Thursday, January 15, 2009
Can Google face up to Microsoft In The Channel?
Google executives say the new reseller program for Google Apps Premier Edition will put the search giant on equal footing with Microsoft, one of the most highly regarded channel vendors in the industry. But some way out providers say there's little in Google's channel track record that suggests it'll be able to back up that claim anytime soon.
Google's channel consists of partners that came over in its July 2007 acquisition of safety services provider Postini, and VARs in the Enterprise Partner Program, which launched in September 2005 with a goal of recruiting solution providers to help swell the search capabilities of the Google Search Appliance to commercial data behind the firewall.
Postini developed a name as a accomplished SMB channel player, but that reputation has been tarnished somewhat since the acquisition, and some VARs aren't sure if Google has its best wellbeing at heart.
In February 2008, Google angered VARs by dramatically cutting the prices of Postini security services from a range of between $30 and $100 per seat/per year to just $3 to $25 per seat/per year. Google also named two authorized distributors for Postini security services -- TestudoData and Excel Micro -- that act as liaisons between Google and channel partners.
Michael Cocanower, president of solution provider ITSynergy, said this arrangement makes it difficult and time consuming to resolve issues with Postini services when they arise. "Google won't engage with us directly, and that makes it tough to handle things like incidents and troubleshooting," he said.
The fact that one of Google's first steps after buying Postini was to distance itself from channel partners shows how hard it is for VARs to make money from the partnership, said Les Kent, principal at solution provider Progent. The Google Apps program's lack of deal registration adds to this difficulty, he added.
"I don't think Google really understands that in order to have successful channel partnerships, their partners need to be able to make money," Kent said. "Between the lower prices, modest margins and lack of channel protection, it's very difficult for partners to justify the transaction costs of servicing small numbers of clients."
Even if Google isn't starting its channel from rub, it still has a long way to go to catch up with Microsoft in terms of building a partner program that drives sales and builds loyalty among partners, said Mark Crall, president of Charlotte Tech Care Team, a Microsoft partner.
Microsoft's considered advantage in the battle to establish services 'sockets' has been its partners, and in the past year, Microsoft has launched the SBSC Partner program and the Local appointment Team, both of which leverage partners as strategic advisers to SMB clients, according to Crall, who cites these as leads Google would be prudent to follow.
Google reseller plan may punch Microsoft where it hurts
Google Apps has been far from a raging success, and has yet to make any serious inroads against Microsoft Office. But a new Google partnership with resellers may change all that. Don't expect immediate results, but in several years, Google Apps may start to see some success.
Reuters reports that starting at the end of March, authorized resellers "will be able to sell, customize and support premium versions of Google Apps."
Up until now, Google has sold directly to businesses itself, and not using a sales force, but instead over the Web. The results have been less than stellar --- Gartner Research estimates Google only has approximately 200,000 Google Apps Premier customers.
Under the new Google plan, resellers can buy the Premier edition at a 20 percent discount, and can "keep the recurring revenue for the lifetime of their customer relationship." That's a significant incentive.
Still, Google has a long way to go, because of Microsoft's relationship with resellers Reuters reports:
Microsoft, which is the world's largest software company, sells more than 95 percent of its software through more than 440,000 third party resellers, according to Gartner Research, and intends to spend around $3 billion on managing those sales channels in 2009.
Posted by SANJIDA AFROJ at 9:56 AM