Will Microsoft Software plus Services Be Partner Friendly?

If you are around the Software as a Service (SaaS) industry long, you quickly figure out that moving software out of the data center and into the cloud makes partnering a critical skill for vendors. No one vendor has all the cloud-friendly solutions you need today, whereas solutions for our traditional enterprise are a-plenty. Vendors in the age of hosted applications, SaaS services and utility computing and storage are putting their partnering skills to the test. The buzzword these days is "ecosystem" and everyone is at least talking a good game about developing their own partner ecosystem.

A lot of innovation in SaaS is happening in new startup companies, as traditionally happens. That was validated for me by a behemoth traditional software company who I talked to that looked down on everyone else because "we have had that capability for years" and "we already own that market". Apparently not, given the flourishing SaaS market developing around them. Keep right on with that arrogance, while others take customers from you is how I look at it.

Partnering and doing it well sounds a lot easier than it is. Solid, robust partnering skills within vendor companies only comes from leadership will tons of prior experience or by organizations cutting their teeth and learning the hard lessons of how to parnter well. OEMs require even more corporate knowledge about how to pull these off well. It's much easier to OEM a product from a vendor who has already done OEM deals than to be the first.

My personal opinion is that the longevity of many SaaS vendors will be directly determined by how effectively they are at developing a strong partner ecosystem and then working to help foster and enable that ecosystem. Frankly, startup companies tend to have a natural paranoia that they are building the next better mouse trap and everyone else with a pulse is a competitor. Startups will have to overcome this natural paranoid tendency and quickly learn to develop partner friendly products and learn to core skills to help them be good partners.

Where does this leave Microsoft? On the one hand, Microsoft has an extremely strong partner channel and a multitude of programs to help partners learn, understand, market, sell and use Microsoft products. Many including myself consider this the backbone of Microsoft's strength in market and something Microsoft has understandably protected as they move into the world of Software Plus Services.

On the other hand, if vendors don't use Microsoft technology in their products, it can be very difficult to get any interest, more-or-less partner with Microsoft. But we've seen some movement that Microsoft sees the need to integrate and work with vendors outside the circle of Microsoft. Support of sharing contacts between Windows Live and Facebook, Bebo, Hi5, Tagged and LinkedIn is one of the most recent examples, as is Microsoft's Hyper-V support for SUSE Linux, through other prominent Linux distros aren't officially supported yet.

Will Software Plus Services signal a new partnering approach for Microsoft? Proclomations that Microsoft will need to turn its partnering strategy on its ear would be premature -- I don't think hitting the reset button on the partnering strategy leverage's Microsoft's deep channel and partner portfolios. But I do expect we'll see more announcements of Microsoft supporting other web 2.0/3.0 and On Demand software and services outside those created in Redmond.

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