Google's Sitaram: Customer Success Depends On Partners

In July 2014, Google named former Cisco collaboration VP Murali Sitaram director of its global partner strategy and alliances. The expectation was that Sitaram would bring structure and coalition-building skills, and it appears he’s met that goal.

The Google Partner program now has distinct buckets and tiers, and he’s added the ability for partners to generate paper for customers consuming Google services. Early in his tenure, Sitaram increased incentives for resellers to offer Google Apps for Work. He gets that security is a significant selling point and stresses the company’s commitment to protecting data. He’s nurtured relationships with the likes of CDW, Synnex and Tech Data as well as hardware partners Dell and HPE and global system integrators, including Accenture. The company’s Chromebooks have become wildly popular in the education vertical, for good reason, and its unlocked Nexus phones provide containers to separate corporate and personal data; the native-Android OS may have a security advantage as well. Google is also doing some interesting things to make Android for Work attractive to enterprises.

As a result, he says upwards of 70 percent of customers overall are coming through partners; in some areas, notably Chromebooks, it’s almost 100 percent through the channel.

However, challenges remain. Google Cloud Platform, while considered one of the Big 3 along with AWS and Microsoft Azure and hard to beat on price, is a fairly distant third and has a reputation for being better suited to developer-centric and mega-customers like SnapChat than the typical small and midmarket enterprises that are the channel’s bread and butter, something Sitaram acknowledged. Microsoft Office will be hard to displace in these shops as well.

Then there’s the competition: IDC says spending on cloud services, hardware and software will exceed $500 billion by 2020, and IBM SoftLayer is certainly looking to bump Google from its top-three berth. Amazon recently released its WorkMail email and calendaring system to general availability and is said to be working on a partner program.{ad}

We recently sat down with Sitaram for a wide-ranging conversation, from his channel plans to the outlook for Android and ChromeOS, to advice for solutions providers looking to go global. Here is that interview, edited for length and clarity.

Channel Partners: Can you discuss your partner categories — sales, services and technology?

Murali Sitaram: A sales partner is one that might distribute in a multitier fashion, or represent a sale of our products to an end customer. They may not manage a customer through their life cycle. So companies like CDW or Synnex might distribute Chrome management platforms and Chromebooks and work with our hardware partners, like HPE or Dell.

The second example is …

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… the services partner, which is pretty much the majority of our partners. They may manage licenses, they may do deployment; they manage the customer over a life cycle, which may span decades or years. They may do upsells and resells, and they may go in and effectively help them with their cloud strategies.

The third type of partner is the tech partner, which effectively augments our platforms in one way or the other. So, for example, Smartsheet offers the ability to take Google Spreadsheets or sheets and make them smarter. There’s the ability to do things from macros to other capabilities that can be put into the platform that are built by this third party. Companies like CloudLock or BetterCloud. Salesforce is a technology partner because they integrate our products, as an example. VMware could be a technology partner. There’s a whole set of partners in the technology space that effectively fall into that bucket where we may or may not have a go-to-market strategy or interface with them, but we effectively integrate our products and offer them to our customers collectively.

CP: Let’s start with Google’s big-picture ecosystem channel strategy and what you see as the most attractive partner opportunities right now.

MS: Google for Work effectively has three or four different product lines. The major ones are Apps and Cloud. We have a large ecosystem of developers that use our Maps for Work platforms, and we have Android and Chrome that we take to businesses as well.

That’s important context, because our ecosystem is geared toward different types of use cases for that community of products.

No. 1, it’s geared toward developers — developers who extend the Cloud platform or use the Cloud platform to create their own experiences, developers who use the Maps API, developers who use Android for Work to effectively show that their applications are first-class citizens in the container world that Android represents, and developers who effectively extend apps with our Drive API, for example, to be able to embed things in different places.

The other audience, which is really the major part of this conversation, would be the go-to-market partners — the resellers. Some of them are only on the sales end; some of them provide services as well. We have a very large ecosystem, by the way. But there’s one characteristic that defines all of these partners that we work with: We call them “born in the cloud.” I’m sure you’ve heard the term before, but these guys have the skills to effectively take SaaS applications or platforms and deliver them to customers for a whole variety of use cases. A majority of our partner community has grown up with us over the last six to eight years around that. We’ve created, in our opinion, a new mode of delivery to customers in this subscription world.

