- Reaction score
- 3,270
- Location
- Manchester UK
Dear Partners,
After many months of negotiations with Microsoft, AppRiver has decided to stop selling Office 365 in the EMEA market outside of Switzerland. This was a difficult decision, but one that was made necessary by Microsoft’s inaction on our requests to adapt its billing model to make our move into the 2-Tier CSP program successful for us and for you.
We want to make sure that you understand exactly what’s going on, why it’s happening, and what to expect going forward. Toward that end, we have created the attached Q&A for your review and use with your partners and customers.
Although we would like to continue selling Office 365, our company was built on providing rock-solid security and productivity services. We continue to see a world of opportunity in wrapping those services around Office 365 or using them in comibination with our Secure Hosted Exchange and other platforms.
You will likely have more questions than we’ve covered here, so remember that you can reach out to our team directly any time you’d like. We’ll be happy to speak with you and discuss your situation specifically.
Thank you,
Rocco Doninno
Executive Vice President
FAQs
Q: Is AppRiver still selling Office 365?
A: AppRiver will continue to sell Office 365 in the US, but will not offer the service in EMEA, outside of the Swiss market, after January 31st, 2017.
Q: Why will AppRiver discontinue Office 365 sales in EMEA?
A: The simple answer is because there is no path to profitability under Microsoft’s two-tier CSP model in EMEA given the current landscape and global billing restrictions. Large distributors and single-tier CSPs are transacting in volume and selling the service at or near cost. Added to that is continuing uncertainty over the Brexit situation and the rescritions in Microsofts intercountry billing model for global ISVs like AppRiver.Taken together, these factors make it much more attractive for AppRiver to simply focus on selling security services that add value to Office 365 rather than sell the service itself. If Microsoft changes its partner model in the future, will certainly consider offering the service then.
Q: Why wouldn’t AppRiver simply adopt the same tactics as the large distributors?
A: We’ve spent nearly 15 years building a 93-percent year-over-year customer retention rate based on the quality of our own IP and the Phenomenal Care™ white-glove service we offer our partners and customers. It doesn’t make sense for AppRiver to try to adopt a different low margin business model in order to sell Office 365. We would rather focus our efforts where there is a need for the value we add – and there is a growing need to provide a greater level of security and support around Office 365.
Q: What about your existing partners and customers in EMEA? Will you still support them?
A: Absolutely. As long as they remain partners under the syndication model, we will continue to provide the high-quality service we’re known for. However, Microsoft has indicated it will end the syndication program by July of 2017 and force partners to either become CSPs or partner with upstream CSPs. This is unfortunate for everyone who has been successful at syndication and we have been working with Microsoft to find ways to minimize the challenges it brings. Moving forward, we will offer to help our partners move to another CSP provider when they find one that is suitable
Q: Are you working with or recommending other vendors to your partners?
A: No. Our resellers are diverse and represent a broad geographic area. They know best what type of company they want to work with and we don’t want to push them toward a relationship that might not be in their best interest.
Q: Will you focus exclusively on security or will AppRiver still sell an email solution?
A: Before we were a worldwide leader in Office 365, AppRiver had established itself as a global provider of Secure Hosted Exchange. We now offer several flavors of Hosted Exchange that compete very well with Office 365 and which offer better margin opportunities for resellers. These services are hosted in our Swiss Data Center, which is the preference of many EMEA companies, so customers and partners do have a choice to move to that secure productivity platform as well. AppRiver’s Hosted Exchange includes, at no additional cost, our premium Advanced Persistent Threat (APT) protection, spam and virus filtering, and they work seamlessly with all our other security solutions. EMEA remains a strong market for Hosted Exchange, so there is still considerable opportunity to fill that need also.
Q: Why do you think security is going to be in high demand? Doesn’t Microsoft build in security to Office 365?
A: Microsoft Office 365 comes with basic email security features built in and advanced features available for an extra cost. Unfortunately, the Office 365 platform has become a very attractive target for cybercriminals who are now motivated to spend time and money to penetrate Microsoft’s security. We believe there is a growing demand for services that mitigate that risk by putting layers of security outside the Microsoft perimeter and providing a failsafe option if the service goes down. In addition, our experience shows that customers who are used to our premium security services end up requesting to add email encryption, email continuity, as well as web and network security around their Office 365 service
After many months of negotiations with Microsoft, AppRiver has decided to stop selling Office 365 in the EMEA market outside of Switzerland. This was a difficult decision, but one that was made necessary by Microsoft’s inaction on our requests to adapt its billing model to make our move into the 2-Tier CSP program successful for us and for you.
