The recession should have taught us all a great many lessons about managing our money how to save more, how to waste less and how to make it go further.
We are all familiar with house prices being used as an economic barometer, and in this recession they have been forced to new lows. As a result, many have argued in favour of taking money out of the housing market during the slump and investing it elsewhere while renting, until those green shoots poke through.
And this ‘rent, don’t buy’ approach applies to other things too. Car pooling schemes have grown in popularity as people look to avoid the hidden, unpredictable costs of car ownership, such as maintenance. In the IT industry, we have also seen a move towards the ‘rent, don’t buy’ model in software and even hardware acquisition.
Called variously application service provision (ASP), utility, on demand, managed services, software-as-a-service (SaaS) or cloud, there have been many flavours of ‘rentable’ computing, typically via a broadband internet connection.
Of course, widespread broadband and Wi-Fi have been major factors alongside a preference for greater mobility by workers. But the recession has hastened the take-up of such services.
The pitch is simple: business users log on and sign up for these services, that run from their browser such as Amazon.com or eBay. They do not need to worry about security, maintenance, updating or patching because that is all done behind the scenes in a datacentre. Similarly, companies do not need to buy the servers to run software applications; they effectively just rent space from somebody else.
Costs break down to a simple, often monthly, subscription fee per user. And that is it. No hidden costs, no nasty surprises when things go wrong. And there is no large upfront hit to capital expenditure to buy the software in bulk, servers to run it or integration and installation.
Little wonder that Gartner in late 2008 claimed 90 per cent of enterprises would be increasing or at least maintaining their use of SaaS.
Yet there were bleak claims about its implications for the channel. If people just need to log on via their browser then what need is there for a middleman? The channel would become redundant.
The channel’s role
But while there has been some consolidation, that prediction looks far from coming true. If anything, as cloud players step towards maturity, those who so aggressively marketed themselves as a one-click IT strategy are looking for a channel that can adapt quickly to their needs.
Even the greatest cloud vendors will find not all new business is in-bound. Many will work with resellers to bring in users and target new markets. Salesforce.com, for example, has struck a good-looking deal with BT to resell its service to thousands of the telco’s small business users.
Traditional channel resellers are finding a market for beefed-up consultancy
around cloud deployments and where they fit within large enterprises. The
multi-tenant, browser-based ideal of the cloud purists will never be the only
model of computing, so
companies of all sizes will need expert advice in making it complement existing and future elements of their IT estate.
The preference in some quarters for ‘private cloud’ -- a cloud-like offering maintained and run by the organisation itself or a dedicated outsourced partner on a single-tenant basis -- further increases the need for intelligent consultancy.
Cloud vendors are also finding value in a white-labelling approach. Some companies offer a hosted desktop both as own-brand and white-label packages. Business ISPs may resell the service to their own customers, who may never see or hear the provider’s name.
The channel is too useful, too experienced and too well established to be taken out by cloud computing. If anything, cloud vendors have had to meet changing times half-way.
Those resellers simply shifting boxes for margin may well struggle but, ultimately, the channel will evolve into a far more holistic service provider, offering strategy over simple sales.
As the property market has many secondary markets estate agents, lettings agents, property search, property management, listings web sites because consumers still need help and assistance even when renting, so software and IT services will maintain a culture for expert middlemen.
Kevin Bland is channel director for the UK and Ireland at Citrix
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