As demand for cloud solutions continues to surge, Microsoft isn’t settling for just being a “good” partner to the 400,000 companies in its partner network—the cloud giant wants to be the best. During Microsoft’s Inspire 2021 partner conference this week, CEO Satya Nadella put it this way: “we want to be the best partner for our partners.”
Nadella and an array of other Microsoft executives used the virtual Inspire 2021 to offer substance in support of that pledge. Key themes of the conference included Microsoft’s increased investments to support partners, the debut of new partner-friendly programs and the launch of new cloud products and capabilities aimed at expanding channel opportunities. Among the areas of focus were Microsoft’s move to bring Windows into the cloud with Windows 365; efforts to raise awareness about advantages of its “holistic” security platform; and updates meant to take the Azure cloud platform and Microsoft marketplaces to the next level.
“We’re only successful if you are successful,” Nadella said, addressing partners during his keynote at Inspire. “That means creating new opportunity for you across every sector and every country.”
After attending numerous sessions, interviewing Microsoft executives and getting feedback from partners, we’ve rounded up the themes and developments that most caught our attention at the virtual Inspire this week. What follows are our 10 biggest takeaways from Microsoft Inspire 2021.
New Channel Chief Is All About ‘Commitment’
Inspire 2021 was the first Microsoft partner conference for Rodney Clark as channel chief, and he set the tone by speaking directly to the needs of partners at a numerous points throughout the show. Clark—a 23-year Microsoft veteran who succeeded Gavriella Schuster in the role in April—said he understands that what partners want from Microsoft, first and foremost, is “commitment.”
“You want to know that we’ll invest in your growth and profitability,” Clark said. During his keynote at Inspire, Clark outlined Microsoft’s efforts to provide more-effective engagement with partners along with investments to improve partner technical capabilities.
On engagement, Microsoft is investing to rebuild deal registration workflows, expand frontline support teams and realign its engineering teams “to bring partner and seller experiences closer together,” Clark said. The company is also planning improvements to the Partner Center portal that will enable a more consistent navigation process, he said.
In terms of partner technical capabilities, Microsoft is increasing its investments in skilling for the current fiscal year by more than 250 percent, Clark said. This includes everything from deep technical training to on-demand digital skilling content, he said. Ultimately, “these skilling initiatives represent our expansion of the channel’s technical acumen,” Clark said.
Key updates for partner programs
Microsoft also offered a number of other partner-focused announcements at Inspire, including around advanced specializations, the Partner Center portal and ISV programs.
Microsoft announced two new advanced specializations related to the company’s fast-growing Azure cloud platform. The new advanced specializations are Hybrid Operations and Management with Microsoft Azure Arc and Hybrid Cloud Infrastructure with Microsoft Azure Stack HCI. Microsoft Partner Network members can gain more visibility with Microsoft sellers and customers, along with new financial incentives and access to Azure business programs, through achieving the new advanced specializations, Microsoft said.
Meanwhile at Inspire, Microsoft announced the launch of a private preview for a new Partner Center portal experience—which will provide recommendations about customers likely to convert from the trial phase, customers needing follow-up and existing customers ready for new deployments. Microsoft is calling the new Partner Center experience “Project Orland,” and says the experience aims to help Cloud Solution Provider partners to grow their cloud business and improve account management. Project Orland is in limited preview, according to Microsoft.
Along with Project Orland, the company said that its Microsoft 365 Lighthouse unified portal for managed service providers has entered public preview. Microsoft 365 Lighthouse offers an easier way for MSPs to secure and manage their Microsoft 365 Business Premium customers, Microsoft has said.
Microsoft also announced changes that are coming this fall to the ISV Connect program, including reduced revenue-sharing fees, simpler go-to-market benefits, ISV app license management and discounted environments for development, testing and demos.
