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Channel enjoying its best time for years

The main keynote session at Canalys Channel Forum has seen the analyst house CEO bang the drum for the indirect world

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There is still life in hardware and now is the best time for the channel with the fourth quarter set to be the best across Western Europe for a decade.

Steve Brazier, CEO of Canalys, used his keynote at the analyst house annual shindig in Venice to sound a clarion call to the channel.

"The channel partners are doing well and perhaps more importantly the European economy is looking better that it has done for the last ten years," he added "There are more opportunities for the channel now than there have ever been."

This year, over the first half, distributors grew 4 to 5% and channel partners improved by 7% on average.

Brazier in the Channels Forum event spoke of the way vertical markets, from retail, transport, health and public sector, were all embracing digital technology and using the channel to roll out those services.

The move towards edge computing was also driving a lot of growth and Brazier expected a growth in 'micro clouds' as resellers provided services closer to user data and applications.

There was also a mention for security with that segment enjoying the strongest growth as a result of the increasing threats and factors like GDPR driving spending across Europe.

But the speech included some words of warning for those making a wholesale move towards becoming a predominately software and services business.

"This has been the year where the vendors have been preaching digital transformation to you. They are not only trying to talk to you about selling more stuff, they are trying to battle for your thought leadership in where you will take your thoughts forwards," Brazier said.

"I'm sure you have been told you need to change the way you engage with customers and invest more in digital marketing and retrain your sales force," he added.

The danger identified by Brazier was that listening to the vendors, which had their own agendas, could undermine the future strategy.

"Should a partner that's reselling infrastructure, PCs and software should they change? Probably yes," he said.

"Let your customers decide where you should go. Listening to customers is more important that listening to analysts," he added.

The other words of warning came about the idea of making changes that led to abandoning hardware sales.

Canalys is predicting that hardware will still contribute over 50% of revenues for 90% of partners in 2020.

"Whoever told you selling hardware was dead is completely wrong. The PC is suddenly the most profitable part of your business again," said Brazier.

Areas of growth

According to the Canalys CEO there are three main areas that should deliver rewards for the channel:

 1. Edge computing

2. App and cloud management

3. Security

This was last published in October 2017

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