A question of growth

Way back in September Irish Computer asked a number of vendors for their view on the market and how they thought the rest of the year would shape up. Now, we’ve gone back to ask them what actually happened and how they think 2012 is likely to pan out.

David O’Reilly, head of product marketing, Sage Ireland
Back in September, O’Reilly said there was "much more confidence in the market", adding 2011 had been a better year than 2010 and 2009. Looking back on it now, he describes 2011 as "a good year for Sage Ireland". He points to the release of a couple of new cloud-based products onto the Irish market, Sage One Accounts and Sage One Payroll, both of which, he says, are performing very well. The mid-market accounts and CRM products also experienced "significant growth in 2011" and O’Reilly thinks Sage has "successfully started the journey of moving our brand into the mid-market space".

He also highlights the company’s connected services strategy. Sage now has "hundreds of customers" for its Sage Foreign exchange service, which it delivers to customers in partnership with Transfermate. The vendor is also "delighted that our customer support team continued to win industry awards for the outstanding support they deliver to all our customers".

Looking at opportunities for 2012, O’Reilly describes Sage’s cloud-based software offering for SMEs as "a huge opportunity", adding "we need to continue to develop new innovative products into 2012, so that we deliver real value to our customers and potential prospects." Connected services will also be in a good condition to grow as a major part of its strategy.

In terms of potential threats, he says the fragility of the economy and uncertainty about the future of the euro "will affect business making investment decisions about buying new software". In addition, difficulties in getting credit from the banks is affecting small businesses trying to get working capital to keeping going in tough market conditions.

Nevertheless, he believes that Sage’s business partner channel is performing: "Through our business partner channel, we had a good year providing a great service to some large corporations that needed to implement our product or provide bespoke integration."

In terms of the first quarter of 2011, O’Reilly professes to be "very positive" and thinks the same for the rest of the year. "I believe we will continue to grow the business in a very challenging economic environment and am very optimistic about the future," he says.

Lorcan Kavanagh, sales manager, Ireland, Scotland and UK North, Symantec
Six months ago, Kavanagh revealed that Symantec had continued to grow, if not at an exceptionally fast rate. Today, he describes 2011 as "a good year with improvements across all lines of business". The highest value opportunities of several years ago may have reduced, but this has been "more than compensated for by success across a wider range of customers and a broader solution set".

In terms of those solution areas he cites back-up appliances, data loss prevention and managed security services which "delivered on their early promise". The common theme running through these solutions was the ability to protect and secure data in the most cost effective manner. "We have proven ROI scenarios where the appliances return their investment within a matter of months and deliver huge ongoing savings," Kavanagh claims.

Over the past couple of years, the nature of discussions with customers has changed, he adds. It has become important to highlight the value delivered as well as the technology’s ability to solve a business problem. "We have developed models using best practice implementations and industry figures to show this in realistic terms," he says. There is an "appetite" for investing in solutions where savings can be demonstrated.

Kavanagh argues Symantec is well positioned with its ‘do more for less’ message of combining a broad range of solutions into a product like Symantec Security Suite, allowing organisations to eliminate the costs associated with individual point products.

In terms of opportunity, he predicts areas that developed well over 2011, such as data management solutions, managed security services and data loss prevention, will continue to do well. Symantec also anticipates strong growth in its cloud business as the appetite for cloud-based solutions in areas like mail and web security, archival, e-mail continuity and backup in the cloud, increases.

But access to funds is likely to remain an issue. "The paralysis of a couple of years ago has gone, but budgets have generally reduced and are strongly competed for," he explains. Macro issues such as the future of the euro could also "put a spanner in the works".

In general, Sage’s channel is "performing well". The vendor is concentrating on partners that commit to specialisation to ensure customers are getting a better knowledge and service level. In turn, Symantec is better represented and channel partners can make more margin through the advantages of the specialist programmes. "This has been a very effective model and helped to drive growth across the boards," Kavanagh claims.

Distributors have been providing good support and have come to recognise the value in providing value added services beyond simple fulfilment, in areas such as initiating sales campaigns to solution training or offering implementation services. "The importance of distribution is significant," he argues, "as there is such a volume of resellers operating in the Irish market. The value of distributors is in managing and driving initiatives across the base.

He is "quite hopeful" for this year. "There are certainly more projects appearing within customers – large and small," he says. "We are well positioned with our solutions and partners to deliver real value to these customers. There is a definite feeling that we are working out way out of the extreme challenges of the last number of years…but ask me again in six months."

Ian Moore, VMware Ireland country manager
Moore doesn’t beat about the bush. Last year was a "massively positive year," he says. There were a number of large projects and VMware was also in a position to announce the addition of 250 jobs during 2011. In addition, it put together a Cloud Masters programme with Cork Institute of Technology and worked with FAS to take people with no IT experience and train them to become support engineers, a scheme which has been "very popular in these troubled times".

