Photo: Matt Rosoff
The common wisdom in Silicon Valley is that Microsoft is a company on a steep decline, maybe in danger of going out of business.Don’t tell that to the thousands of Microsoft partners who have packed the Staples centre in Los Angeles to hear Steve Ballmer and other Microsoft executives speak.
Microsoft collects more than 90% of its revenue through these partners. Most of them earn their living by selling other services — a lot are systems integrators, who combine Microsoft software with products from other vendors into custom solutions for business customers.
To them, the idea that Microsoft is in danger is laughable.
An attendee from one integrator, NWN, explained that his company has grown from one office to more than 10 in the last few years, and now books several hundred million dollars a year in annual revenue. Selling Microsoft software like Lync (instant messaging, voice over IP, and videoconferencing) and SharePoint (collaboration), particularly to state and local governments, is a huge reason why.
This rep said that NWN was a little worried about Microsoft’s move to the cloud — installing and running server software is a great business for a systems integrator — but admits it was necessary because customers are demanding it. It’s taken a few years for Microsoft to get its partners on board with services like Office 365, but now they are beginning to build practices around these services, too.
As far as iPads replacing Windows in the enterprise, these partners aren’t seeing it. A few executives and individuals might be bringing tablets to work, but IT departments are still firmly betting on Windows and Office, and that gives them a powerful wedge to sell other back-end software and services.
There are more than 15,000 of these partners here, from 120 countries — their badges read like a geography lesson, with Croatia, El Salvador, and Mauritius all represented. All of them have bet their businesses at least in part on selling Microsoft software and services.
Google is building its own partner channel, but Microsoft has a 20-year head start and a much bigger product portfolio. It’s going to take a long time for Google to catch up.