Google Cloud to Start Partner Life Cycle Compensation Approach, More
We caught up with Kevin Ichhpurani to learn more about the company’s channel efforts for 2023.
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Google Cloud positions itself as “the data cloud.” As such, Ichhpurani reviewed the company’s 2022 Data Cloud Alliance launch, which kicked off with a range of database and lakehouse vendors (which Google Cloud considers partners) as members. Ichhpurani also touched on Google Cloud’s open-source artificial intelligence development efforts and spoke of general, unnamed “new partnerships to grow our … cloud ecosystem.”
What does that mean for 2023?
“[W]e are doubling down on customer choice, and will embrace partners‘ innovation, even when their services overlap with Google Cloud’s,” Ichhpurani said.
The approach, he added, will support more innovation for end users and increase partners’ total addressable market.
Ichhpurani had more to say about data.
Every hyperscaler talks up “digital transformation,” which, frankly speaking, represents a gold mine for cloud providers. The more organizations they can get to adopt their cloud platforms, the more money they make. It’s a no-brainer. And Google Cloud, having yet to report a profit, is taking aim at helping customers “modernize in every major product area,” per Ichhpurani’s blog — aka “digital transformation.”
As such, Google Cloud now will support “all major data formats” and remove data limits for partners. Ichhpurani cited several database, business process and IT service management companies as specific examples of firms that will benefit as examples.
Presumably, all of Google Cloud’s partners will gain from the data openness. Ichhpurani did say the openness extends to “the more than 800 companies [that] have built their products on our data cloud.”
Ichhpurani told Channel Futures that an open data cloud supports a multicloud strategy and removing data limits benefits everyone, from customers to partners.
Ichhpurani also talked up Google Cloud’s cybersecurity work. He recalled the deal last year when the hyperscaler bought Mandiant for $5.4 billion. That brought deep threat intelligence services to Google Cloud’s capabilities. (And snatched away from rival Microsoft the same company it wanted to buy.)
Yet, rather than sharing solid actual strategy or intent for Mandiant when it comes to the channel, Ichhpurani said Google Cloud will ensure customers can work with “all leading cybersecurity vendors” alongside the hyperscaler. He then named a litany of those companies, which, he said, will create “new opportunities” to deliver services.
Even so, the services he cited — security posture assessments, managed security operations services and technologies that address vulnerabilities — have already been available.
Thus, it’s unclear what’s truly new with regard to Google Cloud’s cybersecurity initiatives in 2023, especially for more downstream partners such as managed service providers. Channel Futures sent an inquiry to Google Cloud requesting more insight into this area.
Here are some other bullet points for areas where Ichhpurani says Google Cloud will focus in 2023, to partners’ benefit:
• AI: Google Cloud will keep pursuing “open-source AI innovation,” Ichhpurani wrote. AI has turned into all the rage — just look at all the chatter surrounding ChatGPT.
• Google Workspace: Google Cloud will continue building this open platform “for hybrid work,” Ichhpurani wrote. That means ongoing integration with productivity and collaboration application vendors.
• ISVs: ISV partners can expect the ability to bring more of their applications and platforms onto Google Cloud, Ichhpurani wrote. We do have to point out that this does not represent a new capability — it’s a continuation of existing efforts.
Ichhpurani then brought up Google Cloud Marketplace.
Cloud marketplaces continue to grow in popularity as a way for buyers to procure services and platforms. A recent survey by cloud firm Tackle.io found that 44% of ISVs expect to transact more than 10% of their revenue through a cloud marketplace in 2023. Google Cloud must see similar promise in the approach because it’s implementing a couple different improvements on this front.
First, Ichhpurani wrote Google Cloud has increased compensation for its own sellers — read, internal sales teams — on partner applications sold via Google Cloud Marketplace. This should encourage Google Cloud field teams to push marketplace sales in tandem with partners.
Second, Google Cloud is formalizing how ecosystem partners pay one another for marketplace sales. Through its partner platform, the company is helping how, say, a security vendor extends margin to a reseller for an implementation. Or, if a customer buys directly, both the vendor offering the service and the partner reselling it earn a cut.
“There’s economics being shared across [the ecosystem],” Ichhpurani told us, adding, “Last year, resellers could transact but weren’t getting margin on, say, third-party technology. But now the ISV can opt in and determine what margin is agreed to with the reseller.”
