Microsoft Grows Cloud Channel Partner Ranks by 33%

Some six months after launching one of the most ambitious efforts ever to transform the channel, Microsoft revealed today that it had increased the total number of partners certified to sell cloud solutions by 33 percent over the past year. Today there are now north of over 68,000 partners participating in those programs.

Microsoft also shared that the number of partners participating in a Cloud Solution Provider (CSP) program that it launched last year to co-sell cloud services has increased 83 percent. There are now over 9,000 partners participating in that program, says Gavriella Schuster, corporate vice president for the Microsoft One Commercial Partner program.

Finally, Microsoft claims that it referred almost 80,000 customer inquires to partners in the last year.

The biggest challenge has been getting the internal Microsoft sales team to make the cultural adjustments required to co-sell Microsoft products with services provided by Microsoft channel partners, Shuster says. Microsoft has poured over $250 million into retraining its sales teams, and there is still more work to be done, especially when it comes to identifying which members of the Microsoft sales teams should be aligned with specific partners.

“Based on the feedback from partners there are still tweaks to be made,” says Schuster.

In general. Microsoft claims that cloud partners on average receive 19 percent higher margins when selling Microsoft cloud services. Naturally, higher compensation for partners is playing a significant role in enabling Microsoft to close the gap between its service and Amazon Web Services (AWS).

Schuster says Microsoft is trying to mobilize a global channel ecosystem, that involves 17 million people, to address a digital business transformation opportunity that has been valued by analysts at $20 trillion over the next five years. Despite all the people in the Microsoft ecosystem, however, the biggest impediment remains a lack of applicable skills. Because of that issue, Microsoft in the last year has spent considerable time and resources delivering over 100,000 Azure training sessions, says Schuster.

With over 95 percent of Microsoft’s revenues being generated by channel partners, it’s clear that the channel continues to play a key role in the company’s overall strategy. In fact, based on the latest results it may very well turn out that the Microsoft channel is a secret weapon in the battle for dominance of the cloud.