Microsoft touts “holistic” security over “point solutions”
Microsoft executives including CEO Satya Nadella used Inspire 2021 to make the case that Microsoft is the one and only vendor that offers such a comprehensive approach to security—and that trying to integrate different point solutions is no longer sufficient. “What differentiates our approach is organizing identity, security and compliance—as well as device management—in an interdependent whole, extending protection to all data, devices, identities, platforms and clouds,” Nadella said. “The Microsoft cloud is the only cloud with best-of-breed and best-of-suite security capabilities.”
Nadella also took direct aim at the alternative approach of trying to integrate security solutions from multiple vendors as a way to protect customers. “Our ambition is to help every organization adopt a zero trust architecture, while also reducing the complexity, cost and risk created by stitching together point solutions,” he said.
Vasu Jakkal, corporate vice president of security, compliance and identity at Microsoft, said that Microsoft brings the unique ability to “safeguard customers end-to-end,” thanks to its solutions such as Azure Active Directory identity authentication that spans Microsoft 365, Azure and numerous other platforms. “We are the only security vendor that can do this natively across all clouds and all platforms,” Jakkal said.
Reed Wiedower, global alliances leader and CTO for the Cognizant Microsoft Business Group, told CRN that many enterprises now have highly complex cybersecurity environments with as many as 50 or 100 different tools. And “these tools don’t integrate together in any real way,” he said, which in itself is a major security concern. By contrast, Wiedower said, Microsoft’s “holistic platform” is “far superior for customers at reducing risk.”
Windows 365 completes Microsoft’s cloud suite
With the unveiling of the Windows 365 “cloud PC” service at Inspire, Microsoft has the final remaining piece for its cloud puzzle. Windows 365 lets users stream a Windows desktop in any web browser, and the solution will be available on any PC or mobile device when it launches Oct. 2. “In the same way that we took Office to the cloud with Office 365 and server to the cloud with Azure, we are now taking Windows to the cloud [with Windows 365],” said Melissa Grant, director of product marketing for Microsoft 365, in an interview with CRN.
The ability to access a virtual Windows desktop through a web browser is new with Windows 365. So is the ability to run a virtualized version of Windows on any PC or mobile device—including Apple’s Mac, iPad and iPhone devices, as well as on Android and Linux devices. Neither capability has been available with Microsoft’s existing desktop virtualization solution, Azure Virtual Desktop.
IT professionals deploy and manage Windows 365 with Microsoft Endpoint Manager, the same tool that’s used for managing physical PCs. From an IT perspective, Windows 365 should appeal to businesses of many sizes because endpoint management specialists are far more common than virtualization specialists, Grant said. Unlike with Azure Virtual Desktop, “you don’t have to have that Azure expertise or that VDI experience in order to be able to use Windows 365,” she said.
Microsoft pointed to numerous opportunities for solution provider partners with Windows 365, including resale and services. For instance, managed services providers will have “a great opportunity to really incorporate Windows 365 into their broader Microsoft estate. A lot of MSPs are already helping our customers do things like adopt cloud management. That’s obviously going to be key for Windows 365,” Grant said.
Ultimately, Windows 365 leverages the full advantages of the cloud in giving customers “a simple and secure method of providing a digital workspace that can be scaled and sized to meet their individual needs—while also avoiding the costs of company-owned infrastructure and endpoint hardware,” said Phil Schwan, manager for end user computing at Bannockburn, Ill.-based solution provider Netrix.
Windows 365 will be offered first with Windows 10, and will be offered with Windows 11 when the new operating system debuts later this year.
Azure virtual desktop opportunities continue
Even with the upcoming launch of Windows 365, Microsoft executives made it clear at Inspire that there are still plenty of opportunities around Azure Virtual Desktop—and that Microsoft is continuing to invest in the platform.
Azure Virtual Desktop is expected to continue to be a good fit for certain organizations—especially those that have virtualization expertise on staff and have specific customization needs, Grant said. Azure Virtual Desktop can be thought of as a “Swiss army knife” for desktop virtualization, thanks to offering “lots of different tools that you can use to meet very specific needs,” she said.
