All in one

In much the same way that Star Trek never seems to stop producing new episodes, Microsoft never seems to stop revamping its partner program.

On 9 October at its inaugural Worldwide Partner Conference in New Orleans, Microsoft command announced a new overall partner program framework to rationalise what had become a complex, confusing channel space in its 775,000-partner galaxy. Could this be the final frontier?

With what is internally dubbed the Next Generation Partner Program, Microsoft is boldly going where few giant global vendors have gone before. Lloyd Ernst, CEO of webhosting and Internet services company WebCentral, says the enterprise - like the original's Captain Kirk - may be voyaging some five years ahead of the opposition.

'I think it's a gutsy move. Either you build a vertically integrating business like IBM or make a partner model to maximise your leverage. I think Microsoft is two to five years ahead of IBM and some of those other guys with this,' Ernst says.

Other local partners have also welcomed the new prime directive, which, like Starfleet's, is presented as a benevolent moral code for civilising other 'species'.

Lorraine Cowan, software and business unit networking manager at distributor Tech Pacific, was at the US conference. '[Microsoft] believes partners will be better able to align themselves and focus on relevant product segments and solutions via the program and partner profitability is a key measure for them,' she says.

Cowan says the plan 'very much' flies on Microsoft reiterating the value it places on its partners, given that more than 95 percent of its business is done through the channel. The vendor sees the new program as better suited to partners' diverse needs, she says.

Brian Walshe, national Microsoft practice manager at system integrator Dimension Data Australia, also attended the conference. 'The new partner program is an evolution, albeit admittedly a large step forward, from Microsoft's partner strategy that traces its lineage back to the original Solution Provider Program of 1992. It's not Microsoft dealing with partners differently but demonstrating a commitment to dealing with us better,' he says.

WebCentral's Ernst concurs. 'From our perspective, it actually looks positive. Bringing all this stuff together is a smart thing to do. It's been a nightmare trying to deal with all those different programs and different people,' he says.

Today, Microsoft administers some 50 different channel programs. Next Generation program development began in August 2002, including 50 global focus groups, surveys, collaboration with Microsoft business groups and individual partner discussions. The new program, which will devour an unspecified chunk of the company's US$1.5 billion earmarked annually for its channel, launches officially on 1 January 2004 and is expected to boost to full power over 18 months.

The plan will roll Microsoft certified partner and authorised Microsoft Business Solutions (MBS) programs into one, incorporating developers, integrators and other service providers as well as hardware OEMs, resellers and distributors.

The new Microsoft partner universe will have three slightly altered tiers. A Registered Member designation replaces the Authorised Partner category at the bottom. Next up, the Certified Partner stream keeps its catch-all division but adds seven competencies like those previously only available to Gold Partners. There are also new specialisations, including for .NET and MBS skills.

The new MBS focus should help WebCentral push its upcoming Microsoft CRM product in six to 12 months, says Ernst.

Partners will be 'grandfathered' in at their current levels but eventually classified using a new 120-point system based on criteria adjusted to the local market size, including certifications in 11 competency areas, Microsoft revenue earned, end-user references and customer satisfaction.

Gold Certified partners will have to earn 120 'Value Points' and Certified partners 50 each year. Registered Members will not have to earn points but will still get some support from Microsoft.

However, point criteria will not be localised by nation but by market. Microsoft divides its partner world by three, with Australia in Market B - a group believed to include New Zealand, Brazil, Canada and Germany.

The company has promised that partners can move up a level but will not be moved down in the first year. Also, some restrictions on how many certified professionals a company must have before qualifying for a particular designation have been adjusted to more fairly reflect business size.

DiData's Walshe argues that the partner points program is a fairer way to measure entrance to the Microsoft Certified Partner and Microsoft Gold Certified Partner worlds. 'It has a wider base of specialisation and the attributes it measures, particularly the client experience, put as much emphasis on successful deployment and associated customer satisfaction as on technical capability,' he says.

Jonathan Klug, executive director at accounting software developer and Microsoft reseller Professional Advantage, agrees that simplifying the program universe is a good idea but fears the barriers to program entry may be too low as a result. 'We're already a Gold Partner so we'd prefer to see the barriers move higher,' Klug says.

Microsoft says its partners should carry on updating their details online as usual, and from April next year all partner details will be moved to an electronic records system for the new program. The vendor will operate the new program in a rolling 12-month time frame instead of forcing all partners to renew on the same date every year regardless of when they joined.

Gary Ebeyan, CEO at reseller Expert IS, says the program is definitely a step in the right direction, especially since it leaves the door open for further improvement. 'Probably we'd like to see more improvements in making customer decision-making easier in terms of the size of the partners,' he says. 'It's very good in terms of selecting a partner in terms of skill.'

David Arkles, general manager of sales and marketing at box-builder Ipex, also views the new program positively. 'I've had discussions with a number of Microsoft executives over the last week or two and understand they are looking to simplify. And we're very encouraged,' he says.

The bottom line is, the Next Generation program should make it easier for companies to work with Microsoft and benefit customers, says Arkles.

Like Star Trek's Captain Picard, Microsoft CEO Steve Ballmer is not afraid to lead from the front. He has promised tools to improve the program's internal processes, including a complaint management system and the ability for global system integrators to register their details once for the entire organisation. The new tools will be gradually offered to more partners next year, he says.

Other, longer-term, changes are still being probed, including a move to foster inter-partner arrangements on certain accounts, the company says.

Orlando Ayala, senior vice-president of Microsoft's small and mid-market product and partner group in the US, says about 40 million companies with 1,000 employees or fewer are 'under-served' by IT, representing a 'huge' opportunity for an MBS push via the channel in particular.

'We have to master this. I'm not going to hire three million people to sell to 40 million,' Ayala told CRN in the US.

Ballmer claims the strategy is important because a partner-based service force is simply