PERSPECTIVES - Reseller viewpoint

Smaller businesses are wanting to get onto the internet, with many now setting up their own Websites. For the reseller, there are opportunities to generate revenue, particularly in the domain of value added support.

The ability of resellers to succeed in the internet market willany now setting up their own Websites. For the reseller, there are opportunities to generate revenue, particularly in the domain of value added support. depend on one factor. 'The part they play will depend on their people,' says Axel Lagerborg, strategic alliances manager at corporate ISP, GX Networks.

'As the network and data communications markets continue to expand, it's ultimately people that will provide the value added support, management, implementation and installation, consulting, service intelligence monitoring, and reporting services,' he adds.

While this may be true, the issues for resellers are extremely broad.

They must be internet-aware, but there isn't much money in connecting users to the internet - not with free services on offer. There is the potential to build infrastructures and provide bandwidth that support not only internet, but intranet and extranet, and also to deploy applications on these systems as well. But these areas mean investment in skills and there needs to be a certainty that a ROI will be delivered swiftly.

One small business reseller says that while there are great opportunities in some areas, the business of getting users connected is very limited due to all the free providers now emerging. But there are good opportunities surrounding email and the Net can also act as a catalyst for networking business in the SME market. Smaller businesses that want to connect to the Net suddenly discover they have no network and that perhaps their priorities ought to be different.

But the low level of understanding among the SME community and of internet penetration is also an opportunity in itself for dealers. Sage estimates that fewer than 20 per cent of small businesses in the UK have internet access and perhaps only three per cent have their own Website. There's a big opportunity here for resellers, according to Paul Stobart, business development director at Sage.

'We recognise that the Web is the way of the future and the only way our customers can start to enjoy the benefits is for us to get involved,' he says. 'Users are concerned, troubled, even mystified by what the internet means to them and the only way for them to find out is to get them onto it.'

Sage is offering its users free access and a free Web-building and hosting service. Stobart insists this will help smaller businesses to get started on the internet and spark more business for resellers: 'There will always be an opportunity for the genuine Vars and they have an opportunity to start to invest in their own Web design and build their own service. We will be training our customers and helping them to do that.'

Many resellers have already started to offer Web construction and design services and forged partnerships with specialist design houses. Computacenter has its own 50-strong iGroup Web team, SCC owns part of the design business TW2 - a spin-off from the Birmingham design firm Third Wave - and Lynx Technology has a tie-up with a Leeds design house.

But these are mostly corporate resellers, and the projects they undertake are usually quite large. But smaller businesses don't always need the bolt-on partner, says Gavin Steen, joint managing director of internet systems specialist and Oracle reseller partner Network Centric Solutions (NCS).

'At the moment, we partner on design and so far it has worked,' he says.

'But many customers have existing relationships with the more established design agencies. Whether we should have our own design skills is a question we will have to consider if we want to provide a more rounded service to the customer. HTML programming is easy enough but designing a Web interface is a real differentiator.'

Partnering can also work in the other direction, adds Neil Sibson, technical director at specialist internet Var, Pipeline UK. Due to its particular speciality, Pipeline has its own graphics skills and partners with companies that have key skills.

'There are some good partners out there,' he says. 'We have developed good relationships with other technology partners. One is a telecoms firm and the other is an IT company that has year 2000 compliance and enterprise management skills. They're good at stabilising systems and legacy databases - that's a good fit for us.'

Legacy support is very important, according to Sibson, as most businesses need to maintain their investment even when they get onto the Web: 'The IT skills are as vital as the design ability and the content of the Website.

Resellers and systems houses without those skills need to develop them or find a partner.

'There are a lot of sites out there designed by IT people, but the Web is primarily a sales and marketing tool and if you use it in that way there is a communications issue. IT people are not always the most lucid in that area. The second area where they fall down is in the graphics execution and sensibly getting that over on a Website.'

Partnering for content is also a good idea. 'Getting the Website content out of the client is akin to pulling teeth,' he claims. The problem with the graphics and content areas is that they add considerably to the cost of site construction and maintenance.

For businesses that need a cost-effective service, resellers might be better advised to develop their own services. What smaller customers really need, says Stobart, is something down to earth. It's not all that difficult to develop the skills either. There are plenty of authoring and publishing tools available and many programmers can adapt to HTML and even Java without much difficulty. Vendors are all too keen to train up resellers.

NCS did not find the transition to internet-based development service too problematic, claims Steen: 'We followed Oracle as it became an internet-based company providing internet-based systems. We're still learning what is required and we have taken on new skills. Oracle has helped us do that and ensured we have been at the forefront of things like Java and Jbuilder.

'It's been a huge change, particularly with Java. But Oracle has made it easy to migrate to the Net computing model with its traditional tools. With those, the transition hasn't been too difficult. Java is completely different,' he adds.

Still, resellers need to be cautious - even the construction of the smallest site costs about £4,000, says Sibson. Some individuals will do the work for much less but what the customer gets out of it is usually very basic and static. Many smaller businesses will be reluctant even to spend £1,500 on a site. 'You get a lot of people expecting to get sites up for that sort of price but you can't do a complete job,' he adds.

Jonathan Chapple, chairman of Equanet, says while the reseller might sell the services, it's not always best to provide them. Equanet's ISP - Hiway - has developed a business out of selling high-end support and does a good job, he claims - one that few resellers could hope to match.

'The know-how required is considerable in the corporate sector. It involves hub, router, gateway and in-house network upgrading.' This is just what many resellers will long for and believe they can deliver. But it does need some specialist skills.

And it's not just the Web setup skills that are required - especially in larger user companies, according to David Redden, general manager of Internetwork Management Systems (IMS): 'People are starting to distribute applications across the internet and intranet and security then becomes vital because, all of a sudden, they are running the application over a number of Lans and their applications performance also becomes absolutely key.'

In such instances, very high level skills are needed to tune the performance of the system. 'Chucking bandwidth at it does not work - it is often a case of renting the applications,' says Redden. IMS has developed particular skills in performance management - originally in networking - and extended those skills to the internet. It finds plenty of customers who need its services and little competition.

'Very few people are prepared to deliver what they promise. I'd say there are resellers that purport to operate in this market but very few have the experience and few have developed relationships with the clients. You do have to make yourself unique,' adds Redden.

There's no shortage of demand then for demonstrable skills within specialist areas of internet or Web-based work. But the sort of companies Pipeline and IMS work for are mostly larger firms with a clear need and serious budgets. Developing specialist skills is certainly worthwhile if you are addressing this market. The smaller user with broad needs requires a different approach and may not yet offer sufficient payback for many resellers.

Smaller users may be much harder to support, says Chapple: 'There's no money in setting up consumers, many of whom, egged on by half PC-literate friends, will have screwed things up on their machines long before they ask you for help. Right now, setting up a consumer on a bundle can still be a nightmare.'

It's true that many users, even in large organisations, remain blissfully ignorant of the intricacies of the Net. Even setting up accounts can be problematic - another reason why resellers have to develop a good level of competency if they're going to play in the internet sector.

'People know very little about domain names and how to manage the DNS and mail routing. We do all of that stuff. It's part and parcel of what we offer,' says Chapple.