As we close our books on 2017, we start to reflect on the numbers. There are a few key performance indicators that I found particularly interesting as they represent trends and momentum in the market that I would like to share.
First of all, we added 90 more partners to the QBS network and with almost 500 partners by the end of 2017, QBS continues to be the largest network of Dynamics Partners worldwide. The reason why I think this is significant is twofold: For one, it proves that our partners see value in being in that community and take advantage of the services we as QBS can provide. But equally it means partners in the QBS network will find their opinion and concerns being represented through QBS into the Microsoft organization – at executive level. Our continued inclusion in the Microsoft InnerCircle program also affirms our voice being recognized. In 2017 we saw great examples, where Microsoft executives not only listened to the feedback provided by the community, but they also reacted and took action. The positioning and release dates for NAV 2018 and the D365 context might be the most prominent examples where QBS and other members of the Dynamics community made a difference.
We also looked into Dynasource and how our partners are taking advantage of this marketplace for IT talent. We now have 415 partners that are profiled through this service. However, to some it might feel posting projects or asking for capabilities through a marketplace like Dynasource is a bit like booking through Airbnb for first time: there is a bit of a trust issue. Hence, I find the number of 23 projects that have been posted in the community of QBS partners in 2017 to be more encouraging. This demonstrates that our partners have started to see the advantage they get by expanding their capacity or capability through a trusted network.
Then I looked into customer adds our partners had contributed to in 2017. Collectively, QBS partners added 619 more customers to Microsoft Dynamics. I think this is quite an impressive number, not only in a sense of market potential, but also it is a strong argument against our partners competitors who argue that Microsoft has no strategic interest anymore in Business Applications or NAV in particular. Adding hundreds and hundreds of net new customers each year from a single network of partners is something any business application vendor would die for 😊. But what is even more interesting is to see that the share of new customers that are entering Microsoft Dynamics through a subscription model has grown from 38% in 2016 to 45% in 2017. By now, every second new customer is choosing to not go with a perpetual license, but to pay as a monthly fee. Not only are these customers more likely to jump on a SaaS type offering, it also reminds us that we have to change our business model. Moving into 2018 and 2019, I predict that only a minority of new customers will accept traditional, perpetual on-prem type offerings.
When talking about the cloud, I also find it remarkable that now, more than 60 QBS partners are transacting licenses for Microsoft cloud offerings through the Cloud Solution Provider Program. These partners can automatically provision and bill seats for Microsoft Office 365 or Dynamics 365 through our platform. They do not need to have upfront investment in their own systems. QBS partners even enjoy the fact that the revenue they do through CSP, is also credited to their NAV license discount thresholds. Moving into 2018 we are extending our offerings to Azure and NAV Tenerife, the NAV platform will finally become available under this modern licensing platform as well.
Which brings me to my last observation. Looking into our 2017 figures, QBS started with a very clear focus on Microsoft’s NAV platform. We along with our partners will continue with this focus and not stop offerings the NAV platform. Business applications also embrace the Customer Engagement side with Sales, Marketing, Field Service and Talent. We all will take advantage of new development platforms such as Power Apps, Power BI or Flow. We are lucky to already have more than 35 partners in our network that also have a Customer Engagement or CRM background. As part of The IT Channel Company, QBS has invested in Minds United an expert in Microsoft Dynamics 365 Sales and Marketing, so we can further enable our partners to extend their business application portfolio.
With this small look into our 2017 numbers, I want to thank all of our partners again for the trust that they gave QBS in 2017 and I am now looking forward to an even more exciting 2018.