Microsoft accused of ‘declaring war' on channel after axing licensing benefits

Microsoft accused of ‘declaring war' on channel after axing licensing benefits

Australian partners rally against decision to cull internal use rights of licenses and support cases

Microsoft has been accused of declaring “war” on the channel community due to a number of “disappointing” proposed Partner Network changes.

Hundreds of partners have signed a petition against the vendor’s plans to remove internal use rights (IUR) for product licenses for partners and the access of on-premises product support incidents as part of the Microsoft Action Pack and competencies.

Launched by a Melbourne-based partner, the petition has so far reached 700 signatures since going live on 7 July. 

The petition follows a number of partner program updates quietly announced by Microsoft. 

The first is that from 1 July 2020 Microsoft will no longer provide free internal use association for product licenses for the channel, meaning they will now have to be purchased out of the partners’ own pockets via a commercial arrangement.

The second is that Microsoft plans to retire on-premises product support incidents currently included with Silver and Gold competencies and in the Microsoft Action Pack, the latter which is used by smaller partners. These changes will be effective when partners renew their existing competency or subscription from August this year.

In addition, from 1 October core product licenses included with competencies will be specific to the competency partners attain, meaning licenses included in memberships will have to be purchased in full. 

“For some partners, this is going to cost them thousands of dollars a month extra,” the petition stated.

“In announcing these changes it’s clear Microsoft is going to war with its partners,” it added. “The partners who have been so loyal to the Microsoft business and to help it achieve the status of being the most valuable business in the world to be now treated like this is just not fair.”

Other Australian partners also attacked the measures, including Wayne Small, founder of the businesses SBSFAQ, a small Microsoft partner and the reseller firm Correct Solutions.

Accusing Microsoft of “gutting” partner value on his personal blog, he told ARN: “Taking away the usage rights is a major hindrance because smaller resellers are not going to buy something just to play with it and see if it works. It’s now going to become more costly to be a reseller of Microsoft products. 

“My personal view is that lately, Microsoft has become more focused on the end customers and less so on the resellers who helped get to them: it feels like they’re not focusing on them as much as they used to, especially the smaller ones.”

Dean Calvert, of the Adelaide-based Microsoft Gold partner Calvert Technologies, claimed the changes were part of a series of a wider problem between the vendor and its partners.

“I know partners who do rely on support cases. We’ve had to use them maybe twice, so it’s not a massive deal for us, but it is a disappointing removal of one of the Microsoft partner benefits. 

“Microsoft for many years, was the stand-out partner program,” he said. “It seems that there’s less engagement from Microsoft than there used to be. In the old days, you had an account manager, but now only particular partners have one. Even if you’re a Gold partner, there’s no guarantee; you just have to go the generic support line. I understand why they did that, but there are a lot of Gold partners who move a lot of product, but yet do not have an account manager due to where Microsoft is focusing.”

“Cloud is where they're pushing,” he added. “They’re not really pushing SPLA ( Microsoft Services Provider License Agreement) anymore, rather it seems to be the Cloud Solution Provider (CSP). We’re still selling a lot of Microsoft licenses, but that doesn’t really seem to be factoring in on their radar. Partners who are doing hundreds of thousands of licenses do not have an account manager.”

In a statement to ARN, a Microsoft spokesperson admitted the program changes were due to the “wide-ranging impacts” of cloud computing, claiming the moves will help partners “capitalise on the opportunities possible with cloud”.

“When looking at the evolution of our program benefits, it was important to create more balance in what our partners have asked us to provide in order to help them accelerate and grow their business as well as enable our partners in a variety of business scenarios,” the spokesperson said. “Partners told us they wanted us to help them not just building and developing solutions, but to also help with enablement, going to market and connecting with the right customers.”

Microsoft also said it will now offer more technical enablement and practice development advisory services across all competencies.  

Partners with a competency will also have access to a full suite of virtual instructor-led technical training events across all three Microsoft clouds, product update and roadmap webinars and one-on-one technical and pre-sales consultations with a Microsoft Partner Technical Consultant, the vendor added.


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