Other Marketplace changes, per Ichhpurani’s blog, will include “accelerated solution onboarding, more granular cost management, and new governance capabilities to support customers in industries with specific procurement requirements such as the U.S. public sector.”
That part about “granular cost management” piqued our interest.
The hyperscalers have a vested interest in not actively helping end users control cloud computing costs. The more test buckets and sandbox environments left running, for instance, the more the meter ticks in the provider’s favor. And the more revenue stacks up on the balance sheets.
But as a recession looms and organizations have started to understand how much cloud computing really cost them during the pandemic-deployment frenzy, there’s been a lot of coverage about controlling expenses. End users are becoming far more aware of the need to manage their cloud environments with deliberation and attention.
That bodes very well for channel partners — MSPs and the like — but not necessarily so much for the hyperscalers themselves. Yet, the cloud providers have to look like champions for end users. For some time, each of them has delivered a cursory level of cost and optimization management, to say that they do indeed help customers keep a handle on cloud expenses.
Therefore, it’s interesting to see Google Cloud assert that it will deliver “granular” cost management in 2023. Several of its vendor partners have specialized in this area for years. Will Google Cloud buy one of them or offer something more home-grown to end users? And to what extent will the “granular” detail go? We’ll have to keep an eye on developments in this domain.
Ichhpurani did tell us that Google Cloud doesn’t look at cloud cost controls “in a negative light. We’re proactively working with the ecosystem, and always have been, to build FinOps practices for our customers.”
And that was the case “even before the current economic situation,” he added.
Overall, Ichhpurani told Channel Futures, if customers are showing return on their Google Cloud investments, “that’s what leads to them continuing to invest.”
Next up, big changes are coming to Partner Advantage.
Look for significant changes to Google Cloud’s Partner Advantage program, starting in July. The biggest headline here is the company’s shift to the much-discussed life cycle compensation approach. That means partners can choose their level of involvement in an engagement, throughout its life span, and earn corresponding compensation.
“Partners can participate in some or all of the incentives,” Ichhpurani told Channel Futures.
And that has garnered interest.
“We’ve gotten very positive feedback from partners,” Ichhpurani told Channel Futures. “They see this as the future and they like the flexibility.”
More vendors are indeed shifting to a life cycle compensation motion as they think bigger about the entities comprising the channel. VMware and Nutanix were among the first companies to enact life cycle compensation within the channel. There’s no particular reason why Google Cloud is following suit in 2023 rather than earlier, Ichhpurani told us.
“We saw this as where the industry is headed, saw this as what will enable a new category of partner that’s really important, these deep services solutions partners that in many cases want to provide their unique domain expertise,” he said.
On top of a life cycle compensation structure, partners — vendors, MSPs, system integrations, ISVs, resellers and so on — investing more in Google Cloud will get more from Google Cloud. Here’s what that looks like, per Ichhpurani’s blog:
• More “emphasis on skilled capacity and partners that invest in service capabilities.” As such, partners who “earn more individual certifications, accelerate customer deployments and successfully execute large-scale digital transformations” will get access to “some new incentives and opportunities.”
• The introduction of product family-specific tracks for Google Cloud, Google Workspace and Chrome Enterprise within Partner Advantage. “This will enable partners to advance through the program as they build expertise aligned to strategic products, grow their certified individual practitioners, and demonstrate proven success deploying these products with customers,” Ichhpurani wrote.
• Incentives “alignment.” That means rewarding partners for meeting “product-level requirements,” building “highly skilled teams” and providing “excellent services delivery,” Ichhpurani said.
Announcing these changes in January gives partners six months to earn certifications, work on product development and “demonstrate proven customer success,” Ichhpurani wrote.
Touting the growth of Google Cloud’s partner incentives and investments (those “grew by more than 50% in 2022,” Ichhpurani said), the company will “continue to reward partners” in 2023.
That’s to be expected, especially from a self-dubbed “partner-led” vendor. But here are the areas where Google Cloud says it is making “significant investments” in new resources, programs and tools to help partners expand their businesses and bring more revenue to Google Cloud:
• Account-specific bootcamps for sharing best practices.
• A new knowledge base and support desk where partners get help with technical issues.
• New “services assurances” tools “so partners know that Google Cloud’s experts are on-deck to help make their projects a success,” Ichhpurani wrote. Those new resources include internal methodologies, best practices and run books “externalized for our partners,” Ichhpurani told Channel Futures. If a partner wants to use its own tools, Google Cloud will audit those to ensure they meet the company’s specifications. “We’re pretty flexible,” Ichhpurani said.