“There’s a little bit more fine tuning that you can do with Azure Virtual Desktop. [For instance] some of our customers might need to virtualize just one app, and they’re looking to do that in a very detailed way,” Grant said. “It allows you more flexibility in terms of controlling all the knobs and dials. It does the server virtualization. And if you have an existing investment in Citrix and VMware, which a lot of our customers do, Azure Virtual Desktop is obviously tuned to work very well with that.”
At Inspire, Microsoft also announced the next series of product updates for Azure Virtual Desktop. Those include a public preview of the capability to directly join Azure Virtual Desktop virtual machines to Azure Active Directory, new cost optimization features and a “streamlined onboarding experience” for setting up a complete Azure Virtual Desktop environment in an Azure subscription. Additionally, Microsoft announced that it will introduce a new monthly, per-user access pricing option for Azure Virtual Desktop on Jan. 1, 2022.
What’s Next For Azure
Another central theme at Inspire 2021 was that Microsoft is not slowing down in its investments into new capabilities for its Azure cloud. At Inspire, Microsoft unveiled new Azure Stack HCI features and an Azure migration program expansion as among the new Azure announcements.
The new features for Azure Stack HCI—the Microsoft’s cloud-connected, hyperconverged infrastructure cluster solution—include simplified guest licensing activation and enhanced infrastructure security. Meanwhile, the Azure Migration and Modernization Program, previously called the Azure Migration Program, now covers more migration and modernization offerings across apps, infrastructure and data—including support for Azure Arc, a set of technologies that brings Azure’s cloud management capabilities and services to virtually any environment.
Azure API Management integration with Azure Event Grid, smart defaults for Azure Kubernetes Service (AKS) and a new partner center in Azure Synapse that will connect customers to partner solutions were also among the Azure-related announcements at Inspire.
During his Inspire keynote, Nadella said that compared to the Microsoft cloud, which has Azure at its heart, “no other cloud offers our breadth or our depth.”
“The Microsoft cloud helps power every organization’s digital capability, while ensuring their independence and sovereignty over it. No other cloud offers this. And the Microsoft cloud is built on trust and security: trust in technology, trust in business model alignment. No other cloud offers this,” Nadella said. “And the Microsoft Cloud offers the best integration across the technology stack, while offering openness at every layer of the stack, ultimately improving time to value, reducing costs, increasing agility. No other cloud offers this.”
Fee cut for Microsoft commercial marketplace
Solution providers say that Microsoft’s move to slash commercial marketplace fees will provide a major boost to profitability while enhancing interest among partners in offering their services and applications through the online marketplaces. At Inspire, Microsoft announced it has reduced commercial marketplace fees on transactable offers to 3 percent, down from 20 percent previously. Microsoft said that 20 percent has been the “industry standard” for commercial marketplace fees.
Microsoft’s marketplace storefronts include the Azure Marketplace, which features consulting services and applications, and AppSource, which focuses on business applications. Dropping the commercial marketplace fee from 20 percent to 3 percent is a “substantial” decrease that will bolster profitability for partners, said Rajeev Agarwal, CEO at Redmond, Wash.-based solution provider MAQ Software, which offers services in Microsoft’s marketplaces including a three-week assessment for Azure cost optimization.
“I think it’s a beneficial move for partners and shows good faith by Microsoft in its partners,” Agarwal said. “The more they invest in their partners, the more their partners are going to sell [in the marketplaces]—more Power BI, more Azure services, more consumption.”
At Inspire, Microsoft reported that momentum has already been growing in its commercial marketplace, with the number of transactable applications now up 70 percent from a year ago. More than 30,000 apps and services are now available in the commercial marketplace, and 4 million shoppers engage with the marketplace per month, Microsoft said.
