The ink is barely dry on the final deals from 2013 but the industry is already looking ahead at what will be flying off the shelves in 2014. And when it comes to storage, some of the trends that will take centre stage are those that have already turned a number of companies, and individuals, into success stories.
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Looking ahead at the coming year the biggest opportunities for the channel will be found in a number of technologies and architectures, such as archiving, managed cloud, software-defined storage, BYOD, and reporting.
Max Gill, EMEA enterprise sales director at Atlantis Computing, says that the last couple of years have been fertile periods of research for innovative storage vendors and they could emerge to shake things up in 2014.
"Resellers who are reluctant to upset the established vendors and a long history of joint revenue, will open the door to those looking to provide customers with innovative solutions which match their needs.
"In addition, the wide-scale adoption of software-defined storage opens the door to storage opportunities for resellers who are not necessarily hardware focused and haven’t traditionally competed in this space. Specialist virtualisation resellers will see their market opportunity grow significantly (at the expense of the traditional hardware resellers) as they add storage to their existing server and desktop virtualisation solutions," he says.
"Many businesses will be looking to move to a software-defined storage model therefore opening a huge opportunity to the channel," he adds "Software-defined storage is the commoditisation of storage and will separate the software function from hardware and give the channel a less expensive alternative to take to customers. By working with any protocol stack, resellers can build specialised storage systems on commodity hardware."
However more traditional storage technologies will not disappear according to Bartek Mytnik, business development manager for EMEA at Qsan Technology, who sees potential for resellers and distributors in targeting the mid market with flexible and affordable solutions.
"From our point of view the biggest opportunity for resellers lies in one of the most serious problems they are still facing: the constantly shrinking IT budgets. The ability to mix tier one solutions and alternative brands while maintaining performance, reliability and a high level of post sales support is going to be an increasingly defining success factor," he says.
Changes for the channel in 2014 are in store not just where technologies are concerned: the position that resellers occupy in the chain will also adapt to reflect recent developments in their relationship with customers. Jason Wildt, director of marketing EMEA at Violin Memory, sees a shift in the role of the channel on the cards.
"For two reasons the coming year is going to enable resellers to become more consultative on storage than in the past: one, there are a lot of confusing messages in the market and two, selling storage is becoming more application oriented. Building up expertise in these areas will allow resellers to access budget that has traditionally been reserved for applications rather than infrastructure."
More opportunities for the channel will be found in the need for organisations to extract valuable insight from the vast amounts of data that they generate and store. Joe Spanarella, director of marketing communications at Spectra Logic, observes, "Data growth is not being driven by the need to restore the past; it’s now all about predicting the future. Archiving will continue to be a growth market as organisations continue to look for ways to cost effectively store their data while maintaining access. We see opportunities starting to emerge for businesses who are ready to implement these approaches and expect others to follow suit in the coming years as well."
Although today the UK economy is in better shape than it was a couple of years ago IT budgets are still feeling the pinch and this will see end users buy less storage capacity in favour of spending towards optimising what they already have. Gill adds ‘In the enterprise, as storage management has spiraled out of control and capacity sits unused across a number of storage silos, complete bans on the purchase of additional storage will come in and end users will be challenged to reclaim and re-provision storage across the business. This will open the door further to storage vendors that can augment, optimise and provide improvements to existing legacy storage arrays.’
The cloud will remain a growth area over the next 12 months; often cited as the remedy to the large upfront capital layouts that were historically linked to the purchase of in-house resources, this is where the channel will have the opportunity to capitalise in 2014, by guiding end users down the service approach path, according to Noam Shendar, VP of service provider sales at Zadara Storage.
"Users who want to migrate to the cloud need help to ensure a smooth and efficient transition. Some cloud companies offer this sort of assistance, but not all do. And even those who do may not have the necessary expertise needed to migrate specific applications. This is where the channel plays a crucial role, especially where resellers have specific vertical market or application expertise," says Shendar.
Indeed the cloud will be a line item in most organisations’ IT strategies. Steve McChesney, VP of business development at Druva, says that the issues end users will face in the next year are significant as they need to develop a cloud strategy that is secure and that addresses the logistical challenges of BYOD.
The channel will act as the actual enabler of the cloud as it brings it in its most suitable forms to different customers in order to make their objectives achievable.
"As the move continues from a physical to a virtual, and cloud, environment the complexity of systems increases. It is vital for customers to implement Infrastructure Performance Management to keep growth, utilisation levels and application response time in check, rather than over provisioning to keep the business happy’ explains Richard Brown, EMEA OEM and channels director at Virtual Instruments.
