Why Apple wants bigger bite of channel

19 Apr 2012

In the latest sign of a détente between Apple and the channel, it has emerged the vendor has pumped almost a million iPads through European distributors in the last six months.

Apple has traditionally been a retail-only player with notoriously strict limitations on who gets access to its stock. When the iPad was first launched, even its top-level APR partners struggled to get their hands on many of the devices, let alone mainstream IT distributors.

And the logic is noDoctor eating applet hard to appreciate. Not only does Apple feel it does not need a channel, letting every man and his dog sell its premium kit could dilute its exclusivity, thereby driving down the price punters are willing to pay.

But although Apple has a ready-made route into consumers, only the channel can provide it with reach into a corporate market it is so intent on cracking. Although iPads are now seen as viable devices for the professional, Apple needs help with implementing large bring-your-own device and IT department-led projects.

The revelation that Apple late last year poached HP PSG channel sales boss Trevor Evans to head up its channel was a first clue betraying its change in tack. This perception has only been bolstered by figures showing sales of its products through IT distribution channels in western Europe ticked up 42 per cent year on year in Q1.

According Context, some one million iPad units have travelled through IT distribution in Europe over the past two quarters. The revenue these distributors generated from iPads rose 180 per cent year on year, the analyst added.

"Apple has traditionally been much more of a retail player," said Context co-founder Jeremy Davies.

"These figures show that the company is clearly engaging more with IT channels in an attempt to get increased traction in the prosumer space across Europe."

Time for UC to get its act together

10 Apr 2012

By Doug Woodburn

You know a technology is a damp squib when even the resellers pushing it admit it's a non-starter.

DLP and VDI are among the much-vaunted technologies that have fallen short of expectations, either due to a lack of end-user buy-in or because initial products were too costly or complex.

And now, the promised land that is unified communications can be added to that list. Five or so years after it burst on the scene, UC is still a term that engenders bafflement among end users and a lack of co-operation among the major vendors is making implementations a nightmare for resellers.

Despite the fact that SIP was approved in 2000, we still live in a world where UC systems as a rule do not work together (as nicely parodied in this video).

This sorry state of affairs was recently branded as "ludicrous" by Gartner analyst Ken Agress, who wrote a furious blog on the issue in the wake of last month's Enterprise Connect show following a panel debate featuring execs from the top vendors including Cisco, Avaya and Siemens.

The UC vendors' stubbornness in going it alone is stunting adoption, he argued, particularly as enterprises increasingly look to connect to carrier services or cloud providers that are using UC solutions from a different vendor.

In a potential boon to the channel though, the interoperability will have to be provided by the firms responsible for tying the A man putting the final piece of a jigsaw togethersystems together: ie the VAR or SI, Agress argued.

However, while that may be true, if vendors don't make further headway on open standards, the potential for the channel to lose out longer term is surely far greater.

Even in instances where a vendor has tried to interoperate with its competitors, resellers are left with integration headaches that can jeopardies whole projects.

Take Avaya, whose Aura architecture features a piece of integration software that can bridge between different vendor systems. "A nice piece of software" in one reseller's opinion, but the issue here is support, in that Avaya will only support the specific integrations it has tested. Only in a minority of cases will these match the customer's exact requirements.

The bind is that the vendors refuse to support configurations outside of these pre-set templates. And neither can the VAR, as it's not them who has written the software. The customer is therefore left in limbo and will probably opt to shelve the project.

And quite apart from interoperability issues, UC is failing to resonate with end users.

Just like DLP, the cost and complexity of rolling out a true UC solution - even when it is from a single vendor - isstill viewed as a barrier to adoption by many.

This means that end users are more commonly opting for pilots and proof-of-concepts or just buying voice with the ability to do more when the business case is proved. Customers may see the benefits of IM and presence, but are usually implementing these as standalone applications, rather than bothering to roll out a wider solution.

A market once billed as the land of milk and honey for the comms channel has moved on very little in five years. The extent to which vendors cooperate and the market moves towards a clearer definition what the technology encompasses may well determine where UC is in another five years' time.

 

Sociable selling

28 Mar 2012

Almost two years ago now, the idea came up from my management team that I go on a social media course. Perhaps they just wanted to get me off the premises, but it got me started trying to talk to our customers through Facebook, LinkedIn and Twitter. Probably the most valuable insight I gained on the course was that nobody really knows what they are doing on these networks so the best thing is just to make it up as you go along.

I started on Facebook, which may seem an odd place to start as Widget UK sells exclusively to retailers and resellers not to consumers.

