
Microsoft backtracks on Partner Network changes that sparked uproar - miles
https://blogs.partner.microsoft.com/mpn/updates-program-change-announcements/
======
zubspace
This is so strange to observe from the outside. The statements of Gavriella
Schuster, when that whole debacle started, provided some insight into the
partner program:

"We can't afford to run every single partner's organisation for free anymore,
because it's not free"

"Put it this way, when customers are paying for services they turn them off
very quickly. When we give it away for free the partners leave these services
on. While my budget has to pay internally for this."

"We have given partners a year to figure this out. I just can't make it free
anymore."

"If we hadn't had such an influx of new partners and everyone's usage hadn't
been this high, then we may not have been in this situation"

The article, where these quotes are from, talks of 7000 new partners each
month [1]. So, on one hand, Microsoft clearly has a communication problem. The
proposed changes slipped in without a clear, official statement and wasn't the
backlash obvious? Why didn't anyone stop Schuster from doing this? On the
other hand, how can they continue like this? They lose huge amounts of money
because partners get a ton of licenses for free. So what's their plan?
Unfortunately the announcement is as shallow as possible. Hard to regain trust
this way.

But many development shops, as the one I'm in, are so dependent on Microsoft
and the partner program, that switching is nearly impossible...

[1] [https://www.dailytimes.live/business/microsoft-cuts-
partner-...](https://www.dailytimes.live/business/microsoft-cuts-partner-
benefit-surprise-move-88246844)

~~~
voidwtf
I work for a software dev company that uses and advocates for Microsoft’s
platform. Many of the solutions we’ve sold and/or suggested to our customers
have been based on our internal use of the same platforms and feature levels
which we use to dogfood and demo the product we develop.

Some features or solutions we’ve developed for our customers are reliant on
our exposure to Microsoft products we would not be able to justify or afford
outside the partner program. If the partner program had not been available
those solutions would have been based off alternative products, most likely
open source.

The most likely jump we would have made already is from SQL Server to
Postgres. In that instance alone, the SQL Server licenses our product/solution
has led our customers to make far exceeds our IUR usage.

I can’t imagine we’re alone in the scenario. There is no way our small company
could justify purchasing the enterprise licenses we routinely suggest our
customers purchase.

~~~
darkcha0s
>Some features or solutions we’ve developed for our customers are reliant on
our exposure to Microsoft products we would not be able to justify or afford
outside the partner program. If the partner program had not been available
those solutions would have been based off alternative products, most likely
open source.

Just a question- what exactly are you developing within the Microsoft
ecosphere that's so expensive? Prototyping new solutions with Azure these days
is definitely pretty cheap, even without being an MSFT Partner.

~~~
voidwtf
This is partially true, Azure has made some of these options available in a
more affordable format. Additionally some features have been made available in
lower level licenses.

One example is any solution utilizing encryption at rest, a feature that was
previously only available in enterprise level SQL Server. That feature is now
available in lower license levels and Azure.

------
FooHentai
My previous employer did a lot of cloud migration/integration work for
clients. They erred in their sales strategy where cloud became 'the only thing
we'll talk to clients about'. In doing so, they not only dried up their sales
pipeline, but lost most of their existing customer base as well.

This (attempted) change to the partner internal-use licensing feels like it's
cut from the same cloth - The existence of IUR didn't seem to be an issue
previously and the need to change it now doesn't pass the sniff test.

Probably a better play here would be to give partners a choice - Each year you
can have the IUR OR equivalent entitlements in Azure/0365\. That gives
partners a transition path, within a construct where the deal can be
sweetened/tweaked as necessary, and doesn't make the mistake of brow-beating
anyone towards cloud adoption (which tends to have the opposite effect).

------
Sujan
Relevant bit here:

> Given your feedback, we have made the decision to roll back all planned
> changes related to internal use rights and competency timelines that were
> announced earlier this month. This means you will experience no material
> changes this coming fiscal year, and you will not be subject to reduced IUR
> licenses or increased costs related to those licenses next July as
> previously announced.

~~~
jlgaddis
> ... this coming fiscal year ...

No mention of the _next_ fiscal year, or the one after that.

