We are now exactly 1 year away from the server end of support for Atlassian server products, and customers are migrating at higher rates than ever. In the past year alone, migrations and enterprise deals in the cloud were both up more than 2x.
Marketplace cloud growth is keeping pace and then some. In FY22, gross sales of 3rd party cloud apps grew over 10 percentage points faster than sales of our own Cloud products. This offers opportunities for Marketplace Partners to access new customers and future-proof your current business in a market that increasingly favors SaaS providers.
Of course, this transition will require changes on the Atlassian Marketplace, including the end of server app sales today, on February 15 2023.
If you haven't already, start preparing your business for a cloud future. Server end of support is coming up in 2024, but migrations and cloud app installs by migrated customers will continue beyond this date:
- we expect customers to continue migrating to cloud from Data Center beyond 2024, and
- For those who migrated by the end of November 2020, we've seen a 20% increase in customers owning 5 or more paid apps post-migration.
This is a big transition, and we're in it together
Over the past two years we've published trainings, resources, guidelines and new features to help you shift your businesses to cloud.
We've also made an effort to shift how we work with you on all Marketplace initiatives, creating more dedicated time to get your feedback and work collaboratively on features and resources that impact you the most.
Your input has led to changes in scope and timeline for many of the key projects that will help us build a stronger Marketplace for cloud customers, like the Privacy & Security tab. We know we get better outcomes for partners and customers as a whole when we listen and work together.
With this in mind, we'd love to hear from you on the next phase of this transition. The timeline below represents key moments for migrations over the coming year. We currently plan to provide you with resources and guidance related to cloud shift over the next year so you can stay on track, no matter where you are on your cloud journey.
In the coming months, we plan to kick this off with a new Journey to Cloud Hub for Marketplace where you can find dedicated Marketplace Partner resources. In preparation, we've compiled several relevant resources here in the Partner Portal (available to all Marketplace Partners with at least one Paid via Atlassian app) to help you:
- build your app for cloud (if you haven't already)
- support migrating customers
- discover other programs related to cloud migrations and cloud growth
If you have any specific areas of concern or resources that you'd like us to include, please let us know via this survey, or by leaving us a comment in the Partner Portal. We want to make sure we're giving you what you need.
And of course, there are plenty of things you can do today, no matter where you are on your cloud journey.
Actions you can take today to prepare your app business for cloud
We recommend the following actions to set yourself up for success as we move toward server end of support:
Build up your cloud and Data Center app offering
When considering future app development, you can:
- build a cloud version of your app, and/or
- build a Data Center version of your app
It is essential that you at least have a Data Center version of your server app to continue selling apps on the Marketplace.
However, if you haven't done so already, we recommend getting up to speed on our cloud app development options and our cloud ecosystem investments. If you're currently blocked from building or enhancing the cloud version of your app by Atlassian's platform, you can follow the platform roadmap for developers, or reach out to Marketplace Support.
Create a plan to retain your server customer base as they migrate
If you have cloud versions of your server apps, that's great! More and more customers are migrating to cloud and assessing cloud apps as we approach the server end of support date. Nearly 700,000 app assessments have taken place in our Cloud Migration Assistants as of January 2023 – last year the number of apps assessed in our cloud migration assistants increased 84%.
We've prepared a course for Marketplace Partners on the customer migration journey and how to prepare your apps for migrating customers. You can get an overview here on the Atlassian Enablement Academy. A few highlights include:
1. Preparing your apps for migration
Apps with migration paths are 25% more likely to be marked as "needed in cloud” by migrating customers. To put your best foot forward, make sure you:
- update your apps migration endpoint via the Marketplace API
- have migration documentation to help customers migrate your app, and
- offer automated migration paths via the Atlassian Cloud Migration Assistants
2. Appealing to cost-sensitive migrating customers
Many customers need to maintain parallel instances during migration, which can be costly. We've created the following programs to ease this burden on customers:
- Cloud loyalty discounts: we are offering existing customers with 1,001+ users a discount when they migrate that can be locked in for 12 or 24 months. Upon announcing our server end of support, we quickly saw that Apps offering a loyalty discount are 20% more likely to be kept in cloud.
- Please note: This program will end this year. Annual Cloud subscription purchases and renewals dated after June 30, 2023 PT will not get loyalty discounts.
- Dual licensing: To help customers with 1001+ users avoid double-paying, we extend existing server maintenance (or Data Center) subscriptions for up to one year at a 100% discount. You can offer the same to customers using a new toggle on the Marketplace (resource available in the Partner Portal only). Migrating customers who have a dual licensing app have 33% more cloud apps in their cloud instance than those without a dual licensing app.
We also encourage Marketplace Partners with at least one Paid via Atlassian cloud app to join one of our "Pricing to Win: Cloud app pricing migration strategy for Marketplace Partners" sessions. If the session you'd like to join is full, have no fear — we will be holding more live sessions during our annual partner event, Partner Accelerate.
Easing the journey from server to cloud can increase the chances of retaining your server customers, and set you up for success in cloud.
Prepare to meet advanced cloud customer needs
As more customers move to cloud, your opportunity to grow your customer base will grow, but it's important to understand what cloud customers are looking for.
If you want to appeal to customers in cloud, building trust is essential. In our most recent enterprise customer survey, we saw that 47% of enterprise customers want more visibility and control over how data is shared with third parties. 80% of Enterprise Cloud customers surveyed reported that apps meeting their data residency requirements is very/extremely important.
To differentiate yourself for enterprise cloud customers, or customers with security, privacy and compliance needs, we recommend taking the following steps:
- Prepare information for your Privacy & Security tab
- Explore Data Residency for your Connect apps
- Learn more about our Marketplace Bug Bounty program
- Learn more about the Cloud Fortified program
- Get up to speed on legal obligations for data processing in cloud (see guidance on SCCs and DPAs)
Once you have established your app's trust posture, you can also think about advanced features to further monetize your cloud app(s). In the future, cloud apps will present new opportunities to segment and monetize your investments.
These are just some of the tools and programs at your disposal to prepare for this transition. We're committed to bringing you the information and tools you need to be successful in cloud, and we'll continue to work with you as we transition to cloud together.