But we already had a group for past and present stMark Needham is chairman of Widgetaff members on Facebook which I was able to migrate into a company page. Any page with more than twenty-five followers gets allocated its own web address, which in turn made it easier to promote the new page through our monthly email shot to customers. I found very few other channel businesses on Facebook, but creating the page just seemed to flow and as time has gone by we have developed a core following of over 100 people, mostly employees, ex-employees, or staff from our customers and vendors. I add content once or twice a week which pops up in their news stream and keeps them informed about the business and its product in a more informal way than the classic email newsletter.

But of course, not everyone on Facebook is there for business. Many students from round the world clearly think it is a laugh to follow a UK distribution business. Sometimes we get two or three joining from the same university on a Friday night. One lad from Indonesia who followed recently listed his occupation as being manager of Liverpool FC. ‘Likes' from these jokers do help persuade Facebook that Widget is a brand of interest, but when I am feeling uncharitable I go around and unfriend a few.

LinkedIn automatically creates a page for any company whose employees are on the network. To my surprise I found that Widget's LinkedIn page already had 80 followers. The benefit of LinkedIn followers is that you can look at their full profiles and work out what they do. The disadvantage is that if you log on one day and notice that the number of followers has gone up, LinkedIn does not show you who the new ones are.

Looking around at the company pages of other distributors, it is clear that our competitors are only slowly working out what to do with their LinkedIn page too.

The largest distributors in the UK such as Ingram Micro seem to have provided some basic company information, but otherwise are still viewing LinkedIn as a recruitment platform, and the rest of the information they provide relates to job vacancies.

Gem Distribution and CCI Distribution have gone a bit further by listing the different services they provide, such as Gem's specialist logistics division in the Midlands.

Varlink, a distributor of hand-held data reading products based near York, has the best page I found from the channel. 26 of its employees are on LinkedIn - which must be nearly all of them - and their products page lists the principal product groups they distribute, along with email details for the salesperson responsible for that range. I congratulated Mike Pullon, the owner of Varlink, and copied everything he had done.

Many people - and this view has been aired in the Widget office - believe that using Facebook, Twitter or LinkedIn is not real work and real sales come from a proactive sales force getting in touch with customers.

While I would not for a moment discourage our sales force from getting out there in front of customers, channel sales is a people business, and the people within channel partners are on Twitter, Facebook and LinkedIn. Our job is to reach customers by whatever method they deem acceptable, which includes social media as well as by phone or by email.

Mark Needham is founder and chairman of consumer electronics distributor Widget UK Ltd. Widget is on Facebook at www.facebook.com/widgetuk, on LinkedIn at http://www.linkedin.com/company/widget-uk-ltd and on Twitter as @widget.

Apple looks to corner tablet market

14 Mar 2012

Long lines formed at Apple stores across the country and around the world last week in anticipation of the new iPad hitting the shelves. While that's precisely what Apple - and any company - wants for a new product launch, there's more to this release than just a new device.

It's the erection of a barrier-to-entry to keep would-be competitors at bay.

Apple's timing is near perfect. The device (unofficially "iPad 3") comes at the same time that Microsoft is releasing Windows 8 beta for pretesting and evaluation, which marks the ramp up of production for new tablets that will run the new operating system.

By releasing the iPad 3 now, Apple is sopping up market demand for tablets. Consumers and business users will race to buy these proven devices long before even innovative competitors such as Windows 8-powered devices hit the market in the second half of the year. The net result: Apple is making it much harder for Microsoft and its tablet partners to come to market.

While few have seen the new iPad, critics and tech enthusiasts alike have been underwhelmed. Many thought it would have a new form-factor and design features, such as a haptic response interface. The high-definition retina display, faster processor and 4G wireless are good features, but some say they're not enough to warrant buying new units.

Maybe so, but consumers aren't the technorati. Apple is delaying the pre-order release by three days because it's already sold out of its online inventory. Apple Stores across the country and around the world were bracing for long lines last weekend when the iPad hits the shelves.

Analysts expect Apple to sell more than 9 million iPads (roughly $6 billion in sales) before the end of the month. It's an impressive number that will add to Apple's fourth quarter holiday surge, when it posted $46.6bn in sales and sold 15.5m iPad 2s - more units than all other PC vendors sold combined.

The arrival of the iPad 3 doesn't retire the iPad 2. Apple is lowering the price of the basic iPad 2 to $399, which makes it more-than-competitive to rival Acer, Toshiba and Samsung tablets running versions of Android. Between the two products at different price points, Apple will continue to dominate tablet market. Apple already has a 70 percent tablet market share, and analysts do not expect that lead to slip below 60 percent over the next decade.

