Cloud Commitments, Concerns across the Channel-Lands

The world is moving up into the clouds, of that there is no doubt. Just how the channel will make this migration and what form will businesses take once they arrive remain in question. This week, the Channel-Lands received a reaffirmation commitment in the cloud to partners from one of the largest patrons. We also heard from the new HP chief on his plans for partners. And we’re monitoring some interesting moves by Apple.

Microsoft Chief Affirms Channel Cloud Commitment

Microsoft global channel chief Jon Roskill used the software giant’s newly minted retail store in Bellevue, Wash., as the backdrop for reiterating the company’s commitment to take its cloud services to market via channel partners. The juxtaposition of making a channel commitment at a retail store selling product direct to consumers probably didn’t help partners’ apprehension about their role in the delivery of Microsoft online products.

Microsoft is making a big push of its new Office 365 – the rebranding of its BPOS cloud-based productivity suite. The company believes the next decade will be one of continual migration to cloud services, and it’s betting a lot on products such as Azure, SharePoint, Exchange and Office 365. During his Microsoft Store Town Hall, Roskill said, “We’re pleasantly surprised to see SMBs and large [enterprises] moving to cloud right now.”

But Microsoft partners are still uneasy about Microsoft’s plans for them in the cloud future. At the Town Hall, partners asked when Microsoft will change its billing policies and allow partners to bill customers. As it stands, partners may sell Microsoft cloud products, but Microsoft tracks and bills the customer directly. Microsoft rationalizes this policy by saying few partners possess the capability to accurately bill for cloud services. MSPmentor noted Microsoft is working with Parallels to enable partner billing, but it’s in the nascent stages.

Partners remain discontent with the margin structure that Microsoft is affording them in cloud sales. The margins extended to partners are razor thin. Microsoft says partners can make good money through “value-add” professional services related to cloud products, but few partners have identified those opportunities or figured out how to monetize them in the same way as they do in hardware and software sales.

Even Microsoft’s position in the cloud isn’t guaranteed. Google and its integrator partner Unisys dealt Microsoft a blow this week by winning the General Services Administration contract to convert its 15,000 federal employees to Gmail. Some observers say the deal is breaking up the logjam and opens the door for greater competition in cloud productivity services.

HP’s New Chief Commits to Partners

With the Oracle-SAP lawsuit concluded, new Hewlett-Packard CEO Leo Apotheker is now free to move about the United States, and is moving quickly to establish relationships with the company’s vast channel community. This week Apotheker sent a video message to all of HP’s partners in the Americas affirming his commitment to work toward the betterment of the channel community.

Apotheker’s pedigree is one of direct sales. He hasn’t been ducking partners since taking the helm of the world’s largest technology company. He’s just been scarce while Oracle and his former employer SAP fought their courtroom melodrama over the theft of trade secrets. The jury in that case found SAP liable for $1.3 billion in relation to its taking of Oracle documents. Oracle wanted Apotheker to testify at the trial, a move many believe designed to embarrass the new HP CEO.

CRN’s Kevin McLaughlin reports the Apotheker goes beyond affirming a channel commitment in the video by stating HP cannot continue to win without the support of its partners. "We remain fully engaged in our channel objectives and fully engaged with you as a core component of our long-term business strategy," Apotheker says in the video. "It's more important than ever for us to maintain our momentum because the opportunity before us has never been greater."

Apple Testing POS Systems with Old Navy

If you’ve been to an Apple store (and who hasn’t), you probably noted the absence of cash registers and checkout counters. Apple has masterfully made every store employee a point of sales with transaction-enabled iPhones. All you have to do is walk up to one of these Geniuses, whip out a credit card, and you’re on your way. Oh, and the receipt will be emailed to you.

There’s much talk of Apple pressing into the enterprise and business verticals. One area where it could potentially be a game changer is in point of sales. Channel Insider this week reported Old Navy is piloting the Apple POS system, rebranded as ZipCheck.  Soon, shoppers at Old Navy may be able to avoid those dreadful lines and speed out of the store with their cotton t-shirts.

POS is an increasingly important battleground for mobile device manufacturers, and a tremendous opportunity for solution providers installing and supporting these systems. Watch for competitive responses from Google, Motorola, Cisco, Microsoft and Intermec.

WikiLeaks Exposes IT Weaknesses, Opportunities

Finally, you had to have been hiding under a rock to miss the firestorm over WikiLeaks publishing more than 260,000 secret diplomatic cables. The U.S. government is in full damage control mode now that foreign governments around the world know what we really think of them (Quaddafi and a blonde Ukranian “nurse”…that’s priceless). But the disclosure of these documents and the circumstances around them reveal some potential opportunities for solution providers.

First, the documents were allegedly obtained by PFC Bradley Manning, an Army intelligence specialist stationed in Baghdad who used read-write CDs and flash memory sticks to pilfer the documents. This shows the need for greater access control, document control and data loss prevention technology adoption. Some security analysts already are predicting an uptick in DLP adoption in the wake of the WikiLeaks scandal.

Second, WikiLeaks was subject to a distributed denial of service (DDoS) when it published the documents. The attack launched by a patriotic hacker disrupted access to the site. While unsuccessful, the attack raises questions about the vulnerability of cloud services to intentional disruption. Should a hacker, activist group or even government become displeased with a company’s action, could they cripple operations by attacking their cloud services? It’s an interesting problem to postulate. 

Well, that’s all the week’s news from Channel-Lands where all the technology works, all the deals are profitable and all of the companies are above average. If you want to follow me on Facebook or Twitter, feel free to connect. Share your suggestions and news with me at lmwalsh@the2112group.com.