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 Channel Futures

Cloud


Microsoft Chases NetSuite’s SaaS ERP Customers

  • Written by The VAR Guy 1
  • March 12, 2010
All's fair in love, war and the software market -- where Microsoft is offering substantial dollars to U.S. customers that dump NetSuite for Microsoft Dynamics. The move comes only a few days after NetSuite started offering on-premises VARs (i.e., Microsoft's partner base) new revenue incentives to promote NetSuite. Here's a look at the ERP sparring match.

microsoft vs netsuite moneyAll’s fair in love, war and the software market — where Microsoft is offering substantial dollars to U.S. customers that dump NetSuite for Microsoft Dynamics. The move comes only a few days after NetSuite started offering on-premises VARs (i.e., Microsoft’s partner base) new revenue incentives to promote NetSuite. Here’s a look at the ERP sparring match.

First, a bit of irony: NetSuite has successfully shifted quite a few on-premises SAP customers to NetSuite’s ERP SaaS offerings. But now, Microsoft is stepping to say not all customers want SaaS. To prove its point, Microsoft is offering U.S. companies a credit of up to $850 for every NetSuite user that switches to either Microsoft Dynamics GP, Microsoft Dynamics NAV or Microsoft Dynamics SL, according to a Microsoft press release. The promotion ends June 25, 2010.

NetSuite’s Position

These certainly are intriguing times for NetSuite. At first glance, the company is ideally positioned in a high-growth market — SaaS. No doubt, some on-premise ERP customers are frustrated with traditional systems that take years to configure, deploy and optimize. So NetSuite could be a natural options for folks that want to tackle ERP in the cloud.

To speed the process, NetSuite recently introduced a new partner program that offers VARs 100 percent first-year commissions on SaaS customer engagements. That special offer was widely scene as NetSuite’s open letter to Microsoft partners. Also, NetSuite is preparing to host the SuiteCloud 2010 Partner Conference (April 13-16, San Francisco), which should attract ISVs (independent software vendors) and channel partners.

Still, NetSuite faces plenty of challenges. The company’s stock sits near a six-month low because recent growth and earnings guidance haven’t impressed Wall Street. Now, Microsoft is intensifying the pressure by offering financial credits to U.S. customers that jump from NetSuite to Microsoft Dynamics.

Will any customers take the bait? Hmmm… Frankly, The VAR Guy hasn’t heard from many customers that tried (then dumped) NetSuite. Our resident blogger sent an email to NetSuite, seeking comment about Microsoft’s NetSuite-centric competitive offer. If NetSuite has any thoughts to share, The VAR Guy will be sure to post them here.



Follow The VAR Guy via his Newsletter; Webcasts and Resource Center; and via RSS; Facebook; Identi.ca; Twitter and VARtweet.

Tags: Cloud Service Providers Digital Service Providers MSPs VARs/SIs Cloud

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4 comments

  1. Avatar Harry Brelsford March 13, 2010 @ 1:46 am
    Reply

    VarGuy – we are very proud users of NetSuite and havbe been for the past three years. I can honestly say that it’s a fantastic product that met OUR needs. granted – its not for every SMB – it’s expensive – but I like to think of myself as a top-shelf kinda guy…if you know what I mean. I truly believe NetSuite has struggled a bit in building a reseller channel and my staff will be attending the NetSuite conference in April to learn more about its efforts.

    I can honestly tell you that we LEFT the Microsoft CRM 3.0 product for NetSuite because we needed the full-on ERP solution. I have a meeting next week with Microsoft Dynamics to hear its SMB strategy and I’ll be delighted to report back here what I find out.

    cheers….harrybbbb

    PS – Competition is GOOD – I’m glad to see MSFT responded to NetSuite’s haed start!

  2. Avatar aikiwolfie March 13, 2010 @ 3:29 pm
    Reply

    Sounds kinda like Microsoft are bribing VARs to push their product.

  3. Avatar Matt Landis March 13, 2010 @ 6:56 pm
    Reply

    Hey Harry!

    Good to see your opinion here. We happen to be in the Dynamics GP + CRM camp. For the very small smb gp+crm is a bit heavy–i don’t disagreee there. Of course there is always GP hosted that can be a solution for that market.

    We had been a var for Microsoft Small Business Financials (perhaps the most active in USA MS SBF var?)so what they/msft have in mind for SMB is very interesting to us. I’d love to here any feedback you get.

    Matt Landis
    ps-i’d say no var or end-user takes bribes to change ERP–way way too painful…laugh..take care

  4. Avatar The VAR Guy March 15, 2010 @ 7:57 pm
    Reply

    Aikiwolfie: More like Microsoft trying to grab a headline or two. And it worked…
    Matt: The VAR Guy appreciates your readership. Please keep our resident blogger posted as you consider SaaS and BPOS moves.
    -TVG

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