Cloud Marketplaces and Co-Sell: What AWS, Azure and Google Cloud Mean for Channel Teams

What actually changed for channel teams

Cloud marketplaces and hyperscaler co-sell have quietly rewired parts of the technology channel. The transaction increasingly runs through AWS, Microsoft or Google Cloud rather than through a traditional distributor and reseller, and the hyperscaler's own sales team has become a partner you co-sell with. For channel teams this is both an opportunity and a threat — a vast new route to market, and a real risk of being disintermediated if you treat it as someone else's problem.

The confusion usually comes from conflating two different things. A marketplace is a transaction and billing rail: a catalogue where a customer buys and deploys software through their cloud account. Co-sellis a selling motion: the hyperscaler's field team working alongside a vendor or partner to win the deal. They often work together, but they solve different problems, and a channel strategy that ignores either one is incomplete. This guide explains both, what they do to traditional resale, and — importantly — where MDF and funded marketing activity still fit. It builds on the types of channel partners, especially ISVs and distributors.

How cloud marketplaces work

The three major hyperscalers each run a marketplace — AWS Marketplace, the Microsoft commercial marketplace (spanning Azure Marketplace and AppSource), and Google Cloud Marketplace. In each, a software vendor lists a product and customers can transact and deploy it through their existing cloud account. Several features explain why customers and vendors have embraced them:

• Consolidated billing.The purchase appears on the customer's existing cloud bill, removing a new procurement and vendor-onboarding cycle.
• Commitment drawdown. Many customers have committed a minimum spend to a cloud provider. Eligible marketplace purchases can count against that commitment, which gives buyers a strong incentive to buy software through the marketplace rather than direct.
• Private offers. Vendors and partners can negotiate custom pricing and terms privately and transact them through the marketplace, so it is not only a self-service catalogue for small deals — large, negotiated enterprise deals flow through it too.
• Channel participation.The providers have added partner or reseller mechanisms (such as AWS's Channel Partner Private Offers) so resellers can transact on a customer's behalf through the marketplace rather than being cut out.

The net effect is that the marketplace becomes the path of least resistance for the customer — which is precisely why channel teams need a deliberate position on it.

What co-sell actually means

Co-sell is where a hyperscaler's own sales organisation collaborates with a software vendor or partner to win a customer deal — sharing opportunities, aligning account teams, and pursuing the deal together. Each provider runs a version of it: AWS through its co-sell motion and APN Customer Engagements (ACE), Microsoft through co-sell in Partner Center, and Google Cloud through Partner Advantage.

The appeal is obvious: a hyperscaler field team has reach, budget and customer relationships few vendors can match, and a genuine incentive to see more of their platform consumed. Getting it working, though, takes real effort — a listed and transactable offer, registered opportunities the provider's sellers can act on, solutions that demonstrably drive cloud consumption, and the certifications or competencies that earn priority. Co-sell rewards vendors who show up as a serious ecosystem participant, not those who list an offer and wait.

The effect on traditional resale

For channel teams, the important question is what this does to the classic two-tier distributor-and-reseller model. The honest answer is: it reshapes it rather than replacing it, and the direction matters.

• The transaction can bypass the traditional channel. If a customer buys directly through a marketplace, a distributor and reseller can be cut out of the deal economics unless they are deliberately built into the motion.
• Distributors are adapting fast. Many now operate their own cloud marketplaces and provisioning platforms, positioning themselves as the aggregator between hyperscalers, ISVs and resellers rather than being disintermediated.
• Value shifts from transacting to advising.As the transaction commoditises, the partner's value moves to what a marketplace cannot do — solution design, integration, managed services and trusted advice. This favours SIs, MSPs and ISVs over pure-play box movers.
• Alliances become central. Winning here looks less like linear reselling and more like building strategic alliances across an ecosystem.

Where MDF fits in a marketplace and co-sell world

A common misconception is that marketplaces and co-sell make partner marketing funds irrelevant. They do not. The marketplace changes how a deal transacts and bills; it does not generate the demand that fills the pipeline in the first place. That demand still comes from campaigns, events, content and enablement — precisely the activities MDF funds.

In practice, MDF and co-op sit alongside the hyperscalers' own partner funding programmes. You may be co-investing with a distributor, an ISV and a cloud provider in the same motion, each with its own funding, rules and claims. That makes attribution harder, not easier: when a deal closes through a marketplace after a co-sell effort, several parties will reasonably claim influence, and untangling which funded activity actually drove the pipeline is a genuine measurement challenge. Being able to track funded activity through to marketplace and co-sell outcomes is exactly the problem our MDF Intelligence Platform and MDF programme optimisation work are built to solve.

Getting your channel ready

Making marketplaces and co-sell work is a go-to-market design decision, not a listing exercise. A few things separate the vendors who benefit from those who merely have a listing:

• Decide the motion, not just the listing. Be explicit about which deals go direct through the marketplace, which flow through resellers via channel private offers, and which are co-sold with the hyperscaler field team.
• Protect your partners' economics. Build resellers and distributors into the marketplace motion deliberately so the new rail complements the channel rather than cannibalising it.
• Enable for consumption, not just resale. Co-sell rewards solutions that drive cloud consumption; enable partners and align incentives around that, not only around a one-off transaction.
• Keep generating demand. The marketplace is a checkout, not a demand engine. Fund and run the through-partner marketing that creates the pipeline.

Where to start

If cloud marketplaces and co-sell are not yet part of your channel plan, start by mapping how your customers actually want to buy and where the transaction is already drifting. If buyers are pushing purchases onto their cloud bill, a deliberate marketplace and co-sell motion is no longer optional — the only choice is whether you design it or have it happen to you.

From there, decide how the motion coexists with your resellers, how you fund the demand around it, and how you will measure it. This is core go-to-market strategy and partner-led growth work, and it becomes especially important as you scale into new regions — which we cover in expanding across EMEA through the channel. If you want a specialist to help you design a marketplace and co-sell motion that strengthens your channel rather than undercutting it, that is exactly what we do.