First Things First – Cloud Vendor as Friend or Foe?

May 5, 2010 at 11:15 pm Leave a comment

By Beth Vanni

Emerging channel engagement models in cloud services delivery

There I sat at the recent Baptie Channel Focus conference listening to channel executives from Microsoft and NetApp talk about their vision for c loud services.  Now, I’ve sat at this conference for some eight years running, and in that moment I had a vivid flashback to the movie “Ground hog Day.”

In the movie, the lead character is trapped in a time warp where he wakes up every morning to the same set of limiting circumstances, and he gets to do a “do-over” of how he handles the day’s events and relationships.  Great movie if you’ve never seen it.   The déjà vu moment for me was about the basic relationship between IT vendors and their channel partners. Despite how far IT technology has come in the last decade and how much of a revolution cloud computi ng promises to offer us all, it seems like basic vendor/partner relationship dynamics are caught in a time warp.

As our good friend, Ross Brown from Microsoft, talked about his company’s innovations in social networking built into their applications, the new Windows 7 phone and the next billion people who will connect to the Net, the details of a recent interview I did with a Microsoft Gold partner echoed in my ear.  This particular partner went on for nearly 10 minutes about the subtleties of having the monthly statement for Microsoft’s BPOS (Business Online Productivity Suite) arrive at his customer directly without his involvement and with only Microsoft’s name on it.   Now, we all know that Microsoft has the market clout and channel following to “experiment” a bit with cloud delivery models.  They have different channel routes to market for their hosted and cloud application offerings.  And, yes, partners are in the profit food chain to some degree for all the different offerings.  Some are partner dependent, but others not so much.   Mr. Brown himself noted “in 10 years the line between partner and customer blurs.”

Microsoft’s assertion is that there’s plenty of value for solution providers to provide in cloud offering, beyond just transacting the licenses.  I agree.  And, they continue to actively push partners to build vertical domain expertise and innovative services models.   But, they haven’t really declared their position that they are indeed experimenting with where they want their channel partners to shift in adding value and to what degree they will be increasingly touching end-users directly.

Now, over to NetApp.  Julie Parish, of ex-Symantec channel chief fame, shared the storage leader’s cloud plans.   Her vision statement and pitch about partner engagement was relatively aligned with that of Microsoft.   But, in laying out her rules of cloud channel engagement, the #1 rule she stated was as such — “To embrace end-user requirements and help your partners, you must first determine your position.”  NetApp’s position happens to be really clean.  That is, they are not a services company and have chosen to bring their cloud services to market exclusively through their 3,000 channel partners.   Further, they have declared they will sell-in to a very focused list of leading service providers (think AT&T, Rackspace, Terremark) and delivery sell-through programs for all of their channel partners to leverage.   Most of their channel partners rave about the clarity and discipline of NetApp’s direct vs. channel go-to- market strategy.

NetApp’s big critical success factor for cloud services in the next several years will be how successfully they facilitate partnerships between their traditional on-premise integrator channel and their emerging service provider channel.  And, I’m sure there will be some degree of channel “foe” conflict between these two channel segments with their technology.  It’s inevitable.  NetApp’s channel chief echoed Microsoft’s vision for the new kinds of value partners will need to create to be relevant in the cloud space, i.e., vertical expertise business process consulting.    But, there was something pretty simple and clean about NetApp’s declaration of their position in services delivery vs. their aspirations for their partners.

I’m not here to throw Microsoft, or any other vendor, under the bus regarding experimentation on cloud technology delivery channels.  But, I absolutely echo Julie’s challenge for vendors to openly and clearly state their cloud route-to-market plans to their channel partners, even as they evolve over time.   There’s plenty of business for everyone, even if that means many channel partners have to reinvent themselves, partner with peers, or shut down non-performing practices.  It’s just easier to do that when you know who you’re real competition is.

See Also:

Avnet launches new CloudReady initiative

May Webinar: Engaging the Services Partner
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