In-depth: Distributors find a role in the cloud

When the cloud hype kicked off in earnest a couple of years ago it sounded as if there were going to be few angles for distributors to get involved.

When the cloud hype kicked off in earnest a couple of years ago it sounded as if there were going to be few angles for distributors to get involved. With vendors talking of hosted services that at best could be white label offerings from resellers some eyes fell on the response from distribution, writes Amro Gebreel.

The response has been a positive one and few now question the role of distribution in the cloud. There are very few companies placed in a better position to become aggregators of numerous products and provide resellers with guidance and advice.

On a very basic level, as Bill Roth, channel marketing officer at LogLogic, points out, sales are still about person-to-person relationships.

"Distribution's role will remain the same. Supplying local resellers with products that can be sold to people they know," he says.

As some of the dust settles after all of the talk of cloud changing the world, distributors are starting to find that in many respects the job and skills they have been doing and honed over the years are still as important.

"I believe that there continues to be  an important role for the distributor in the new ecosystem.  From a marketing perspective, not much has changed - it's about providing on-the-ground support to vendors that have a cloud computing strategy about how to position their solution to their reseller and to their end users," says Alex Teh, commercial director at Vigil Software.

"Whilst the delivery mechanism may be different, our role continues to be about providing our support and expertise, not just in selling the product but in supporting end users through our partners," he adds.

As well as doing that Teh acknowledges that providing the right products is crucial, with all of the SLAs and guarantees as well as being a product that meets customer demand.

The likes of Ingram Micro have already identified they should act as a solution aggregator and others in the distribution world are also going down that route.

Barrie Desmond, business development director at VADition, believes distributors should act as a proxy or an aggregator for cloud based services, either by building out infrastructures and time sharing them with their channel, or white labelling advanced based cloud services back to back with existing operators.

"Essentially the role of the channel should be unfazed and unchanged by this new cycle/business model.  We still offer scale, expertise, credit and know-how - these essentially are what customers need and what SAAS and cloud operators demand.

"Distributors and VARs that fail to grasp this are either afraid of cannibalising their existing business or are unable to put the investment into the infrastructure needed to develop services.  Sadly, these will become the Woolworths and Zavvis of the IT world," he warns.

David Ellis, director of new technology and services ComputerLinks, alluded to Stan Lee's 2002 Spider Man movie which he says first coined the phrase "With great power comes great responsibility".

"The emergence of cloud puts distributors in a very powerful position  - providing the means for business critical data and applications to be trusted to third party service providers.  The great responsibility of distributors, I believe, falls into three key areas - education, aggregation and support," he says.

"Along with education and support, true 'value-added' distribution partners can provide aggregated, integrated and 'market-ready' solutions that provide far greater margin opportunities for resellers than just shipping boxes," he adds.

Those skills have long been recognised by vendors and distributors are expected to continue to evolve their ability to support the vendor messages and technology as it flows down to resellers.

"50% of SMB customers are expected to adopt cloud solutions in the next five years - which provides a huge opportunity for our channel to capitalise on. Microsoft recognises the important role that distributors play in supporting the channel transition to the cloud, for example it provides business transformational workshops, value-added services, and training and support in delivering Microsoft Online Services to customers," says Clare Barclay, SMB director at Microsoft.

"Microsoft is working very closely with its distribution partners to evolve their cloud offerings and the value they add to the channel, and will continue this partnership as the opportunity and offerings from Microsoft grow and develop," she adds.

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