Google Apps: Where Are Resellers Heading Next?

When it comes to Google Apps, there are those partners who fear the SaaS platform. And there are those who fully embrace it. Stephen Cho, director of Google Apps channels, says more than 2000 resellers now promote Google Apps to their end customers. What key trends is Cho seeing within the Google Apps partner base? And where is Google potentially heading in 2011? Cho provides some thoughts in this TalkinCloud FastChat video. And we share our own perspectives in the wraparound blog.

Cho says a good number of MSPs use Google Apps as a door opener for broader business discussions with customers. The best partners push beyond SaaS licenses and also wrap additional services around Google Apps -- such as document management and customer extranets.

Meanwhile, Cho says MSPs and VARs are starting to embrace the Google Apps Marketplace -- an online destination where partners can pick-and-choose third-party applications that integrate with Google Apps. Off camera, Cho noted that a healthy number of partners are connecting the dots between multiple marketplace apps.

Sounds impressive but Google also faces its share of challenges. First, Google Apps partners only early about $10 per user per year -- so the base offering isn't going to make small business partners much money. To maximize profits, partners will need to follow Cho's advice and branch out into the application integration space. Or, use Google Apps as a starting point for a broader cloud and managed services discussion. Second, Microsoft is set to launch Office 365 -- the successor to Business Productivity Online Suite -- sometime in 2011. That suite (featuring SharePoint Online, Exchange Online, Lync and more) will cost small businesses about $6 per user per month.

Like we said: Competition is intensifying.

SMB Customer Control

The Google vs. Microsoft SaaS war has triggered fear, uncertainty and doubt among some VARs who worry about maintaining SMB account control. But here's a twist: While Microsoft insists on handling SaaS billing for end-customers, Google is giving partners the option to manage Google Apps billing on their own.

According to Google Apps Channel Program Manager Jeff Ragusa:
"Our resellers own the billing, pricing, and provisioning relationship as well as ability to provide frontline support and pre- and post-sale messaging.  Its a design point of our program that the VAR/MSP continue to be the face of the technology to their customers, and we see this as not just a nice-to-have - rather its critical for them to monetize their role with respect to cloud applications."

Just a hunch: I suspect Microsoft will bow to partner pressure sometime in 2011 or early 2012, allowing VARs to handle Office 365 billing. (Officially, Microsoft has not changed its stance and continues to manage SaaS end-customer billing.)

In the meantime, the SaaS war between Google and Microsoft will surely escalate -- especially by the time the Google I/O conference rolls around in May 2011. Cho claims more than 2,000 partners have lined up behind Google Apps. But Microsoft claims to have more than 16,000 partners backing BPOS (the precursor to Office 365).

We'll be watching to see how those figures change in the months ahead.

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