Our blog team spent Dec. 2 in New York at a lunch-and-learn hosted by DynTek (an $85 million solutions provider), Microsoft and Citrix. The topic: Virtualized Desktop Infrastructure and Windows 7. But during a side interview, DynTek Managing Director Ken Young offered up his thoughts on Microsoft’s cloud strategy. Our key question: Can VARs and MSPs really profit from Windows Azure (Microsoft’s Windows cloud) and BPOS (Business Productivity Online Suite, which includes Exchange Online, SharePoint Online, etc.). Here’s a recap of the conversation.
As both MSPmentor and The VAR Guy have noted, Windows Azure presents clear opportunities for ISVs (independent software vendors) and solutions providers that want to launch applications in Microsoft’s Windows cloud. But our views on BPOS have been mixed: It’s a fast way for VARs to get some recurring revenue while moving customers onto Microsoft’s own hosted applications. Yet some VARs worry about losing customer control and some solutions providers are concerned that Microsoft is already aggressively cutting BPOS prices to compete with Google Apps.
So, how does DynTek — a successful $85 million solutions provider — feel about Microsoft’s cloud? “Every customer I have today is looking at cloud services,” says Young. Then, Young offered a strong statement on BPOS:
“BPOS… There’s a tidal wave coming. BPOS is real. Customers are adopting it.”
Where Are the Profits?
But can solutions providers like DynTek profit from BPOS? Young says yes. And he offers up deeper thoughts on Microsoft’s cloud strategy plus the Virtual Desktop Infrastructure (VDI) market in this FastChat video with our sister site, The VAR Guy:
The video includes:
- 0:00: Intro
- 0:13: Who is DynTek?
- 0:47: Are Virtual Desktop Infrastructure (VDI) solutions ready for customers?
- 2:15: DynTek’s views on Microsoft’s cloud, Azure and BPOS offerings — can VARs profit?
- 4:25: More Info
- 4:41: Conclude
Looking Ahead
Our blog team thinks Young is right: A BPOS tidal wave is inevitable. Even if only a fraction of today’s Exchange and SharePoint customers move to the cloud that’s a massive opportunity for Microsoft. But is it also a massive opportunity for solutions providers and managed service providers? Young sounds upbeat and he raises some great points in that FastChat video. But we know plenty of readers who remain skeptical.
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Great interview. I agree 100% that BPOS and at least the separate MOS offerings are going to hit like a “title wave” especially now that the price is cut.
Since VDI is mentioned I also want to throw out there that Citrix has released a full feature 10 user XenDesktop Express v4 for FREE and is licensed for production use.
I am skeptical that clients with less than 100 desktops can see any ROI on VDI (maybe increase continuity or replace terminal server) but hard dollar return I am not sure on. Maybe thats why Citrix made the move.
Anyone out there running XenDesktop, running BPOS and only using local servers for AD and desktop hosting?
Andy M: Thanks for the perspectives. Do you work with Citrix? Partner with them? We always strive for full disclosure among our readers who post comments. You can expect more VDI coverage over on our sister site — http://www.thevarguy.com — later today.
I hate that attitude that some partners have about it being ‘their’ customer to control. The MS partners that are worried about ‘losing customer control’ due to BPOS should consider that if they offer customers a more expensive solution with ‘control’ built in, then they should not be surprised if the customer jumps to another partner that sells them BPOS with their ‘value’ built in.
Disclosure: Im a Microsoft Partner, and partnering with other Micrsoft Partners was my idea
I sell BPOS and the power of choice with my partner who is also a Microsoft Partner. We are both obsessed with providing our customers with solutions that meet their needs not ours.
Angus: Thanks for sharing such a strong viewpoint. We welcome intense but respectful debate on MSPmentor. Please keep us posted as your BPOS strategy evolves.
-jp
Angus speaks wisley – “providing solutions that meet their needs” – this is how you keep customers for a long long time.
One of the examples of solution based on Microsoft Azure and targeting SMBs is CloudBerry Backup. http://backup.cloudberrylab.com/
Andy: Weill check out CloudBerry Backup. Are you associated with them?
-jp
I can vouch for the MSO/BPOS movement based on what we’ve seen in my own department. BPOS deals are accelerating quickly, and the I can vouch for the MSO/BPOS movement based on what we’ve seen in my own department. BPOS deals are accelerating quickly, and the pipeline is growing geometrically.
Microsoft is being tremendously supportive of this initiative too, as Ballmer has publicly announced his desire to destroy (er, ‘kill’ )Google. http://bit.ly/5cz0CO
The price cut is just one key move. MS moves slow but methodically and will be making some very interesting, and frankly very impressive moves in their Cloud the next 18 months.
I think the two will perpetually coexist, fighting for market share & driving innovation, all the while, lowering the cost of computing. We need to decide whether to take sides (or not) & thrive, or stand by the sidelines and risk dying on the vine.
No matter what, it’s an exciting time to be in IT again…
Niv Dolgin
Director, ITS
http://www.sadasystems.com
Angus, we don’t seek to retain “ownership” of our customer relationships so that we can force more expensive solutions on them. To the contrary, we seek to retain our position as “trusted advisor” so we can protect them from some telemarketing yahoo selling BPOS when, in fact, Google Apps (or something else) may be both cheaper AND better suit their needs.
It may sound trite these days but as soon as we quit acting in the best interests of our customers, someone else will do it for us.
Jim
We are a cloud services provider helping IT companies make the transition to selling more cloud services and less on-premise. We fill in the gaps where Microsoft leaves off – <5 users, dedicated services, customization, disaster recovery, MOSS, Dynamics GP, etc… I completely agree with the sentiment in the video and the business case is very strong for most
Our partners get calls every week from businesses whose IT "partner" has told them "Cloud services are not here yet, wait" or downplays their significance. Customers are learning and seeking it out.
As for Google Apps vs. BPOS – right now there is no contest unless you are less than 5 users. Google cannot compete (today) against Exchange, SharePoint Office Communications Server and LiveMeeting. And if they are less than 5 users, we can help you provide them the solutions they need at a cost that makes sense.
I talk more about it on the partner spotlight at http://www.SMBNation.com.