Microsoft Office 365 Open Lets VARs Control Billing, Revenue


Microsoft also plans to push VARs to sell Office 365 within their own organizations. "If they use it, they will be better at promoting it and selling it. We like to say 'You have to use the cloud to sell the cloud,'" Microsoft's Roskill said.

Rob Moyer, vice president of Synnex's Microsoft global business unit and cloud computing, said the ability for VARs to take title to sell Office 365 Open should appease many VARs hesitant to sell Microsoft's cloud solutions.

"Go back to the early days of the Advisor program, and a lot of people complained about losing billing to customers. While it took a while, Microsoft did what channel was asking of them. The people that will benefit most is the traditional channel. This is a huge positive," Moyer said.

Microsoft expects some partners to view the Open program as a stepping stone to drive more sales through the Advisor program, but the two programs will sit side by side, Roskill said.

"The goal is not to drive the Advisor channel to Open. We think they're quite complementary," he said.

Microsoft wouldn't detail channel discounts or incentives, but Roskill said they would be volume based and that they would be "some of the richest if not the richest rebates ever" offered to partners.

"We're doing that to send a clear message. Our biggest competitor is not somebody like Google. It's our on-premise products. A lot of partners have made a lot of money selling on premise. We want to make sure they can make just as much if not more selling cloud," he said.

Don MacNeil, Managing Partner at Strategic SaaS, a three and a half year-old VAR based in Austin, Texas, has registered nearly 200 Office 365 users under the Advisor program but plans to leverage the Open model going forward.

"We'll be doing the end SKU every time we can. Absolutely. From a capitalization perspective, and so many other perspectives, we like to control that," MacNeil said. "We spend an enormous amount of time helping customer evaluate the benefits of cloud; we help them migrate to cloud, [and] then we hand it over to Microsoft and [customers] wonder who their partner is. If we can maintain a billing relationship, that's a much longer-term strategy for us to service accounts and overall help them in their migration to cloud services."

In addition, the Open program provides incentive for Strategic SaaS to target smaller customers for Office 365 Open, MacNeil said. "It has a ceiling of 350 users. That's our average prospect today. My value proposition is helping customers make a comfortable transition to cloud, and a primary step is moving into Office 365," he said.

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