Speculation is swirling that hosting and cloud pioneer Rackspace could finally be on the table as an acquisition target. As the cloud wars heat up and large providers such as Amazon.com, Microsoft, and IBM look to expand capacity and market share, they'll buy rather than build their businesses.
For third-party IT providers, this wave of M&A activity is disruptive. New ownership sets off changes in channel programmes, prefigures the discontinuation of products and services, and means a need to adapt to different levels of technical and sales support.
In years past, roviders could jump to another vendor with better partnership terms and marketable technology. Unfortunately, the number of vendors is decreasing as consolidation takes its toll and, as the Kaufman Foundation reported earlier this year, the number of new tech start-ups in the US is shrinking.
Vendors are acquiring companies that provide access to technology, platforms for emerging market trends, resources such as infrastructure or staff, and - in many cases - market share. Since the beginning of the year, IBM has made two major acquisitions; Dell one; Microsoft two; Lenovo two; HP one; EMC one; and Google 13 (although several were consumer-oriented).
These are just the tip of the iceberg, as smaller vendors are consolidating and strengthening their market positions through M&A, too.
More significant is how vendors are using their acquired assets for growth. Dell is pushing its SonicWall, Quest and Wyse Technology products that it acquired since 2012.
CenturyLink is moving deeper into the cloud wars after assimilating and renaming its Savvis cloud computing business. IBM is banking its future on the success of its SoftLayer investment.
Probably the most interesting acquisition so far this year is Lenovo buying IBM's x86 server business for $2.3bn. When it closes, the deal will catapult Lenovo to the top echelon of server vendors.
Lenovo sees the deal as an opportunity to replicate the success it had when it bought IBM's ThinkPad PC business in 2005. However, HP sees the deal as so disruptive to partner businesses that it has launched a "rescue" programme.
Lenovo and HP are both right. Lenovo will have success with its server business, as it has a knack for turning lead into gold. HP is correct that the M&A will disrupt IBM partners that are forced into an ecosystem that lacks technology, certification and support elements.
What is the partner to do? Jumping to HP will solve some, but not all, challenges in products and support. But it comes at a cost:
Partners need to learn new systems, establish new channel relationships and convince customers that HP's boxes are better than IBM's, even though they told them the exact opposite in their last meeting.
Instead of jumping ship with each M&A deal, providers should invest in themselves to future-proof their businesses.
Before abandoning vendors, they should study the market prospects for the new company, understand the complementary technologies in and around the vendor's ecosystem, and do a cost/benefit analysis that compares staying and leaving.
They should engage with the new vendor as early as possible to understand the motives behind the deal, the roadmap for future development and requirements for staying in the channel.
This kind of due diligence will become part of the routine business review and planning of every solution provider as it assesses its current and future partnership prospects with a view to maintaining relevance and viability.
The channel is challenged in navigating the partnership seas. Instead of moving around with each deal, companies will have to learn to adapt to the changing landscape, make the most of the new vendor paradigm and be prepared to do it all over again with the next deal.
Larry Walsh is chief executive officer and president of Channelnomics
For more US-focused channel coverage see www.channelnomics.com
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