Friend or foe? Microsoft partners wary of Office 365 migration plans

Microsoft's self-interest may leave solutions providers in the lurch, but for now there's still a need for third-party help

Last week, I advised third-party developers to be as aggressive as Microsoft in making the shift to the cloud via Windows Azure and Office 365. But a reader reminded me that it's hard for some third parties -- particularly solutions integrators and professional services providers -- to do that. Why? Because Microsoft is muscling into their business, not creating a platform to which they can add as much value.

The specific issues revolve around residual percentages for customers migrating from Exchange to Office 365 and the available professional services work, including migration and continued support, for those migrated customers. Once an enterprise is on the cloud, the third parties' opportunity to do work for that customer drops dramatically as Microsoft directly manages the platform.

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Also, the deal between Microsoft and the third-party solutions integrators and consultants keeps changing, to the third parties' increasing disadvantage. It's a state that reminds me of a scene in "The Empire Strikes Back":

Calrissian: Lord Vader, what about Leia and the Wookiee?

Darth Vader: They must never again leave this city.

Lando (outraged): That was never a condition of our agreement, nor was giving Han [Solo] to this bounty hunter!

Darth Vader: Perhaps you think you're being treated unfairly?

Lando (after a pause, in a nervous tone): No.

Darth Vader: Good. You know it would be unfortunate if I had to leave a garrison here.

Lando (to himself): This deal is getting worse all the time!

I very much appreciate the third-party providers' frustration. Like most vendors, Microsoft calls such entities "partners," which implies they're in this together. That's not the real relationship: Microsoft is aggressively trying to stay alive and relevant in the changing technology market, and if it has to sacrifice its "partners" to do that, so be it.

Solutions providers aren't the only ones who may be sacrificed for Microsoft's greater good. Ask the folks at Acer, Asus, Dell, Hewlett-Packard, and Lenovo how they felt when Microsoft announced the Surface tablet and became a direct competitor.

It's true, as announced at its Worldwide Partners Conference, that Microsoft is tossing its hat further into the professional services arena, and migration to Office 365 is one area where it feels the need to come into its partners' territory.

As of Sept. 1, Microsoft will offer through its FastTrack program free migration assistance to customers on deals of 150 or more Office 365 seats. Microsoft is hiring between 200 and 600 employees to aid the onboarding and migration process. Microsoft may perform the migration itself (if it can be handled from beginning to end from a call center using remote-access tools) or it may pull in a partner and pay it $15 per seat for the first 1,000 seats and $5 per seat after that, up to a $60,000 per customer migration.

In the past, moving to Office 365 was a bit problematic, but Microsoft has developed enhancements over time to the migration process, making it an easy target for Microsoft to use call center staff and remote tools to handle.

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