"End users feel abused by hardware suppliers and would prefer to see better utilisation. The best way for a reseller to help is to become an independent and trusted advisor, rather than an off-the-shelf supplier. They should offer to benchmark application performance to see how the current system is performing and is being utilised. They can then advise on migration where needed and optimisation of the entire system," he suggests.
Wildt at Violin agrees that a deep knowledge of the IT solutions landscape is critical for the channel moving forward: "The key thing resellers can do is learn the product landscape and gain more knowledge on the application workloads that end users are deploying. Having an understanding of new areas will enable resellers to provide business justification for the solutions their customers need."
Spanarella at Spectra Logic sums up the two-pronged approach for a successful and long-lasting relationship: "Service their immediate needs while thinking of growth scale and long-term concerns,’ he adds and Mytnik at Qsan seems to be in agreement ‘Helping a customer build a well-performing infrastructure is only half the story now. Making sure that this infrastructure is flexible enough to allow stable growth without unnecessary or unexpected expenses is the key."
More with less
It would seem that overall the key for the channel to help customers meet IT needs and do more with less, is knowledge. "Resellers need to have a greater knowledge of the alternatives to selling more storage. They need to understand the different options for slowing storage growth and be able to advise customers on the range of options currently out there and what issues there could be around security, risk, bandwidth and data protection," says Nigel Houghton, regional sales manager for EMEA at APTARE.
The challenge of managing data remains a priority for IT administrators. "Despite data-defined storage being in its early stages, the anticipated growth of the market is considerable. IDC has put forward early indications that an expectation for the scale of the data-defined storage market by 2017 might reach $27bn,"’ points out Joseph Lynn, vice president of marketing at Tarmin.
But can you have too much of a good thing? Dave Thomson, senior VP of sales and marketing at QStar Technologies, reckons that too much choice can indeed become an issue for end users who will find it increasingly hard to make sense of the vast array of solutions available on the market, and this is where the channel can make a real difference.
"Vendors are increasingly offering multiple ways to solve the data capacity/cost of storage issue; each is priced differently and so getting to the bottom of what is best for each individual user will become harder," he says.
"Resellers need to be better educated on the options available from multiple vendors. Getting to the bottom of best value-for-money is increasingly a harder task and only a well-educated reseller can offer solutions that are optimised for each user."
Gill also believes that in the future the channel will need to review the traditional way in which it has approached the sales process: "Resellers need to change their mindset from selling brand new arrays for storage refreshes or new capacity, to showing end users how what they already have can be optimised."
The exponential growth of copy data, which has been a long-standing source of revenues for traditional storage vendors, has reached a tipping point, where companies are now spending more money managing copies of their production data than the production data itself. Ann Thueland, director of EMEA marketing at Actifio, drives this point home: "End users need to be ready to face the truth around the amount of spending they have so far invested into managing copies of their production data. They will also need to be ready to go through a transition to prepare themselves and their IT architectures for the latest technology. The good news is, that once they have completed this journey, they will have far more capacity for more important, business impact relevant projects."
The opportunity for the channel is in adding value by identifying and solving this issue. Thueland adds. "As with all new technologies, it is essential that any resellers are trained appropriately in order to consult their clients professionally on this new matter of copy data management. According to IDC the copy data problem has been identified as a $44bn market opportunity."
So what changes will we see in the channel over 2014? In the eyes of Thomson at QStar: "The industry changes so quickly that users are not keeping up with available options. Vendors are all focussing on software which makes hardware just a commodity. A reseller will need to invest in understanding a range of software solutions, how to combine them and how maximise both their and their users’ return on investment."
Shendar at Zadara believes that change might be hard at first but it will be worth it ‘As the IT world shifts to services, so must the channel. This can mean a bit of discomfort up front during re-training and business model adjustment but it is well worth it because it will mean more predictable revenue and increased profits in the long term.’
Lynn at Tarmin agrees that the shift in focus towards services will continue over the next year, "Resellers will continue to join the relentless march toward the cloud and managed service provision as they see the benefits of economies of scale, recurring revenues and improved customer retention. As margins reduce in the hardware business, a services and value-driven approach will reap dividends."
There will also be a change in the way end users approach storage cost according to Brown at Virtual Instruments: "With end users being educated in the software-defined everything, the internet of things and pace layering of applications, they are moving away from the old way of cost per terabyte."
Ultimately, with budgets under pressure, end users will turn to resellers for help. "People want more for their money and businesses will turn to resellers for this," concludes Nexenta's Van Achterberg.