Microsoft (NASDAQ:MSFT) apparently is preparing a Windows desktop as a service (DaaS). Code-named Mohoro, the DaaS offering apparently will run in Windows Azure. For managed services providers (MSPs), this news represents yet another inflection point: Should MSPs build their own hosted desktop services from scratch? Should they leverage a third-party solution like independenceIT, Cloud Nation, Citrix in Amazon or OS33? Or should MSPs hold out for Microsoft and hope Mohoro launches with a channel-friendly partner program? I've got some strong views on this topic.

First, let's state the obvious: Microsoft over the past three years has alienated some partners with its cloud strategy. The original BPOS (Business Productivity Online Suite) platform was not reliable and it wasn't channel friendly. The successor, Office 365, arrived in 2011 but did not allow partners to manage end-customer billing or pricing. And a more recent release, called Office 365 Open, only allows partners to manage end-customer billing for engagements of up to 250 users per company.

Give Microsoft Credit

But here's the thing: I truly believe Microsoft Channel Chief Jon Roskill is looking out for partners. I personally believe Roskill convinced CEO Steve Ballmer and the Microsoft C-suite that cloud partners needed the end-customer billing capabilities. I also believe many partners are now warming up to Office 365 -- which now has a $1 billion annual revenue run rate. Plus, Microsoft's Cloud Essentials partner program now has 125,000 members -- though it's unclear how much cloud revenue those partners drive.

Microsoft's cloud partner programs aren't perfect, but all the anecdotal evidence suggests the company continues to move in the right direction.

Inflection Point: Microsoft Mohoro Daas and Hosted Windows

So what does all that mean for MIcrosoft's desktop as a service ambitions? I think there's bad news and good news here for MSPs that want to offer Hosted Microsoft Office and Windows.

Over the past two or three years, Microsoft has proven over and over again that it's cloud services are designed first for end-customers. Then gradually, Microsoft figures out where partners can fit in and really add value.

When Mohoro arrives I suspect history will repeat itself -- but even faster. Microsoft will address the channel missteps more rapidly this time around -- but there will be missteps.

Alternative Options

Some Microsoft partners aren't sticking around and waiting for Mohoro. A few examples:

  • masterIT, an MSPmentor 501 company, is leveraging independenceIT desktop as a service technology.
  • TOGL Cloud, backed by MSPs like MJ Shoer, has built its cloud service atop OS33's platform.
  • SMB Nation, which hosts conferences for the Microsoft channel ecosystem, has been a backer of Cloud Nation. I don't know whether Cloud Nation's platform is home-grown or leverages software plumbing like OS33 or independenceIT.
  • During the Amazon Web Services Re:Invent conference in November 2012, I saw dozens of channel partners investigating Citrix-powered hosted desktops in Amazon's cloud.

Questions I'd Ask

Regardless of your path forward, I'd make sure you're asking all the hardball questions about financing and long-term channel strategies. We've already seen quite a few DaaS and virtual desktop infrastructure providers implode because their financial models (A) made no sense or (B) made it too difficult for MSPs to on-board end customers.

Before selecting any DaaS offering, I'd ask:

  • Finance: How are you financed, what's your burn rate, when will you need to raise more money, and what's your exit strategy?
  • Service Provider Licensing Agreement (SPLA): How are third-party applications like Windows and Microsoft Office supported? Does the MSP have to manage the Microsoft SPLA (service provider license agreement), or does the DaaS technology provider manage the SPLA?
  • Deployment: Where is the solution deployed? In a third-party public cloud? In the DaaS technology provider's cloud? In the MSP's data center? On-premise at the customer site?
  • Platforms: What platforms are supported? Windows? Mac OS X? Linux? Apple iOS? Google Android? And how is that support offered -- native apps or via HTML 5?
  • Pricing and Margin: Who controls end-customer pricing and how much margin can MSPs truly expect?
  • Service Level Agreements: Who is responsible for what?
  • Investment Protection: What assurances do I have that the DaaS platform will be enhanced for years to come?

Bottom Line

Microsoft Mohoro could be a game changer. Or it could be another far-off Microsoft technology that isn't ready for the channel for years to come. Either way, customers are starting to ask about DaaS -- mostly because they want to extend PC desktop application access out to tablets and smartphones.

I wonder: How many MSPs are ready to answer the DaaS question with a real hosted Windows and hosted Office solution -- right now?