IoT on tap: Avnet rolls out draught beer solution
Distributor claims it is showing partners the way on IoT with several live applications, including a proof of concept with a UK brewery
Avnet Technology Solutions has held up a proof of concept it is conducting with a UK brewery as evidence that a distributor's role in the Internet of Things (IoT) market can extend beyond marketing.
Miriam Murphy, senior vice president for the North region at Avnet TS, told CRN that the distributor has built up a 35-strong EMEA IoT team from scratch since the summer, including eight dedicated UK heads.
This represents part of a larger investment Avnet claims to be making in six specialist business units, namely IoT, datacentre, cloud, security and networking, education, and mobility.
Avnet TS is "storming ahead" with this investment strategy, even as its impending acquisition by rival Tech Data - set to complete early next year - looms, according to Murphy.
This includes creating several live IoT applications that partners can showcase to customers.
The distributor has installed sensors at its offices in Bracknell and London which monitor occupancy, air quality, light and temperature in real time, Murphy explained.
"We also have a development we are working on right now in the UK where a well-known brewing company has commissioned us to build an IoT proof of concept for them," she added.
"We are inserting sensors into their draught beer pump in pubs across the country, and in their staff bar at their HQ. I'd like to state that Avnet doesn't have a staff bar, so we are measuring meeting attendance and air quality, but the beer company is measuring flow and quantity of beer pulled, temperature and location. They are investing in this based on this generating invaluable data for them through these sensors for sales, marketing and logistics purposes.
"We are being commissioned now to develop proof of concepts like this and that's opening opportunities that are allowing us to bring partners into new opportunities."
"I would absolutely refute that we have pulled back from incremental investment in new services."
This year has seen consolidation and cost-cutting in the distribution space accelerate, leading to questions over the value-add provided by the middle rung of the channel.
Avnet TS itself recorded a 21.2 per cent annual slump in sales in its fiscal Q1 ending 1 October 2016, with falls in servers, storage and software sales fuelling the decline. EMEA sales fell 14.3 per cent.
But Murphy said the investments Avnet is making in these six business units is evidence that the distributor is not reining in its cost of sale.
"I would agree that margins are tighter, but I would absolutely refute - and certainly for Avnet that has not been the case - that we have pulled back from incremental investment in new services. It's absolutely the opposite," she said.
"The examples I gave in IoT is a brand new investment this year. The year before, and running right through this year, we have continued to invest in becoming a specialist in the security and networking space. And this year we have also built our own Flexpod by Avnet. It's an Avnet SKU, based on four standard configurations, that we can build at our facility in Tongeren [Belgium].
"That's in the datacentre space, so there are very significant growth areas even in a space which people are talking about being in some decline. I think it's a question of making a decision on where the best investment is going to be."
On the cloud front, Murphy said Avnet's recent rollout of its Cloud Marketplace has addressed some of the billing and sales recognition issues partners typically experience around cloud. Meanwhile, the distributor has signed seven UK partners to AWS in the last eight weeks, with at least three times that tally set to come on board by January.
"But I don't disagree that the opportunity will continue to be a hybrid opportunity, with on-premise and off-premise in duality," Murphy said.
Last orders
Avnet's role in the draught beer IoT project came about because the sensor vendors it works with typically don't have the capability to manage an entire IoT project and call on the distributor to bring in more vendors to complete a solution, according to Murphy (pictured). As well as the sensor vendors, Avnet also works with the likes of HDS, IBM and Informatica around IoT.
"We have integrated ourselves into the ecosystem," she said.
Even though sensors cost next to nothing, Murphy waved off the suggestion that IoT isn't a clear money-spinner for IT resellers.
"The sensors are the driver of the solution, but they are not the driver of the revenues," she said. "It's all about the services and the infrastructure. One of the things that is really interesting about this is it's about developing solutions that have repeatable delivery, which will really allow partners to gain scale and have shorter sales cycles, and there are incremental services that can be offered on the back of any analytics solution."
Murphy claimed that Avnet TS' progress in IoT, including the fact it has built its own development platform - Visible Things - was a key reason why Tech Data swooped in to buy the firm.
The deal remains set to close in the first half of 2017, Murphy said, as she dismissed claims from rivals that the impending ownership change has created a distraction for the distributor.
"We are still competing aggressively with them, as you would expect, and we will continue to do that," she said.
"We have not seen any let-up in our numbers. Of course, lots of people are trying to build insecurity and the only way to combat that is to not only say it's business as usual but to make sure our customers and suppliers are feeling that it's business as usual, and that's what our team here has been doing."