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CRN: Where do you see the opportunities for partners to make money on desktop virtualization? Is this a prime, greenfield opportunity? How aggressively are you going to enforce this VDI license for Android and iPad?
Roskill: Broadly, desktop virtualization, yes, is a huge greenfield. It's actually one of the places where we have a competitive advantage versus a company like VMware. So it's something we're excited about. The iPad is just a component of that story, broadly. But again, the partner opportunity is huge.
In terms of whether we're going to enforce it, our whole licensing methodology is based on trust and will continue to be.
CRN: Is that why you decided to hold the paper with Office 365? Because that's a big issue with the partners that Microsoft collects the money. If you look at it, it's a big inhibitor for some of the small business guys. They want to own the customer relationship and they're fearful Microsoft's getting in the middle of it. As a result, it's held back a lot of guys who would have jumped more aggressively at selling Office 365.
Ross: I don't disagree that there's an opportunity for us to be more streamlined and to leverage our natural channel strengths. But by the same token, we went into it first with BPOS [Business Productivity Online Suite], then Office 365. I use the experiences we've had around Xbox as a metaphor for it. We had to make sure that the out-of-the-box experience was seamless. When you're running the service, the more breakpoints you introduce into the model, where the dependencies on third parties and dependencies on expectations are set, the more you can kill it. So there's a real concern that we would effectively create a bad user experience out of the gate. A bad user experience would kill the cloud. So it was important for us to have that consumer-class experience. How that evolves over time -- we want to try to maximize our opportunities as best as possible without sacrificing that experience the customer has.
Thomas: In the past year we've gained several hundreds of thousands of new customers in the cloud SMB space. Those customers are net-new to our partners. These are not customers who have been cannibalized away from volume licensing. They are net-new in the Microsoft universe. So it means new opportunities for the partners -- not just in terms of the cloud but also with all the add-ons that follow the cloud sale.
Ross: We have a metric internally in terms of measuring partners who are really in the cloud business. A lot of folks have tried it once. But we measure people who have done three deals with 150 seats or people who have done eight or more deals with more than 500 seats. And when we look at those two groups, 50 percent of the ones who cross [from the first group into the second] are net-new partners; they came into being to sell cloud, as opposed to traditional Microsoft partners adopting cloud.
Roskill: We're now at the point where 75 percent of the partners who are really moving and grooving in that top space are now our core managed partners.