What might we expect from the channel's biggest vendors in 2019?

Tom Wright looks at what's on the biggest channel vendors' agendas this year

Microsoft

Satya Nadella is frequently credited with reviving an ailing Microsoft since taking over as CEO in 2014, but the recovery is arguably now completed, with Microsoft finishing the year as the most valuable company in the world for the first time since 2002.

2018 was not a year of radical announcements for the vendor, but more about developing existing strategies.

The Microsoft Inspire partner conference in July was relatively announcement-light, but saw Microsoft push the likes of Microsoft 365 and Teams, and we can most likely expect 2019 to be similar.

Microsoft 365 in particular will be pushed hard. On an earnings call last October, Nadella said the service - which bundles Office 365, Windows and other products - is now a multibillion-dollar business and certainly one that Microsoft sees at the forefront of its offering.

This push will certainly involve the channel, with Microsoft claiming that partners can earn 60 per cent more than by selling Office 365 on its own.

In addition, at the end of last year the vendor tentatively launched Microsoft Managed Desktop (MMD) in just two countries - the UK and the US. Canada, Australia and New Zealand are set to receive the package early this year. MMD is a monthly subscription service offering DaaS, Microsoft 365, device management and software updates.

The vendor will also continue to push its collaboration service Microsoft Teams, which is reportedly now used by more businesses than Slack is.

Finally, the cloud will obviously continue to drive Microsoft as adoption continues. UK Partner boss Joe Macri recently told CRN that the vendor saw 20 per cent of its UK growth last year come via its Cloud Solution Provider programme, which was overhauled in 2018.

Microsoft will also look to bolster its ISV ranks and push partners to build intellectual property on top of its platform, including Azure, Dynamics and AI, he said.

Cisco

Cisco CEO Chuck Robbins is credited with rebooting the networking vendor after taking over from John Chambers in 2015, doubling its share price in the process.

Robbins has led Cisco through a transition phase, which has at times caused short-term pain - another batch of job cuts was made public in November, adding to a 1,100 cull in 2017 and a 5,500 batch in 2016. But that isn't to say the vendor is struggling - in fact, the mood in the Cisco channel is overwhelmingly positive.

Cisco's shift away from traditional hardware sales and towards software subscriptions has been viewed positively by the channel, with partners at the vendor's Bahamas and Las Vegas events last year praising Cisco's newfound clarity and focus.

Partners that have embraced this shift quickly, including Natilik and CAE in the UK, are reaping the rewards, but Cisco will push its partners hard towards change this year.

Recently appointed global channel boss Oliver Tuszik recently told CRN that partners need to assess if they are still relevant to their customer bases, while his predecessor Wendy Bahr said that even partners still thriving selling traditional hardware need to change their business models.

Cisco also made bold claims at its partner conference last November, heralding a new era for the networking industry as it made a range of its security products available across its SD-WAN portfolio. Partners should expect these offerings to be at the forefront of Cisco's strategy this year.

Product sales still make up around three quarters of the vendor's revenue, but this split will likely become more balanced over the coming months.

HP Inc

The PC and printer side of the original Hewlett Packard will undoubtedly continue its expansion into the managed services and device-as-a-service (DaaS) markets in 2019.

The biggest announcement from HP Inc last year came in its acquisition of UK-based Apogee, which is considered the largest managed print partner in Europe.

Acquisitions of channel firms by vendors is not uncommon in the print space, but even by these standards this deal was huge, valuing Apogee at ￡380m.

This year will likely see HP continue to push its managed print services towards its channel partners which, it stressed, will get the same treatment as Apogee. But the model isn't restricted to printers, with HP's UK channel boss Neil Sawyer telling CRN that the vendor is seeing "extreme" interest from the channel in its DaaS offering.

Some analysts claim the DaaS model will account for one in six PCs shipped by the year 2020, so expect to see HP touting the benefits of its own options to the channel.

The vendor has also said it will look to its managed print partners to expand their offerings into other devices. DaaS may be relatively scarce in some areas of IT, but print partners will be used to contractual-led sales and therefore will have the processes in place.

As part of this, HP said it may look to widen Apogee's reach outside its typical printer space and into PCs.

Dell

Headlines involving Dell were dominated by its winding round back to public life last year, culminating in a listing on the New York Stock Exchange just before the new year.

While the goliath has been criticised by some for placing its bet on legacy technology, following its acquisition of EMC, it has excelled in these areas and, according to analyst figures, has risen to the top of the pile in many.

Dell was crowned the largest global server vendor in the world by IDC last year after overtaking HPE, while also surpassing its Palo Alto-based rival in the storage market.

But for some, questions remain over Dell's credibility in emerging technology areas such as artificial intelligence - which Dell is eager to address.

Recently appointed channel boss Rob Tomlin, who took over from Sarah Shields, has also put emerging technology at the top of his to-do list for 2019, saying that his key early objective is to recruit more partners in the AI and IoT spaces.

HPE

Like most hardware vendors, Hewlett Packard Enterprise has been embarking on a transition to subscription and cloud-based models.

HPE shelved its own public cloud offering in 2016, opting to partner with public cloud providers including Microsoft.

But the vendor has also been evolving its own offering, and last year made its hardware consumption service GreenLake Flex Capacity available to partners.

The service is a combination of two HPE solutions - GreenLake, which is the umbrella name for HPE's as-a-service offerings - and Flex Capacity, which allows customers to pay for what they consume.

HPE will be putting considerable focus on recruiting partners with public cloud expertise to sell the service in 2019, and claims that the rebates available are "larger than any rebate we are currently paying" when announcing the move last year.

A broader shift for HPE that we can expect to see continue this year is a move away from low-margin deals and towards more fruitful business.

Towards the end of last year the vendor said it was close to seeing out an incredibly low-margin tier-one server contract, which has plagued quarterly numbers over recent years.

CEO Antonio Neri said that HPE will continue to "de-emphasise" its focus on the commoditised server market, instead focusing on higher-margin business.

IBM

IBM is arguably going through the largest transition of all the vendors featured in this article.

2018 saw Big Blue end a run of 22 consecutive quarters of revenue decline, but still fail to convince investors it is on the right track. The vendor saw its share price decline 28.23 per cent over the course of the year.

CEO Ginny Rometty has gone all in on reshaping the giant, brokering the largest software acquisition ever in Red Hat, while also offloading $1.8bn-worth of software assets this year. A further sale of IBM's mortgage platform, which contributes $400m in annual revenue, has been announced this year.

While IBM's overall numbers have not impressed, the firm will tell you that its "strategic imperatives" continue to grow at a faster rate.

The collections of technologies include the business units that IBM is placing its bets on, including AI, analytics and cloud, and report frequent quarterly revenue growth.

These will be the areas of focus for IBM this year, as well as a huge drive to encourage the channel to develop its own intellectual property.

IBM sees its AI platform Watson as a staple of its future, and wants more partners to use AI as a platform on which to build bespoke solutions for customers.