Within Microsoft's Q3 2013 earnings results (announced today), the company said Office 365 is now a $1 billion cloud business (using annual run rate figures). I'm not suggesting all MSPs (managed services providers) need to run out and start an Office 365 consulting and deployment practice. But you at least need an educated response as more customers begin to ask you about cloud suites from Microsoft, Google and others.

During the recent Tech Data (NASDAQ:TECD) Channel Link conference in Orlando, Fla., many MSPs and VARs said (A) they were interested in Office 365 or (B) seeking alternatives to the Microsoft suite. But if you really listen closely to the attendees, you could tell that major portions of the channel still haven't really studied today's market offerings. For instance:

  • Outdated Information: Some folks considered Intermedia purely a hosted Exchange provider -- without realizing that the company offers a broader cloud suite plus hosted PBX services.
  • Market Blind Spots: Other folks were seeking partners that easily shift Microsoft Office into the cloud -- without necessarily needing to deal with Microsoft correctly. Again, there are plenty of options in the market. One example includes independenceIT, which is developing a relationship with N-able Technologies (among others).
  • Stuck in the Past: Some VARs continue to lament Microsoft's decision to kill Windows Small Business Server development in 2012. In some cases I understand that frustration -- especially if you have customers in bad broadband areas that can't really leverage cloud alternatives. But in other cases, I think some VARs are simply being stubborn -- holding onto the past even as the future of IT actually becomes easy to predict.

When it comes to business productivity and collaboration software, Microsoft's Office 365 revenue milestone -- $1 billion over the past 12 months -- is a clear indication that cloud computing has shifted to the masses.

Even if you don't jump on Microsoft's bandwagon, you better have an alternative ride to the cloud bash.