Microsoft Changes Controversial SaaS Billing Policies

"There is definitely a movement afoot to let you resell [services], and you would own the paper and agreement with the customer," said Shannon Day, director of Microsoft's Software Plus Services program in the U.S. Software Plus Services is a term Microsoft uses to describe what most technologists refer to as Software as a Service.

Microsoft in July unveiled its Business Productivity Online Suite (BPOS) at its Worldwide Partner Conference and said VARs would receive 12 percent of the first year's subscription value and 6 percent of the ongoing annual service fees from reselling the suite. BPOS bundles hosted Exchange, SharePoint, Office Communications Server, and LiveMeeting and costs $15 per user per month.

But with BPOS, Microsoft also revealed its intention to take control of the billing relationship, a prospect that was upsetting to many solution providers. That's why Day's revelation at XChange will help smooth ruffled feathers within the Microsoft channel.

Speaking at XChange Solution Provider '09 in New Orleans, Day said Microsoft has heard the issue "loud and clear" from partners, and the change will take effect "in the coming months." Microsoft also envisions channel opportunities in integrating customizing and providing ongoing support for the services, he added.

Day also touched on Windows Azure, the platform-as-a-service offering Microsoft plans to launch later this year, noting that it provides an answer to the capacity issues many companies face. Azure, which is hosted in Microsoft's data centers, will enable partners to use building blocks like SQL Server and SharePoint to extend tailored services to their customers, Day said.

"Soon all of our enterprise class software will be delivered as an option, available either in the cloud or on-premise," Day said.

In the question and answer session following Day's presentation, one solution provider asked Day if Microsoft will allow VARs to run some of the Azure platform in their own data centers, and his response suggested that Microsoft has been entertaining exactly this very notion.

"I definitely expect some movement in that area," Day said.

XChange Solution Provider is hosted by Everything Channel, which also owns Channelweb.com.