Today on the SBS Blog it was announced that the successor to SBS 2011 Essentials is going to be called Windows Server 2012 Essentials, and that there would be no replacement for SBS 2011 Standard. This really shouldn’t come as a surprise, the writing has been on the wall for SBS as we knew it for a long time, but some just weren’t seeing it there. This announcement doesn’t have the emotional impact on me that I know it is having on many others, despite my being involved in the launches for all of the versions of SBS up to and including SBS 2003, and I was then involved again with the launch of SBS 2011 Essentials and Standard.
Going back to my comment about the writing being on the wall, what am I referring to?
Exhibit A: Steve Ballmer says Microsoft is all in as a cloud company, and that if you weren’t onboard, well, you weren’t onboard.
I think people really underestimated this comment from Ballmer, but if you take a look at nearly everything MS is doing now, there is a private or public cloud message integrated into it. Even System Center traditionally an on premise management solution, is gaining stronger and stronger cloud deployment and management capabilities. Windows Server 2012 was built with cloud scenarios in mind. If you attend a Microsoft event for customers or partners, it’s all about the cloud.
Exhibit B: The complexity of the individual components causing more compatibility issues, to the point where products and features were being removed from the product.
It was inevitable that the all services on one server approach was going to break due at some point, either due to compatibility issues or system requirements growing too greatly. If you think about Microsoft now being a cloud focused company, this means that the team building future versions of SBS would have a smaller and smaller amount of influence over the other product teams to incorporate changes or fixes to allow co-existence or scaling down.
Going to the Exchange team, for example, who are becoming more and more focused on extremely large scale deployments for hosting scenarios and very large corporates, and asking to make sure that everything can run on one machine, or going to the SharePoint team and asking why can’t they just make Office Web Apps work on SBS in a supported manner etc are things that they just don’t have the clout to do anymore.
Here’s the unfortunate part of all of this… all of the work that has gone into Windows Server 2012 and the new version of Hyper-V and the new management tools, it has gotten much, much easier to deploy complex virtualisation solutions that would address some of these concerns. The problem is though, is that as soon as you go down the path of a multiple virtualised server solution you end up with something that is awfully similar to Essential Business Server, and we saw how that ended.
One of the questions I was asked repeatedly over the last few years was why there wasn’t more attention placed on promoting SBS. There are several reasons I saw for this, and these are based on personal observations, they weren’t official policies or procedures etc. Within MS the teams that cared about SBS were the SBS team, the SBS product managers in the subsidiaries, and the various OEM account teams including OEM distribution.
Absent from this group were the partner teams and the SMB marketing teams. These groups had already shifted attention (read that as what they were goaled on) to BPOS several years ago, and to Office 365 when it launched. From my perspective, I saw the promotion of SBS Standard as an activity that stopped a customer from moving across to BPOS or Office 365 for at least 3-5 years, and therefore not something to be recommended.
The sole SBS session at TechEd North America this year focused on SBSE, and I saw that as another nail in the coffin for the traditional SBS product. Based on the questions and mood in the room, I was reminded of something that I had seen many times in the past at Microsoft. They focus on where they want to be, where they need their partners to be, and where they need their partners to get their customers.
Sometimes there is a discrepancy in terms of where the market is, and in this case with SBS partners, many of them raise the problem of inadequate bandwidth as a big reason for not going down the cloud path, along with some other reasons. Microsoft not releasing a successor to SBS 2011 Standard does not mean that existing customers will be left without options. Most SBS customers are not on SBS 2011 Standard today, so there is still an upgrade path available for them. If this buys the customer another 3-5 years, hopefully the roadblocks for cloud adoption have been well and truly addressed to their satisfaction. This 3-5 year period will also give the partner base more than enough time to adopt new business models that include cloud solutions
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Indeed a sad day for those with historical ties with SBS….just like me! I cut my teeth in IT selling, setting up and managing SBS. But over the last 12-18 months I’ve seen more and more SMB resellers offering non SBS solutions – mostly virtualised environments and certainly Cloud too. I’m sure many would agree they’ve simply outgrown the simplicity of SBS, and what were once complex solutions around virtualisation and cloud are now much more simple and affordable to deploy – and any cost difference is outweighed by the greater benefits in reliability, redundancy, security and so on. Clients are also getting smarter in the way they purchase IT and how they use it to deliver advantage in their businesses. The one-box to do everything solution isn’t as viable.
I also remember it being virtually impossible to sell solutions such as Sharepoint, Office Communicator (now Lync) or Systems Centre to my SMB clients – just too big of an investment in both the software licenses and also the additional hardware to run it. But with many of these services now being offered in the cloud, their commodotised prices, the fact customers can sign up and purchase directly, massive marketing campaigns direct to customers via Microsoft & Telstra (can’t remember SBS getting much promoting as you say Mark) it seems like the plaform is basically out there selling itself, so the potential customer base is growing. In the past, maybe you had 50 clients on your books and only 1 purchased Sharepoint from you so you offer them some pretty high-value services. Now you have an expanding base of potential SMB customers, well above the reach you probably would have ever had, signing themselves up to cloud services like Sharepoint Online, Lync, competitive services etc and all who require smart resellers offering management and support and customisation services. So in the future, you might approach 50 new customers and find half of them already use Office 365 or some other online productivity service etc – you don’t have to do the hard sell job on the technology – all you need to do is offer your value added services on top of these platforms: management, a custom sharepoint solution, user support, intergrating Lync with other systems, training etc etc.
