Learn How You Can Succeed With Microsoft CSP Program
What is a Microsoft Cloud Solution Provider (CSP)? Microsoft defines its “Microsoft CSP program” as a true cloud reseller program, with Microsoft partners shifting from principally reselling Microsoft Cloud Products and Services to managing the entire customer relationship.
Cloud computing is changing the profitability dynamics of managed-service providers, system integrators, IT distributors, and VARs globally, by transforming IT spend from capital expenditure to on-demand operating expense. According to Microsoft-sponsored research by consultants such as IDC, the market opportunity for Microsoft Cloud Services is worth $50 billion over the next few years. Microsoft believes that the revenue opportunity for its cloud solution provider (CSP) partners is at least nine-times that amount. This has prompted Microsoft to formulate a new go-to-market strategy via its CSP program.
Components of Microsoft CSP Program
1. A licensing model and program
2. An annuity stream of revenues, versus traditional one-time-licensing revenues
3. A way for partners to own the customer IT spend lifecycle, from consulting, integrating, billing, and provisioning, to managing and supporting conventional IT and cloud for their customers
The Microsoft CSP Program is designed to align the CSP Partner’s core cloud products with the partner business model and their partner’s unique value proposition for customers. This allows Microsoft customers to purchase an overall solution, including Microsoft products, related partner service offerings, and third-party products and services.
Here’s how Microsoft defines its CSP Program:
“The Microsoft Cloud Solution Provider program enables partners to directly manage their entire Microsoft cloud customer lifecycle. Partners in this program utilize dedicated in-product tools to directly provision, manage, and support their customer subscriptions. Partners can easily package their own tools, products, and services, and combine them into one monthly or annual customer bill.”
In the CSP business model, the CSP Partner is responsible for the customer-management lifecycle. This means that the CSP Partner provides and manages an online marketplace of services from which customers can buy Microsoft Office 365 and Azure products, core partner products, and third-party products and services.
The CSP Partner must be able to bill customers directly and manage collections and customer support without Microsoft’s involvement. CSP Partners control the entire customer relationship, creating new revenue sources. The direct billing relationship provides the ability to up-sell and cross-sell services to customers. Also, partners that control the billing can bundle Microsoft services such as Office 365 with their own services and other third party services. This gives customers the convenience and value of paying a single bill and accessing support from a single source, and it also gives partners control over margin.
Types of Microsoft CSP Partners
Direct Partners: The direct partner is what most people envision when they think about the CSP concept. It’s the partner that orders cloud licenses directly from Microsoft and then resells them to a customer in a solution bundle combining services from Microsoft and third parties with their own services. These partners provide:
1. Direct billing to customers
3. Technical integrations
4. Customer-lifecycle management
Direct Partners are typically organizations that have invested in a direct-business model with customers, providing support services and solutions directly. For MSPs or SIs, the direct CSP model is in line with their current business model.
Indirect Partners: These partners do not get their licenses directly from Microsoft. Rather, they work with Indirect Distributors (described below). Indirect Partners are typically organizations that want to start small or do not want to incur large capital expenditures around cloud business.
These organizations have customer relationships and core services that differentiate them, typically, in an SMB or niche market.
They take the advantage of the support capabilities, investments, etc. from Indirect Distributors. For example, these partners may have white-labeled storefronts to sell CSP services, third-party services, and their own services to customers. Such storefronts run on the infrastructure and platform owned by Indirect Distributors.
Indirect Distributors: Indirect Distributors are the backbone of Microsoft CSP programs, dealing with Microsoft on one side and hundreds or thousands of Indirect Partners on the other side. Some Indirect Distributors, which Microsoft refers to as “cloud distributors,” bundle other products for Indirect Partners to offer. In many cases, Indirect Distributors provide billing and provisioning on the back-end, on behalf of Indirect Partners. In some cases, these distributors also offer white-label support.
Microsoft CSP Program Support
Microsoft has provided a CSP API to enable its CSP Partners to integrate provisioning and ordering activities into their own systems. The API supports provisioning new customers, ordering subscriptions and add-ons, and modifying the license count. The CSP marketplace, billing and collections, and customer-relationship management remain the responsibility of the CSP Partner.
For CSP Partners that lack billing and customer support resources, many of the major indirect distributors, direct system integrators, and MSPs engage Jamcracker to provide the platform to enable the required marketplaces, billing solutions, and customer support operations so that they can act on Indirect Partners’ behalf in the background.
Keys to Success for CSP Partners
As the CSP Partners control the entire cloud-services lifecycle for their customers, the key success parameters are different from those of a traditional license-model sale. Based on our interactions with CSP Partners, Microsoft representatives, and CIOs globally, we have identified the following key requirements for a partner to maximize success in the Microsoft CSP Program:
· Faster go-to-market: Accelerate the cloud marketplace rollout from months to days so you can test the market, assess your GTM strategy, and then proceed with a large-scale rollout.
· Bundle and differentiate: Bundle CSP services with your intellectual property and services, third-party cloud, or IT services to provide customers with a comprehensive solution rather than a licensing model.
· Modernize sales and marketing for the cloud business: Fine tune your sales and marketing teams to build your digital brand across social media, industry forums, etc., and emerge as a thought leader in the cloud business.
· Become a trusted advisor: Deploy the operational framework so that you can be the single point of contact for your solution, including Microsoft CSP services, your intellectual property and services, and third-party services, including industry-specific services.
· Guiding the customer: The first 45–60 days of support is critical in most cases for annuity-related customers, driving greater lifetime customer value.
The Jamcracker Platform: CSP Program Enablement Solution
Microsoft classifies Jamcracker as a “cloud-marketplace-technology provider.” This means that Jamcracker works closely with both Indirect Distributors and Direct Partners to enable and automate the Microsoft CSP business model.
Jamcracker uses its market-leading Cloud Management and Governance Platform (“the Jamcracker Platform”), to support CSP Partners by providing the billing, provisioning, and automated customer support and management that is required to become a fully qualified and profitable CSP Partner, all available “out-of-the-box,” within a matter of days.
Microsoft CSP Office 365 and Azure have already integrated the Jamcracker Platform with the Microsoft CSP API (CREST API) to onboard Microsoft Cloud Services; provisioning the licensing; providing customer service; and managing recurring billing. Jamcracker also brings a complete catalog and marketplace of similarly automated services for more than 100 other cloud services, enabling Indirect Distributors and Direct Partners to easily curate unique service-package offerings to end customers and their resellers.
Jamcracker is a global leader in cloud aggregation, delivery, and management solutions. Many of the world’s leading telcos, managed service providers, IT distributors, technology providers, and enterprise IT organizations use the Jamcracker Platform to unify delivery and management of public, private, and hybrid cloud services to their customers, through their channels, and to their employees.