Page 2 of 2
So how is the channel roll out going to work?
We announced the commercial program July 1, and Monday we announced we're bringing it to 27 more countries by September. We're going in on a phased approach. We are working with set of distributors that give us the coverage we're looking for.
And as we go into a market, we're picking a handful [of LAR partners]; it's going to be three to 10, depending on size of the market, and the number that we need to work with to get coverage.
There are clearly other partners out there that want to resell the Surface, and I acknowledge that. At the same time, we don't want to get into position early on where we get over-distributed.
We're watching very carefully what happens in the U.S. over the next three months. We're watching what happens in these other countries, and we will make adjustments.
Switching gears, what does Microsoft think about its partners working with Apple on big iPad and iPhone deployment projects?
Well, anything that's driving business for our partners around our infrastructure is generally a good thing. There's money to be made there.
That said, we think a Windows 8 device is a much better device for an employee in a business. The iPad doesn't support encryption, or peripherals, or USB, or BitLocker. So you can have people walking out of the company with data, which can be lost in a taxi and then fairly easily be pulled off the device.
Microsoft's cloud business has come a long way since BPOS [Business Productivity Online Suite] launched at WPC in 2008. What lessons has Microsoft learned along the way?
In April, we said Office 365 is now at a $1 billion run rate. Windows Azure and associated services around it are also over $1 billion. Then there's CRM Online, and Windows Intune.
Looking around, who's the leader in cloud software? There's Salesforce, a pure cloud company; they're at about a $2 billion run rate.
You look at Google, their Google Apps business is in the $100 million range -- that's what they're making in terms of paid customers.
You could look at Amazon Web Services, and our data shows they're in the $1 billion range.
I really feel we're at the point where we're the leader in the cloud. This is something I'm pushing the company to state more loudly.
How much of the Microsoft channel is involved in driving this cloud business?
We now have 150,000 partners in cloud channel programs, which is 25 percent of our 600,000 partners around the world.
About three months ago, we looked at the data from partners in our cloud programs. About 75 percent of them are traditional Microsoft partners who've made the transition to cloud. About 25 percent are startups that were born in the cloud.