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SQL Server 2008 release news, SaaS angst on tap for Microsoft partner event

Microsoft partners converging at the Worldwide Partner Conference will get SQL Server 2008 release news and, hopefully, guidance on Software as a Service futures.

Microsoft has told several large database shops to expect their final SQL Server 2008 bits this week. That means it's possible, in an ideal world, that the company will announce RTM (release to manufacturing) of the new database next week at the Microsoft Worldwide Partner Conference. (Microsoft is holding to its official "it'll ship in Q3" story.)

The SQL Server 2008 database, Small Business Server 2008 and midmarket Windows Essential Server have all been promised to ship this year -- SQL Server 2008 in the third quarter, after several delays -- and will be highlighted at the Houston event.

Microsoft partners have concerns other than when products that have already been widely publicized will ship. Many value-added resellers (VARs) worry that the company's evolving cloud-based initiatives will cut them out of transactions and customers accounts. The big fear there is complete disintermediation in a world where Microsoft and customers interact directly.

But a small number of Microsoft partners feel exactly the opposite.

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An executive for a boutique application development shop on the East Coast said he is angry about Microsoft's tardiness in building a viable cloud foundation. He said he feels the company has squandered a huge opportunity not only for itself but for its most forward-thinking partners.

"I care that they're two to three years late building out their cloud," he said. "We've done Web commerce in the past, and we could do more if we could use Amazon's Elastic Cloud. That would be fantastic, but we can't because it's Linux."

Microsoft needs to monetize the cloud by putting its services up there, he said.

"On their schedule, it's a year and a half out, which means it's actually at least two years out," he added. "Right now we do all this development work and throw it over the wall to some vaguely interested infrastructure provider -- usually a company's internal IT department -- and hope they do it right and on time. If we could do it on Amazon, we wouldn't have to worry about that. Flick the button and it's there. That would save us weeks or months."

Andy Vabulas, CEO of I.B.I.S. Inc., a Microsoft Gold partner in Norcross, Ga., wants to hear all about Microsoft-Yahoo entanglements from CEO Steve Ballmer himself.

"We all want to hear about what's going on with Yahoo -- that's number one -- and about how Microsoft will deal with the [partner] disintermediation threat from SaaS," Vabulas said.

Bob Shear, CEO of Greystone Solutions, a Microsoft Gold partner in Boston, said different types of partners will have different focal points at the conference.

"For companies with a desktop or infrastructure focus, the whole Vista-XP business continues to be a big deal, as in, 'How do we get ourselves out of this?'" he said. "For systems integrator-type partners, there's concern about the integrity of the Gold program. Microsoft has a hyper-quantitative system that can be gamed, which is why you have UPS stores with Microsoft Gold designations."

The Microsoft Gold label is supposed to go to top-tier, value-added Microsoft partners who fulfill stringent requirements. But many Microsoft partners complain that there are too many Gold partners scrapping over too few deals, leading to margin erosion.

Another concern for longtime Microsoft partners is what they see as the company's tendency to segment them by customer size. They say Microsoft tries to steer large-account customers to preferred large global systems integrators (SIs) or alliance partners, even when the smaller VAR has a longstanding customer relationship.

"There is conflict in these accounts among VARs and regional and global SIs," said another partner, who would not be quoted by name.

As for the top-line products at the show, SQL Server 2008 will be a welcome sight for partners. Many are also particularly jazzed about the midmarket server bundle, Windows Essential Business Server.

"They've done a really good job putting the applications most midsized businesses need on a couple of servers, versus 78 servers that no one will buy," Vabulas said.

On the product front, Microsoft partners with a unified communications (UC) bent naturally want Microsoft to stress that technology.

"I think Microsoft is going to make the case that unified communications has made the corner," said Mark Feverston, vice president of Microsoft solutions at Unisys. "We all have our early adopters, we have trained up thousands of services personnel, and our partnership ecosystem foundation is strong. Now it has been proven. I think you are going to hear from them that it's coming into mainstream and starting to mature."

The message there, he said, is that partners can feel safe going forward with UC as a main practice.

Senior news writer Rivka Gewirtz Little contributed to this report.

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