Sorry to sound dramatic, but TalkinCloud firmly believes Microsoft Office 365 -- the forthcoming successor to Business Productivity Online Suite -- represents a major inflection point for channel partners and customers. Office 365, expected to launch around July 1 or sooner, will include Exchange Online, SharePoint OnLine, Lync Online and Web versions of Microsoft Office. Office 365 will cost as little as $6 per user. (For more background, here's an Office 365 FAQ.)
Pitted against Google Apps, Office 365 will likely shift the cloud computing conversation from IT conversations into business departments and even into consumer households, TalkinCloud believes.
The Microsoft Office 365 advertising campaign is part of a larger Microsoft Cloud Power billboard campaign in New York. I spotted the massive billboards earlier today at New York's Laguardia Airport. Sources say Microsoft also is planning a multimillion-dollar Office 365 television advertising campaign.
Generally speaking, Microsoft's initial Office 365 ads target business users, through the company is taking steps to include channel partners in the initiative. For instance, Microsoft's Cloud Accelerate and Cloud Essentials training and promotion efforts help channel partners prepare for Office 365. Jenni Flinders, VP of US Partner Strategy and Programs at Microsoft, explained the Cloud Accelerate and Cloud Essential initiatives to TalkinCloud in December 2010 (see FastChat Video, left).
Opportunities and Challenges
On the one hand, Office 365 sets the stage for channel partners to earn recurring, perpetual revenues from customers. (Already, Microsoft's top 10 U.S. cloud channel partners have moved 1,000 customers to BPOS, the Office 365 predecessor.) And Microsoft has published research to prove its commitment to channel partners. But on the other hand, GM Bill Staples recently described how Microsoft will both compete and cooperate with channel partners using Office 365 (see FastChat Video, Left).
Meanwhile, some partners have a range of concerns -- such as moving customer information into Microsoft data centers, and trusting Microsoft to manage cloud billing to end customers. Microsoft Channel Chief Jon Roskill has indicated that he's listening to partner feedback about the cloud billing policy. Ironically, Microsoft rivals like Google and Rackspace allow channel partners to manage end-customer cloud billing.
Some of Microsoft's own channel partners are teaching VARs and MSPs how to compete with Office 365 before the cloud suite even arrives. Intermedia, a hosted Exchange partner, offered Office 365 competitive advice to channel partners during a recent partner conference in March.
Whether partners embrace or reject Office 365, one thing is clear: Judgment day is coming in the software market. The Microsoft ad campaign seems to confirm that Office 365's launch is eminent. So it's nearly time for channel partners -- and customers -- to choose sides.
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