Microsoft already decided they want to push these changes through -- and they
will. It might just take them a little longer than originally planned but
Microsoft will continue to "extinguish" anyone or anything standing in their
way.

(I know this isn't a popular opinion with some of the developers here on HN --
who seem to think they are Microsoft's BFFs -- but some of us don't forget so
quickly.)

~~~
Dayshine
They're withdrawing subsidies for resellers of their products. It's pretty
hard to see how that is them extinguishing competition...

Isn't subsiding by a major market power generally seen as an anticompetitive
action?

~~~
jlgaddis
> _They 're withdrawing subsidies for resellers of their products. It's pretty
> hard to see how that is them extinguishing competition..._

Microsoft was going to yank internal use rights from the "partners". For many
(most?) of them, this is the primary reason they remain partners. Without this
benefit, lots of them will choose not to remain partners.

Many companies will _only_ work with Microsoft partners. Lots of them would
work directly with Microsoft if that were an option (as some are speculating
it will soon be).

So there will be a lot less "partners" standing in between Microsoft and their
customers. Then, at some point, Microsoft will start working directly with
these customers, cutting out the middleman, sucking them into their
subscription models (which will be expanding), have more insight into their
operations, and will be better able to track (and enforce) licensing.

To put it a simpler way, Microsoft is simply going to cut out the middleman --
the partners -- and take their customers -- and revenue -- away from them.

~~~
zubspace
There are many partners which are not simple resellers. Dev shops and
integration businesses which do a lot of customer oriented work, which
Microsoft itself could never reliably take over. Those partners profit from
the MPN licenses by using them internally and on the other hand get in touch
with new tech from Microsoft, which they could maybe use in one or another
way.

Losing them would be really bad for Microsoft, because they are at the
forefront installing, integrating and extending the Microsoft stack into their
customer base. Think of deals in the government or education sector.

Microsoft should not put those businesses and resellers into the same basket.
But they are right now and every change affects them both. Hard to get out of
that program which has been running since decades...

~~~
jlgaddis
> _Losing them would be really bad for Microsoft, ..._

It would be, but they won't lose them.

Those folks aren't going to just all of a sudden stop using or recommending or
integrating/deploying Microsoft products. With regard to licenses for
development / test / demo machines and such, the 180-day evals (which can be
"renewed" for 30 months, IIRC) aren't going away and will work just fine for
them in the majority of these cases. Besides, the dev shops and integration
businesses aren't who Microsoft is targeting right now -- they provide value
to Microsoft and will continue to do so.

There's a lot of "partners" that are _only_ partners because of the money they
save in licensing costs. Why would Microsoft really care if they remain
partners or cost? Their value to Microsoft is very little (and probably a net
negative in many cases) so why not force them to pay "full price" for their
licenses too? Microsoft has been effectively giving them away like candy for
years and years and now that's going to change. They may have backtracked,
_for now_ , but I fully expect them to continue limiting, restricting, or
totally phasing out internal use rights -- except, perhaps, for the
higher/highest partner levels. To Microsoft, the smaller "partners" just
aren't worth dealing with at this point and this is an easy way to get rid of
many of them without simply "kicking them out" of the partner program.

I've thought about this a lot deeper than I care to write about here at the
moment but I think their long-term goal here is to continue to push as much as
they can into Azure for that sweet, sweet (monthly recurring) "subscription"
revenue (plus licensing!) month after month. For anything else -- whatever
they can't push into Azure (where they can track it much better) -- they're
gonna make sure that _everything_ is fully licensed and that they're
extracting every penny that they can. They simply don't need the majority of
the partners in order to do this.

Microsoft, of course, is after the large enterprise customers -- the ones they
can extract the most revenue from. (By the way, they can already work directly
with Microsoft Professional Services and "skip over" the partners.) Once
Microsoft has gotten them to move everything into Azure, Microsoft will be
able to work with them more directly and provide more services to them that
would traditionally be provided by partners.

(In the interest of full disclosure, I should perhaps mention that I once
owned a company that was a Microsoft partner. That's been so long ago that it
really isn't even relevant to the discussion, though. More recently, I worked
for another such "partner" \-- in name only.)

------
dang
The earlier thread:
[https://news.ycombinator.com/item?id=20389077](https://news.ycombinator.com/item?id=20389077)