CP: Can you discuss tiers and the trigger to jump from partner to premier tier?

MS: That’s the second dimension. I told you about the first dimension, which is the type of partner. The second dimension is to which tier they belong.

We really have a very simple program. We have two tiers. Most partners come into the standard tier and get a benefit where, if you’re selling apps, you get 20 percent of the license fee, and you get that in perpetuity.

To get to the next tier, which is our premier tier, you have to have …

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… a certain set of technical credentials as one requirement. For example, you need to be really good at deploying our products and building solutions on top of them. You need to be really good at sales and marketing so that you can attract the right type of customers and provide value to them. A lot of our program is based on effectively ensuring that the end customer sees value from this ecosystem; it’s less about the economics per se. But if you do all of that, there’s a benefit to you as a partner. You get 30 percent instead of 20 percent.

There are some other requirements around things like customer satisfaction. Today it’s a little bit loose, but over time we’re going to tighten that in terms of specifics and numbers and things like, “How effective are you with ensuring that customers renew with you?” Customers don’t renew if you’re not satisfying them. So it’s a proxy for us to effectively make a partner a premier partner versus not.

There’s also an economic piece, which is, you have to hit a certain threshold of bookings to be able to avail of this extra dollar benefit, and that depends on products, so it’s a little more complicated to describe.

CP: As of September, Google Drive had 1 million paying business customers, thanks largely to new security and management features. How much of that growth is thanks to the channel?

MS: In general, if you look at our customer base, there are three ways we go to market.

One is online. Customers come to us, especially the small and medium business, and buy directly from us online. There’s no human interaction. It’s provisioned and delivered to you automatically. You create a domain and everything works from that.

The second way is that you may come to us direct and want to buy from us direct. Over time, that cohort has become smaller and smaller, because the third way is that you use a channel partner to effectively bring deals and sales into the ecosystem.

So I think your question is, if you subtract the online stuff, because by definition it’s direct, we are finding that about upwards of 70 percent of our customers are coming through our channel partners. So that’s a very strong number for us, and I’ll tell you, in certain areas, like for Chromebooks, for Android, it’s almost 100 percent through the channel partner.

On the app side and in cloud, for example, you’ll find that some customers want to have a direct relationship with us. Our very largest cloud customers want a direct relationship with us because there’s no real need for a middleman. They use our platforms, their developers talk to us directly. But our goal is over time, we want all of our customers to be managed and supported through channel partners.

I would also just point out, I think the better metric to use is, we have …

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… 2 million paying businesses of Google Apps for Work. So the overall suite, there’s 2 million businesses paying us to use that.

And the majority of them come through our channel partners.

CP: In Q4, you launched initiatives to convert Microsoft Office 365 customers to the Google Apps suite by offering free use to midmarket companies until contracts end, new features, that $25 credit. How successful has that push been?

MS: It’s early days. The whole point here is that we want to offer choice. It’s not about taking something away from somebody or competing. It’s about choice for our customers, and we want to make sure that they can effectively go to these modern cloud-based platforms such as ours without worrying about any sort of vestigial contractual elements that they may have in place. So that’s really the whole push here. You could have almost any cloud-based technology in place and we can offer you options for you to move safely into this modern world.

I think that we will see over time a great benefit for customers — that’s the whole point here. And for partners as well. So we’ve engaged now; I think we’re up to about a 100 partners at the last count, that effectively are taking this program and offering it to their customers. They are super-excited about it, but it is early days.

CP: I spent some time at the Google booth at Ingram Micro’s recent partner event, and the talk was all about how Chromebooks have seen such great success in the education vertical. Are you working with partners to extend Chrome into other areas?

MS: That’s been a great story for us over the last 24 months — the education vertical. Do we go to market in other verticals as well? We do that, but we do that through our global system integrator partners – so PricewaterhouseCoopers or Accenture or Capgemini – because they work with certain verticals and they have the industrial expertise in those verticals. They’re better off supporting customers and solving problems in those verticals than we are directly. We’re a broad technology company. We build these massive platforms for billions of users. That’s what we do well. We’re not particularly good at going and figuring out what that might mean to a financial services customer. We leave that to our partners.

