While there might not be much money to be made selling Microsoft Office 365 itself, a new survey of 109 IT services firms conducted by SkyKick, a provider of Microsoft Office 365 migration tools, finds that 84 percent of IT services firms that work on Office 365 migrations report that customers are likely to request additional cloud services as part of the overall project.
Initially, those additional services consist of things like data protection services and help managing access in a way that meets compliance requirements. Over time those requests get more complicated, though. Whether it's running on premise or in the cloud, Microsoft Office is still the front end to a whole host of enterprise applications, so integrating Microsoft Office 365 with applications running on premise or in the cloud represents a major opportunity for IT services firms.
Of course, there is also the process of actually migrating to Microsoft Office 365. The survey found that IT services firms that have facilitated these migrations make most of their money from consulting and managing the migrations. The migration is usually an extended process, so most organizations wind up running instances of Microsoft Office on premise alongside Microsoft Office 365 for quite some time. Before too long, however, most of those customers will become increasingly anxious to complete the transition.
Put it all together, and Microsoft Office 365 clearly creates a level of disruption across the enterprise to the benefit of IT services providers. That doesn’t mean customers don’t stand to benefit as well, though. They gain access to centrally managed Microsoft Office 365 cloud services that in the long term will greatly reduce management headaches.
A good number of those customers will decide to make the shift to Microsoft Office 365 at the same time they decide to migrate to Windows 10, a transition that is expected to occur at a healthy clip over the next year or two. Between Windows 10 and Microsoft Office 365, it’s pretty clear that Microsoft is laying the foundation to deliver a raft of cloud services that will all be consumed using a subscription model similar to Microsoft Office 365.
Naturally, it will take IT services firms that have resold software more time to make the transition to the subscription model than those that don’t. But, over the long haul they should wind up being more profitable for making the effort.
Push to accelerate adoption
At the Microsoft Worldwide Partner conference next week, Microsoft will no doubt go to great pains to remind partners of all the downstream benefits of Microsoft Office 365. The trouble is that the SkyKick survey results suggest that on average IT services firms only completed 15 Microsoft Office 365 migrations in the past year; and that they only expect to complete 17 more in the coming year.
The issue that creates for IT services firms is a compelling need to figure out how best to go about accelerating that process so the higher margin opportunities start showing up on their balance sheets sooner rather than later.