.NET Losses


"We need to do a better job making sure that we are a good partner."
--Microsoft CEO Steve Ballmer

That statement may be the one thing that Microsoft and its partners agree on today. The biggest software company in the world is quite different than it was a year ago, but not because of lawsuits, government settlements or new products. Microsoft has become barely recognizable in its channel management these days, employing changes that are unpopular, at best, and potentially harmful to partners.

In the past year, the company has forced new licensing models and mandatory certification upgrades on partners, just as Microsoft Consulting Services has begun to compete more aggressively for channel business.

"We must be doing something right," insists Enrique Fernandez, director of channel programs at Microsoft. "We have a 92 percent renewal rate with our partners, and we're proud of our achievements." But critics note that Microsoft is the predominant game in town,which may have something to do with that 92 percent renewal rate,and that severely curtails the leverage of the channel.

Microsoft's Achilles' heel appears to be .NET, its proprietary platform for XML Web services. To spread the .NET gospel, Microsoft needs to team with solution providers and software developers that can build products compatible with Microsoft's Web-services strategy. But partner program changes have damaged the channel's faith in Microsoft and appear to have put .NET strategy in jeopardy. Many solution providers stake their businesses on Microsoft, so they can't just end the partnership. But, they can, as a recourse, not play ball with .NET. Microsoft needs software companies and solution providers to become .NET certified if its Web-services plan is ever to get off the ground. CEO Steve Ballmer realizes that, and, previously has described .NET as offering "amazing" opportunities for developers and partners. Still, some integrators aren't biting. Here's why some partners are turning their backs on .NET,and, in effect, Microsoft.

Licensing Links

.NET or .Not?

Certification Standoff