IBM: Cloud is leaving some partners exposed

Vendor holds Influencer event at its Southbank HQ and European channel chief expresses fears that some partners may not survive the next generation computing transition

IBM is fearful that some of its channel partners’ inability to move to the cloud fast enough, as the pace of change and demands of customers continue to speed up and multiply.

Dave Kay, vice president of Business Partners for IBM Europe, was speaking at the vendor’s ‘Influencer’ event in London on how partners need to transform their business models to a higher margin version.

With a dedicated strategy centred around CAMMS (Cloud, Analytics, Mobile, Social and Security) & Commerce, Big Blue was keen to stress that its business partners play a key role in its future success. But he warned they need to keep up with the speed of change.

Kay said that on average, partners that have made the transition to the cloud early with IBM are seeing accelerated revenue growth of 2.5 times the average with the cloud, and are able to capitalise on an average of 7.6 revenue streams.

“Some of our existing partners can lead IBM to the CAMMS & Commerce goals quickly, for example many of our MSPs are doing that already.”

And this need for change was being driven by growing expectations from customers as the concept of ‘Smart Cities’ takes off, and an increasing number of businesses needing IT experts to find solutions to their IT needs, rather than focusing on technology.

Kay added that focus areas for IBM and its partners included wearable computing, mobility and security around mobile solutions and devices, and the concept of ‘cognitive’ computing which saw the launch of the Watson Content Store in January, following a $1bn investment from the vendor.

“We want partners to come along and develop mobile apps with us, with this in mind,” he said.

As customers see the rise of new board-level decision makers; and the demands for data storage and security explodes, reliance on trusted providers of IT is going to continue to grow, Kay said.

But he added that the pace at which some partners were making changes to their business models was worryingly slow.

“I look after our top 200 Business Partners across Europe, and my team deal with our distribution partners and their thousands of customers in all the territories, but my challenge is how can we help with the transition to new markets. We are sitting down with partners to see where they can make new bets and develop new skills.

“But not enough of them are making enough progress quickly and I do worry about their survival into the next era of computing,” he said. “The move towards cloud is inexorable now, IBM is a cloud solutions player in our own capability, but want to leverage our partners’ capability as well.”

And distributors did not escape scrutiny either. “We are seeing our distributors talking about what a new VAD looks like, but they are not getting there quickly enough,” he added.