If you're at the helm of a hosting business, you're well aware of the dynamic shifts in customer
demands. Today, it's all about fortifying cybersecurity, enabling remote work seamlessly, and
extracting actionable insights from data. Simultaneously, the drive to reduce operational costs
and accelerate time-to-market is relentless. As a result, businesses are making a fundamental
shift from on-premises solutions to embrace the boundless potential of the public cloud.
As a hoster, you might find yourself at a crossroads. How do you maintain the satisfaction of
your current client base while expanding your offerings to cater to their growing appetite for
public cloud and Software as a Service (SaaS) solutions, all while ensuring your profitability
goals are met? The exciting news is that the world of public cloud services holds the key, with
partners witnessing staggering revenue growth-up to 20 times-when compared to their traditional
data center offerings.
To drive growth and profitability, we see partners making three key investments as they work to
capitalize on the market opportunity:
- Modernizing Data Center Services: Staying competitive means staying current. Upgrade your data center services to keep pace with the market and explore how Azure Stack can be a part of that.
- Elevating Public Cloud Practices: Faster growth comes from the cloud. Build and scale your public cloud offerings to boost your revenue while expanding relationships with existing customers and attracting new ones. Will talk more about this below.
- Expanding Service Capabilities: It's not merely about what you provide but where you provide it. Broaden your service capabilities to include Azure, enhancing your overall services' profitability. Take a deep dive into Forrester's insights on this pivotal subject
Our recent licensing enhancements unlock exciting possibilities for your customers. These exciting changes enhance what and how you offer solutions to customers. One of the key changes you want to be familiar with is the Flexible Virtualization benefit, which lets customers with Software Assurance or Software subscriptions outsource their hosting to dedicated or multi-tenant servers. (Please note these terms are not available to Listed Providers. Listed providers as of this blog post are Azure, AWS, GCP, and Alibaba). In addition, we also shared partners can also now license Windows Server on a vCore basis per VM, which means better cost optimization for your data center customers. Another key benefit from that announcement was the launch of the CSP-Hoster program. This program is all about expanding the hosted solutions you can offer your customers. With CSP-Hoster, you can:
- Host Windows 11 and M365-based desktop solutions.
- Enable customers to bring their own licenses to your hosted solutions.
- Resell 3-year CSP subscriptions with substantial discounts.
Right now, the CSP Hoster program is open to direct CSP partners with Service Provider Licensing Agreements (SPLA) , but don't worry if you're not there just yet. We're planning to extend it to CSP indirect resellers and Indirect Providers in the future. If you're eligible, you can dive into these benefits by signing a CSP-Hoster amendment. For full details on this announcement see our post here: New licensing benefits make bringing workloads and licenses to partner's clouds easier - Microsoft AI Cloud Partner Program
While we remain invested in your data center business, the epicenter of customer demand resides in the public cloud. Hosting providers offering public cloud solutions not only boost their customer retention rates but also gain a competitive edge. To facilitate your transformation, Microsoft has made significant investments to build a world-class platform for partners, built around the Cloud Solution Provider program and Microsoft AI Cloud Partner Program. The CSP Program enables you as the partner to retain ownership of the customer relationship, sell Microsoft Cloud solutions and own the deployment and ongoing management, resulting in accelerated topline revenue and EBIDTA. In parallel, our Microsoft AI Cloud Partner Program (MAICPP) is here to support your differentiation and capabilities. Within the MAICPP, you'll find pecializations that allow you to showcase your deep technical expertise, highlighting your partner superpowers in specific domains, all built on a single pane of glass for managing your partnership, Partner Center. MAICPP also provides access to marketing content on-demand found here:
- Smart Partner Marketing aka.ms/smartpartnermarketing
- Digital Marketing Content OnDemand aka.ms/dmc
- Partner Marketing Center aka.ms/pmc
Partners transacting through CSP benefit from being able to offer services found only in the Microsoft Cloud, including Microsoft 365 and Azure Virtual Desktop. CSP is not just a platform for resale, it also presents the opportunity to create new managed services and intellectual property, ultimately boosting your overall profitability. Once you've joined the CSP program, expanding across the solution portfolio is key to accelerated growth.
The Microsoft cloud also empowers you to bring new capabilities to market at a much faster pace. For instance, you can launch a true desktop as a service offering, without the need to invest in costly upfront infrastructure or worry about predicting demand. By combining the capabilities of your data center with Microsoft Cloud solutions, you can not only attract new customers but also retain existing ones who are looking at Public Cloud options as they seek to meet industry requirements or benefit from new innovation, like Artificial Intelligence.
We recognize it's a big shift when partners pivot to the public cloud over their data center. As we've engaged in our partners transformation we've observed several noteworthy trends that validate their investments and strategic shift :
- We see partners grow faster when they expand offerings to focus on public cloud solutions. Our partners win new customers, grow existing relationships and improve customer retention as they migrate on-premises customers to cloud-based solutions. The migration of existing customers often occurs at strategic times, such as a pending infrastructure refresh or customer contract expiration.
- Transitioning to Azure also enables partners to reach new markets, leveraging Microsoft's Azure global infrastructure to enhance their end-customer experience and reach new customers.
- Partners frequently generate initial cloud customers from their existing install base. One way Microsoft supports this is by providing leads through the CloudAscent Program. CloudAscent data provides valuable insights for upselling and cross-selling within your current customer base, rapidly aligning your sales outreach with customers intent. It enables you find migration and growth opportunities across your installed base, aligned to solution plays to accelerate those sales conversations. CloudAscent data is one of the fastest ways our partners generate new wins.
- Strategic alignment at the exec level, including sales compensation that incents cloud outcomes and enablement of Partner technical teams to support Microsoft Cloud solutions are all critical to a successful partner transformation.
- Understanding Azure costs and the complexity of a cloud migration is crucial. Partners can utilize the Azure Rapid Assessment Estimator to determine projected costs for data center moves to Azure, facilitating informed decision-making for both the partner and their customers.
Our team is here to help partners navigate this shift and business transformation. We recognize it's a large undertaking when you pivot your business to add on or enhance your offerings on the Microsoft cloud and are here to partner with you. We've helped hundreds of partners across the Americas modernize their service offerings and seize the incredible opportunities that Azure and our partner programs have to offer. If you have questions, or could use some guidance getting started or enhancing your existing offerings, don't hesitate to reach out to us.
The top three things you can do today, if you haven't already.
- Join the Microsoft AI Cloud Partner Program to partner with us and transform our joint customers.
- Enroll in the Cloud Solution Provider (CSP) Program to expand what you can sell.
- Contact our team to discuss how we can help you get started on your transformation journey.
Together, we can navigate the evolving market, drive growth, and maximize profitability. Your partnership with Microsoft opens doors to a wealth of resources, tools, and programs designed to empower your success. Thank you for choosing to embark on this transformational journey with us. We look forward to witnessing your remarkable achievements in the world of Azure and seeing the new benefits and capabilities you'll bring to our joint customers.