Microsoft remains enigmatic over Office 365 billing pledge

Vendor has nothing to say after eagle-eyed partners notice that Office 365 Home Premium SKU added to FPP price list

Microsoft partners are scratching their heads after plans to give them control over Office 365 billing have still not materialised.

The software giant bowed to partner pressure at its Worldwide Partner Conference last July by unveiling Office 365 Open, a programme that will allow partners to sell its cloud-based email and productivity suite as an Open license.

This will mean they will have the option of billing customers themselves rather than have Microsoft do it, something partners have been calling for since Office 365 was launched in June 2011.

But despite murmurings that the scheme would go live towards the end of 2012, it has yet to see the light of day.

Eagle-eyed partners have noticed that Microsoft has added the Home Premium SKU of Office 365 to its FPP [full packaged product] price list in the UK this month. But asked about the significance of this, Microsoft declined to comment further and some partners have been told it could be months before Office 365 business SKUs are added to the FPP or Open price lists.

One source urged Microsoft to break its radio silence on the issue sooner rather than later.

"There is a huge amount of heat and emotion about who owns the customer because resellers fear losing control or the opportunity to make money," he said. "And customers want one throat to choke and one billing arrangement."

One partner described the current set up, where customers must place their order with Microsoft and put the reseller as their Partner of Request, as a "bit fiddly". Microsoft jacked up margins on the product last summer but partners are still handed a fixed cut of just 23 per cent in the first year and four per cent thereafter.

"We want to be able to sell it as a license," said the reseller. "Every reseller is talking about this as it is really difficult to make any money on Office365 without services - but it is a good product."

Stephen Hennessy, sales manager at Computerworld Business Solutions, said Microsoft had intimated at an partner network roadshow in November that Office 365 Open would be launched in December.

But he admitted that some customers may not want to be billed by the partner.

"The negative for the end-user is they may have to pay upfront, although we don't know yet," he said. "They may like the 30-day rolling billing platform from Microsoft. There are some intricacies to how Microsoft pitches it."

Microsoft has stayed tight-lipped on the success of Office 365 but at WPC claimed it had been deployed five times faster than Office 2007.

However, promotions it has brought in - including generous funding that covers some or even all of the cost of customers switching from on-premise - as well as its attempt to nudge customers towards cloud through Windows Server Essentials - speak of its desire to accelerate adoption further.