During July’s Worldwide Partner Conference in Toronto, Ontario, Microsoft (News - Alert) revealed that its partners would now be allowed to buy, sell and support Office 365. Also, the partners’ newfound powers will include handling billing directly for their customers.
This move shattered Microsoft’s dome of exclusivity over Office 365 and could also prove pivotal in driving more enterprises into the cloud.
Currently, only 16 percent of customers considering cloud services are thinking about leveraging Office 365 while 34 percent are considering Google (News - Alert) Apps. However, in the small-and medium-sized business market, 43 percent of buyers purchase Office 365 and 48 percent of buyers purchase competitor solutions.
In other words, in a key growth sector, Microsoft and Google cloud services are locked almost in a statistical tie.
The greatest beneficiaries of Microsoft’s unshackling of Office 365 are large partners like Dell (News - Alert) and Verizon Wireless, which have already started to offer the service as a component of their cloud packages. In addition to Dell and Verizon, multiple regional service providers and large telecom carriers across the world are following suit.
Smaller service providers, on the other hand, still have concerns. Making money from Office 365 and other Microsoft cloud products is challenging for them, particularly when margins are wafer-thin and recurring payments are too low. Also, partners who refer their customers to purchase directly from Microsoft will now receive an additional kickback.
Even smaller clients should see many advantages to Office 365 particularly because the product will allow them to access Office documents on their mobile devices. This flexibility could drive many clients into reconsidering an alternative to their on-premises Office products.
For solutions providers, Office 365 could mean income from value-added services like hosted e-mail, backup and storage services even if they do send their customers directly to Microsoft for Office 365.
The best business targets for Office 365 adoption, according to a recent survey from TechAisle, are businesses that employ 20 to 49 people. Only six percent of businesses with four or fewer employees are actually considering dumping their client-side Office software.
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Edited by Jamie Epstein