CP: Can you discuss the future of Chrome OS in light of Pixel C? How do you see Android tablet/PC hybrids fitting in the enterprise, and why would a solutions provider recommend Chromebook versus Android convertible?

MS: From our perspective, we see that there are going to be multiple use cases. There are certain use cases for which you need a laptop or a compute device in a traditional-form operating system, like Chrome OS. In some cases, you need a mobile operating system.

We’re going to experiment in how these things come together and what’s best for the end user. Your guess is as good as mine as to what will happen in the future, whether these things will blend or not. You see Apple …

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… doing somewhat similar things, trying to figure out what that might mean between OS X and iOS. Microsoft is doing some of the same things, although they don’t have anywhere near the presence in the mobility space. For them, it’s simpler on the desktop.

Your bet’s as good as mine, but I’ll tell you one thing: We will try different avenues to see what might be best for the end user, and five years, 10 years from now, who’s to say what’s going to happen with the operating system platforms?

I’ll also tell you that in the modern technology world, we’ve got to a point where we’ve learned that we don’t get ahead of our skis. You look at what happens three months from now, six months from now. What can we learn? Of course, we make big plays for the long term, but it’s all about use cases and trying to figure out what might be best from an end-user perspective. That’s probably the best way I can answer your question.

CP: Let’s talk hardware — what’s your preference?

MS: I bought the Nexus 6P, and I use a Chromebook as my desktop, and I tell you this Pixel device that I have here in front of me is probably the best computer I’ve ever used. The first-generation one had some issues, but the second-generation one is just absolutely amazing. I get 12 to 15 hours of battery life. It’s instantly on.

CP: The Pixel Chromebook is beautiful. The price point’s a little high for enterprises, however. I can see customers saying, if we’re paying that much, why not buy a PC?

MS: The Pixel itself is a high-end device. By the way, if you look at the Dell [Chrome] devices, the new Acer devices, they are at a price point that’s much lower than the Pixel. And they have many of the same features, the same high-definition displays. So we think that for three, four, five hundred bucks, you can get some amazing hardware that can support the same use cases. You don’t have to go to the Pixel per se.

CP: For partners that help customers with mobility, what ops do you see for Android at Work? And by the way, it’s pretty interesting to see that Apple is going to help migrate data from iOS to Android.

MS: I saw that the other day. From our perspective, it’s about customer choice, making it easy for customers to do what’s best for them, and that’s always been our philosophy. If you see any application that Google’s ever built, it actually runs better on iOS; in fact, in some cases better than it does on Android. That’s a good philosophy to have, and it’s heartening to see that other companies are looking at that as well.

For mobility, No. 1, our biggest partners in that space are the enterprise mobility management vendors, the EMMs, the MobileIrons, the AirWatches, and so on. So that’s No. 1.

No. 2, we work with application developers to …

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… make sure that they can use Android for Work to have a work mode as well as a personal mode, if that makes sense for that application. So we want to invite every application developer, whether it’s Microsoft or Salesforce or anyone. Anyone that has an application that runs on Android and has a business focus should be able to be containerized. That’s another push that we’ve been on, and now we’ve got hundreds of applications that have been certified for Android for Work.

The third part for us is to effectively ensure that as many devices as possible can support Android for Work. Android for Work was supported from Android L onward. But from our perspective, we want to make sure that more and more of these devices are available. A year ago there were only one or two. Now there’s a whole handful, tens of devices from different vendors, and over time we’ll see more.

So those are our three angles, and we work with different partners, whether they’re software developers, EMMs, and/or hardware vendors to make sure that ecosystem works effectively.

By the way, there’s a fourth, which is the carriers. We’ve got to work with the carriers to enable this continuum of applications to work seamlessly in a containerized work mode versus a personal mode as well.

CP: What impact do you think the switch to OracleJDK will have on enterprises’ willingness to go all in on Android?

MS: That’s a little bit of future story yet to be told. I couldn’t tell you how that’s going to shake out in the next versions. You read in the press about what we might do with the next version of Android with replacing the Java Kit, but it’s hard to say how that’s going to turn out in the future.