Microsoft is looking to claw its way into the tablet market with the much-anticipated Window 8 launch. Reviewers have given Microsoft high praise for the operating system's innovative features and the revolutionary Metro interface. Studies in the past six months indicate

Microsoft could become a serious rival to Apple by appealing to business users who want the interoperability with the legacy Windows systems.

Apple's strategy to take the oxygen out of the room before Microsoft gets to market has worked before. The iPad 2 was raced to market last year just ahead of Hewlett-Packard's ill-fated TouchPad running WebOS. While the TouchPad has many technical flaws, comparisons to the iPad had it dead on arrival. The only thing that saved the TouchPad was reducing the price to fire-sale levels.

Samsung is proving the most viable competitor to the Apple tablet franchise. The Galaxy Tab and other devices running Google Android are gaining in market share, but sales are still far behind those of the iPad - particularly in North America and Europe. Amazon appeared to have a model for challenging the iPad with its Kindle Fire, but that too has cooled since its November 2011 launch.

With the iPad 3, Apple may prove yet again that it has the technical, marketing and business smarts to stay ahead of the competition.

Lawrence M. Walsh is president and CEO of The 2112 Group, a channel strategy and business services provider, and editor-in-chief of Channelnomics, a blog on channel business trends. You can reach Larry at lmwalsh@the2112group.com and follow him on Twitter @lmwalsh2112.

Meg Whitman’s channel charm offensive

16 Feb 2012

Doug Woodburn

After the walking disaster that was Léo Apotheker, it was vital that Meg Whitman put in a star performance at HP's Global Partner Conference to win over resellers still spooked by the events of last year.

HP's decision to save Whitman's keynote for day three of the event was a controversial one, but it was worth the wait.

Whitman's 20-minute address contained three or four obvious crowd-pleasers that elicited rapturous applause from the 2,000 attendees - including UK partners such as Logicalis, Kelway, Vohkus and Softcat.

Firstly and most importantly, Whitman went to great lengths to reassure partners that she "gets" the channel, something her predecessor failed to do.

Secondly, Whitman put to bed any lingering doubts over HP's commitment to its PC and broader hardware business. Yes, HP's fastest-growing unit - HP Software - is important to the firm, but is there merely to complement the core printing, PC and infrastructure solutions that still generate 70 per cent of its sales.

Thirdly - and just as crucially for partners - Whitman signalled that HP would re-rev the R&D engines that have been left to idle over the last few years.meg-whitman-hp-ceo-global-partner-conference1

This may spark concern among investors, but if HP is to thrive for another 70 years (it turns 70 next year), a recommitment such as this to invest in HP Labs is essential.

HP had arguably become the Chelsea of the IT market, shelling out fortunes to acquire star technologies rather than developing homegrown talent itself, perhaps for a fraction of the cost (at one point, Whitman even joshed with Autonomy founder Mike Lynch about the price HP had paid for his firm).

Resellers want to know that their vendor has the ability to sniff out and develop its own IP and Whitman's soundbites on this topic perhaps earned the most vigorous round of applause of the morning.

Whitman ran for office in 2010 and clearly knows how to whip up her audience into a frenzy, insisting HP had "got its swagger back". Although she herself admitted it will be deeds and not words that will ultimately convince partners that HP is a vendor worth sticking with, making the right noises is half the battle won.

Being picky, HP's (seemingly) carefully stage-managed Q&A session stuck in the throat slightly, and Whitman's silence on HP's smartphone strategy (or lack thereof) was deafening.

But this was not enough to dampen the mood and Whitman clearly had delegates eating out of her hand. HP dearly needs a new darling of the channel and they may just have found one in Whitman.

Departing CEO has done Dixons a service

01 Feb 2012

Following the news that John Browett is to leave Dixons to head up Apple Retail in the US, an American friend emailed me yesterday in puzzlement. When he last looked, there was a large gulf between the level of service he might expect at Apple and the level of service at Dixons.

"What‘s the lowdown," he asked?

My friend is right that Dixons was a retail chain built on price not service. Its founder, Sir Stanley Kahms, gave customers low prices and then sold them extended warranties to make up his profits. Sir Stanley did not believe in any of this internet nonsense, and retired before the scale of his error became apparent.

By 2007 internet retailers were making heavy inroads into Dixons' core market. The solid balance sheet which Sir Stanley had left behind had been spent acquiring loss-making retailers across Europe, mostly in countries whose economies tanked following the financial crisis.

