Will Viral Adoption Model Work for Microsoft’s Solution Providers

Microsoft finally announced what everyone already knew – that they were acquiring Yammer. Yammer produces what some term an enterprise social network product. It’s Facebook for the corporation. The news broke two weeks before the deal was confirmed because someone involved was overheard talking about it in a coffee shop. When the actual announcement came down it seemed somewhat anticlimactic since even the size of the deal ($1.2B) was already pretty much known.

What struck me in the call that surrounded the announcement was how often the executives involved, including Steve Ballmer, cited the Yammer viral adoption model as a key to success. Viral adoption is a polite way of saying “we use freemuim offerings to infiltrate a corporation.” The theory is that individual users will sign up for the free version, introduce it to their departments, and from there will then spread the product throughout the company like the flu. Sooner or later, the people who run the company will catch the Yammer flu and spend big dollars in licenses. Yammer claimed to have 5 million corporate subscribers, though they declined to mention how many actually pay for the software.

The question that kept rolling around in my mind was “what about the Microsoft solution providers?” What do they think of this viral marketing? The few I spoke with recently were not thrilled. They had been using a number of other social enterprise products as overlays on top of SharePoint, so having a competing Microsoft technology was going to cause them some problems. The big issue though is the Yammer selling model. What a solution provider wants more than anything is to be a trusted advisor to their customers. They need to be the go-to for technology advice in whatever area they service. Then, they need to sell them products and services based on that advice. Viral adoption undermines that. The whole point of a viral adoption model is that technology bubbles up from the end-users. They decide ahead of time which products work best for them and spread that throughout the company. It bypasses the solution provider’s advice. This problem is only exacerbated by the Yammer cloud deployment model. Since end-users make the decision to buy without the trusted advice of their local solution provider and don’t need their techies to deploy it, what is left for the Microsoft partner channel to do?

It also sounded like this is part of a wider strategy at Microsoft, one that could end up cutting out their partner channel. Steve Ballmer himself lauded the viral adoption model and pointed out that the Yammer model was part of the overall consumerization of IT. If Microsoft begins to adopt this model across a variety of their products, this might turn into a serious problem for those whose livelihood is dependent on recommending, selling, and deploying those products.

We won’t know if this deal makes sense for Microsoft for awhile. It does if they don’t mess it up. There is no question it makes sense for Yammer’s founders and investors and most likely the company overall. Competition in the Social Enterprise is fierce and deeper pockets are needed. For the Microsoft partner channel? It looks like the road ahead will be rougher.

Topics: Enterprise Mobility