Looking forward, he reports that quite a few customers have yet to virtualise, and there will definitely be opportunities with government departments and larger organisations focusing on business critical applications and the management stack in a virtualised environment.

The launch of VMware’s cloud infrastructure and management products should also drive demand. "Would you buy a car without a dashboard?" he asks, arguing that the "simple to use tools that self-learn" will prove attractive in an environment where management seems to get more complex as time goes by. There is also "quite a bit of growth" in end user computing, although it is driven by iPads and Android devices rather than the virtualisation of desktops. He describes them as "quick wins".

The vendor expanded its channel last year by taking on more partners and changing its distributor with the appointment of Avnet. He claims it is "going really well" and there are plans to "really drive the business partner community this year, there is a lot of opportunity and we’re building really great incentive plans for those partners".

The first quarter is going to be positive, he predicts, and 2012 overall will "be another good year for VMware based on our customers and what their plans are".

Martin Deignan, director of sales and marketing, OKI Ireland
After a difficult few years when the printer market fell by as much as 40%, Deignan said in September that 2011 was shaping up to be "a little bit better". Today, he admits that although 2011 started relatively brightly, a lot of uncertainty "returned in the autumn" as the euro crisis caused customers to delay their decisions. Overall, it was "a tough year for business in Ireland".

OKI’s manufacturing was also affected by two natural disasters during the year. Owing to the Japanese earthquake and tsunami and the floods in Thailand, stock availability is just beginning to return to normal.

Growth came from its managed print services expertise as the market continued to evolve and several new dealer partners came on board to take advantage of the market opportunity for cost savings and productivity efficiencies. Deignan says it will continue to be an opportunity in 2012. OKI tries to be flexible enough for dealers to be as involved as much in the process "as suits their business model", even down to giving them the option of outsourcing the entire service to the vendor on their behalf.

In terms of potential threats for 2012, he highlights the way in which the current economic uncertainty can lead to delays in decision making and encourage belt-tightening, as well as a shortage of investment capital.

He says many IT companies "are due a lot of credit for finding ways to survive in such a difficult economic environment". Some companies have managed to do even better and are "actually expanding through finding new innovative ways to offer customer value".

Unlike other vendors, OKI does not deal with distributors, choosing instead to invest in direct relations with channel partners through a nationwide sales and service infrastructure "as we believe in shortening communication lines and working very closely with our dealers on a local basis to provide expertise and search out business".

Overall, OKI is more optimistic about 2012 in the longer run as its groundwork in managed print services "bears fruit and new products and solutions come on stream", Deignan says. "A bottoming out of the financial crisis would be a bonus."

James Stevenson, area vice president, Citrix
Six months ago, Citrix Ireland country manager Niall Gilmore, revealed it was enjoying positive growth and things were likely to continue in that direction. Now, his colleague Stevenson is happy to report that 2011 was "the best year we’ve had in a long time". The vendor did well with indigenous Irish customers and data centres. The year was helped by a very large public sector project near the end for the complete replacement of a fat client environment with a virtual desktop one.

Adoption of desktop virtualisation is being heavily driven by migration to Windows 7 and Stevenson thinks "the real market is still to come" because many larger companies are still in the process of planning their Windows 7 migration. He warns that companies are not planning it yet could get caught out, especially as they will need to address the challenge of application migration as well. "We’re not at the point where it’s dangerous," he says, "but if they’re not planning it now, they are going to get caught out."

The acceleration of migration to Windows 7 will represent "a phenomenal opportunity for our partners," he claims.

With a number of acquisitions last year, Citrix can see additional growth opportunities on top of its existing products. There are major opportunities for products like XenDesktop and Netscaler but the addition of its VDI-in-a-box solution (on the back of the acquisition of Kaviza) will also play well in Ireland. Stevenson thinks the market here is better suited to the product because of the high number of SMB and medium sized companies: "It suits them particularly well because of its ease of deployment and ease of management."

He believes AppDNA, which addresses the issue of migrating applications from XP to Windows 7, could also be a "very good opportunity" for resellers, as could Sharefile, which he describes as a "Dropbox for the enterprise".

When it comes to threats, like everyone else he identifies continuing economic issues around the euro but believes that Ireland is in better shape because it "took all the very tough choices early on" and has "done most of what it needs to do".

Citrix is "very happy" with its sole Irish distributor and Stevenson stresses that "a second distributor wouldn’t make any sense". He says Data Solutions continues to invest and increases its skills to give smaller partners all the assistance they need to take Citrix’s products to market.

So how does he think 2012 will shape up? "If we can repeat 2011, I’d be very happy," Stevenson says. "If we can get the same growth from our product portfolio as last year we’ll be very happy. Q1 is looking pretty good and the pipeline looks very strong."

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