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Cloud Could Rain Money on Channel

One of the things we love most about cloud computing is the name; it simply lends itself to a massive library of plays on words, metaphors and jokes. In this edition of RCPU, we're devoting the entire newsletter to cloud computing. And the timing is good for that, too, because there's a storm brewing in the cloud computing space (see?).

Just this week, F5 Networks (yes, we know, a vendor) released results of a study it commissioned somebody called Applied Research West to undertake. Applied Research West surveyed 250 IT managers, each at a company of 2,500 people or more, and found that clouds are indeed rolling in on the corporate horizon. Check out a few key numbers from the linked story:

  • 66 percent [of IT managers] said they have money in the budget for cloud computing.
  • 71 percent expect cloud computing budgets to grow in the next two years.
  • 82 percent said they are in some stage of trial, implementation or use of public clouds.
  • 83 percent said they are in some phase of trial or implementation of private clouds.

All of that cloud investment could lead to sunny days for partners who know how to take advantage of it. If partners aren't actively hosting applications in datacenters, they need to be figuring out how to reach for the sky (see, it just never stops) and grab some of the money that's about to come pouring out of the cloud.

Sure, cloud computing is simple and inexpensive -- ideally, anyway -- but there's still room for all kinds of partners to consult on and customize cloud applications. Here's the tough thing about working in the cloud, though: Because cloud computing is meant to be cheap, partners might not be able to charge the same rates as they would for an on-premises deployment. Of course, they likely won't be doing the same type of work, either.

Plus, some big cloud computing providers want to take add-on revenues for themselves and pawn off partners with (sometimes fairly measly) referral fees. That's where being a trusted adviser for clients is so important. Companies know Microsoft or Google, for instance, as vendors, but they know their partners as just that -- the people who help them get things up and running and come around when there's a problem.

Although part of the notion of cloud computing is to cut the partner out of that scenario and let the vendor handle everything, companies will still need help setting up and customizing their cloud applications -- and getting them to work with incumbent in-house apps, as well. Microsoft and other big vendors have recognized the role the channel can play in cloud computing and have re-tooled their cloud strategies in recent months to be more inclusive of partners.  

At its Worldwide Partner Conference in July, Microsoft further spelled out how partners can float comfortably in the cloud, rolling out Microsoft Communications Services on a global basis and getting specific on how partners can blend into the Azure cloud development platform. The company is also working to make its Business Productivity Online Suite -- a kind of, sort of preliminary competitor to Google Apps -- more channel-friendly.

Microsoft has perhaps the best channel program in the industry and has consistently put partners at the forefront of its sales and service strategies. Nobody knows quite yet -- not even folks in Redmond, probably -- exactly how cloud computing will affect the relationship between Microsoft and its partners, and with Microsoft doing its own hosting, there will certainly be some Microsoft vs. partner competition.

But Microsoft is highly unlikely to leave the channel grounded as it soars into the clouds. Over the last year, the company has made great strides in talking about its cloud plans in specifics and including partners in the conversation. It's worth listening to what Microsoft has to say. And it's worth developing a cloud strategy, because as the survey results above indicate the storm that's brewing now in the cloud could rain revenue all over partners. And wouldn't that be a cool drink of water during a long, dry recession?

How are you working with Microsoft in the cloud? What's your take on the future -- or the present -- of cloud computing? Sound off at lpender@rcpmag.com.

Posted by Lee Pender on 08/26/2009 at 1:22 PM


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