The one thing I do want to say, on the cloud platform, we bought a company called Firebase last year that provides us the ability [on Google Cloud Platform] to effectively build mobile applications as well as desktop or Web applications. And those are done with modern technologies that go into any of those platforms, whether it’s iOS or Android. I think most developers will start looking at those sorts of platform layers and not worry too much whether it’s going to be Java or what have you. So that’s another area for us to continue to invest in.

CP: Google Cloud Platform is considered one of the big three IaaS offerings, but it’s currently well behind Azure and AWS. Diane Greene has said that building a partner network of resellers and consultants is on her to-do list. How big a role will a partner ecosystem play in Google Cloud success?

MS: We think it’ll be huge. Our focus on the cloud platform has not yet been, just to be clear, the typical enterprise use case. Of course, we’ll go there over time. But it’s about those amazing experiences, startups and net-new experiences that companies of any size want to build. We’ve been great at things like storage or big-data analytics. And that’s really where our strength has been, in industries such as genomics or media. So we’ll continue to go down that path, but I think we’ll add more capability for the enterprise workloads as well.

We’re not hot on things like lift and shift. Whether you’re running …

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… SAP on one thing or another, I don’t think there’s a lot of benefit from the computer science that we can bring to that. But if you’re doing something new, if you’re building a new mobile application that connects SAP data with CRM data somewhere else, or some other data that you might have from a second or third party, then I think we deliver a lot of benefits.

So to answer your question, the ecosystem around cloud is a huge area of investment and focus for us. We introduced about 12 months ago the ability for our partners to bill directly on behalf of their customers into the Google Cloud Platform. Before that you had to go into cloud.google.com and effectively get an account, and work separately with your partner. But now you can go through your partners, and they can take care of all the billing and the management for you. And that can make a big difference for us as we go forward into 2016.

The cloud infrastructure is one element of what they may provide to a customer, so they want to effectively have one consolidated sort of paper that they provide, and so this was a huge step for us, and I think you’ll see this ecosystem mature very rapidly.

CP: Google Cloud can beat AWS on price, and that’s attractive to developers. But businesses care more about integration, the ability to run enterprise apps in a hybrid setup, essentially being an extension of the network. That’s one thing Azure does pretty well. What’s Google’s story there to help partners beat AWS and Azure?

MS: I think the way we approach it, again – maybe it’s a different philosophy – it’s about, “What is the computer science in the platform that is better than anything else that you might find?” versus us comparing ourselves with another company.

Let me give you a couple of examples. Let’s say you have a big-data analytics job, or you have some offline storage that you want to effectively store somewhere. You want to have more immediate ability to retrieve that information. We’ve got something we call Nearline, with which we disrupted the industry from a price standpoint, where you can get near-real-time throughput for stuff that’s stored offline, but at an offline or tape cost.

That’s somewhere that we led the industry, and I think others have followed. That was all in the computer science that we’ve had within our platform for quite some time. I think our partner opportunity here is to tell customers, “Look, these are things we’re good at. We’re good at very large data analytics platforms of various size. We use that internally here; we’re great at that. We’re great at effectively ensuring that the cost of what you deploy is going to be the cheapest in the industry, and we’re going to continue to drop that over time with the investments we’ve made in the back end. We’re great at looking at things like very large files or very large workloads of certain types.”

Containers [are] something that we’re awesome at. That’s something that we’ve led. People are talking about …

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… Hadoop and things like that, but in terms of data flow and so on, we’ve gone two or three generations beyond that.

So, think about the computer science – I go back to that term – we’ve put into effectively taking the platform and moving away from just simple infrastructure to something that effectively helps developers build applications more easily. We’re going to be leading in that space, and those are the sort of workloads where we will do better than anyone else.

CP: Since moving from Cisco to Google, can you compare the channel program now compared with when you came on board?

MS: I think the best thing that we did was to look at it from an outside-in point of view where we said, “What does it take to be profitable in this cloud space and this cloud world?”

And we hadn’t done that before because we were just going rapidly and we were adding partners. So taking a breath, stopping, looking at the profitability of the partner and working toward improving that by adding these multiple tiers that I talked about was something that, I think, was important for us to do.

