Microsoft calls its channel partner, LeetGeek, “those Apple Guys”. The label has some justification, confesses the service provider’s director, Ben Corbett.
But that doesn’t stop the Adelaide reseller advocating a non-Apple solution.
“We’ve got the most [Apple Certified Macintosh Technicians] in the state,” Corbett says. “When the Apple Store opened in town, the first two people queued up were wearing LeetGeek shirts.” (They were LeetGeek staff.)
LeetGeek’s philosophy that modern IT systems need experts versed in all facets of their construction, maintenance and migration – irrespective of vendor or affiliation – is catching fire with Australian resellers. And it betrays the shift in allegiances that causes Apple experts to advocate Microsoft Small Business Servers, or Microsoft cloud resellers also to offer Google Apps.
In its most recent vendor analysis, Gartner saw disruptors Google and Amazon Web Services becoming more influential over the next 10 years at the expense of Apple and Microsoft. Indicative of industry flux, CIOs told Gartner the most influential vendor category was “Other/To be determined”.
“We’re very much about heterogeneous environments and agnostic solutions; we do a helluva lot of Microsoft stuff as well,” Corbett says.
Corbett laid down the law to Apple when it opened its company shop last May in the heart of Adelaide’s Rundle Mall, three kilometres from LeetGeek’s offices in the fashionable inner east suburb of Norwood.
“We work pretty closely with the Apple Store and they send a lot of referrals our way, but I was cautious about how that relationship was going to work. I said to the [business development manager], if you pass me a referral and I don’t think Apple is the right choice, I’m not going to push it even if it’s from you – and that was what he said he wanted to hear.
“He said, ‘If the customer winds up with a solution that isn’t appropriate they will be unhappy and that’s a negative association with our brand’. And I said, ‘Wow! That’s so awesome’. That’s how it should be.
“It shouldn’t be we have to shift a certain amount of tin, no matter what. We’re not going to sell a product just because we get a free holiday out of it.”
As a trusted adviser, LeetGeek sometimes tells customers home truths. This happened with a financial services client who allowed his Mac fandom to obscure IT infrastructure for his new business.
“It was what he was used to, so when he set up his business he said he wanted Macs. He went to a Mac supplier and asked, can you give me a computer and servers for my business?”
But it turned out Windows was needed to run a critical software application across the business. The earlier Apple reseller had crafted a solution that overlaid Parallels virtual machine to enable Windows.
“Before you jump into a sale, you have to do your due diligence,” Corbett says.
“Trying to install Windows inside that – it’s clunky and a pain. It didn’t make sense to maintain it if it wasn’t necessary.”
Instead, Corbett and co decided to “scrap OS X and install Windows native” with Microsoft Small Business Server 2008 for the back end.
In education, it’s the opposite. “When we started out – and this is why Microsoft thinks we’re an Apple shop – [most] of our clients were looking for Apple devices,” says Corbett. That’s still the case.
“Whereas the backend infrastructure may be a mix of Windows and OS X, a lot of the client devices would be iPads or MacBooks.”
Keeping abreast of so many competing technologies requires vendors and distributors to share their roadmaps and provide evaluation equipment and services on fair terms, Corbett says.
“You have to cut through the marketing and get figures and real-world examples before you invest your time. We have to be confident with the product before we’ll roll with it. [Evaluation equipment] makes a huge difference. It’s a pretty hard sell if someone won’t let us play with the stuff.”
Next: A foot in both camps
Platform migration
Source Central Partners is another reseller finding it more fruitful to walk both sides of the street, says chief executive officer Brendan Redpath.
“We were a traditional reseller until we recently saw an opportunity to work with Google,” Redpath says.
Moving to cloud services allowed Redpath’s customers to cut physical infrastructure and invest in networks, especially wireless, he says. This is reflected in the vendor relationship he says is strongest – with wireless network maker Xirrus.
But that hasn’t stopped the Melbourne solutions provider collaborating with Cisco, another strong partnership mediated through distributors: “We’re making the distribution channel work for us because they know how to play the game with vendors better than we do.”