Basically, build your services for a market that’s already there and, by all reports, is rapidly growing. You don’t have to build the market for your services like we used to (you couldn’t be a Sharepoint specialist in SMB unless you were building up a client base by selling them Sharepoint because nobody had the technology!). It’s the same theory that’s driven the boom in mobile device apps. Be where the customer is!
What do you think Mark?
Disclosure: I currently work in the SMB team at Microsoft Australia. But prior to that, I spend 10 years working as a reseller.
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Hi Clayton
I can understand that there are partners that are very heavily invested in SBS, and for whatever reasons, moving to a new group of technologies as well as a new business model isn’t something that will happen overnight. It would have been nice if there was much more transparency early on instead of assuming that people could join the dots. I’m sure that many in the SBS MVP world are in a world of frustration at the moment, because they would have been informed of this at an earlier point in time, probably didn’t agree with the decision, and really couldn’t say anything about it to those it would affect. I tried to be as open as I possibly could about my lack of faith in the long term viability of SBS as a product given it’s lack of alignment to what Microsoft is focused on as a company, as well as within the individual product teams. For those who seem to be blindsided by this announcement, the best advice I can give is that if a product isn’t listed as a high priority in the keynotes of events such as WPC, don’t assume that Microsoft will engage with you on those solutions, and don’t assume that legacy solutions have a long life ahead of them as far as new releases go.
The way I see it moving forward is that while the sky may be falling for traditional SBS partners, the number of Office 365 partners has exploded. For every SBS partner who wants to throw the towel in now, more partners will spring up that only want to work on cloud solutions, whether it be MS, Google etc As I pointed out in the article, SBS Standard is still in channel, and there is a base of customers out there who may benefit from this upgrade, but if partners want to go down this path they need to know that they are going to be competing with cloud offerings from new and established players, and many of these partners deliberately target the removal of the legacy SBS platform. As for your comments about discovering the usage of cloud technologies within the customer base, if you start with the consumer services they are probably using for file sharing, their music and video services etc, you already have high cloud adoption. Add in line of business application usage such as QuickBooks Enterprise, running in a hosted environment via Remote Desktop, and you already have the company’s financials in the cloud. Hosted email really isn’t that much of a concern for customers, they want the benefits of Exchange, not necessarily an Exchange Server. With more and more users accessing their email remotely via their phones and laptops, there’s a tipping point at which it really makes more sense to have it hosted, knowing that there will be redundancy and uptime guarantees that SBS will never be able to deliver. Maybe I need to write a part 2…
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Right now I think Microsoft is going in a very wrong direction. I am a Microsoft fan and Partner, but with the ending of the SBS (with Exchange on Premise) Microsoft will harm itself.
The logic will be:
– Customers with 5-25 clients buy W2012 Essential Server (no Exchange)
– Partner will install other Mail Servers (Open Source/Low cost Mail Server)
– Customers do then not need Outlook anymore
– Customers will then not need Microsoft Office anymore (why not use open office)
An extra Exchange Server for Small Businesses is too expensive for most small companies. The customers do not want to have their E-Mails in the Cloud and the Internet is not everywhere fast and stable. This is the situation in Germany right now …
I love new technology and ideas – I will by a MS surface immediatly. But many customers won’t.
Mircosoft is now pushing to the cloud, but forget their customers and Partners. Unfortunately I see see some black clouds in the sky …
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Hi Claus
Thanks for your message.
As long as the partner is not compromising the capabilities that the customer is expectin, then the alternatives you talk about are valid in my view. The move away from Outlook seems to be happening to a degree already, just not on the desktop. People are spending more time on their phones or tablets accessing email, so the email is already becoming less relevant in many situtations.
I don’t see anything wrong with a partner choosing to go down the path of SBS 2011 Standard as the option for their existing customers, or even some new customers. It will still be in channel for over a year, has a healthy support lifecycle ahead of it, and can still form the basis of short to medium term solutions for those customers. Longer term, it gives everyone a chance to figure out what the next step is. If internet connectivity improves (this relly is a global issue, even the US has large pockets of poor connectivity, and here in Australia people are waiting patiently for the rollout of a government funded broadband network) and some other objections that people have are overcome, then cloud could make much more sense for more users by then. Alternatively, as you point out, there is potential for Microsoft to lose to alternate offerings if they hit the right mix of price and features that an SMB customer likes.
At this point I’m not 100% convinced that I would use Essentials 2012 as the leading solution, there are still a few unanswered questions. For a partner that is looking at hybrid solutions, the additional VM rights within Standard 2012 are much more appealing for ADFS and dirsync type scenarios and better future growth options. What Microsoft is doing with the full range of Windows Server 2012 products is the most impressive array of server upgrades they have ever delivered (ignoring the demise of SBS Standard).
In my work life I straddle both sides of the on-premise and cloud argument, one of my employers is about as close to 100% cloud you can get, while the other provides on-premise software and hardware, and has an amazing internal IT refresh taking place with no cloud utilisation just yet.
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