Wednesday, December 30, 2009

Up in the sky


A few posts ago (I smell fear) I was lamenting the fact that Microsoft seemed to be getting pretty desperate about getting resellers on board to sell its Business Productivity Online Suite (BPOS). I pointed out that in my opinion existing resellers and their inertia when moving to this new platform was going to be a millstone around Microsoft’s neck that it needed to address.

Now the following article ‘Microsoft must sell the cloud to IT Pros in 2010’ covers similar ground. The article points confirms a number points that I have been speaking about for quite a while, such that if IT Pros

"don't get in line to compete [with online services], they put themselves at a significant risk of being not there when real money starts to get spent in this space."

and the fact that a majority of businesses are going to be dipping their toes into the world of online services:

“data also shows that only 16% of those who have adopted cloud computing, or will within 12 months, will go solely with an off-premises model. But 50% of those respondents will go with a mixture on both on-premises and off premises.”

and that BPOS is the best opportunity for IT resellers:

“The most popular is software-as-a-service, represented for Microsoft by BPOS, and infrastructure as a service, represented by SQL Azure and integration technology.”

and finally Microsoft has a major challenge on its hands but only a limited time frame in which to achieve it:

EMA's Mann says couple all that with the fact that "IT never gets rid of anything" and you have a situation where "IT is not going to move to the cloud, they are going to add the cloud to what they have."

And how IT can go about doing that will be Microsoft's challenge. The clock begins ticking louder in 2010.

The reality is that most businesses are considering the adoption of some form of cloud technology in their business. It is certainly, not in the short term at least, going to replace on premise infrastructure it will supplement it. However the majority of IT Pros that I know have no online strategy at all, they like Microsoft, are focusing on the wrong aspects of changes online services are going to usher in. It is not about selling a per month service, it is about what opportunities become available with the wide spread availability of these tools.

To survive in this new environment you are either going to make money by volume (many sales at low margin) or specialization (fewer sales at much higher margins). It seems to me the option with the least effort required is simply moving up the food chain (i.e. the second option) but this appears to put the fear of God into so many IT Pros. Why? Because in past they became comfortable selling their IT knowledge. The reality is that Google has changed that landscape FOREVER. As evolution has taught us, now is the time to adapt or perish, because the window of opportunity will not remain open forever.