Office-Vista Subtext

Infrastructure partners say they can charge $50 to $100 per desktop just on the migration—above and beyond licensing costs. Custom app developers and solution providers should do very well adding even more value.

Huckaby, who is based in Carlsbad, Calif., repped the partner contingency of the Microsoft ecosystem. And indeed, after long years of development, it looks like the new Office and Windows clients pack some punch.

But here's what infrastructure partners have to watch: Microsoft's continuing balancing act between the traditional Office/Vista delivery model relying on big-bang software sales vs. software as a service (SaaS), the delivery model pioneered by Google and representing the latest threat to Microsoft's traditional model.

Critics maintain Microsoft will protect its Office/Windows cash cows at all costs, even if that means neutering its nascent hosted Office Live and Windows Live efforts.

Microsoft Corporate Vice President Chris Capossela nixed that contention outright last week. "We try not to worry about cannibalization of our existing business. We want to be No. 1 in productivity, I don't care whether that's Web productivity or server productivity. It's software, I don't care where that software runs. It's our mission to be No. 1 in it, and if that's where all the usage is going to go, then we want to be No. 1 in that space," Capossela told CRN. "I'd say there's a healthy dose of 'What would this do to our existing business if we did X,' but there's a healthier dose of 'Make sure you're doing the right things to be No. 1.' "

Microsoft CTO Ray Ozzie now is working with the Windows Live and Office Live teams, much the same way Bill Gates worked with the Windows and Office teams of yesteryear, Capossela said.

The challenge for Microsoft's traditional partners is to make sure their skill sets keep them relevant in a world where Microsoft or Google or Salesforce.com serve up more of the application maintenance and functionality that may have flowed from partners in the past.

What's your take on Microsoft's software-SaaS straddle? Get back to me at (781) 839-1223 or via e-mail at [email protected].