Charlotte Yarkoni, chief operating officer for cloud and AI at Microsoft, said during Inspire that the company’s commercial marketplace presents a massive growth opportunity for partners. “Our commercial marketplace is the channel to scale your solutions to millions of customers,” Yarkoni said. “And this marketplace exists only for one purpose--to help you scale and connect with customers.”
Doubling down on industry-focused cloud solutions
Partners have seen Microsoft change from a focus on product-by-product solutions to a strategy around business outcomes, hence the investment in the tech giant’s “industry clouds” strategy of providing industry-focused packages of cloud tools and services, said Alysa Taylor, Microsoft corporate vice president of industry, apps and data marketing. “Most of our ecosystem has vertical solutions, yet all of our capabilities were horizontal -- It was very difficult for partners,” Taylor said.
A focus on business outcomes and vertical solutions is what partners want and what customers want, she said. During Inspire, Microsoft revealed its sixth industry cloud, Cloud for Sustainability.
“Here we are today, going into fiscal year ’22, and our sales plays are all in the voice of customer,” she said. “That was a direct feedback from our ecosystem: We must get better and we must iterate and be more customer centric.”
Omar Abbosh, Microsoft corporate vice president of cross-industry solutions, said the industry clouds present new revenue streams for partners and ISVs and speed up customers’ prototyping and production processes. “What we‘re doing is anchoring on the customer journey,” he said. “It’s making sure we’re super centered on industry, and it’s investing alongside our partners to help them engage with us in driving growth for our customers.”
During Inspire, Nick Parker, corporate vice president of global partner solutions at Microsoft, said the industry clouds build resiliency and performance in entire sectors while customizing to individual user needs.
“Partners play a key role in tailoring these solutions to each customer‘s need,” he said. “This added layer of partner-led customizability and depth positions all of you as a vital and critical element of the industry cloud experience for our customers.”
Viva is a new revenue opportunity
The Microsoft Viva employee experience platform not only brings customers new capabilities for boosting workforce morale of its workforce, but partners can find a new line of revenue with human capital management and human resources consulting or deepen existing services, according to Microsoft.
“This all of the sudden opens a new conversation at the C-suite business level to be a strategic adviser,” Seth Patton, general manager of Microsoft 365 next generation productivity and employee experience, told CRN US in an interview. “It builds on their existing capabilities. A big part of this is: now that we‘ve got you on Teams and you’re doing core comms and collaboration, how do you get even more from that investment? Now you really want to focus on people development and culture employee experience. The beauty of it is it’s a new revenue opportunity -- but it’s adjacent to something where they already have skills, they already have relationships. For some partners, they’re looking for ways to get out of IT and want to be more strategic in terms of relationships.”
Partners will have new training programs, partner workshops and sales and marketing resources over the next month to add Viva to their offerings. During Inspire, Microsoft said that Viva will become generally available in the fall with integrations from 21 vendors, including ServiceNow, Qualtrics and Workday.
Viva Learning APIs will enter preview later this year, offering the ability to pull in content from learning providers -- as well as due dates and assigned content from learning management systems for use in Teams, Office.com, SharePoint and Microsoft Search in Bing.
In terms of revenue new customer opportunities for Viva, financial services, manufacturing and retail have so far proven to be the largest verticals, Patton said.
Nadella’s message to partners
Nadella addressed partners directly on two separate occasions during Inspire—first during his keynote, where he expressed the desire for Microsoft to be “the best partner for our partners,” and then during a shorter appearance where he thanked solution providers for their work.
“I want to extend my sincerest thanks to all of you,” Nadella said during his second appearance. “Our partner ecosystem is core to who we are and what we do as a company. You have demonstrated remarkable commitment to our customers, to our communities and to the world through this year of great constraints and change.”
Ultimately, “what you have built is an inspiring reflection, I would say, of the difference each of us can make with digital technology,” he said. “Thank you for your hard work, dedication, and for your ingenuity.”