Microsoft set off a year-long saga in February with its unsolicited $44.6 billion offer to acquire Yahoo. The company eventually pulled its offer, but you couldn't go more than a few weeks in 2008 without hearing rumors that another bid -- for significantly less money -- was in the works.
Microsoft eyed Yahoo for its online search and advertising business -- areas where Google dominated. In fact, Google's online success had a lot to do with the strategy coming out of Redmond this year. Microsoft pushed its Software plus Services strategy hard, ramping up Microsoft Online Services and unveiling Windows Azure.
With Online Services, the company planned to make all of its software available through a hosted model -- delivered by partners and sometimes directly from Microsoft. Initial offerings included Dynamics CRM Online, SharePoint Online and Exchange Online. Azure is a cloud development platform that will compete with, among others, the Google App Engine.
Channel conflict on the rise
Rocky vendor-partner relationships are common, but channel conflict reached new heights in 2008. Infra-Comm, a former Cisco Systems reseller, took the networking giant to court in June for poaching a registered deal and then kicking Infra-Comm out of its partner program. In October, the court ruled in Infra-Comm's favor and ordered Cisco to pay the partner $6.4 million for breach of contract.
Cisco wasn't alone in drawing the ire of partners, though. Symantec saw its channel-friendly reputation take a hit this summer when COO Enrique Salem told Wall Street analysts about the company's direct sales strategy for its largest customers. Dell's MessageOne acquisition got partners worried about increased competition for services business. The size of Microsoft's partner program became a critical issue. And some VMware partners accused the vendor of taking a "predatory" approach.
Coming in 2009: Some partners fear the recession could put even more pressure on vendors' sales reps to poach partners' customers.
Oracle sets middleware plan, hikes prices
Oracle hiked the prices on its database and BEA WebLogic server in June, rankling some partners who were already having trouble making sales because of the poor economy. The price tag on Oracle 11g Enterprise Edition went from $40,000 to $47,500, and WebLogic increased from $17,000 per CPU to $25,000. Other partners said the move didn't matter too much, because Oracle is known for discounting heavily to win deals.
Oracle also plotted out its middleware roadmap, putting BEA Systems' WebLogic application server smack in the middle of its game plan. Oracle acquired BEA after a long and contentious courtship early in the year.
VMware unveils Virtual Data Center OS
VMware tried to usher in a new era of computing at VMworld 2008 in September, announcing its Virtual Data Center Operating System. By adding new technologies to the existing VMware infrastructure, the company said the new OS would improve storage and networking capabilities as well as virtual machine management. But when CEO Paul Maritz said "the traditional operating system has all but disappeared," some VMware partners said that day is still a long way off.
Coming in 2009: We'll see just how far ahead of its time VMware was with this announcement.
Web 2.0 adds business value
Web 2.0 technologies emerged as legitimate business tools this year, giving solution providers new ways to develop partnerships and even drive sales in some cases. Channel professionals said Facebook, LinkedIn and blogs helped them reach new customers in ways that traditional marketing never could. Even Twitter, the micro-blogging site with a 140-character limit, increased partners' visibility among its tech-savvy audience.
Read the rest of the top 10 IT channel news stories of 2008.
Dig deeper on Channel Conflict