BT's Open Orchard proves fruitless

BT-backed reseller folded back into parent division after less than a year in operation

BT-backed reseller Open Orchard has been folded back into its parent division, BT Retail, after less than a year of operation.

A BT representative admitted the decision had been made because Open Orchard had not served the SME hosted-application market any better than its channel.

But the news has left its vendor partner, SME application provider NetSuite, needing to recruit a new country manager and sales staff just weeks before launching in the UK. Formerly known as NetLedger, NetSuite had planned to launch with Open Orchard last week.

"We began to get inklings that things were not okay around the last week in August," said Zach Nelson, NetSuite's chief executive. "We were due to launch our offerings through them last week but are now doing that independently."

Active policy management vendor Orchestria, another Open Orchard partner, said it had found out "in the last seven working days" that the reseller was "defunct".

Paul Johns, global marketing vice president of Orchestria, said: "We are working with BT to find the best way to support existing customers."

BT refused to say how many accounts had been affected or how much money it had lost, although Open Orchard boasted an initial £6m marketing budget alone.

The telco's decision to compete with its own channel was never a popular move with VARs.

At the time, David Reynolds business development manager at VAR Star Computers, said it would struggle to make ground in the SME sector because of "a lack of understanding of SME business needs".

Gordon Davies, commercial director at BT reseller Compusys, said about the recent announcement: "BT didn't research its market very well and never won the channel's confidence. I just hope it learns lessons from this."