Microsoft COO Outlines 'Plan Of Attack' Against Amazon, Google, Apple And Others

Microsoft Chief Operating Officer Kevin Turner on Wednesday coached the company's partners on the strategy they should employ to go win business in 2016 from rivals like Google, Amazon Web Services, Oracle, Apple and Salesforce.

In his keynote at the Microsoft Worldwide Partner Conference in Orlando, Fla., Turner touted Microsoft's new openness to integrating with products from just about all those other vendors.

But in the same speech, he shared the "plan of attack" for how Microsoft partners can eat their competitors' lunches by selling Microsoft's Software-as-a-Service productivity applications, CRM, cloud infrastructure, analytic tools, and laptops loaded with the upcoming Windows 10 operating system.

[Related: Microsoft CEO Nadella Details Windows 10, New Cortana Analytics Suite, The 'Mind-Blowing' HoloLens]

"It feels so good, ladies and gentleman, not to be yearning for something we don't have," Turner said of Microsoft's portfolio. "We have what we need, and if we don't, it's coming."

The plan was formed in the context of a strong year in which a major transformation took place at Microsoft, among its partners, and within the industry as a whole, Turner said.

The rapid pace of change, driven by more organizations embracing the cloud, will continue.

"We don't see it slowing down," Turner said, so the challenge is leveraging the excitement around that change to drive deals. And Microsoft is more reliant on its channel partners than ever to do that, he said.

"Ninety percent of our revenue, ladies and gentlemen, comes through and with our partner ecosystem and our partner channel," Turner told attendees.

He also professed the company's love for technology partners contributing to Microsoft's ecosystem. Those ISVs and system integrators once were marginalized by the company.

"We might have lost our way there for a little bit. We found it," Turner told attendees.

The fiscal year 2016 attack plan focuses on "great innovation and austerity in this new world," Turner said. "We have the products, services and ecosystem to be able to complete this entire solution for the customer."

The new world comes with new partnerships, which are "great evidence of the new Microsoft," he said. "We have partnerships with companies we would have never partnered with in the past."

"The reality is, we're a better company when we extend and reach across the aisle," Turner said of working with other vendors. But everyone should remember they are all trying to get in each other's wallet, he added.

While Microsoft's legacy business is still profitable and will be for some time, it's the cloud business that's growing fast. Managed services is the future, and partners can improve their margins by optimizing a cloud strategy, according to Turner.

They should focus, when possible, on developing their own intellectual property and offering it as a unique value-add to customers.

Microsoft partners need to "own the cloud," he said, through Office 365, Azure, CRM Online and the services they build on top of those products.

"The cloud market is being made right now. I promise you, if we don't own it with the customer, somebody else is going to own it," Turner said.

Microsoft is competing against great companies, he added, but has the competitive edge with an intelligent, open and flexible cloud.

Another great advantage is that Microsoft operates one of only three hyper-scale clouds, along with Google and Amazon.

"Hyper-scale matters," Turner said, "because compute and storage is a commodity business." Microsoft has spent "tens of billions of dollars to get there."

Turner said the Enterprise Mobility Suite will be a billion-dollar product in the future, and partners should be selling it, deploying it and wrapping IP around it, since the "market is being made now."

A major pillar of the attack plan involves Windows 10. The upcoming release is a seminal moment, much like the release 20 years ago of Windows 95, Turner said.

Partners need to seize the opportunity to upgrade 1.5 billion Windows devices with the new OS.

"It's the greatest release of Windows we've ever done," Turner said.

Five million users are beta testing the game-changing features, including a single platform that runs across a family of devices, with natural interactions and top-flight security built in, he said.

But the biggest change is how Microsoft will release Windows from now on, abandoning a three-year release cycle in favor of "Windows as a service."

"The ability to keep a customer current with the latest technology has always been our Achilles' [heel] with Windows," Turner said. "We're fixing that with Windows 10."

Microsoft's goal is to see 1 billion Windows devices in operation by 2018, Turner said.

The attack plan has a strategy for partners to compete with specific rival vendors.

It starts with using Office 365 to win back customers who switched to Google Apps, a process that is already taking place, he said, pointing to Microsoft-compiled data.

"We've got to go rescue the rest of the Google Apps customers," Turner said.

With AWS, Microsoft needs to leverage identity management, support for hybrid clouds and privacy.

And on the Windows side, it's the OEM partners -- like Hewlett-Packard -- who will save the day with notebooks that compete with Apple's MacBooks or Google's Chromebooks.

Ric Opal, vice president at Peters & Associates, a Microsoft partner in Oakbrook Terrace, Ill., told CRN that in the keynote, Turner did what he has done so many times in the past.

Turner is "always the one to say what the big bets are."

Now it's up to partners to take the plan, go through its stages, boil them down to a marketing pitch, and go after verticals, he said.

Allen Falcon, CEO of Cumulus Global, a born-in-the-cloud solution provider that just introduced a Microsoft practice, told CRN that Microsoft's products "have gone from lagging to leading in the space over a fairly short period of time."

"Microsoft is clearly defining the opportunity and is backing with research the types of products and services partners need to be most successful," Falcon said.

But while Microsoft offers the right tools and guidance, it's not clear how many of their traditional partners can make the transition to the cloud, Falcon said.

"It's not about replacing on-prem with cloud, it's about improvement and innovation in ways that are more cost-effective and results-driven. Moving from transaction to adoption and consumption is a big change," he told CRN.

Turner said in the keynote that Microsoft has more than 70,000 Office 365 partners, but to scale, it needs even more.

He also addressed Microsoft's write-down of some $7.6 billion from its Windows phone business.

Turner said Microsoft will restructure and right-size its phone business for profitable growth and has absolutely no plans to abandon the business.

PUBLISHED JULY 15, 2015