Riled Partners: Microsoft, With FastTrack Migrations, Will Be Our Competitor

Microsoft's renewed FastTrack program might drive greater Office 365 adoption with free email data migrations, but in offering that service the software giant is sidestepping its channel partners, and many are less than pleased.

Heading into next week's Microsoft Worldwide Partner Conference, several Microsoft partners told CRN the expanded FastTrack program -- which goes beyond the previous iteration with Enterprise Mobility Suite onboarding and the email data migrations for customers buying 150 seats or more of Office 365 -- will step on their toes and hurt their businesses.

The program -- now officially called Microsoft FastTrack rather than Office 365 FastTrack -- is backed by a team of engineers Microsoft recruited last year into a new division called the Onboarding Center.

[Related: Microsoft To Provide Free Onboarding Services To Enterprise Mobility Suite Customers]

One managed service provider based in the southeastern U.S. who boasts a thriving Office 365 practice told CRN that "at the end of the day," Microsoft is poised to become a competitor.

The earlier Office 365 FastTrack with its onboarding services was nowhere near as intrusive on his business, he said.

"Now they're going to do the full migration. And that is definitely moving into the realm of what a majority of us doing Office 365 make money doing. A good amount of money," he said. "So they're definitely going to be competing with the channel in that aspect."

Microsoft's explanation that migrations are a low-value, low-margin business doesn't hold water, the partner, who asked to not be identified, told CRN.

"It wasn't a couple years ago, they were telling us to invest in it. They said it was high-value," the solution provider said. "It would be great if they told us two years ago, 'You only have two years to make some hay, because in two years we're going to compete against you.' "

He added that some partners have invested hundreds of thousands, or even millions, of dollars to develop tools that automate those cloud migrations Microsoft is now offering at no cost.

Another Microsoft partner from the Midwest told CRN he is concerned by the direction Microsoft is heading with the program, also because the software giant is now positioning itself as a competitor of his firm.

"We have invested thousands of dollars into building a successful practice around the Microsoft cloud, much of that coming from Office365 migration services that we provide," that solution provider, also asking not to be named in this report, told CRN.

"Microsoft has often been a phenomenal company when it comes to partnering together," he said. "However, moves like this do raise a lot of questions about the overall strategy that Microsoft is taking now, as this appears to be a direct competitor to our own service offerings."

Mary Hester, CEO of LAN Systems, a Microsoft partner based in Atlanta said Microsoft is executing a strategy of accelerating cloud adoption for Office 365 and Azure.

"For us in the channel, we have two choices: Get on the train or out of the way," Hester told CRN.

Channel partners often move much slower than desired by their partner vendors. But there are many valid reasons for that pace, she said, "especially when a change is so revolutionary."

"Moving to the cloud, for many, is a paradigm shift that needs more work on the details," she said.

Hester told CRN the partners she thinks "would have heartburn over it" are NeoNova, AppRiver, SkyKick, BitTitan and other ISVs that make third-party migration tools. SkyKick and BitTitan "might have been most disturbed," she said.

The rankled MSP partner from the Southeast also said he imagines SkyKick, MessageOps and BitTitan are probably the most-frustrated with the program.

But BitTitan CEO Geeman Yip told CRN that the company he founded has always competed with Microsoft's free tools. In spite of that, the business of migrating companies to Office 365 grew exponentially.

Yip pointed out that customers have two choices, thanks to FastTrack -- they can accept free migration services, or they can take a cash-back option. He thinks many will choose the cash, and then spend it on a partner to perform the migration.

"In our experience, those same customers aren’t bypassing the partner. They’re being smart about it and using it to benefit their projects by decreasing costs," Yip told CRN.

Either way, BitTitan's remote configuration and onboarding tools will likely be the beneficiaries, he said, being used either by Microsoft's Onboarding Center team or by the channel partners.

Ultimately, "channel partners need more than a mailbox migration tool," Yip said, and Microsoft's program will activate more Office 365 licenses, which will drive business.

Chris Hertz, CEO of New Signature, a Washington, D.C.-based Microsoft partner, said FastTrack doesn't pose any threat to his business, which offers the value-rich services Microsoft now expects from more of its partners.

"I don’t see the change as all that impactful on our business, and I'm pretty excited that the fairly rich funding levels have been kept in place," he said of the latest FastTrack iteration.

For New Signature, the change aligns with the company's approach to Exchange Online migrations: "We rarely migrate mailboxes for customers," he said.

"Instead," Hertz said, "we train the customer’s IT professionals and script/automate the process to make it easy for them to execute the mailbox migrations, or in some cases already hand it off to Microsoft."

The FastTrack updates also allow customers to maintain the option of handing off mail migration to Microsoft after New Signature has completed its work in earlier phases, Hertz said.

New Signature's model is clearly representative of what Microsoft's channel leaders hope to hear from their partners at the company's massive global conference, which kicks off July 13 in Orlando, Fla.

Microsoft would not comment for this story. But in revealing the updated program, the company said: "FastTrack is designed to minimize the time a partner needs to spend doing the time-intensive, administrative tasks, so they can accelerate time spent selling and deploying high-value added services that can be more profitable and drive usage."

The message to partners: It's time to add value to their customer relationships in other ways.

But according to the MSP from the Southeast, FastTrack will make it harder for many to make the transition.

"Many partners are evolving their businesses in that way, but it takes time, energy and resources," he said. Partners, to get there, will have to leverage their existing migration businesses, and it'll be tougher to fund those efforts with Microsoft directly impinging on that profitable line of business.

PUBLISHED JULY 10, 2015