Microsoft partners at this year’s WPC may be able to purchase a discounted Surface tablet, but resale rights remain elusive for the majority of partners.
Microsoft’s channel strategy – or lack thereof – around its Surface tablets shows that the software giant has not learned from its past attempts to exclude or limit the influence of its channel around key products and solutions designed for business users.
At least year’s Worldwide Partner Conference in Toronto, the company touted the then-upcoming tablet as the next big thing and hyped it up heavily, but remained very quiet about its strategy for getting the vaunted new tech toy into the hands of the partner base that does the vast majority of its business-to-business sales. That turned out to be because Microsoft had no intentions of making Surface available through partners, a fact that CEO Steve Ballmer hammered home when he made the ill-considered observation that partners could feel free to buy Surface tablets for their customers when they launch, but they would have to do so through Microsoft’s Web store or retail locations, with no advantage over customers buying the devices direct.
Fast forward a year, and Ballmer again hyped the Surface to the company’s channel partners – urging partners to take advantage of a promotion at this year’s WPC that allows attendees to buy a Surface RT for $99 or a Surface Pro for $399, both steeply below retail prices. But that might be the only way most Microsoft partners are going to get their hands on Surface at any sort of discount in the foreseeable future. Neither Ballmer nor any of the executives who followed him made any reference to broadening the horizons for Surface in the channel.
To be fair, Microsoft’s announcement last week that it would make the tablets available to a select few large account resellers and DMRs was likely a pre-emptive strike, a way of telling the about-to-assemble masses of Microsoft partners that they were not getting an invite to the party just yet. After all, Microsoft has a history of reversing decisions that have proven unpopular to the channel at its annual partner mega-conference.
Just last year, the company used the WPC stage to announce an about-face on its unpopular-to-partner position that Microsoft and Microsoft alone would own the customer billing relationships on its Office 365 suite of online productivity and collaboration tools.
But by announcing that a select few of its largest volume partners would be allowed to resell Surface just days before this year’s WPC, Microsoft was clearly sending a message that the cries of the rest of its partners would remain unheard for now. To be fair, Microsoft channel chief Jon Roskill did announce that its nascent partner program for Devices, the one by which those select LARs will have access to Surface, would expand to 28 new countries in the months to come, but stressed that this was a continuation of its “thoughtful, phased approach” to introducing Surface to the channel.
Translation: LARs in other regions will get access to Surface. The rest of the channel will have to continue to wait.
The continuing silence for one of the company’s most intriguing offerings towards the vast majority of the 15,000-plus attendees of WPC is made all the more baffling by other comments made by Ballmer in his presentation Monday. The chief executive, reminiscing about more than 20 years of partner programs from Redmond, told partners that “it became absolutely obvious to us that the only way for us to scale out the value of our technology was to find the people, small businesses, and startups that want to take that vision” to the masses. In other words, even a young Microsoft knew that the only way it could fulfill what it saw as its destiny was relying on the force multiplier of the channel.
That equation has continued to do well by Microsoft up to the current day, including the case of Office 365 over the last two years. At last year’s WPC, Office 365 was a growing product, but a year after it made it available to partners on the terms many have sought since day one, it is now the growth darling for Redmond. A good portion of that growth is due to more time in market, and the maturing of both the product set and custom attitudes towards cloud in general, but clearly the liberalization of its channel policies around Surface have played no small role in the rockets strapped to the online suite.
If Microsoft wants to make the tablet it’s pushed so hard for the last 18 months more than just another promising technology that flopped in the market, it’s going to have to learn that the modus operandi that has served it so well in the software world – enable and empower a broad and skilled channel to evangelize its technology and make it “come to life” for customers – is also the way to go in the devices world.