Source Central Partners rounds out its key vendors with Dell, Lenovo, Microsoft and Apple while recently pursuing HP directly, “but we try to stay reasonably agnostic”, he says.
Further compounding this approach was Source Central’s March acquisition of a small start-up that specialises in Juniper. “It can make us more attractive to clients who are looking for a relatively agnostic approach. It gives us the opportunity to supply a different solution if required. Or it allows us to work with clients who already have Juniper in their network,” says Redpath.
When it comes to “unravelling the mystery of Microsoft licencing”, Synnex has emerged as a trusted adviser.
“I have enough grey hairs managing it,” Redpath says. “[Synnex] takes the responsibility of understanding the opportunity and what the client has and comes back to us with a solution.”
In schools, Apple will hold the upper hand over Microsoft and Google for at least two years. “That discussion is a no-brainer – iPad absolutely dominates that space. There are those [schools] who want to have a chat about Windows and Android but it always rolls back to iPad.”
And on notebooks, “it’s all gone MacBook Air”, he says. But devices such as Lenovo’s new ThinkPad X1 Carbon, a lightweight Windows contender, are making headway.
Shifting customer expectations and rapid innovation means Google is a contender, especially where budgets are tight.
“Chromebooks are starting to get more traction [but] we say, ‘Hang on you’re not even on Google’.”
This is where it may be necessary to switch a customer’s infrastructure.
“If they’re running on Exchange and proprietary applications, it won’t work. [Chromebooks] are fast and quite good for what they’re intended but they have to be in the Google ecosystem – Drive, Docs, Gmail.”
Redpath cautions a staged approach with plenty of time to iron out crimps.
“Pilot, pilot and pilot. When you’re making such a fundamental shift for a client you don’t roll out without piloting. We had a client we migrated from a pure Microsoft platform to Apple and Google. The expectation is it will be seamless but we did a pilot and found a bucketload of issues.”
Training for new user interfaces is a major pitfall of any migration, he says.
“So it’s going from Outlook to Gmail and how users are going to take that. And addressing that finite detail because you’re making a complete shift.”
Gartner analyst Brian Prentice backs Corbett’s and Redpath’s approach.
“It’s a mistake at the moment to try to pick a winner,” Prentice says.
“It’s not about throwing all our chips on Apple or Google [because] we’re living in a heterogeneous platform environment. This is not an issue enterprises are particularly comfortable with.”
Prentice says Apple is in the lead in mobile, with Google second but Microsoft is “struggling to get their message to resonate”.
“Microsoft has not really made a dent in the mobile market of any appreciable size.”
A factor resellers should consider when presenting solutions is that CIOs still harbour a “negative bias to Apple”, he says.
“Apple is not geared to being an enterprise company. CIOs would prefer to have vendors who will share their product plans for the next 12 months so they can make decisions. Apple’s model requires secrecy up to the launch.”
And although enterprises are warming to Google Apps, owing to its security flaws and Google’s business model, Android is off the table.
“Enterprises still have substantial issues with Android. There are security issues that Google has not addressed. Apple and Microsoft are much safer from a security perspective,” says Prentice.
Next: A wave of uncertainty
Resellers can differentiate themselves by creating intellectual property (IP), especially since cloud is “tearing out” labour, Prentice says.
“You have to get into your own service-delivery model which has highly scalable, global-class delivery predicated on your own IP.
“You can tie into these ecosystems and connect to iOS, Android or Google App Engine but it’s going to be really tough to read tea leaves, invest in competency of staff and hope the market is stagnant enough that you can bank that.”
Against the uncertainty stands Microsoft and its unparalleled channel clout. The US software, hardware and cloud vendor has 14,000 channel partners across the spectrum including mum-and-dad computer shops, systems integrators, cloud resellers, device makers and general solutions providers.
“Microsoft has been deliberate over the past couple of years reframing ourselves as a devices and services company,” says Microsoft Australia’s channel manager Dean Swan.
“We thought bringing a Surface device to the market would drive Windows and open the market for OEMs as well as Microsoft.”