The other thing that has changed in the two years I’ve been here is, while it was predominantly Google Apps then, it’s now more than Google Apps. We talked about Chrome and the great stuff we’ve done in education. We’ve talked about cloud. Maps — we’ve got over a million developers that know how to use our Maps APIs and the capabilities that we have there. They love the Maps platforms.

So we’ve gone from one product to more than one product. And we’ve gone from an ecosystem that effectively was more – maybe the last three or four years – dominantly small/medium business to multiple segments. I think one of your questions was, are we still SMB? We clearly are very strong in SMB, we continue to be, but by no means is that where we stop. We have very large customers, we have partners now, the GSIs, PricewaterhouseCoopers, Accenture, Capgemini and a couple of the Indian SIs that have all happened in the last couple of years.

So those are the changes and transitions. I think some part of it is working through and understanding what it takes to be successful with us. But some part of it is that our platforms are mature, and it’s helped us attract a different type of partner as well.

CP: Lots of big North American solutions providers are looking to sell in Europe and Asia. How can Google help? Do you have any particular advice?

MS: Pick the workloads or the use cases carefully and appropriately. Not every customer is ready to go to the cloud. I’ll tell you this, on the Google Apps platform, while we want every customer to avail of the magic of Google Apps, the ones that are going to see the most benefit are the ones that are willing to make cultural changes, the ones that are going to be more plural with how they share information within the companies and outside. If you’re not ready for that, what does it matter whether you have some old technology or new technology?

The other place that I’d ask our partners to be cognizant of is, what are the regulations associated with those territories they’re going into in Asia? Are there data privacy issues? Do we understand them effectively? How can we best support them?

I don’t know if you know this, but everything on our Google Apps platform, both at rest and in motion, is encrypted now. We have a very strong security posture, so we just need our partners to know that that’s something they need to reflect into the regulations of the particular markets they’re going into.

Also, if you’re doing stuff on the …

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… cloud platform, you’ve got to know, what is the impact of latency in any of those regions? How evolved are the Wi-Fi and the Ethernet and computer networks? Those are a variety of things, but those are the things to us, the end experience for the end users using whatever applications or tools is the most important. We don’t want that compromised.

CP: Anything else to tell Channel Partners’ readers?

MS: We want to make sure that every channel partner out there knows that we’re channel-friendly. We don’t have our own professional-services team. Every other company does. We don’t. We, in fact, cannot make a customer successful without a channel partner in some form or the other, unless you’re very small, in which case we just do everything automatically. That’s something we want your readers to know.

The second thing is that we have grown and matured. People often look at somebody like Google and say, “All you guys do is search.” We’ve got major ads and search and information for the platform. In terms of the enterprise space, we’re growing very rapidly. The best thing for us is that people are starting to imitate us, if you think about it. Everything is cloud. Microsoft Office is cloud now. Even Oracle offers cloud. Who started all that? Who started in the early 2000s? 2004 was Gmail; 2006 was Google Apps. That’s 10 years ago.

We’ve learned and matured through that process, so we want your readers to know that we’re a completely different space now. And we also want your readers to know this is not just one product only or something of that sort. We’ve got everything that an enterprise would need and want to use from a cloud-based platform.

The last thing I want your readers to know is how seriously we take privacy and security. The amount of investments we put in is absolutely amazing, and I challenge any company or any data center, any IT team to have better skills than we have and the talent we have to be able to securitize your data on your behalf. We’re super-good at that.

CP: There’s certainly an argument, especially for smaller and midsize enterprises, that there’s just no way they can afford the security expertise that a Google can afford.

MS: Even the large ones. There’s just no way. I was talking to a large insurance company yesterday. They’ve got 8 to 10 million insurance customers, and they have to protect the information about those customers. And they’ve come to the conclusion that there is just no way that they can do that on their own. How many people are they going to hire?

This is our business. You imagine if we get compromised, that affects everything that we do, and so we’re going to day and night put the best technical and computer science minds into it. We’ve got 500 or 600 people that are just focused on security on our platform. So even the large companies won’t be able to be able to manage that over time.

Follow executive editor @LornaGarey on Twitter.