February 02, 2009, 11:24 AM — Microsoft is still tinkering with its channel model for its Software Plus Services offering. Tinkering is good though, it shows a willingness to adapt. Today's Redmond Channel Partner Online carries an article talking about this tinkering, and the latest iteration shows a lot of promise.
Specifically, the company's new private label option adds a lot of potential and solves a critical problem. One key worry on the part of the channel was that Microsoft would take customers direct or do upsells without involving the VAR. It's a valid concern, and if you're selling SaaS, the only way to make it worthwhile is to make sure that you're going to continue to get those monthly commissions for some time to come. In December, Microsoft, together with HP, created a private label program, which lets VARs sell Hosted Exchange, Hosted SharePoint, and Hosted Microsoft Dynamics CRM on a private label basis. This lets the VAR take care of the billing directly, puts the VAR's brand on the product, and brings control of the customer relationship firmly under the VAR's domain. On the back end, HP provides the server and storage hardware to the hosters. Besides shifting the balance of power back to the VAR, this model also lends itself to more value-add opportunities.