Ballmer Issues Marching Orders For Microsoft Partners

Opening Microsoft's Velocity 2006 worldwide partner conference in Boston, Ballmer formally launched the Dynamics CRM Live platform as well as plans for a Live Partner Advisory Council (PAC) and a new Search Specialization for partners in 2007 to help VARs build services businesses for the Live software-as-a-service (SaaS) platform.

Ballmer said Microsoft isn't going to get "outhustled" by competitors on the hosted CRM front and will rely heavily on partners to uncover money-making opportunities.

"This industry is full of change. Some call it a disruption. But change is the nature of our industry, and the change that we'll go from running [technology] infrastructure on the Internet is inevitable," he said. "Microsoft has to embrace it, and our partners have to embrace it. We need to work together to find new opportunities. "

The introduction of a "partner-based customization model out of the gate for CRM Live" demonstrates that Microsoft will count on partners to grow its business in the SaaS era," Ballmer said.

He predicted that partners will benefit from advertising revenue, earn agent fees and commissions for reselling Windows Live and Office Live services, and build practices for hosting customer infrastructures and customizing Internet services.

Microsoft estimates that 7,000 of its 360,000 service partners will attend the conference. Hundreds of the partners who attended Ballmer's keynote Tuesday morning cheered the new CRM Live, which is due to launch in the second quarter of 2007.

Microsoft plans to release more than 10 Windows Live services in fiscal 2007. CRM Live will be hosted within Microsoft's Windows Live data centers.

Microsoft said Live will be a big business going forward but emphasized that most of the channel's business in fiscal 2007 will revolve around on-premise software.

Buoyed by the cheers that rang out with the formal launch of Windows Small Business Server 2003 R2 during his keynote, Ballmer gave five top marching orders for partners in fiscal 2007:

• Partners should focus on selling the "blockbuster" Windows Vista and Office 2007 platforms and building solutions for them.

• Partners should push .Net-based Windows Server 2003, SQL Server 2005 and System Center 2005 products.

• Partners must drive Dynamics implementations, including Dynamics CRM and Dynamics CRM Live.

• Partners should participate in the Dynamics Live PAC.

• Partners should help Microsoft enter new markets, including search and portals, unified communications and security software.