Avaya VARs to take the fight to Cisco

Avaya hopes VARs will help it win emerging business

A year after pledging to get closer to partners, Avaya claims to have trimmed the fat from its channel model and is going after Cisco with all guns blazing.

The vendor held its EMEA partner conference in Prague earlier this month. Last year’s event saw Avaya unveil plans to radically simplify its product portfolio and channel engagement and ramp up indirect revenue.

In Avaya’s 2009 fiscal year indirect revenues contributed 57 per cent of the total. The first half of the 2010 financial year has seen the channel account for two-thirds.

Avaya’s vice president of sales, Todd Abbott, told VARs at the event that Avaya would conduct three-quarters of business indirectly by the 2011 financial year, rising to 85 per cent the following year.

He revealed that 2009 revenue collapsed more than $1bn to $4.17bn, but the EBITDA of $780m was up by more than $60m on 2008. Products and services each contributed half of total turnover. Enterprise sales accounted for 51 per cent, with SME making up the remainder.

But Abbott expressed concern that just six per cent of revenues came from new products and customers.

“This is worst in class,” he said. “Other companies are at 25 to 30 per cent.”
He claimed Avaya and Cisco were “the only two” companies making money in unified communications, and asserted that he had not lost a Fortune 100 account to Cisco or Microsoft in the past year.

“Cisco is a safe bet — nobody ever got fired for choosing Cisco — but it is very proprietary,” he said. “And, fortunately for us, it has made enemies of its two largest allies around the world: HP and IBM.”

Anthony Bartolo, general manager of Avaya’s Integrated Office Communications division, claimed the small business-focused IP Office range would allow VARs to steal a march on Cisco-selling competitors.

“We are allowing partners to go after the sub-20 seat market, which has been a weak spot for us,” he said. “Cisco addresses this market with three products: we use one.”

Tony Parish, managing director of Platinum partner G3 Telecommunications, said Avaya had so far kept the promises it made last year.

“It has taken virtually zero direct business in the last year,” he said. “The management team has been there 18 months and has resellers’ trust. Previously, we heard a lot, but there was not a lot of action.”

Avaya gets channel centric
www.channelweb.co.uk/2226922