• Expansion of the Delivery Readiness Index. This resource evaluates partners’ combined levels of certification so they can “assess their delivery readiness and assure customers they have the most delivery-ready for a specific implementation,” Ichhpurani said.
To sum up, Google Cloud is making some significant — and some more incremental — changes to its partner program for 2023. Ichhpurani said these efforts will result in “a new, world-class migration program, which will unify multiple migration-related motions into a single initiative.”
What that means is giving customers a clear path for moving to Google Cloud, which, at the same time, opens the way for partner life cycle compensation. Everyone, from Google Cloud to customers to partners, benefits. Customers often receive subsidies for migrations, which then power partner involvement, and Google Cloud increases its market share.
So, from there, Ichhpurani rounded out his Jan. 12 blog with this: “The opportunity for our partners to drive innovation and digital transformation will only grow this year.”
We would like to point out that, for partner-led companies, this is the case every year. But for 2023, Google Cloud partners will be able to take advantage of new capabilities and incentives to make that prediction come to life.
Channel Futures will continue to talk with Google Cloud’s ecosystem and channel leaders throughout the year to keep you updated.
To sum up, Google Cloud is making some significant — and some more incremental — changes to its partner program for 2023. Ichhpurani said these efforts will result in “a new, world-class migration program, which will unify multiple migration-related motions into a single initiative.”
What that means is giving customers a clear path for moving to Google Cloud, which, at the same time, opens the way for partner life cycle compensation. Everyone, from Google Cloud to customers to partners, benefits. Customers often receive subsidies for migrations, which then power partner involvement, and Google Cloud increases its market share.
So, from there, Ichhpurani rounded out his Jan. 12 blog with this: “The opportunity for our partners to drive innovation and digital transformation will only grow this year.”
We would like to point out that, for partner-led companies, this is the case every year. But for 2023, Google Cloud partners will be able to take advantage of new capabilities and incentives to make that prediction come to life.
Channel Futures will continue to talk with Google Cloud’s ecosystem and channel leaders throughout the year to keep you updated.
Google Cloud on Thursday released a nearly 1,300-word blog about changes coming to its partner program. The title alone – “Putting partners first in 2023” – caught Channel Futures’ attention. We’d like to echo Larry Walsh of the 2112 Group and Channelnomics in cautioning any vendor that considers itself partner-led to avoid such obvious declarations. Here’s what Walsh had to say in December on LinkedIn:
“A recent channel trade headline still making my head hurt: A vendor declaring to partners “We’re here for you.” First, such declarations aren’t news — especially if you’re one of the pillars of the channel. Second, it implies that they were drifting from partners or a chance they were pulling back from the channel. Third, no new information from it. It’s just a PR grab that signifies nothing. If you’re going to talk to the channel through the press, have a real message.”
Here’s our most recent list of important channel-program changes you should know. |
Google’s Kevin Ichhpurani
Luckily, Channel Futures was able to secure an interview with Kevin Ichhpurani, corporate vice president of global ecosystem and channels at Google Cloud, about that blog, attributed to him, which discusses the coming year. In his message to the channel, Ichhpurani called Google Cloud “a partner-first company” and reiterated the company’s intent to “work closely with the entire Google Cloud ecosystem” in the coming year.
One of the biggest takeaways for partners of all stripes is that Google Cloud intends to outsource all services to the channel (or ecosystem, if you want to think of the opportunity in its broadest terms, encompassing even the companies Channel Futures readers consider vendors).
A ‘Technology Company’
“We fundamentally are a technology company,” Ichhpurani told us. “Our goal is to have 100% of services attached [through partners].”
This all has to do with digital transformation, with emphasis on the services aspect. By the way, Google Cloud, like its peers, has a professional services organization. But, unlike competitors, it intends to keep that division small and partner-first. That means not going to market against partners via professional services.
“We’re committed to a 100% partner-first approach,” Ichhpurani said.
As such, Google Cloud sees its professional services organization as the arm for deep technical expertise and an ability to fit into an engagement however the customer and partner need.
Finally, the most impactful news concerns the Partner Advantage program. Think life cycle compensation, which is growing ever more imperative within the indirect channel.
See the slideshow above for more.
Want to contact the author directly about this story? Have ideas for a follow-up article? Email Kelly Teal or connect with her on LinkedIn. |
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