VARs Skeptical About Google's Channel Moves

Some channel partners question the willingness of customers to switch from Microsoft applications and wonder about Google's commitment to and experience with the channel.

January 29, 2009

Lynn Haber

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Opportunity is what channel partners thrive on - that is, opportunity they can bank on. The recent invitation by Google (NASDAQ:GOOG) to sign up for its large-scale reseller program to sell Google Apps Premier Edition (GAPE) doesn’t fit that bill, at least not yet, according to a some channel players.

If anything, channel partners are greeting Google’s call with skepticism and restraint. “If it gets traction, we’ll go with the wave, but we won’t lead the charge,” said Bob Puphal, director of technical services at CommNet International, a managed service provider and Microsoft Gold Certified Partner located in Voorhees, N.J.

Admitting that he didn’t have all the details about Google’s channel initiative, Puphal was certain that at this point in time, GAPE isn’t strategic to his business. Nor does he want his company to sit in the middle while Google and Microsoft (NASDAQ;MSFT) battle it out.

GAPE, which harnesses the software as a service (SaaS) model to offer messaging, collaboration and security solutions, is poised to compete with Microsoft’s Office applications package and Business Productivity Online Suite for hosted messaging and collaboration solutions, including Microsoft Exchange Online, Microsoft SharePoint Online, Microsoft Office Live Meeting, and Microsoft Office Communications Online.

James Savage, president of Concurrency Inc., a Brookfield, Wis.-based solution provider, believes that given Microsoft’s experience with the channel and proven enterprise-level software, it will be years before Google matures enough on both fronts to gain hold in the enterprise market.

“I’ve walked through GAPE, and it isn’t ready for prime time, it isn’t business caliber,” he said, adding that integration with Microsoft documents isn’t there either. “At least that wasn’t my experience,” he added.

Savage also cautioned about the perceived value of what is referred to as lightweight applications. “The features in the Google apps aren’t robust enough to get the job done,” he said.

Google's Challenge

That is why many channel partners believe that Google has to do something very special to get them or their customers to switch products.

“Our customers want a single solution provider. They use Exchange Server. It’s a well-proven robust client. I don’t see customers switching to Gmail from Exchange and then have Outlook and Calendar. They don’t want to break up their applications,” said Jack Simpson, CEO of Advanced Business Concepts, an eight-year old Microsoft Certified Partner based in Bridgewater, Mass.

As far as his business is concerned, Simpson needs more information about what Google will do for its channel partners in terms of sales tools, marketing collaboration and lead generation, which he says is huge." We've benefited from lead generation programs from both HP and Microsoft,” he noted.

While the idea of gaining product and service revenue as an Authorized Google Reseller has its appeal – Google partners receive a 20 percent discount from the $50 per-user, per-year subscription fee for Apps Premier, and the same percentage for annual renewals – the vendor’s lack of whole-hearted commitment to the channel drew strong criticism. Google has stated that it will sell GAPE directly to customers.

“Google has to decide whether they’re in the channel or not. You can’t serve two masters,” said Dimitri Miaoulis, partner at Baroan Technologies, a Microsoft Gold Certified Partner located in Elmwood Park, N.J.

Channel Conflict

Not wanting to serve as Google’s free sales force, Miaoulis said he’s heard and seen it before. “There are manufacturers who want you to pay them to get certified and learn their product, beat the bushes, market and sell their product then they take over your account,” he said. “Why would I want to do that?”

Miaoulis is currently switching customers to Symantec after selling McAfee products for 10 years. “They have our customers registration and are calling them directly,” he said.

Scott Butler, president and CEO of Tango Enterprises, a Vienna, Va.-based ISV and Microsoft shop also has concerns about Google selling directly and through the channel.

“One of our benchmarks as a small company is customer service. Will Google try to undercut what we offer?” he said.

Butler believes the world is moving towards SaaS. He also notes that his developers use Google maps in some of the applications they build. However, the value proposition to become a Google channel partner isn’t there. “Maybe at some point in the future I’ll look at Google’s program in more detail,” he said.

In a recent Gartner note, the market research firm said it expects Google channel partners and direct sales force to clash especially in larger accounts, prompting analysts to recommend that Google establish clear rules of engagement to manage such potential conflicts and to minimize wasted reseller and vendor resources.

TAGS: Google,Microsoft,Google Apps,VARs,channel

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