Partners, you do know that that Exchange Online, E1, E3, Office 365 ProPlus will be available through the Open program on September 1st, don’t you!?
Why is this good news? It means more money in your pocket! If you have enjoyed your Partner of Record (POR) fees through the Advisor model, you will enjoy greater upside when you purchase Office 365 through your Distributor!
Whenever I used to talk to partners about selling Office 365 through the Advisor model, the allure of 16% (Cloud Essentials) and 23% (Cloud Accelerate) first-year POR fees was very appealing. However, the 4% in subsequent years meant brand new customers/seats needed to be sold in order to maintain the same year-over-year revenue.
With Office 365 Open, the game has changed.
Take a look at this calculator/comparison I set up below. Let’s say you sold 500 Seats of E3 across your customer base and never sold a “new” seat ever again:
For the purposes of this example, we assumed an approximate 13% up-front margin from your Distributor. Of course, your mileage will vary. We also included the current VAR Rebate incentive of 8%.
For the Advisor model, we are using values for a partner who has achieved Cloud Accelerate status, which means 23% in the first year. Cloud Essentials partners would start out at 16%
If you take a look at both bar graphs, you may notice that both models are fairly balanced, but in year two, the Open model completely flips the scale over. Even if the 8% VAR Rebate became unavailable, you still have the potential to make 3 times more than the Advisor model in years 2 and beyond (4% Advisor Fee vs. 13% Open Up-Front Margin)
Oh, and did I also need to remind you that with Office 365 Open, you set the price and control the billing?
Call D&H, Ingram, Synnex, or Tech Data for more information!
Ah, if only you hadn't shafted Australian partners by shackling us to Telstra and thereby not allowing us access to the Open licence. You really did a number on us Microsoft.
Totally agreed with Wayne here. Why in the world are we the only country to have to be paired with an Australian ISP? i work for a Microsoft partner and we've been absolutely shafted by having to go through telstra. so many opportunities have been lost.
Many customers wanting to go with office 365 find out telstra is the only way forward and go for on-prem upgrades to exchange 2013 instead. its bad business for everyone but telstra.