Few firms would choose to be in third-party maintenance at the moment. There's no doubt that smaller traditional desktop third-party maintenance suppliers are being squeezed between the pincers of the big manufacturers and the reseller channel.
Compaq has just appointed 12 systems service providers (SSP), resellers which will provide support and maintenance for application servers. Compaq openly admits that the move is aimed at taking it from being a PC-only company into a mid-range player. The move is bound to put pressure on third-party maintenance companies as the reseller channel begins to eat into their market share.
The other threat to these firms comes from the likes of Digital, IBM and ICL Sorbus, which, according to market research company Input, dominate the European market for multivendor support services with a 25 per cent share.
Input has further bad news for independent maintainers. In a report, The Influence of Support on Software Product Selection, Europe 1996, it says PC support costs have been escalating while the cost of products has fallen and software product vendors 'can be expected to increasingly use support as a means of gaining competitive advantage'.
Up until six years ago any customer looking for maintenance had two choices: to go to the supplier of the kit or to use a third party. A hardware manufacturer supplying maintenance contract ensured that the maintainers knew the kit inside out and had the expertise to fix any problems. It also (usually) had ready access to any spare parts required and could call on the services of others in a large organisation.
There were disadvantages. For example, parts became difficult to maintain if a hardware fault was discovered in a piece of kit that was the result of a problem with mass production techniques or poor quality assurance on the part of the maker. Manufacturer-led contracts also tended to be more expensive than those of third-party suppliers and manufacturers would also only maintain their own kit. In a mixed vendor environment this meant the customer had to have several maintenance agreements running at the same time.
The main benefit of using third-party suppliers, other than cost, was that in general they offered a cross-platform service. While it is true many of these companies - such as IBM, Digital, ICL and Hewlett Packard - specialised in one particular area, they were usually flexible enough to be able to offer expertise in other areas even if they had to subcontract to another specialist.
Maintenance revenues represented a considerable slice of turnover for manufacturers and they had no wish to preserve the life of a rival's kit.
One reason why third-party suppliers were successful lies in the fact that they were often brokers which bought up second-hand kit, stripped it down, rebuilt a new box and sold it on. Those parts of the system not used would be kept for spares.
But third-party firms often found it difficult to get new spare parts from manufacturers, which in some cases could limit the service they offered.
Because in the main they were also small companies, they could not afford to employ, train and retain staff across a range of platforms on the off-chance of picking up a contract.
Circumstances have changed since then: the future is looking bleak for many third-party maintenance companies. The recession put greater power in the hands of the customer and forced a change in the arrogant attitude of suppliers like IBM, Digital and ICL.
The move towards open systems assisted the trend. Customers were no longer dependent on one vendor and were able to demand that if their major supplier wanted a support contract then it had to be able to maintain all machines. With both hardware sales and prices falling, the manufacturers readily agreed, seeing cross-platform maintenance as an alternative source of revenue.
'There are still niche market opportunities for smaller, specialist third-party maintainers,' says Input consultant Paul Connolly. 'There will always be companies that operate at a strictly local level but some of their business is being subsumed into the channel. A lot of resellers have their own maintenance capabilities or a link with a local supplier.
A lot of third-party suppliers have either been taken over or have gone to the wall.'
Some small companies are surviving by offering what Connolly describes as 'fourth-party maintenance' - swapping one piece of hardware for another so that a failed device can be sent back to the workshop and fixed at leisure.
Computacenter, one of the SSPs accredited by Compaq, has always had a maintenance arm, mainly to support its own customer base. 'The latest accreditation is Compaq's way of saying that we have worked with these people and are assured of their quality,' says head of marketing Martin Hellawell. 'Customers have to listen to a lot of different marketing stories and it is often hard for them to distinguish which are the best suppliers.'
He believes that the days of the third-party maintenance company are numbered unless it has a specialisation - without one, only the larger companies will survive.
'Scale is increasingly important,' he says. 'Margins have gone right down and it is the old tale of get big or get out.' Hellawell believes that the maintenance of the giant PC networks which now run critical business applications in the corporate environment is comparable with those companies a decade ago which maintained mini and mainframe systems.
Paul Gardner, integrated logistics service and support director for Compaq, does not believe the day of third-party maintenance supplier is over, but he acknowledges that its role has to change.
'We have space for third-party maintenance firms in the SSP programme and some of the leading ones have applied to join,' he says. 'We had a clear objective as we went forward to move from being a PC company to a computer company and produce more products that talk to data-centre systems.
'Our customers were asking us how does the service operate with an independent business model of which you are the arch-proponent.'
In effect, Compaq's customers are asking that the company, which now aspires to become a supplier of systems to rival mid-range system vendors, guarantees the same backing that they have from the Digitals and HPs of this world.
Compaq invited its top systems resellers to apply for accreditation for the SSP programme and about half the number of applicants passed the tests. The company then went through a similar process with third-party maintainers.
But Gardner insists the programme was introduced at the behest of customers. 'The conversations that I am having with our large accounts are very illuminating. They are saying
Vendor's announcements include AI-powered Microsoft Office, a move away from password verification and an alliance with Adobe and SAP
Vendor claims hackers are hijacking machines to mine for cryptocurrency
Nearly half of SMBs are planning to invest in digital workflows to reduce their paper-based processes by 2025, according to Quocirca
The charter has pulled together the biggest names in tech in an unprecedented attempt to address the tech industry's lack of diversity. Tom Wright asks how it plans to do it