Dive Brief:
- Microsoft will lean on its network of Cloud Solution Providers to offer customers free 30-day Copilot trials for up to 25 users beginning Aug. 1. The introductory 365 SKU was first extended to businesses with fewer than 300 employees through direct licensing in June and through partners as Copilot in 30 earlier this month.
- “This is a tool for distributors and the resellers they work with to serve SMB customers, give them the experiences they need in Copilot and then, at the end of the 30 days, that trial converts to a paid motion,” Nicole Dezen, Microsoft chief partner officer and CVP of global channel partner sales, told Channel Dive.
- The SMB bundle is part of a channel-focused push that includes additional investments in skilling, credentials and co-selling resources for members of the Microsoft AI Cloud Partner Program. “This is really about how we enable customers to operationalize AI across their businesses securely … through the combination of the Microsoft AI platform and the Microsoft partner ecosystem,” Dezen said.
Dive Insight:
Copilot is the tip of the spear in Microsoft’s campaign to drive AI adoption across Azure cloud services and the 365 office productivity suite — an effort the company has dubbed “frontier transformation.”
Earlier this month, Microsoft committed $2.5 billion to a new business unit that will send 6,000 technicians out to help customers with AI adoption. Microsoft Frontier Company will initially embed forward-deployed engineers with large global systems integrator partners, including Accenture, Capgemini, EY, KPMG and PwC, the company said in the July 2 announcement, a day after the start of its current fiscal year.
“Our fiscal 2027 strategy is focused on frontier transformation,” Dezen said.
Microsoft is banking on Copilot adoption, which some partners reported was sluggish among SMBs earlier this year, to unlock larger opportunities.
“Copilot is the very important entryway for most customers to AI,” said Dezen. “We talk about it as the UI for AI.”
Copilot is also reshaping how Microsoft distributes cooperative marketing funds to distributors and resellers. Moving forward, the company will direct 30% of co-op investments to partners focused on Copilot growth.
In addition to selling clients on Copilot, Microsoft wants partners to add to its army of FDEs. On Wednesday, the company introduced a Frontier Transformation Engineer credential for AI deployment architects in the mold of Microsoft’s in-house FDEs, and a Frontier Partner specialization for partners that have expertise across multiple AI and security domains.
“This is all built on the same profile and skilling methodology that Microsoft Frontier Company is using,” Dezen said. “It's really about how Microsoft scales that FDE capability to customers in every segment, every industry, every geography around the world.”
Co-op assistance is key to helping partners generate demand, according to Lisa Lawson, senior principal analyst at Omdia, a Channel Dive sister company.
“Buyers have more control in the modern customer journey and rely more on their network of trusted advisors, partners and expert networks, making partners critical to capturing customers pre-sale,” Lawson said. “Yet Omdia research shows 62% of partners invest only 10% or less in demand generation. This is why vendors must equip their partners to invest more in high-impact demand generation activities, to meet customers exactly where they are in their decision-making process.”
As Microsoft intensifies its AI efforts, the company is growing its cloud-based marketplace, which added more than 30 regions to its roster in Europe, Australia, Japan and South Africa. The expansion gives resellers more opportunities to build multiparty solutions with independent software vendors and puts Microsoft Marketplace on a par with its competitors, Omdia Chief Analyst Alistair Edwards told Channel Dive.
Multiparty private offers were only available in 3 countries — the U.S., the UK and Canada — prior to this year, Edwards said. “AWS and to an extent Google Cloud are further ahead in enabling partners to transact offers through their marketplaces globally,” he added. “Without this MPO mechanism, customers were essentially having to buy direct from third-party vendors if they wanted to procure through Microsoft Marketplace.”
The Marketplace moves also signal Microsoft’s willingness to build out its channel operations.
“With Microsoft now leaning heavily on co-sell for Marketplace, channel partners will be able to leverage the power of Microsoft’s sales force to drive momentum,” Edwards said. “Microsoft sellers are now heavily incentivized to drive marketplace billed revenue, so expect to see them prioritizing sales with partners.”
