Ballmer: Microsoft Is Basically In Three Businesses
CEO Steve Ballmer mentioned...
Microsoft CEO Steve Ballmer and Channel Chief Jon Roskill rallied 12,000 channel partners this morning at Microsoft Worldwide Partner Conference 2011 in Los Angeles. Ballmer briefly conceded that some people think Microsoft has too many products in too many different markets. But Ballmer countered critics by stating that Microsoft competes in only three core markets. Ballmer also tried to provide a reality check between the PC market, the tablet market and cloud computing. Here’s a recap.
CEO Steve Ballmer mentioned…
- Hybrid Strategy: Microsoft is unique in the breadth and level of integration between on-premise and in-the-cloud solutions.
- Three Core Markets: Without mentioning any critics by name, Ballmer seemed to be addressing criticism that Microsoft competes in too many markets that are vastly different. Ballmer tried to simplify the discussion by stating that Microsoft competes in three core markets: Platforms for small screens, big screens and middle-size screens.
- Scary Time: Last year’s partner conference — WPC 2010 — was scary because Microsoft at the time said the company was “all in on the cloud… 100 percent.” Fast forward to the present, and Ballmer asserts that cloud computing will be one of the most beneficial transitions ever for IT users.
- Continued Growth: When it comes to market growth, Ballmer mentioned Windows Server, Azure, Bing, Dynamics, Windows Server and Office as continued growth opportunities.
- Jabbing Google+: Microsoft and FaceBook are connecting the dots between Bing and FaceBook. It sounded like an indirect jab at Google+, though Ballmer didn’t mention Google’s social media platform by name.
- PCs Still Dominate Tablets: Apparently aiming to provide a reality check between tablets and PCs, Ballmer said 350 million new PCs with Windows 7 will be sold in 2011. In stark contrast, 20 million tablets will be sold.
- Bing: This is the area where partners focus least right now, Ballmer conceded. But Microsoft plans to open up Bing over time as more of a platform for partners, he added. Ballmer said Bing has captured 14 percent market share, up from 11 percent last year.
- Phones: In terms of market share Microsoft has “gone from very small to very small but it has been a heck of a year,” Ballmer quipped.
- Cloud Comes Into Focus: In past 12 months, Windows Azure, System Center, Visual Studio, Active Directory and other Microsoft services have gained key on-premise and cloud capabilities to give customers more flexibility to mix and match between public and private clouds, Ballmer asserted. Ballmer mentioned WireStone LLC as a partner that used Windows Azure, Windows Phone 7 and more to launch a business application for Boeing.
- Happy Anniversary: Over the past 10 years, Microsoft has averaged 20 percent compound annual growth since moving into the business applications market with solutions like Dynamics, Ballmer said. Ballmer said ERP and CRM integration with the Outlook user interface gives Microsoft a leg up against rivals. Microsoft ERP solutions will be available in the cloud in early 2012; CRM solutions are already available in the cloud.
- Office 2010: Microsoft has sold more than 100 million licenses, Ballmer noted.
- Office 365: One business trials Office 365 every 25 seconds, Ballmer said. “Any place we engage or a partner engages with Office 365, we win,” asserted Ballmer, who said Microsoft is doing “outstanding” any time the company engages.
- Skype: Subject to regulatory approval, Ballmer said he’s enthusiastic about acquiring Skype to help people communicate and collaborate. “One of the great motivations in acquiring skype is to enable enterprises to have all the control they want to collaborate and communicate, and yet connect to consumers, partners and customers around the world. Lync with Skype will allow the consumerization of IT to proceed” aggressively, Ballmer said.
- Xbox: The strategy is to deliver any entertainment you want or dream of, and have that one any screen — not just your big screen in the house, Ballmer said. Also, Microsoft is preparing voice-enabled remote control for Xbox, which will arrive in late 2011. The voice-enabled software will be integrated with Bing, so that users can search NetFlix and other multimedia services.
- Windows Phone 7: Ballmer shared a message of “belief” with partners, stating that Windows Phone 7 has sold millions of devices but he avoided any mention of specific shipment numbers. He noted that nine out of 10 people who acquired Windows Phones would recommend them to a friend. He said there are 20,000 applications built for Windows Phone 7. And he mentioned that Nokia bet the company on Windows Phone 7, though he didn’t mention financial incentives that Microsoft apparently supplied to Nokia.
- Windows 7: Twenty-seven percent of the Internet runs Windows 7.
- Windows Intune: The public beta for the next Windows Intune beta is available now with more remote support features, though it sounds like Windows Intune remains Windows-centric; there was no mention of remote support for non-Windows devices.
During opening statements Roskill mentioned…
- Money Matters: For every $1 worth of Microsoft software that a partner resells, the partner generates about $8.70 in additional revenues.
- Who’s Here?: Roughly 12,000 partners from 120 countries are attending the conference. The audience includes distributors, OEMs, resellers and ISVs.
- Continued Partner Commitment: 95 percent of Microsoft’s revenues come from channel partners, Roskill said. He mentioned Parallels as a key company that helps channel partners to stand up and activate cloud and SaaS applications.
- Key takeaway: No big surprises from Roskill. He basically reinforced some key channel messages that Microsoft has promoted since early 2011.
The VAR Guy has a range of meetings with Microsoft executives over the next few days. Stay tuned for regular updates and analysis.
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