Are you aware of the massive changes Microsoft’s Service Provider License Agreement (SPLA) partners will have to navigate in order to secure the future of their businesses? Here’s a quick overview of the issue, if you’re not already familiar…
Background: For business applications, what we now call “the cloud” was created over the past decade by a cadre of several thousand hosters who leverage Microsoft SPLA partnerships to deliver fully managed, semi-customized, value-added hosted solutions using the now familiar per-user, per-month pricing model. Most manage a few closely-related services for a few hundred to several thousand customers, with a very few developing larger cloud marketplaces serving tens of thousands of customers and hundreds of thousands of users.
The Challenges: With the emergence of hyperscale cloud providers, these SPLA partners face mounting business pressures.
The number of modern versions of core Microsoft applications like Exchange, and the pace of new major releases from Redmond, mean SPLA partners are managing more concurrent versions and working harder to keep up with new ones.
Offerings like Exchange Online and SharePoint Online in Office 365 have reset the retail value of those services, sometimes to half of what they were prior to the hyper-scale cloud explosion.
Customer expectations regarding uptime, financially backed SLAs, and security are higher than ever before, so SPLA partners aiming to meet those expectations must spend more on infrastructure and support per hosted user.
Longstanding Microsoft 0365 reseller, AppRiver and current Microsoft SPLA partner Bizcom Web Services, Inc. have teamed up to provide advice and tips on how Partners can manage the transition. Please find them below.
3 Tips for Microsoft SPLA Partners
SPLA partners are facing mounting pressure to reevaluate their business models as hyperscale cloud providers enter the market. They must be prepared to face the challenges of rapidly-changing technology, changing margins and information overload, as well as keep up with new upgrades, migrations and cost. Following are some tips and steps for small hosters:
- Analyze your business—Do you have enough direct business to afford the service? Are you able to offer a true premium product and market it so that someone can see you through all the noise? Can you get your message to market? Can someone do what you’re doing better, more efficiently, cheaper and allow you to concentrate on running the business? By answering some or all of these questions, you’ll be able to make a more educated decision on where to go next.
- Determine your best course of action—there are various options to choose from:
- Upgrade to the current form of Hosted Exchange. With this, Partners can also offer bundled or more value-added services (i.e., premium price, service and 24/7 support).
- Become a CSP. If not already in Microsoft’s Cloud Solution Provider (CSP) program, there’s never been a better time to get started. Find more information on whether this is the right option for you, here.
- Partner with a two-tier provider. If lack of infrastructure prohibits a partner from joining the CSP program, they can still capitalize on the program’s many benefits through the indirect channel. The indirect channel are partners participating in CSP that have the reach and depth to produce tens of thousands—even hundreds of thousands—of seats. More information on this route is available here.
- Stop selling email and become more specialized. Shift core business focus to where customers need your service the most as opposed to a commodity service provider.
Act Now— Maintaining the status quo is no longer an option; SPLA partners should choose how they will adapt their business model to this new market.