Westcon-Comstor wants to be seen as the “easy button” for hyperscaler marketplaces, one of its execs has said after it went live with its spin on the new Microsoft Marketplace resale enabled offers (REO) programme.
Unveiled at Microsoft Ignite in November, REO enables ISVs to authorise approved channel partners to create and manage private offers on their behalf via Microsoft Marketplace.
Westcon-Comstor last month announced it is now enabling a two-tier motion around REO, adding to its status as an AWS DSOR.
ISVs it is working with on REO already include Palo Alto Networks, Zscaler, Infoblox, Check Point and Cisco.
The move comes after analyst Omdia in September raised its projections for hyperscaler marketplace growth. It now expects total hyperscaler marketplace spend to stand at $163bn by 2030, 59% of which will be generated by channel partners.
“Okay, Westcon is my easy button”
Talking to IT Channel Oxygen, Peter Woest, Cloud Marketplace Partnership Director at Westcon‑Comstor, said the distributor wants to be known among resellers and ISVs as the cloud marketplace aggregator of choice.
“Any partner or vendor that wants to do anything in the cloud marketplace, they know that, ‘okay, Westcon is my easy button, because they take away the complexity’,” he said.
“With Microsoft, we’ve been waiting a long time to have more of a value play. With REO, we really recognised we can step in and solve some of the complexity that might be there.”
Westcon-Comstor can step in and remove risks around currency effects, Woest said.
“The other element is on the procurement side. REO requires the designated partner to place a PO with the ISV, and a lot of the [ISVs] we collaborate with don’t want to set up all those partners as direct billing partners and do those credit checks.
“That’s where we then can step in.”
Another benefit of REO is that partners who care about revenue get the money “actually landing in their banks”, rather than seeing only the margin come their way, Woest said.
“Traditionally, cloud marketplaces have been a barrier to maybe some of those GSIs or large outsources that are very revenue focused – so REO allows partners to be in full control of the dimensions of the offer,” he explained.
“First to market”
Talking to IT Channel Oxygen, Microsoft’s Marketplace Partner Lead Darren Sharpe characterised Westcon-Comstor as “the first to market” in launching a motion of this nature.
“The real innovation here that Westcon and the likes of Palo Alto have brought to life is that they’re using REO in a two-tier motion globally – and that’s Westcon providing the off-marketplace governance and payment piece from a Microsoft perspective,” Sharpe said.
Although, unlike AWS and its so-called ‘$1bn marketplace club’ members (see here), Microsoft hasn’t publicly called out the marketplace sales successes of its ISV partners, Sharpe claimed the growth of the marketplace model should not be underestimated.
“Jay McBain at Omdia called out that the channel is going through its largest transformation in its life through the precedent of cloud marketplaces, and we now have vendors like Nerdio, an Azure virtual desktop management platform, that gets 94% of their revenue from Microsoft Marketplace,” he said.
“Very often, the VC companies that are building those digital-native software companies are mandating they start with the cloud, and they start with the cloud marketplace.”
“Very different muscle memory for partners”
As recently as 18 months ago, many of the UK’s top channel partners were still devising a hyperscaler marketplace strategy.
“We’re focused on helping partners build a marketplace practice, as we recognise it’s a very different muscle memory from how they’ve traditionally gone to sell,” Sharpe said.
“I’m seeing boutique partners like Saepio in security really build up cloud marketplace practices with all the hyperscalers, because they realise that’s the modern way customers are consuming elastically.”
Westcon-Comstor’s move comes nearly two years after Microsoft followed in AWS’ footsteps by launching its Multiparty Private Offer programme in the UK.
Adding Microsoft as a second marketplace string to its bow alongside AWS was “critical” for Westcon-Comstor, Woest said.
“Microsoft is a more dominant player in some [EMEA] markets. We often got the feedback, ‘hey, we want Microsoft, what can we do together with you on Microsoft’,” he said.
“It’s really critical to have the collaboration started now.”
Doug Woodburn is editor of IT Channel Oxygen
