Microsoft Soft-Launches SaaS Marketplace Connecting ISVs Directly To Its Channel

Microsoft quietly unveiled at its Inspire conference Monday an online marketplace through which its channel can directly provision solutions from the software giant's technology partners, potentially upending the current software distribution paradigm across its vast ecosystem.

The B2B platform, called Third Party Offers, was introduced in a soft launch in the Office 365 section of the exhibition floor of the partner conference in Washington, D.C. The new cloud software marketplace aims to make it easier for solution providers to bundle third-party products with Microsoft offerings like Office 365.

Third Party Offers delivers to partners a catalog of ISV products they can purchase, deploy and manage for customers.

[Related: 5 Major Microsoft Announcements At Inspire 2017]

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"Third Party Offers helps ISVs with SaaS-ready apps connect and sell through the Microsoft partner channel," reads a Microsoft brochure distributed at the event.

Microsoft, Redmond, Wash., will beta-test the commerce portal over the next six months with select partners, according to the brochure.

The soft launch includes channel partners with MSP or CSP business models and roughly 20 ISVs, including popular offerings like Zendesk and DocuSign.

Third Party Offers will greatly enable ISVs to leverage the channel to extend their reach, freeing resources to invest more in their sales and marketing capabilities, said Jon Ferrara, CEO of Nimble CRM, a Microsoft technology partner based in Santa Monica, Calif., that's participating in the trial program.

What Microsoft's AppSource marketplace did to ease selling SaaS directly to the end user, Third Party Offers will essentially do for channel partners, Ferrara added.

Currently, ISVs that want to sell SaaS solutions through an online marketplace must build custom integrations with a hodgepodge of commerce platforms offered by 2-Tier CSPs—large Microsoft resellers that distribute solutions to other partners.

Many are offered by large distributors, like Ingram Micro, which purchased Odin Services Automation in 2015 to power its own cloud marketplace. Others come from telecoms or web hosting companies that have built their own commerce platforms or embed ones from vendors like AppDirect.

Microsoft will streamline that process to drive sales of comprehensive solutions through its channel. Once in general release, Third Party Offers will be available to all Microsoft technology and channel partners, Ferrara said.

ISVs will only have to on board once to the Microsoft platform, Ferrara said, and "once we're in there, we can start selling through any part of that channel, or all of it."

Smaller CSPs will be able to provision Microsoft and third-party solutions directly from that cloud commerce portal. And the 2-Tier CSPs can connect their own marketplaces to the portal through APIs, avoiding the time and expense common in developing an integration with every third-party vendor.

"They [Microsoft] know that when you mix third- and first-party offerings, it makes them both more sticky and gives VARs more ammunition for making additional margins on services," Ferrara said.

Products from ISVs like Nimble CRM are underpinned by Microsoft technology and drive adoption and continued use of Microsoft offerings like Azure, PowerBI, Dynamics and PowerApps, Ferrara said.

The commerce platform will make it much easier for Microsoft's channel to sell solutions to business decision-makers from the front and back office, Ferrara told CRN.

The CSP or MSP will get a line-item bill from Microsoft including all the solutions they sell through Third Party Offers.

"Microsoft is very good at this. If they make a commitment to the market and to the channel to build this, I think it's going to be huge," Ferrara said.

Behind the project is Ron Huddleston, commercial vice president of Microsoft's One Commercial Partner organization, who previously played a major role in developing the Salesforce AppExchange.