Dixons buy sharpens focus on services
Resellers unworried as group gains critical mass in SME sector
Channel players have down-played the move by Dixons Group, owner of PC World Business (PCWB), to ramp up its services capabilities following its acquisition of the UK arm of Micro Warehouse.
Dixons confirmed it had bought the UK part of the reseller from investment firm Gores Technology Group last week.
Micro Warehouse's entire European business had been auctioned off and Gores succeeded with its bid, believed to be about £82m. As revealed in CRN two months ago, Dixons Group had already signed a contract with Gores to buy the UK arm, although both firms could have been gazumped at the auction.
David Lloyd, managing director of PCWB, told CRN the deal will be finalised this week. "It is a natural analogue to our business. The Micro Warehouse brands are very strong, and although we intend to integrate the firm with PCWB, we will keep the brands as they are," he said.
"Our aim is to continue to develop our services, to be more of a complete partner to SMEs, and not just to supply a box. We want to look after their networks and offer a range of maintenance and support services."
Mike Norris, chief executive of corporate VAR Computacenter, which was rumoured to be interested in buying the reseller, was positive about the deal.
"Clearly this is a fantastic endorsement of IT resellers. (PCWB) is a very aggressive organisation and tough on its vendors. It is certainly an interesting move for the SME channel," Norris said.
Jonathan Wall, marketing director at reseller dabs.com, which officially registered an interest in the sale, told CRN: "This is really an inevitable consolidation of the market.
"In the long term this could be a threat, but in the short term we see this as an opportunity for us. PCWB has to go down the services route to bolster its margins."
Steve Wood, managing director of VAR Parity ITC, said: "Products in the market have been commoditised for quite some time, and it would seem that PCWB is looking to do the same with services."
Rachel Power, analyst at Canalys, said: "PCWB is one of the key players in the UK. But it will always be a challenge delivering services over the web, as opposed to other resellers that have the feet on the street to deliver services in person."