We want to make sure that you understand exactly what’s going on, why it’s happening, and what to expect going forward. Toward that end, we have created the attached Q&A for your review and use with your partners and customers.
Although we would like to continue selling Office 365, our company was built on providing rock-solid security and productivity services. We continue to see a world of opportunity in wrapping those services around Office 365 or using them in comibination with our Secure Hosted Exchange and other platforms.
You will likely have more questions than we’ve covered here, so remember that you can reach out to our team directly any time you’d like. We’ll be happy to speak with you and discuss your situation specifically.
Thank you,
Rocco Doninno
Executive Vice President
FAQs
Q: Is AppRiver still selling Office 365?
A: AppRiver will continue to sell Office 365 in the US, but will not offer the service in EMEA, outside of the Swiss market, after January 31st, 2017.
Q: Why will AppRiver discontinue Office 365 sales in EMEA?
A: The simple answer is because there is no path to profitability under Microsoft’s two-tier CSP model in EMEA given the current landscape and global billing restrictions. Large distributors and single-tier CSPs are transacting in volume and selling the service at or near cost. Added to that is continuing uncertainty over the Brexit situation and the rescritions in Microsofts intercountry billing model for global ISVs like AppRiver.Taken together, these factors make it much more attractive for AppRiver to simply focus on selling security services that add value to Office 365 rather than sell the service itself. If Microsoft changes its partner model in the future, will certainly consider offering the service then.
Q: Why wouldn’t AppRiver simply adopt the same tactics as the large distributors?
A: We’ve spent nearly 15 years building a 93-percent year-over-year customer retention rate based on the quality of our own IP and the Phenomenal Care™ white-glove service we offer our partners and customers. It doesn’t make sense for AppRiver to try to adopt a different low margin business model in order to sell Office 365. We would rather focus our efforts where there is a need for the value we add – and there is a growing need to provide a greater level of security and support around Office 365.
Q: What about your existing partners and customers in EMEA? Will you still support them?
A: Absolutely. As long as they remain partners under the syndication model, we will continue to provide the high-quality service we’re known for. However, Microsoft has indicated it will end the syndication program by July of 2017 and force partners to either become CSPs or partner with upstream CSPs. This is unfortunate for everyone who has been successful at syndication and we have been working with Microsoft to find ways to minimize the challenges it brings. Moving forward, we will offer to help our partners move to another CSP provider when they find one that is suitable
Q: Are you working with or recommending other vendors to your partners?
A: No. Our resellers are diverse and represent a broad geographic area. They know best what type of company they want to work with and we don’t want to push them toward a relationship that might not be in their best interest.
Q: Will you focus exclusively on security or will AppRiver still sell an email solution?
A: Before we were a worldwide leader in Office 365, AppRiver had established itself as a global provider of Secure Hosted Exchange. We now offer several flavors of Hosted Exchange that compete very well with Office 365 and which offer better margin opportunities for resellers. These services are hosted in our Swiss Data Center, which is the preference of many EMEA companies, so customers and partners do have a choice to move to that secure productivity platform as well. AppRiver’s Hosted Exchange includes, at no additional cost, our premium Advanced Persistent Threat (APT) protection, spam and virus filtering, and they work seamlessly with all our other security solutions. EMEA remains a strong market for Hosted Exchange, so there is still considerable opportunity to fill that need also.
Q: Why do you think security is going to be in high demand? Doesn’t Microsoft build in security to Office 365?
A: Microsoft Office 365 comes with basic email security features built in and advanced features available for an extra cost. Unfortunately, the Office 365 platform has become a very attractive target for cybercriminals who are now motivated to spend time and money to penetrate Microsoft’s security. We believe there is a growing demand for services that mitigate that risk by putting layers of security outside the Microsoft perimeter and providing a failsafe option if the service goes down. In addition, our experience shows that customers who are used to our premium security services end up requesting to add email encryption, email continuity, as well as web and network security around their Office 365 service