Swan says that after a couple of years of “slim pickings” of Surface devices, the platform now has a “vibrant ecosystem” including its own devices and those from third parties such as Acer and Dell.
Microsoft has also navigated reseller concerns over its cloud services, Swan says.
“The initial response from cloud integrators when we released Office 365 was that they felt we were competing with them. They had built a model around deploying software as system integrators and now as a cloud service we were taking that over. But we have educated the market and shown that as they transform the business, they will be more profitable.”
Swan shrugs off Apple’s dominance in mobile and education sectors. “We’re starting to see the preferences move strongly towards Microsoft and the Windows ecosystem – a no-compromise experience of notebooks using a digitised pen and coupled with cloud services to drive education outcomes.”
Microsoft has just run seminars for schools to introduce its solutions to influential educators. Swan says the message is sinking in that Microsoft is “more open than Apple... and when they use One Note, it runs on Apple, Android as well as multiple devices. When you look at Office 365, it runs across devices.”
Microsoft also offers incentives for resellers to promote its products, including up to 50 free Surface tablets if the customer was willing to be a case study, a reseller told CRN.
“We’ve got incentives and programs to allow [resellers] to procure hardware at a significantly discounted price,” Swan says.
“From a services perspective, we provide internal use rights to partners, and then depending on their level, they can leverage those services to demonstrate to customers.”
Microsoft also offers an “immersion experience”, where it demonstrates hardware, software and cloud services at a customer site, he says.
And against Google, Microsoft is pushing back with a story about privacy: “Google at its core is still a company driven around advertising revenue and they scan the student emails to drive targeted advertising and most parents are concerned about those practices”.
A resurgent Microsoft is a relief to Downs Microsystems partner and business development manager, Ian Hurley. The Toowoomba reseller recently reapplied for its Apple dealership following a merger, which included a hefty re-registration bill and passing a bill of health.
Hurley credits Apple with great marketing to consumers, who then sought the same experience when they entered the workforce. “Apple did a very good job of making [the experience] wanted and that’s what brought it into the business market.”
But Hurley rails against Apple’s poor margins: “It’s hard to say pick the Apple product over Windows Lumia, Android or Sony Xperia where you make $200 or $300 margin over 20 bucks. They almost push you out of the market so they can go direct.”
But he says he “happily” advises customers to buy Apple if that’s the right platform for them. “If you’re using an iPhone and want a tablet device, I say use a single OS rather than mix your flavours; you’ll have a better experience. I’ve certainly moved a lot of people away from Apple, and even recently we have companies that are asking us for iPads but when we drill down, the technology is best delivered on Windows,” says Hurley.
“When they’re trying to deliver up-to-date, live Excel spreadsheets to 1,000 coaches or people in the field and they can deliver that on SharePoint, then why would you cross-platform and support a second operating system instead of a native Windows 8 platform?”
Internally, Downs Microsystems has largely transitioned from Apple to Microsoft, which enables roaming staff to access SharePoint repositories, phone directories and communications through Lync from their mobile devices, Hurley says.
Microsoft’s tight integration is a factor in why IT operations staff like Windows, says LogicalTech’s head of Microsoft integration, Peter Linton.
“If you talk to C-level people, they love their iPads,” Linton says. “The good thing about the Surface Pro is there’s no reworking of the software to run it and that’s where you win the operations staff.
“The messaging for us is very straightforward: you run Word, Exchange and Excel; do you want to bring in a product that is a bit hit and miss or bring in something that is out of the box and fits into your ecosystem?”
But he acknowledges that where Apple has a wide and deep selection of mobile apps, Microsoft has a “problem with take-up and they don’t have the ecosystem in the apps”.
“Once the ecosystem is there you will see some very large changes in the percentage ownership.”
Linton says Microsoft is poised to blast past Apple in the area of business intelligence and providing critical, real-time data to workers in the field.
“It’s absolutely the big one for mobility because it’s a situation where people have the information in their hand and can walk into the meeting and take it with them,” says Linton.
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