Distributors have told CRN how they intend to differentiate in a crowded market after Microsoft expanded its roster of indirect Cloud Solution Providers (CSP) from two to seven.
The vendor today appointed five new names to the CSP program, with Synnex, Dicker Data, Avnet, Distribution Central and SaaSplaza joining existing distributors Ingram Micro and Rhipe, which were appointed CSPs in April 2015.
The news significantly expands Microsoft's ability to sell cloud services such as Office 365 and Azure through the channel. The distributors can provide monthly billing for Microsoft cloud services, and can also wrap other products and services around the Microsoft stack, as well as offering support.
The CSP program currently includes Office 365 SKUs, Azure infrastructure-as-a-service, Enterprise Mobility Suite and Dynamics CRM Online. The next version of Dynamics ERP will be launched first on Azure as a managed service.
Phil Goldie, Microsoft Australia's director of partner business and development, said CSP "fundamentally lines up the way customers want to buy with the way partners want to sell. It is the hero motion around selling to the midmarket and SMB."
Today's news means Australia's three largest distributors, Synnex, Ingram Micro and Dicker Data, will now go head-to-head in the mainstream channel to bring Microsoft cloud services resellers, along with four disties aiming for a more nuanced and niche pitch to the market.
Synnex: all-in-one cloud platform
For Synnex, Microsoft services will become a huge part of the distributor's newly minted cloud automation platform, which was launched this year after an investment of more than a million dollars.
"It is fantastic news," said Kee Ong, chief executive of Synnex Australia and New Zealand. "We have invested so much in the cloud portal, bringing a lot of cloud vendors in addition to Microsoft CSP to expand our strength in the cloud business."
Ong said the distie's cloud marketplace stood apart from competing platforms thanks to its integration with Synnex's e-commerce ordering site, making it the only distributor "with an all-in-one portal with hardware, software and services together".
"You can manage all of the cloud products in one portal. We also can transact all of your legacy business on the hardware side. The cloud business is all about solutions, not just about products. We have around 30-40 cloud vendors on board already," he added.
Complementary vendors include cloud migration tool BitTitan, scanning software Udocx and file sharing system Egnyte.
Ong also revealed to CRN that Synnex had signed Megaport, which offers elastic interconnections services allowing users to acquire high-speed ethernet on-demand.
Phil Goldie, Microsoft Australia's director of partner business and development, said: "We’re looking forward to seeing how Synnex’s white-label offering and newly launched cloud portal help resellers get started faster and accelerate adoption of cloud among our joint customers."
Dicker Data: broad range of options
Dicker Data also expands its Microsoft portfolio with today's CSP announcement. The Australian company is an authorised distributor of Microsoft OEM software, and boasts a dedicated configuration centre located at its Sydney head-office. It is already a CSP indirect partner in New Zealand.
According to the distie, it now represents all all Microsoft products except Surface, including "volume licensing, ISV, SPLA, OEM, FPP and ESD".
Like Synnex, Dicker Data was appointed as a CSP to bring "massive partner and customer reach across multiple products", according to Microsoft's Goldie.
The distributor's founded, David Dicker, said the appointment "comes at a time when many of our reseller partners and their end-users are pivoting their businesses towards consumption-based billing".
Microsoft will now play a pivotal role in Dicker's cloud marketplace. "Our access to the CSP program will take centre stage on our CloudPortal platform to support our partners who are moving towards these opex models.”
Dicker Data cloud lead Tony Lam told CRN that resellers are "at different stages of purchasing and this allows them to dip their toes into a subscription model. It provides different ways of building a solution."
The distributor will focus on Office 365, Enterprise Mobility Suite, Azure Backup and Site Recovery. "Later we’ll be moving more into CRM Online. There is definitely a huge focus on enabling resellers to maximise opportunities in Azure," said Lam.
"The main thing for us is trying to allow partners to provide lifecycle management for end customers, and make sure our partners are best placed to facilitate opportunities. We do that by providing education from a sales and technical perspective, and we’ll do it through our cloud portal."
SaaSplaza: Dynamics expert
Among Australian resellers, SaaSplaza is the least known of the CSP partners, having moved into the Australian market in 2014.
The global Dynamics expert, which is headquartered in the Netherlands, was named as a one-tier CSP last November – a reseller of cloud services – and now transitions to the two-tier role.
Jakub Wolinski, general manager of SaaSplaza Australia, said the company's CSP appointment would "make it easier for customers and partners to choose between public and private cloud deployments" of any supported Microsoft Dynamics SKU, including Dynamics AX, NAV, GP and CRM as-a-service on Azure.
"SaaSplaza makes it simple for partners and customers to go to cloud by working with us so they can focus in what they do best, including implementation and functionality. Our role is to make sure that the environment works, that it is performing well and support is available 24/7," said Wolinski, adding that 95 percent of the company's business is through partners.
He said a key differentiator was around liability. "Partners that sign with us get cloud liability covered. They don't have to go through Microsoft or cover this themselves, and we make ourselves liable, which is something partners appreciate."
