CXO

IT channel: Will cloud rain on resellers' parade?

The cloud computing model asks big questions of the channel...

The IT industry's apparently headlong rush towards cloud computing poses serious questions about resellers and their relationships with user organisations, says Bob Tarzey.

The IT distribution channel has always been considered a major influence on the adoption of new products, services and ideas by end-user organisations. So as the IT industry seems set on moving relentlessly forwards with the message that the cloud is the future, how important is the channel in helping the delivery of that technology?

The relationship between IT vendors and the resellers that ultimately shift many of their products has always been like that between the proverbial chicken and egg. Resellers need products to sell and vendors need resellers to sell their products, at least at high volume with a low cost of sale. But does the cloud change this?

At one level, it has the potential to do so. Some vendors, such as Microsoft, that have been stalwart supporters of the channel in the past have wavered. Microsoft now offers some of its cloud-based products for sales direct to customers as well as via partners - for example, Microsoft Office 365, or BPOS as it was previously known.

A reseller that maintains strong relationships with customers should have little to fear from the arrival of cloud computing

A reseller that maintains strong relationships with customers should have little to fear from cloud computingPhoto: Shutterstock

Furthermore, the further up the cloud stack a customer buys, the less there is for a reseller to offer. For example, an infrastructure-as-a-service offering still needs some systems and application software licences to make it functional, whereas software as a service includes all that, and so just needs user-access devices and connectivity.

Strong relationships with its customers

However, a reseller that maintains strong relationships with its customers may not have too much to worry about for two reasons. First, no vendor, not even Microsoft, can offer a full range of cloud services and second, cloud-based services will never be the be-all and end-all. IT delivery will always be an appropriate mix of on-premise and on-demand services for a given organisation.

Resellers need to help their customers strike a balance between on-premise delivery and on-demand services, and in doing so maintain their value-add. To achieve this balance, they must identify appropriate cloud offerings to add to their portfolio so they can offer these to customers alongside on-premise alternatives.

Requirements can be reviewed case by case, with the reseller being impartial and suggesting the most suitable approach for each customer.

A customer that is growing fast might need rapid access to more processing power. Is this best provided by buying more servers and renting the datacentre space to deploy them or buying commodity virtual servers from a managed hosting provider? Is content security best deployed at the network edge or in the cloud? A range of factors will provide the answers to these questions and help the reseller make its recommendation.

IT infrastructure requirements

When a cloud-based service seems to be the best option, it still needs to be integrated with on-premise infrastructure. Some would argue smaller organisations could source all their IT needs from the cloud but that can never be true if you look at all the IT infrastructure requirements.

There will always be a need for user end-points - PCs, laptops and smartphones - routers and printers. A true value-added reseller with strong client relationships must...

About Bob Tarzey

Bob Tarzey is a director at user-facing analyst house Quocirca. As part of the Quocirca team, which focuses on technology and its business implications, Tarzey specialises in route to market for vendors, IT security, network computing, systems manage...

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