It’s great to have good news and there’s no doubt the channel has had quite a bit of it in recent months. There’s been so much positivity, you have to wonder whether it might make sense to start an IT channel offshoot of the Good News Network.
For those of you unfamiliar with its workings, the Good News Network is “a clearinghouse for the gathering and dissemination of positive news stories from around the globe”.
Anyway, back in October at the Canalys Channel Forum, president and CEO Steve Brazier, said there was “more opportunities for the channel now than there has ever been and we face a very bright future”. He predicted that channel partners would “grow at least 5% per annum for the next five years”.
In November, the Global Technology Distribution Council released a report entitled The Distribution Landscape and Disruption which reinforced the important role distributors play for vendors, finding that over 75% of vendors expected to increase the value of their business transacted through distribution and 70% predicted a rise in the share of business going through two-tier distribution.
While there were a number of challenges to be faced by distributors and resellers, the report was confident there would be no increase in direct business over the coming years. “The ability of the distributor to offer integration capabilities and to have the infrastructure that enables that to happen is one of the key reasons why it is unlikely we will see any resurgence in direct business,” it stated. “Although the IT landscape will change dramatically, there is no future landscape which doesn’t include distributors.”
The latest instalment of good news came with the release of a survey of channel partners across Northern Europe (including Ireland) by Canalys on behalf of Citrix. According to the research, 72% of Citrix partners expected double-digit revenue this year and 59% predicted they would enjoy double-digit profit growth as well.
Resellers identified the top drivers of growth as security, cloud applications and cloud infrastructure-as-a-service. In what could be taken as an endorsement of the growing adoption of recurring revenue business, 35% of channel partners revealed they had recruited sales staff to support the sale of subscription-based services, such as managed cloud services. Almost 60% said cloud services provided more profit than reselling hardware and software.
Commenting on the survey results, Justin Sutton-Parker, Citrix partner director, Northern Europe, said businesses were being forced to evaluate their IT infrastructure and business models. “These industry changes appear to be encouraging increased dependence on the channel, with customers relying on partners’ knowledge and expertise – especially in relation to cloud deployments,” he said.
We’re at a point in time when vendors need channel partners and customers need them too. Better still, they both accept that they need channel partners. It’s all good.
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