CRM and ERP resellers can continue to lead the software sale, but "rely on SaaSplaza for deployment, support and monitoring of their customers’ cloud environments".
Ingram Micro: massive adoption
Today's news bring extra competitive pressure on the channel's existing CSP distributors, Ingram MIcro and Rhipe – though both remain confident of maintaining their first-mover advantage.
Lee Welch, Ingram Micro Australia's general manager for cloud and software services, said the distie been "very successful" with CSP. "It is measured in transacting partners and seat count. We have the second highest adopted Ingram Micro market in the world after the US. The adoption rate in Australia has been huge. That is testament to our team but also the maturity of the Australian market – it is incredible."
Welch said the distributor has been providing face-to-face sales and technical enablement across Australia to "help partners essentially transform their business and transform their mindset".
"What is really important is the quality of the marketplace that you have and also the quality of the team that is driving the cloud enablement and cloud adoption. I have doubled my headcount since last year – really quality people. I have dedicated marketing, dedicated sales management and we have the most highly functional and automated platform."
Ingram Micro launched its cloud marketplace in Australia in June 2015. The platform, which it imported from its global headquarters and localised, was built on Odin, a product developed by Parallels. Ingram went on to acquire the IP behind Odin in December 2015, hiring around 500 employees, many of them software engineers.
"We now own Odin and we made another acquisition recently that puts us in a really strong position because platform development is key at that distribution layer in having scale," said Welch.
Ingram has "end-to-end" Microsoft licensing, he added, with the ability to transact volume licensing, SPLA and now CSP constructs.
"Partners can come to us and we can supply Microsoft solutions under a managed service model, a true cloud recurring revenue model and we can also support them on-prem and with a subscription model."
Next: Rhipe, Avnet and Distribution Central
Rhipe: subscriptions specialist
Dominic O'Hanlon, managing director of ASX-listed Rhipe, said he isn't worried about the competition. The company has been smashing its CSP targets with Microsoft since coming onboard the program a year ago.
"Business is crazy. Today we hit 41,000 seats on CSP, which is unbelievable. Our original target for Australia was 25,000 seats. We came on in Asia much later, and we are way ahead of all of our targets.
"It is accelerating. Here is the cool thing – in the first five months, we got 11,000 seats. In the next five months, we got 20,000 seats. Last month, we got 7,000 seats... CSP is going to be be big."
Previous known as NewLease, Rhipe was historically focused on services provider licence agreements (SPLA), a model Microsoft developed to allow hosting providers to provide software on a subscription model.
"In my opinion, we have been a world leader in SPLA, but globally SPLA is probably less than a $2 billion [Australian dollar] business and we have $100 million. We are a significant player for them globally in SPLA," said O'Hanlon.
"Now when you think of the SPLA business, it is about charging data centres and resellers at the end of each month for what they've consumed in that month. That is what we do. We have really good billing engines, really good consumption models, the way we pay our staff, everything we do is about driving consumption.
"In our world, if you don't consume you don't pay. The traditional distributor world is, 'We distribute a product to you and you pay for it upfront and if you don't use it, that's your problem'. Everything we do, from marketing, to sales and support, to how we pay our staff, is based upon, 'If you don't use it, you don't pay'. So our launch into CSP has been globally successful because we have taken our heritage and DNA and applied it to public cloud," said O'Hanlon.
Avnet: Azure focus
Avnet is one of the "Azure-focused indirect partners", along with Distribution Central and SaaSplaza. While in theory these companies could provide any products available on CSP, the three companies have each agreed a business plan with Microsoft focused on growing Azure.
Goldie said that "Avnet’s multi-channel cloud commerce platform offers an aggregated billing platform and the Avnet Cloud Marketplace can be white-labelled for partners".
"We see great opportunity for Avnet to showcase their strength in IoT, analytics and security.
The appointment to CSP allows Avnet to expand its existing footprint in the Microsoft channel, having been the first Australian distributor admitted to the vendor's Cloud OS Network (COSN) earlier this year.
Joining COSN means Avnet's private cloud is technically validated with Microsoft Azure, enabling the distie to open up hybrid cloud data centre solutions for its partners.
Distribution Central: new kid in Microsoft channel
Unlike the other six new indirect CSPs, Distribution Central joins the Microsoft channel for the first time. Microsoft expects DC to focus on the midmarket space and specialise in hybrid cloud scenarios.
Goldie was excited about what Distribution Central could bring in terms of integrated solutions. DC already offers its 'product on demand', or POD, range, and Goldie could see how Microsoft cloud services could be pre-integrated with hardware from Distribution Central's vendors, which include close Microsoft partner Hewlett Packard Enterprise, which appointed the distie after a major tender process earlier this year.
Distribution Central also operates a cloud marketplace. "Their DC CloudSelect platform offers a fully automated aggregation, integration and customisation point for both cloud and other ICT services with integrated billing, delivering an outstanding user experience that makes the delivery of cloud products and services easy and simple," said Goldie.
"DC CloudSelect is also available white-labelled for their channel partners and we see this as key differentiator to help drive demand for Microsoft Azure."
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