Friday, November 14, 2008

Step Right Up: Microsoft App Store Now Selling at a Online Store Near You

Microsoft today launched their first online store in the US (already available in the U.K., Germany and Korea). With the launch, US customers can buy first-party software and hardware directly from the internet. Products include software, devices and hardware, after payments are confirmed, customers can immediately download products and install them right away.

As we continue to see the "going direct" strategies implemented by Microsoft, VARs will need to act rather than compliant in adapting the inevitable - MSP will have a tough time competing against the big daddy (that used to make them money) for what will become the future of the channel, wait a minute what channel? According to ChannelWeb, Allison Watson, corporate vice president of Microsoft's Worldwide Partner Group, made no mention of the Microsoft Store and said that there were plenty of opportunities (hmmm...really?) for VARs to grow, as long as they stay focused on projects that improve energy efficiency, boost productivity and drive down costs.

I wonder what sort of margins can you continue to profit from Microsoft? How long can VARs sustain to this rate of change? Don't you have to survive so you can continue to deliver value?

In addition, they are rolling up the end-user customers with deals like going direct aggressively with 0% finance for Dynamics for 36 months (launched today as well) or the BizSpark program offering Web startups free software before becoming profitable. If any of these pilot programs are wildly successful (which I don't see why not), more products and services will be rolled out with even more aggressive offerings, don't forget even in this recession Microsoft is one of the few companies that's got a ton of cash in the bank, $26 billion to be exact.

You can't fight the trend as VARs or MSPs and you must live to fight another day by transforming your business to deliver IT smarter.


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