In an effort to rebuild a healthy network of ISVs that write software for its platform, Microsoft is introducing two programs aimed at helping ISVs write business plans and build delivery channels for their software. Business Builder aims to help develop basic business skills among the technical people who run small software companies; Channel Builder aims to put them in touch with systems integrators and consultants who can put their products in front of customers.

Both programs are part of the new Microsoft Partner Program, unveiled in Oct. 2003, that will get under way in 2004. This program puts great emphasis on serving smaller partners better, and the new "builder" programs follow that theme. They supplement the company’s Empower Program, announced in the spring of 2003, which offers ISVs low-cost access to development resources such as the Microsoft Developer Network (MSDN).

Rebuilding the Partner Network

The software business and the partner landscape have changed significantly in the last decade: as Microsoft grew more dominant on the desktop and as the Internet offered a new outlet for developer interest, the ranks of the thousands of commercial developers that once built products for Windows desktops have thinned.

However, the rise of strong and vocal open-source communities and other factors have convinced Microsoft that it needs to re-create a strong "partner ecosystem," particularly as the company moves into specialized vertical niches where the company has no expertise of its own and relies on specialized partners to lead its "go to market" campaigns.

According to Margaret Cobb, Microsoft’s ISV Group manager, "we’re trying to get that [ISV] community back." The majority of these ISVs, says Cobb, are small firms with fewer than 50 employees and less than US$10 million in annual revenue. Many have short lives as companies.

Because they play a significant role in building interest in Microsoft’s platforms, Microsoft has a strong interest in ensuring these companies' vitality, Cobb says.

"They are great at developing software, but often they’re not good at marketing their products" or raising capital. The Business Builder and Channel Builder programs are designed to give the technical people at the helm of many ISVs additional skills that will increase their chance of survival.

Business Builder

Business Builder, piloted in Brazil, will be made broadly available to Microsoft partners, including the Registered Partners that occupy the lowest rung of the partner "ladder."

The Business Builder program consists of three online courses that cover business strategy, financial management, and writing a business plan. Each of the courses takes two to three hours to complete and can be done online or can be downloaded for offline use. At the completion of the course, the ISV can download some additional Excel templates to aid in business analysis and will get a list of books and other resources that can deepen their knowledge.

Microsoft has contracted with consultants to review the business plans of ISVs that complete the program. These consultants will offer a US$250 discount off their usual US$750 fee for reviewing a business plan.

Channel Builder

The Channel Builder program has higher entry requirements and is aimed at more established ISVs—the Certified Partners and Gold Certified Partners at the top tiers of Microsoft’s partner programs.

Most of these firms sell directly to customers, but many would benefit by developing channels through which they could sell their products. For example, an ISV could expand its business significantly by working with Microsoft systems integrators in other regions or those that specialize in particular vertical markets.

The Channel Builder program has three primary components: an online directory where Microsoft ISVs can advertise their wares to Microsoft systems integrators, events that will bring ISVs together with other Microsoft partners, and a telesales group that proactively identifies potential Microsoft ISV and integrator partners.

Online directory. The online directory will give ISVs a place to profile their products, similar to newspaper help-wanted advertising. ISVs can identify regions or vertical markets in which they are particularly interested—for example, an ISV could indicate that it is looking for a firm with customer relationship management (CRM) expertise on the east coast of the United States that can integrate the ISV’s CRM module or application. Partners will be able to rate each other’s performance to give other directory participants a measure of their success.

In its first phase, the database will include only ISVs and systems integrators. Resellers might be added later, but many of the ISVs that Microsoft is concerned about sell complex add-on applications that require the skills of an integrator. Because their products don’t lend themselves to shrink-wrap distribution, these ISVs will benefit the most from the Channel Builder program, Cobb says.

Events. Microsoft plans to bring ISVs and other partners together at events around the world where ISVs can showcase their products and talk to integrators about reselling them.

Telesales. Microsoft will proactively telephone ISVs and integrators to create profiles of partners and find out what products they are developing and the platforms they run on. This will expand the database, advertise its availability, and increase the chances that ISVs and integrators will find good partners.

Microsoft is also developing a portal devoted to ISVs. The portal, which is part of the Microsoft partner site, will have research, case studies, information about the Business Builder and Channel Builder programs, and other resources for ISVs.

Resources

The Empower program is described in "License and Test Discounts for ISVs" on page 14 of the May 2003 Update and at http://empower-isv.one.microsoft.com/isv/programguide.

Microsoft’s ISV partner portal is at members.microsoft.com/partner/isv.

The new Microsoft partner program is described in "Partner Program Gets Major Redesign" on page 23 of the Dec. 2003 Update.