Taking to the cloud
VARs are employing varying strategies to ensure that they are prepared for cloud takeoff
Going places: Resellers are being warned not to miss the cloud computing flight
The VAR community is coming under increasing pressure to embrace cloud computing, with vendors, distributors and analysts predicting bleak futures for those that resist.
High-profile names such as Microsoft and Gartner have spoken publicly on the subject over the past 12 months and the channel, it seems, has sat up and taken notice.
Blackburn-based VAR CMS Group cites the many industry warnings as a factor in its decision to take its own private cloud platform to the market.
Martin Young, managing director of CMS Group, explained: “We were hiring a suite within a datacentre and had a lot of spare space. We had heard all the noise coming from the industry about cloud and decided to put it to use that way.”
The company’s move to the cloud took 10 months, said Young, and he predicts the business derived from it will account for half of the company’s £4m turnover this year.
“We found that selling cloud requires a completely different sales approach and have had much more success discussing it at board level than with our customers’ IT departments,” he said.
The reason for that, he claims, is that IT staff are too attached to on-premises products and fail to grasp the financial arguments for cloud.
“I think there is an element of fear from the IT department that moving to the cloud will give them less to do and put their jobs at risk,” he said.
“In my experience, there are not many sales people in the reseller space capable of pitching at board level. That is something VARs serious about moving into cloud need to address.”
Multi-vendor coalition
Systems integrator MTI credits VMware, Cisco and EMC throwing their collective weight behind cloud computing as having a profound effect on its approach.
The three vendors joined forces last October under the Virtual Computing Environment (VCE) banner to provide the channel with the hardware needed to deploy private clouds through its Vblock infrastructure packages.
Ian Parslow, UK and Ireland vice president of sales at MTI, said, at the time of the launch, the firm already had a high level of accreditation with all three vendors, making its move into private cloud provision relatively easy.
“It has given us a certain degree of first-mover advantage because it is going to take time for other companies considering going down the VCE route to the cloud to get the necessary level of certification,” explained Parslow.
The company became one of the first in Europe to sell a Vblock package earlier this year, and plans to target service providers as a major route to market with the technology.
“There is a growing demand from service providers that want to be able to start or expand on their ability to deliver cloud services,” he added.
Figures released last month by analyst Gartner as part of its latest study into IT spending trends back this up. More than 1,500 IT decision makers from 40 countries took part in the study, a third of which (484) were asked for their thoughts on cloud.
Forty-six per cent of those questioned said they planned to increase their use of cloud services from external providers over the coming year. Meanwhile, 43 per cent said they expected to up their spend on private cloud provision specifically.
For VARs that do not have a datacentre, the right accreditations and/or the resources to become cloud-ready, there is the option of partnering up with someone that does. This is something in which Rise, the channel-only infrastructure-as-a-service arm of web hosting giant Fasthosts, specialises.
Winning teams
The company, launched in March, allows partners to resell white-label, cloud-based applications to end users.
Alex Hilton, channel sales director at Rise, said its services have attracted a broad cross section of partners since its launch.
“The breadth of organisations we work with spans from the large-account, transactional resellers to systems integrators and every type of VAR that falls between the two,” he said.
“We have had partners come to us who have a datacentre of their own, but want to offload it because of the cost involved with maintaining the facility.”
Hilton said that as well as providing partners with product, the company also gives them guidance on how to go about making the sale.
However, while CMS advocates bypassing the IT department and heading straight to the boardroom, Hilton advises partners to try a more neutral approach.
“The cloud pitch involves a technical conversation wrapped up with a strong financial proposition, which calls for insight from both the technical side of the business and the ones that control the budget,” he said.
David Chalmers, chief technology officer for enterprise storage, servers and networking at HP, said he would not be surprised to see VARs partnering with each other to deliver cloud services in the future.
He said: “If one reseller has a specialisation in market A but no cloud proposition and another has a strong foothold in market B offering cloud solutions, would it not make sense for them to work together to increase their overall share of the market?”