Mark Needham is chairman of WidgetWith the group in dire straits, John Allan and John Browett were appointed as chairman and CEO respectively. They gave away or shut the worst of the loss-making subsidiaries, and John Browett set about changing what I have heard him call the group's "ambivalent relationship with its customers" by retraining staff and refurbishing stores.

Currys and PC World, the group's trading brands in the UK are now much more attractive places to shop than five years ago. Turnover was down over Christmas, but it fell less than at competitors such as Comet or Game.

Although Amazon are hot on their tail, Dixons are still the largest retailer of electronics in the UK, and the stores which John Browett leaves to his successors are better than the ones he took over.

Mark Needham (pictured) is founder of Widget UK

EMC channel push to equal Dell hell?

25 Jan 2012

By Doug Woodburn

Not since Dell ditched its direct-only mantra last decade has the IT channel stood to benefit from such a big transfer of business from a major vendor.

The scale of EMC's announcement this morning that it is turning its back on direct sales in the enterprise segment - barring 1,000 named accounts globally - should not be underestimated.

Unlike Dell, EMC has a strong channel heritage but the volumes of business involved in this handover are still massive.

EMC also said it was throwing more resource behind its partners' traditional backyard - the midmarket - pledging to double its UK midmarket headcount to 60 this year. Together, the intiatives are designed to help it increase global turnover to $28bn by 2014.

And coincidentally it is Dell that could stand to lose the most from EMC's channel push. Ever since Dell stopped reselling EMC's storage wares last summer - instead opBoxing glovesting to focus on its own technology - the two have warred for influence in the channel. Dell has recently made headway in the storage channel but EMC's latest announcement could just give it the edge, some resellers believe.

In the UK, EMC will reserve the right to work directly with a "hard deck" of 150 giant enterprises - falling to 100 next year. It previously worked with about a 1,000 accounts in the UK and estimates the move will free up $3bn of enterprise business for its partners in this country.

That works out at a tasty $15m for each of EMC's 200 UK partners if the vendor has done its sums right, although partners are still not yet sure how these 850 accounts will be allocated.

Although EMC is no Dell, the vendor still must swifly overhaul its sales culture to ensure a smooth handover, which is why it is also updating its rules of engagement and internal sales commission structure.

And partners I spoke to were convinced that EMC has an easy job ahead of it compared with Dell.

After all, EMC does already "get" the channel, said Softcat boss Martin Hellawell.

"The channel is not new to them - they know the ropes and just see us as the best route to service a larger number of customers," Hellawell said. "Yes, some sales people will be stuck in their direct ways and it might be hard work for them to begin with, but the adjustment will be relatively small compared with someone like Dell, who saw the channel as an enemy."

Brett Edgecombe of EMC partner 101 Data Solutions also saw the announcement as the final step in a five-year journey for the vendor.

"We have been selling into one of EMC's largest accounts for four years," he said. "The customer has asked them if they will get any benefit from buying direct and EMC has told them they're better off being looked after by us."

No matter who wins - EMC or Dell - resellers hunting for a channel-centric vendor in the storage space are now spoilt for choice.

Three ways to avoid the HDD price hike

12 Dec 2011

As has been widely reported, floods in Thailand are restricting hard drive supply, leading to inevitable price hikes. Here are three ways, using storage virtualisation, the channel can help its customers hedge against this.

Rupert Collier is regional manager at DataCoreA hypervisor remains a relatively new concept in the storage world; integrated arrays combining proprietary software and hardware stacks still dominate. However, applying the same rationale to storage hardware as we are long used to seeing with server virtualisation can provide huge advantages.

1. Open up the whole market
A storage hypervisor enables choice: disk becomes just disk, regardless of the vendor badge on the front. Virtual disk pooling anonymises the resource, nullifies vendor lock-in and provides the flexibility to choose whoever you like. And choice lowers costs.

2. Consider SSD
SSD production is less affected than HDD. Using automated storage tiering, customers can assign frequently accessed data to fast solid state disk and hive off less critical data to slower, cheaper formats.

3. Sweat the assets
Virtualising storage allows customers to repurpose and/or extend the life of existing kit. Pre-caching write requests in server RAM also enables significant performance improvements which, combined with thin provisioning, could reduce physical capacity requirements. Perhaps your customer won't need new disk after all?

Ruper Collier (pictured) is regional manager at DataCore Software

 

A blog that explores the views of some of the CRN editorial team as well as guest bloggers from the channel. Do get in touch with sara.yirrell@incisivemedia.com if you are interested in being a CRN guest blogger for a week.

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