger than Apple. Microsoft doesn't depend on people buying luxury cellphones, a market which is reaching saturation.
That's not a "sexy" story, but it's the truth. A more "proactive" CEO would've just blown more money on Zunes and Kinects to fail in the market.
As much of a problem I might have with some of Ballmer's ideas and actions, this is simply amazing. It completely saved the whole company.
Microsoft looked at what AWS was doing and realized they were getting left in the dust and they are still playing catch up, albeit in very good shape.
Nadella discusses having to catch up to AWS in his book.
Ballmer's major contribution was finally allowing the company to follow Amazon's playbook.
As old timer insiders said to me prior to that time “You wouldn’t believe just how committed Microsoft is on this. I’ve never seen anything like it.”
(But Satya has made it really work.)
I believe they would have been fine if they focused on the European and Asian markets instead of the US.
Back when the iPhone, HTC G1 and Motorola Droid ads were saturating TV around 2008/9, I couldn't recall seeing a single ad for Nokia. Nokia's only real sales outlet were 3(!) retail stores in the entire US. And even those shuttered well before 2011.
The idea that focusing away from the US might have saved them as an independent entity doesn't hold up because their average selling price (ASP) was falling due to low-end models selling better than their more expensive smartphone line. Eventually it reached a turning point where the brand was more closely associated with super-durable and super cheap "burner" phones than upscale smartphones.
Finally, their smartphone line was a mess because like Windows Mobile 6.x, the OS appeared on a variety of screens, both touch and non-touch. The Ovi app store was deeply fragmented as a result, because old apps scaled badly on larger touch devices, and newer apps didn't work at all on the non-touch phones.
How much per unit profit were they making with their low-end models compared to the expensive smartphone models? As I recall, I spent roughly $300 to $350 per phone when I purchased models like the N95 8GB, N8, N9, and 808 (which isn't that expensive compared to certain smartphone models).
Most people I know/knew, before they switched to Android and iPhone, were using the higher end model Nokia and Blackberry phones. In fact, they had features that early models of the iPhone lacked (IIRC, the ability to copy and paste text).
So if Microsoft fails in one market segment it's his fault, but if Microsoft succeeds, it's solely the success of the people doing the work?
That's not how it works when you're CEO. You might have a point if Nadella pushed for cloud against Ballmer, but that wasn't the case. To the contrary. In any event, Ballmer ultimately called those shots, not Nadella. That's his job as a CEO.
That was the change in administration. "Microsoft is a monopoly" came under judges appointed by Clinton. "The punishment is Microsoft has to give free Windows licenses to schools" was under judges appointed by the GW Bush administration.
I think one difference is that BB, Motorola and Nokia dropped the ball technically; Microsoft had a technical solution that was ahead of its time, but failed on the business side.
Belatedly. I mean, they’re the largest software vendor on Earth, and they’re still miles behind a book retailer.
- Wikipedia's "reception" section: https://en.wikipedia.org/wiki/Windows_Me#Reception
- An XKCD comic: https://xkcd.com/323/
In any case, it's not meant to be an exhaustive list ...
Maybe I just hot lucky with my hardware choices at the time.
I agree, Vista was boring, in the sense that it just worked and didn't get in the way. Now that I think about it, the built in Start Menu search bar made it awesome.
That might have been (in part) due to all of the underpowered PCs sold with "Windows Vista Capable" badges, IIRC there was a class-action lawsuit because of it.
Every install behaved differently and had random failures which were gone without a trace after a reboot, never to appear again. Troubleshooting a non-booting WinME box was a nightmare compared to troubleshooting a Win98 box with similar issues, which had all kinds of emergency "shell" with dozens of useful utilities (which were absent in WinME, with no replacement), and a "safe mode" which was actually useful and predictable.
The Control Panel, and all the GUI around configuration was a difficult to use abomination, stuck somewhere halfway between utilitarian look&feel of Win98 and sleek look of WinXP, with all the disadvantages and none of the advantages of either.
Of course, I was used to reimaging my Windows machines at the time anyway. That's something that's mostly gone away, and I think one of the better (but mostly invisible) advances in Windows.
The "bad" OSs weren't really that bad, but they were attempts to force a big change on people without too much choice, and people absolutely hate that. Note how the successors kept most of the same underlying features while dialling back the UI redesign.
Although you are correct, these were the worst strategy moves, I don't think we are not talking about that. This is about fiendish corporate behaviour towards friends and partners.
Still are. Even better with Android.
My interpretation, or at least one of them, is that Microsoft want to start pushing the smaller accounts entirely to the cloud by starving that channel while also gaining the option of engaging with more of the largest customers directly. The latter will only be possible once most of the MPN members prone to open critique towards MPN policies have left the program. It also seems to fit nicely into the "open source" narrative with it's implicit, or explicit focus on charging for various services rather than the software itself.
(South African IT company found to abuse the MPN license terms when a client lodged complaint with SEC).
I do not have the link to the complaint to the US SEC but if anyone does, it might help.
Maybe it's some vocal partners rather than the majority that would be affected by this?
In any case, unless they have ample evidence of abuse this is a bad move
I work for a silver partner and this literally doesn't affect us. There aren't many "good faith" configurations I can imagine that would struggle fitting into this model. I'd be all ears if there's someone affected but I imagine those businesses would be operating multiple arms, one of which is performing the functions of a Microsoft partner and the other is leveraging the free access to tools to drastically cut the costs of operation.
That said, fewer partners that try to shoehorn dubious cloud licenses wouldn't be unwelcome.
MPN allowed their partners to use licenses for free for any "internal" use, now they are restricting it to only business development use cases.
This means that you can have an IT services company that barely sells any microsoft products, paying a small yearly fee to be a partner whilst getting considerably more than they pay out in return in the form of free licenses (for all internal business uses), technical support, training and other perks.
What Microsoft has done now is basically restrict the uses of MPN licenses only for business development and any other in good faith activities that are actually designed to promote Microsoft products to your customers.
Basically with this new change you can't have a 500+ employee company anymore that doesn't pay licenses for Windows, CAL licenses for domain, exchange, gets free sharepoint and more importantly free tech support which is often misused to solve customer problems rather than their own.
This more or less brings the MPN licenses closer to what say MSDN licenses are; you can use them to learn how stuff works, you can use them to demo the tech to clients, and for internal POC's but you can't roll into production on their back.
This allows Microsoft to compete in prices with cheaper products without risking being accused of dumping. It also helps with vendor lock in by inducing higher dependency than would be achievable on pricing alone. Finally, it creates a steady flow of people trained in an artificially homogeneous ecosystem.
MS is going for a personal subscription based lisencing solution in the near future.
If you think office is a cash cow think what windows whould be, every company whould boy this for their employers, the employers when fired e.g without a job whould buy it so that they can log in to their machine and so on. They could easily fetch 5$ a month from about a billion people if not more. Pluss servers being maybe 100$ a moth per server per company and so on.
Allowing MS to capitalize and companies being able to easier shape their own usage.
And some whould argue... A lot of people will move to Linux (no they wont (some but not a lot) simply because for most people it looks, feels and works like something made in someone's garage.
Just my guess.