AMY BABINCHAK still remembers the first time she saw Microsoft Small Business Server. It was at the office of a company already using the solution when that firm became one of her first clients. The ready-made network-in-a-box offering made an immediate impression.
“”All you had to do to come out with a perfectly configured, error-free environment was stick in the DVD and run the setup to completion,”” says Babinchak, owner of Harbor Computer Services, an IT services firm in Royal Oak, Mich. “”It really was a pretty amazing engineering feat.””
Pretty soon, she was using SBS at every customer she supported. “”My entire business was built off of Small Business Server,”” Babinchak says.
Hers and a lot of others. Indeed, from its humble beginnings in 1997 as an edition of Microsoft’s BackOffice server suite to its introduction in 2000 as a standalone product, SBS all but defined an era in the evolution of the SMB channel.
The end of that era began in July 2012, when Microsoft announced that with its future in the cloud, it was discontinuing the on-premises Small Business Server line. Seven and a half years later, on the same day that extended support for Windows 7 expired, so too did support for the last product to bear the SBS name, Windows Small Business Server 2011.
Almost no one noticed. “”People have had a lot of time to move on,”” observes Dave Seibert, CIO of Irvine, Calif.-based solution provider and former SBS reseller IT Innovators. Many SBS partners have retired since 2012 as well, and the IT industry has changed in a thousand ways. Yet for those who once sold and supported it, SBS may be gone, but it’s far from forgotten.
“”The channel’s never really seen its equal,”” Seibert says.
Overnight Sensation
To understand why longtime channel pros speak so fondly of SBS, one must first understand what life was like before that product’s debut. The industry’s leading vendors, Microsoft included, had few if any server products specifically for SMBs, forcing would-be providers of small business networks to cobble together a domain controller, file/print services, email application, and other necessary components on their own. Worse yet, each of those systems required its own dedicated hardware. Big businesses had no problem with that model. Small ones struggled with it.
“”They didn’t have the money to buy all of those servers,”” Seibert notes.
SBS rid small businesses and their IT partners of such frustrations almost literally overnight. “”What Small Business Server did was to take what normally would have been a whole bunch of capital expense, a whole bunch of physical servers, and a whole bunch of technical time to set up all of these servers, and put it into a single SKU,”” Seibert says.
Included in that SKU were DHCP, DNS, file, print, internet, remote access, and backup services, plus Microsoft Exchange Server for email, built-in patch management, and more. “”It was enhanced monitoring that nobody had before. It was centralized management that nobody had before. It was centralized reporting that nobody had before,”” Seibert explains.
Moreover, anyone with even modest technical chops could deploy the entire package through a single, wizard-driven installation process. Suddenly, people who had been haphazardly improvising server environments had a simple, all-in-one solution from a vendor their clients respected that they could sell everywhere.
“”They got good at explaining to a prospect what the business benefit was, and they got good at configuring it, because it was the same solution configured over and over,”” Seibert notes. They made a lot of money too, he adds, because implementing SBS was typically a high-profit $5,000 to $6,000 project, followed by years of maintenance and management fees.
The channel’s never really seen it’s equal.—Dave Seibert, CIO, IT Innovators
Failing to recognize that it had a hit on its hands, however, Microsoft initially provided little support for the product. “”People were hungry for information,”” recalls Michael Klein, president of Albertson, N.Y.-based solution provider Computer Directions Inc.
Before long, those people began banding together in user groups and partner communities. Microsoft soon took notice, creating a new Small Business Specialist Community (SBSC) with a membership logo that partners could put on marketing materials. “”It was like kerosene,”” Seibert says. “”It took the momentum of all these user groups and all these community groups and just kicked it up to a whole other level.””
Into the Cloud
And then, just like that, the good times came to a close. First, in April 2012, Microsoft sparked fury among channel pros by announcing plans to ditch the SBSC in favor of a new small business competency that was far more expensive to earn and maintain. Just a few months later came word that SBS itself would be terminated as well.
“”It wasn’t just the end of the product, but the end of that era,”” Klein says.
Needless to say, partners were unhappy. “”They were back to where they were in the year 2000,”” Seibert says. “”Everybody had to come up with their own solution, and that’s pretty much how it is today.””
With one important exception, of course: cloud computing generally and Office 365 specifically. In a lot of ways, in fact, Microsoft’s prepackaged productivity and collaboration suite is the heir to the SBS throne. Yet SBS veterans see little comparison between the two offerings. SBS was an on-premises solution that nurtured face-to-face client relationships. Partners can sell Office 365 over the phone, by contrast, and install it remotely. Forget about signing rich maintenance contracts too, now that Microsoft rolls out patches and enhancements centrally overnight.
“”You log on and it’s done,”” says Harry Brelsford, founder of SMB Nation, a partner community originally devoted to the SBS channel.
Furthermore, he continues, the 6% sales commissions Microsoft pays on Office 365 seats, though perpetual, are little match for the steep project fees and $150-an-hour labor rates SBS partners once commanded. And while there are still plenty of partner communities for channel pros to join, their members don’t share as much in common.
“”They don’t have that thing that kind of knits them together that was present in the heyday of SBS,”” Babinchak says
Much has changed between Microsoft and its partners as well. “”The allegiance that was there years ago, in both directions, has softened,”” Klein says. “”People still like Microsoft, but it’s not as do-or-die as it was years ago.”” Babinchak agrees. “”They support us in completely different ways now, but it’s almost like it’s less personal,”” she says. “”Microsoft isn’t reaching down through the stack as they used to.””
Of course, the years since 2012 have been good ones for channel pros. From the continuing rise of managed services to the appearance of new markets like the Internet of Things, there has been no shortage of fresh opportunities to pursue. Even cloud computing has been a boon for those who know how to profit from it.
“”I’m glad to have moved along to the cloud,”” Babinchak says. “”The things that we can do today for our clients we couldn’t even dream of at that time.””
Yet according to Klein, those who were there will always remember the SBS epoch with more than a little nostalgia. “”The community came together, the vendors came together, the sales were there,”” he says. “”It was a great product.””
