Number 2 Newsmaker: Eric Gales of Microsoft Canada

Published: December 16th, 2010

Last year’s number three newsmaker of the year, Eric Gales, inched one step closer to the top with his company’s “All-In” campaign for cloud computing . Gales, who became Microsoft Corp. ‘s (NASDAQ: MSFT ) top Canadian executive only 18 months ago, surpassed Frank Clegg in the CDN Newsmakers rankings. Clegg’s best showing was number three back in 2004.

In 2010 Microsoft used the poker term “all-in” for its new cloud direction, but gambling reference aside, the difference between this year’s strategy and 2009’s Software+Services venture isn’t much.

Gales said that the journey from Software+Services to All-In with the cloud was very interesting for him personally.

“A year ago, we were talking about Software+Services and I think we found that the market was already conditioned to using the term cloud. So when we talked about Software+Services we had to explain what we meant. What’s become apparent this year is the way the world is planning out with the cloud. It’s a Software+Services world. We chose to start calling it cloud services to make it easier to respond to the way the market was evolving,” he said.

What was new about Microsoft’s cloud direction came in the form of Windows Azure and Business Productivity Online Standard suite or BPOS. BPOS is currently going through a name change to be announced sometime in 2011.

Cloud fever

More than 7,000 channel partners have already signed up for BPOS, while many

customers began adopting Windows Azure. The channel was already performing more than 20,000 BPOS trials before the annual Worldwide Partner Conference kicked off in July in Washington, DC.

In the channel, Gales told CDN that the Software+ Services strategy became a big differentiator. “We have a range of cloud services as well as on premise options and choices for rich and thin clients. The strategy has not changed but the way we tell the story has changed to say cloud services we are ‘All-In’ and our differentiator is Software+Services,” he said.

There was no stopping cloud’s juggernaut momentum in the marketplace. IDC Corp. forecasted the Software+Services market at more than $13 billion and growing to more than $40 billion by 2014. Gales reorganized Microsoft Canada resources swiftly to take advantage of the cloud opportunity that was coming.

“I had to restructure the organization to get after the cloud opportunity and we kept our head count at Microsoft Canada the same while putting more people in the field to help the channel partners get after the cloud services opportunity,” he said.

More changes were made to Microsoft’s channel program because of the cloud. Possibly the biggest change came in leadership as Allison Watson’s eight-year run as channel chief ended. She transitioned to a U.S. market role in the company and was replaced by unknown Jon Roskill .

Microsoft’s Partner Network channel program will now feature new tools, resources and sales support to help solution providers fast track customers to the cloud. The additions include a branded effort named Cloud Essentials Pack and the Cloud Accelerate Program.

One of the primary issues with cloud business for the channel is profit and sales compensation. The new program changes try to address this with a partner profitability modeler and tools that can forecast all of the possible financial outcomes of a cloud deal over a three-year term.

The Cloud Accelerate Program will have one brand for committed partners who give sales targets, business plans for new products such as Azure, Intune, Online Services, CRM Online and BPOS and get from Microsoft market place priority with solution finder.

It wasn’t all about the cloud for Microsoft Canada’s Gales. He also oversaw the launch of Office 2010 , which gave solution providers a new opportunity to go back to its customers for a wider IT refresh plan. Office 2010 was the first major upgrade since 2007.

Windows Phone 7

The other major announcement from Microsoft was the release of Windows Phone 7 . Microsoft was heavily criticized for losing a generation of users with its mobile strategy or non-strategy as was the case.

But with Windows Phone 7, the software giant took a huge step to recapture the mobility marketplace. Microsoft focused on high profile brands such as Facebook, Flickr, NetFlix and Twitter for the launch of Windows Phone 7 in November, but it also produced integration with Office and Exchange Server so that it would appeal to enterprise users. Windows Phone 7 was made available to Canadians in a variety of sleek form factors from device-makers Samsung, HTC and LG Electronics.

Gales said that he had the “good fortune” of using the Windows Phone 7 mobile operating system before the launch and was confident that it would be a seamless fit for the business user.

“If you’re a business user and you use Outlook or Office apps this is the best devices bar none. The clients on this device are incredible and we are extending it to include OneNote and Sharepoint as well as the core office apps,” he said.

Gales also said Microsoft Canada extended its development environment for the platform to make it easier for developers in the enterprise to create rich applications for the phone and extend whatever applications they have internally.

“There are two no-brainer markets for Windows Phone 7. If you have an Xbox and an Xbox Live account you want Windows Phone 7. If you’re a business user and you use Outlook you want Windows Phone 7. So we have a good starting point to have these new business conversations and expose more people to what the devices can do to make it more relevant in an enterprise context.”

Running Microsoft Canada always puts its president front and centre in the IT industry in this country, but the full commitment and the new resources to get its large channel partner base ready for the cloud opportunity its what put Gales so close to the top in 2010.

Follow Paolo Del Nibletto on Twitter: @PaoloCDN .

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