CHS worries channel with DSP bid

CHS Electronics has caused disquiet in the channel by applying to be reinstated as a Microsoft delivery service provider (DSP), in the hope it will become an official distributor of both boxed and OEM software in the UK.

But existing DSPs are urging Microsoft to reject the applications on the grounds that a one-stop-shop supplier would have a competitive advantage in an already crowded channel.

Microsoft reviews its distribution contracts annually in March. Computer 2000 has also submitted a business plan seeking dual status.

Jason Rabbetts, business unit manager responsible for Microsoft OEM products at Ideal Hardware, said he was aware that Microsoft is considering taking on more DSPs and that he had spoken to the vendor to voice his concern.

'I would be disappointed if either CHS or Computer 2000 did get the franchise.

Six or seven distributors in the channel would only dilute what are already very slim margins,' said Rabbetts.

Alex Campbell, marketing manager at DSP Osmosis, agreed saying that additional suppliers were unnecessary and could compound piracy problems in the channel.

But Peter Rigby, marketing director of CHS, was optimistic: 'We are confident that we will get the contract. Up until last year, we did actually have dual status but it was removed even though we were meeting targets on both product lines.

We have been in discussion with Microsoft and it has not presented any argument saying why we should not be given access to these products again,' he said.

Axel Lagerborg, software manager at Computer 2000, said he expected to know by the end of March if its application had been successful.