Is Google Dealing from the Bottom of the Deck When It Comes to the Channel?
I just watched Google’s Jeff Ragusa’s video clip explaining the Google Apps reseller model. If I didn’t know any better I would have thought the Just for Laughs Festival I attend every year started early. Here is the big joke: Google is offering a whopping 20% of the Google Apps revenue generated by the Channel for directing their customers to Google’s coffers. For those of you that don’t know yet, let me give you the math: Google charges $50 per year per user for access to Google Apps. Gee Goog, you shouldn’t have. I mean really! A cool $10 per year for every user I hand over? Where do I sign up for this cash bonanza!
The financial scraps approach to building a Channel play and my sarcasm aside, this is where it appears Google is dealing from the bottom of the deck when it comes to the Channel: You are giving up the control over the operation of your customer most important applications: Productivity and Email. Opening up your IT Service practice to Google is nothing short asking the fox to guard the henhouse.
If you are seriously considering the Google reseller program, ask tough questions. Here are 10 questions to get you started:
- How does Google Apps integrate with my clients other business systems?
- Will I be able to apply my remote monitoring and maintenance tools to Google Apps so that I can maintain SLA consistency with my client?
- Will Google Apps integrate with my Professional Services Automation (PSA) software?
- Who controls the database where customers are registered?
- Will my clients email be filled with Google ads, just like my Gmail account?
- Can I choose where my customer email data is stored geographically to satisfy data residency requirements?
- If I educate my customer about Google Apps and then they sign up directly, how do I get compensated?
- Can I just take the Google Apps software and run it on my how hardware?
- My customer has built an IT operation on Active Directory services. Is IT migration to Google Apps as easy as buying an Adword?
- Who owns the risk if Google Apps fails since I’m the one billing and collecting from the client?
Google’s ‘hand is quicker than the eye’ program comes with a nice slick portal, white labeling bells and whistles, a cool training program and the power of Google’s expertise in building a state of the art system from the ground up. But don’t be fooled. Google fails just like any other IT system. What matters in this is who owns the guts of the operation; it’s who controls the data. Google is right on point when they say that centralized application delivery is the future (SaaS), but IT Service Providers need to ARCHITECT hosted solutions for their clients to perpetually demonstrate value and relevance as the cloud computing paradigm continues its takeover of IT best practices and deployment strategies. It might be the harder road to travel in the near term, but your service practice will be better for it.
I truly believe IT Service Providers CAN succeed and actually beat Google at their own game. I spoke with one of our Service Provider clients recently that believed the price of Google Apps was going to ‘win’ the market because Microsoft on premise solutions are so expensive. I said to him, “look, if your customer is not married to the features and functions of the Microsoft solution, then don’t let them become susceptible to the Google pitch.” By that I meant begin exploring hosting open source software alternatives to Microsoft. Other Service Providers are flocking to open source mail systems and productivity software suites and the control over pricing to your customers is very compelling.
Naysayers point to the fact that Google’s price of $50 per year per user is simply so rock bottom that you can’t compete if you are a regional Service Provider. Not true. At 6fusion we are helping Service Providers go to market with open source services priced the SAME as Google and we are beating them at their own game. Google sees the commodity applications as a loss leader. They aren’t interested in building their business on Apps revenue. They are interested in everything that trails the wake of productivity and email application use. IT Service Providers working with us are starting to use the very same strategy (we give them commodity utility computing infrastructure so they can compete with the likes of Google and others). And it’s smart. Any mature IT Service Provider knows full well that the bread and butter are IT management, migrations, projects and ongoing fixed fee SLA revenues.
So Google now has over 1000 employees focused on cracking the Enterprise SaaS nut and you, the IT Service provider, have a team 12 consultants and 2 sales people. Worried? Don’t be. Here is what Google will never have that you will never have: Trusted advisor status with your customer’s decision makers and more to lose if things don’t work as advertised. This is a very valuable trump card. If you play your cards right, Google (and others) should never be a real threat to your business.
Implications of the Twitter Hack for the IT Channel
One of the biggest industry news stories in recent memory happened this past week when Twitter’s back office was ‘hacked’, causing an information leak of epic proportions. When the story broke many read in stunned amazement. What I found in most of the blogs and stories I read following TechCrunch publishing the confidential documents was just like an eye-witness account to a horrific train wreck. There were plenty of stories about the shock and horror of it all. But there were very few stories that got past that and began to deal with the real questions.
In my mind, here is a real question: What the *%@$ is Twitter doing using Gmail and Google Apps?!?!
The point of this whole sordid affair, in my opinion, is not that Twitter got hacked. Software systems get hacked every day. And no, it’s not that the Cloud failed, as many mainstream naysayers hinted. The cloud did not fail.
I could not believe Twitter, a company with billions on the line and a bull’s-eye painted on its chest, chose to trust their most sensitive trade secrets and corporate documentation in the hands of a software service for which Twitter management could only have had limited control. Nobody failed here except Twitter (or Twitter’s IT Management/Advisors).
The implications for the IT service channel are clear: You can’t trust your customer’s data in the hands of third party application providers for which you cannot ultimately guide and control security and compliance.
The Twitter leak underscores the importance of maintaining 100% control over your customer’s information when making the decision to recommend a ‘cloud computing’ solution. It also shines different light on the same argument I made for IT Service Providers to avoid the trap of the Google Apps Reseller model. In that blog post, I wrote that if you chose to align with Google Apps, “You are giving up the control over the operation of your customer most important applications: Productivity and Email. Opening up your IT Service practice to Google is nothing short asking the fox to guard the henhouse.”
At the time I was writing from the perspective of protecting the information assets of the IT Service Provider. But the same argument holds true for the information assets of their customers. As a trusted advisor to your customer’s business you would never recommend they store sensitive information on a shared application system (i.e., a SaaS product you can’t control or make a party to your customer SLA). Never. Period. End of discussion. It’s not only Compliance 101, it is pure common sense. SaaS has its place in the new paradigm of cloud computing and 6fusion is a huge proponent of the multi-tenant architecture. But it doesn’t mean companies should ever disregard the principles and best practices of Risk Management.
I’m not out to slam GOOG in particular. It just seems platforms like Google Apps, or even Microsoft’s hosted Exchange and Office suite, are only geared for home consumers. I think this model has a long way to go before it is considered optimal for IT Service Professionals and their real-life business clients. It’s not about how big Google or Microsoft are or how much money they can plough into security. It is about control over the systems and data.
Let’s pause for a bit of Channel introspection: Imagine for a moment what would happen if YOU were the consultant or Managed Service Provider that recommended to the CEO of Twitter that he trust his company’s most sacred information on the Google platform, trying to shoehorn security best practices into what is, at best, a consumer price-driven product. Then imagine you got the call when the breach happened. Forget about why or how this happened. And don’t even think about pointing the finger at Google. The why or how is a moot point.
Whose precious reputation is really on the line in situations like this? Yours or Google’s?
Here’s the simple truth: After an incident like this, it would be nearly impossible to recover from the reputational damage to your IT Service operation. And Google? Well to Google, your IT Service practice would be but minor collateral damage incurred on route to their seemingly relentless quest to topple Microsoft.
The message behind the unfortunate events at Twitter are clear: IT Service Providers must trust in themselves, and their own ability to harness the cloud, in order to earn the trust of their customer, which makes aligning your cloud strategy with the Google Apps of the world a very questionable step.