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Newsletter Home > December, 2007
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Managed Services Raises Stakes for Channel Partners
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The channel has always survived based on its ability to navigate change: changes in customer needs; changes in technology; and changes in business model.
The managed services arena is a case-in point. While many VARs, integrators and other channel partners are drawn to the concept of a recurring revenue model, such a move causes many adjustments to how they do business. Often, the fears are not about the things that the partners need to do to make it work. It's that gnawing concern about what they didn't anticipate – whatever might have slipped through the cracks – that makes them reluctant to pull the trigger.
As we prepare this newsletter, Ingram Micro is putting the finishing touches on its first annual "Seismic Partner Conference" in Dallas, Texas. The event is aimed at helping Ingram Micro's partners build managed services businesses through discussions on service offering development, pricing strategies, technical training, and similar best practices.
Other corporations are also launching their own programs, each of which stresses the advantages of their own home-grown MSP initiatives.
Cisco Systems recently rolled out its new Managed Services Channel program, aimed at service providers, integrators, and VARs who are moving in this direction. Qualifications include ongoing network monitoring, the ability to troubleshoot customer networks from a NOC, a minimum one-year contract, and a clearly defined service level agreement.
The move is part of Cisco's "offer-based strategy" that provides separate channel programs specifically geared toward common channel business models. Most Cisco go-to-market initiatives fall under the general resale program that has been familiar to IT professionals over time. Since the offer-based strategy was announced two years ago, Cisco has rolled out a global resale program, and intends to add an outsourcing program in the future.
The objective is to provide a program that is best aligned with the needs of each of these different types of business models, and have requirements, rewards and branding that drive the things that are critical in each of those spaces, and do so in a manner consistent with the overall corporate strategy.
By establishing best practices and a de facto seal-of-approval from a large technology vendor, Cisco hopes to help build customer trust in partner capabilities.
"Managed services also create a different set of needs from the resale model," explains managed services program director Tom Williams. "If you're reselling gear with a service contract, you make money during downtime. But if you are using a managed services model, you make money during uptime."
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Google Goes Green: Will Other Major Tech Players Follow Suit?
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Silicon Valley-based Google announced a new strategic initiative to develop electricity from renewable energy sources.
Dubbed "RE<C," ("renewable energy less than coal"), the new initiative will focus on solar power, wind power, geothermal systems and other technologies, representing an investment of hundreds of millions of dollars over the coming years.
"We have gained expertise in designing and building large-scale, energy-intensive facilities by building efficient data centers," said Larry Page, Google Co-founder and President of Products. "We want to apply the same creativity and innovation to the challenge of generating renewable electricity at globally significant scale, and produce it cheaper than from coal."
At this point, the burning of coal supplies 40% of the world's electricity, while generating substantial greenhouse gas emissions and threatening the environment.
Google's objective is to produce one gigawatt of renewable energy; enough to power a city the size of San Francisco.
The company also plans to make strategic investments and grants to help capitalize other companies, laboratories, universities, and other organizations doing research in renewable energy. Pasadena, California based eSolar Inc., which specializes in solar thermal energy, is one example. Alameda, California-based Makani, Inc. is another company spotlighted by Google for its high-altitude wind energy extraction technologies.
Last spring, Google also announced its intention to become carbon-neutral for 2007. Efforts include the development of technology to power and cool its data centers, using electricity from a 1.6 Megawatt solar panel at its campus in Mountain View, accelerating development and adoption of plug-in vehicles, and membership in the Climate Savers Computing Initiative, a consortium that advocates the design and use of more energy-efficient computers and servers.
Other companies that have launched clean energy initiatives include General Electric and IBM.
Avaya to Help Partners Forge Alliances with Build Independent Sales Agents
The Avaya Master Reseller program is enabling select Avaya business partners to recruit and train independent sales agents who work under their direction to sell Avaya's small and mid-sized business portfolio. Many of the new agents are companies who specialize in data networking but want to offer their clients ready access to voice solutions as well.
To date, 10 Master Resellers are working with more than 300 independent sales agents across North America. Avaya supports the program with a special educational program for new agents and with dedicated account managers and distribution managers for each Master Reseller.
Avaya Announces Zero-rate Financing Program
Avaya Financial Services is offering zero-rate financing on software and appliances when purchased with certain configurations of Avaya IP Office 500, Avaya Distributed Office and Avaya S8000 series communication servers. In addition, customers can lease equipment with zero percent financing over 36- or 60-month terms and defer their initial payments until April 2008 – freeing up capital that can be invested in other parts of their business.
The program is available to businesses in the U.S. and Canada, and runs through December 21st.
Nortel's Announces New European Marketing Bureau
Nortel has rolled out a new marketing bureau for UK- and Ireland-based channel partners. The bureau provides a suite of co-branded, co-funded lead generation campaigns that can be up and running within a week, through a specialist channel marketing agency.
Campaigns for strategic technologies, such as unified communications, are co-branded and may include a series of HTML emails, direct mail, a campaign web landing page, online registration, a collateral download tool and telemarketing. Each partner has access to their own secure reporting tool allowing them to track success.
Microsoft Hires Robert Youngjohns to Lead North America Sales & Marketing
Microsoft Corp. has named Robert Youngjohns to the role of president, North America Sales & Marketing, and corporate vice president, effective December 3rd.
Youngjohns brings more than 30 years of experience in sales, marketing and strategic business development. Most recently, he served as president and chief executive officer of Callidus Software Inc., a publicly traded company and a leading provider of sales performance management software based in San Jose, Calif. Before joining Callidus, Youngjohns spent 10 years at Sun Microsystems Inc. in a series of leadership positions, including executive vice president of Global Sales. Youngjohns also spent 18 years in various roles at IBM Corp.
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On The Other Hand - Green Google and the Cisco Channel
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By: Ken Presti
The blogosphere has been full of reactions to Google's renewable energy initiative. If you're still coming out of a turkey-induced slumber, the company announced plans to invest huge quantities of money in the development of renewable energy technologies, especially solar, wind, and geothermal.
Some of the reactions are very complimentary; others more skeptical. But I had a completely different reaction jump into my mind when I saw the announcement.
This is going to be the beginning of an entirely new channel opportunity, at the broadest level. Just as in the IT space, someone is going to have to function as the integrator and, I'm sorry, but I can't picture Eric Schmidt climbing a ladder to get onto my roof. Other companies will end up doing that.
In this scenario, the role of the service provider is played by the gas and electric companies, complete with demarcs and everything. The channel plays itself, albeit in a somewhat adapted form with different technologies. But their mission will be to understand the needs of the end user, separate the marketing hype from what's real, propose the solution, make the sale, do the installation, and take the first call when something goes haywire. Sounds familiar, huh?
Yes, it kind of plays out a lot like the networking sector of the IT industry. If I were a Cisco channel partner, I'd keep my eye on this space, at the very least.
Again, at the tactical, feet-on-the street level, the technology is obviously a whole different ball game. But I don't know that it's all that different at the more strategic level. And the technical skills can be purchased - or at least rented.
A few years ago, some people looked at me funny when I speculated that IT security partners would eventually get involved in premises-level security involving alarms and such. But there are now companies that have moved in that direction.
Now I admit, some types of renewable energy are more suited to centralized operations in which the output is simply sold to the "grid." But that's not always going to be the case for every energy option.
Since energy is basically a network unto itself, the potential for synergy appears to be quite strong. I don't think it will happen overnight, but I do think it will happen faster than most people might think. It will probably emerge in new construction where home networking and solar panels can be bundled into a unified offering. But as private homes and offices become increasingly bandwidth-hungry and energy-hungry, I think the demand will be there!
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