Google threat
We asked him if part of the reason for all this S+S activity has been the growing online threat from Google. “Google is making a noise about wanting to play in the enterprise space but its delivery to date has been questionable,” said Patterson. “No company is offering the breadth of enterprise class tools and services as you get from the Software Plus Services model. It’s the flexibility that’s the unique thing.”
Whether or not Microsoft admits to fearing Google as a competitor, it’s clearly aware of the need to establish itself as a major online services player ASAP. We asked Patterson whether there is a risk of it cannibalising its existing business in the rush to move online.
“This is a new opportunity for us,” he said. “Two thirds of new enterprise online services deals have been competitive wins rather than cannibalising our own business. Equipt represents an exciting new business model approach. You can expect to see additional subscription productivity solutions from Microsoft.”
Partners
"Two thirds of new enterprise online services deals have been competitive wins rather than cannibalising our own business."What about Microsoft partners, what are they making of it all? There must be a bit of unease at Microsoft shifting its commercial model so fundamentally. “This is a big shift and a big opportunity, but with any shift you have a lot of questions and concerns. Some partners are wondering where their place is in the new scheme of things,” said Patterson.
We suggested that the ability to get regular income from subscriptions must be appealing to partners. Patterson agreed, but added: “All the focus on the new partner opportunity has been on the annuity model, but partners can still exploit all the other things they already get revenue from.”
According to Patterson, there are also entirely new markets to be tapped by this new model. “There are huge opportunities in the deskless worker market,” he said. “Roughly half of the workforce is deskless; people like factory workers, nurses, etc.”
It seems that one usage model for the cheaper Deskless Worker suite is a browser-based online home for these deskless workers, which they can access from any computer terminal when they get the chance. They will then be able to do whatever they need – emails, administration, etc – whenever they can.
To illustrate a further manifestation of Microsoft’s online offering Patterson pointed to Microsoft’s ability to host an organisation’s entire email set-up. “From 1st October last year Microsoft has been able to host Exchange for large organisations or 5,000 people or more,” he explained. “Coca Cola Enterprises and Nokia are among companies already using it. It allows internal IT professionals to offload basic maintenance and focus on mission-critical stuff and there’s been an SME offering from last March.”
