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While keynote addresses on Microsoft’s second day of its
Worldwide Partner Conference were all about cloud and mobility, no mention was
made about the issue that’s been at the crux of why many partners have been
slow to adopt Microsoft BPOS and Microsoft Office 365. Who owns the billing?

VARs and MSPs want to bundle Office 365 into the services
they sell to customers and present those customers with a single bill. But so
far Microsoft has only named a handful of large service providers and telcos
who will handle their own Office 365 billing. Microsoft will offer commissions
to other channel partners, but will bill directly.

Microsoft channel chief Jon Roskill told channel partners
that more than 200,000 customers had participated in the beta of Office 365 and
since the formal launch of the service two weeks ago another 50,000 had signed
up. Kurt DelBene, president of the Microsoft Office Division urged partners to
get onboard with the cloud-based productivity solution, promising improved

“We really believe Office 365 is a conversation you should
be having with your customers,” he told partners. Why? For one, Office 365 does
not work with Office 2003.

Another reason, according to Kirill Tatarinov, president of
Microsoft Business Solutions, is that the update to Microsoft Dynamics that is
coming in Q4 will include integration with Office 365 making Dynamics a part of
the Office 365 interface and providing customers with a single bill.

Microsoft also announced Dynamics ERP RapidStart Services designed
to help partners quickly configure and set up consistent and repeatable steps
common across the life cycle of an ERP deployment. Built on the Azure platform,
the service will be available in September for Microsoft Dynamics AX 2012,
Microsoft said.

Microsoft executives described a world of devices connecting
to cloud-based applications, allowing users to access their information in a
familiar format regardless of their location or device.

“Today’s user is smart, connected, and expects everything
she needs on every device she touches,” Roskill said.

On the infrastructure side Microsoft executives pointed to
the momentum of Hyper-V, their server virtualization technology which ships
free with Windows Server. HyperV has doubled its market share in the past year
and moved into the Gartner leadership quadrant, said Satya Nadella, president
of the Server and Tools business at Microsoft.

He also announced the availability of a community technology
preview of the new Microsoft SQL Server codenamed Denali, which includes Project
“Crescent” for visual data exploration and SQL Server Developer Tools codename
“Juneau.” An on stage presentation of Denali drew robust applause from channel
partners at the Staples Center stadium during Tuesday’s keynote.

Nadella noted that Microsoft and partner designs over the
last year have won 12,000 SQL Server deals. In addition, he said, 30,000
partners have been trained on Windows Azure.

Nadella said that one of the next products set for release
is Systems Center 2012 which will have the capability to configure, monitor,
move applications around, spanning both public and private.

“We will continue to push the envelope,” he said. “It’s
about the application and the application management.”

Microsoft’s server lineup will soon feature Windows Server 8,
which includes Hyper-V Replica enabling asynchronous secure replication of
virtual machines to a backup site. The function can be performed over the
network, it can be scheduled or it can be done to attached media.

“Cloud computing is as big a transformation as we have ever
seen and, together with our partners, Microsoft will help customers through the
shift,” Nadella said.