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Channel enjoys a strong start to the year

Just how has this year been going? There is no better way to find out than ask a number of those working in the channel

Before thoughts of the first quarter of 2019 fade completely into memory, the channel was asked how those first three months had gone. The responses indicated that 2019 got off to a strong start, which was echoed by a recent trading update from Computacenter, and optimism is spread across the market.

Channel executives were asked how things had gone in the quarter, whether Brexit had caused problems, and whether or not digital transformation was the main driver of sales at present. Here are a selection of responses from the great and the good in the industry.

Karen Holland, channel business director, EMEA, Malwarebytes

“We are continuing to see an upward trend in our sales and a growing customer base in the security space. We have a renewed focus on partner enablement this year to better equip our partners with identifying opportunities, positioning our security solutions and supporting their customers effectively, whether it be an on-premise, cloud-based, in-house or service-managed solution.

We have just launched our new OneView product, designed to make provisioning of our security offering easy for partners wanting to start in this space or grow their existing security service portfolio. Plus we have recently announced our partnership with Tech Data, which will further enhance our reach in the European market.

There is a still a lot of uncertainty about the real impact for business of Brexit overall, and most companies operating in the security software marketplace are waiting to see what the “end plan” is before investing in costly business changes. However, analysts continue to predict continued rises in more sophisticated cyber attacks targeting all market sectors and segments, so it is more important than ever for customers large and small to ensure they are secure. We see this as an ongoing opportunity for us – whatever the Brexit outcome.”

Paul Speciale, chief product officer, Scality

“The first quarter of 2019 has started strongly, with channel success across numerous industry segments that are continuing and accelerating their digital transformations, with solutions to help visualise and monetise data. For example, our partners in healthcare are in the middle of the transformation storm, with medical imaging in hospitals driving demand for petabytes of storage of radiologic and other images, genomics data, and more.

Our partners focused on financial services are seeing a growing storage demand, driven by big data, to help enable long-term archives and “data lakes” as solutions for long-term retention and analytics of that data. Not to be ignored are our partners focused on media and entertainment, an industry that has clearly already transformed to digital, and is now a forerunner in leveraging cloud services to optimise both processing and content delivery. This opens up new value-added solutions for our channel partners to augment data storage with cloud data management.”

Ed Baker, EMEA partner lead, McAfee

“It is always great to test the sentiment and trends at the start of each year. Generally, the sentiment is overwhelmingly positive for today and for the future in the world of security partners. This is largely driven by the expanding security market opportunity. In my view, 2019 will be the year when the maturing cloud access security broker (CASB) market becomes mainstream. 

In addition, there will be appetite from many more channel partners to accelerate their options in cyber security as more and more companies start to realise that security as a service would be a more efficient way to ensure that their data is managed and stored safely. This shift will drive innovation in offering threat intelligence as a service.”

Myles Leach, managing director, NFON UK

“There are tremendous opportunities for channel partners. No matter what the political environment, businesses want and need to stay competitive – and maintaining their digital transformation projects is key to this. While digitisation sceptics still think that voice communications volumes have peaked and will eventually decline, the raw statistics say the opposite.

Technically speaking, all forms of communication will be digitally transformed by the change to the all-IP standard. At the same time, all-IP provides the foundation for new cloud services that facilitate, but do not dehumanise, the new world of work.

Small and large companies can achieve cost savings and productivity benefits from a variety of cloud service options. Another channel opportunity is the rise of omnichannel contact centres – interacting with customers beyond voice, to include webchat and social media channels. Multichannel, big data and the integration of the internet of things also pose new opportunities for the visibility of customer-related data.”

Alan Conboy, office of the CTO, Scale Computing

“The first quarter has been strong across all parts of the channel – from our growing OEM partnerships through to our diversifying reseller community. This growth is being driven by our software’s ability to adapt and solve numerous vertical and use-case challenges faced by enterprises today.

As companies across the UK adapt to digital transformation, it is clear that every customer has their own unique needs – regulations such as the General Data Protection Regulation (GDPR), the ongoing dilemma of Brexit, or supporting a growing distributed mobile workforce while staying compliant. 

Partners that can utilise software that is simple to use, self-healing and is agile enough to solve each organisation’s individual needs will be able to build value-added services and improve their profit margins.

The biggest change we are seeing is the move from the centralised enterprise to the distributed one. The technology is available for partners to offer customers a complete portfolio that will meet their exact needs. Digital transformation is undoubtedly driving sales for the channel, but the biggest driver is customers looking to utilise the benefits of edge technology.”

Steve Armstrong, regional director, UK & Ireland, Bitglass

“Brexit is causing uncertainty – this leads to a potential lethargy in the decision-making process for some end-users. Hesitation is the mother of rear-end shunts – and right now this lack of clarity is causing organisations to doubt the way forward. The channel has seen a minor impact, with end-user organisations pushing decisions out. This is compounded not by Brexit in and of itself, but more by the inconclusive nature of the actual exit.

Those channel partners who service customers across EU boundaries may well find it difficult to continue trading in the same fashion as they have done so previously. On the flipside, Brexit does provide an opportunity for channel partners working with organisations that are looking to ensure their data is kept secure and within the UK shores come the departure.

The reality is very simple, though – once you cut through the hype around Brexit, we probably won’t know if it is good, bad, indifferent or a catastrophe, for 10 years or so.

We need to ensure that any exit does not cause technology investment in the UK to dwindle. The question channel partners, and vendors, have to ask is what do these EU deals really mean in terms of trade? Without certainty, my recommendation to the channel is to hunker down, look at the areas of additional opportunity that Brexit will bring and focus on the next five years.”

Ed Owen, EMEA & APAC cloud channel sales director, Zerto

“From an EMEA and APAC point of view, the first quarter has been fantastic. The channel is continuing to thrive and we have even had to hire an additional resource to manage the cloud service providers (CSPs) in the region. Yes, digital transformation is still driving sales, but we actually believe we are seeing most of this growth come from the convergence of CSPs and channel partners.

The CSP industry is continuing to thrive and, given the nature of today’s cloud-focused IT landscape, traditional channel partners are looking for ways to ride the wave, after seeing the true value of the cloud. Because of this, channel and CSP partnerships are starting to form, and the traditional lines are beginning to blur. It is definitely an exciting time for the channel.”

Gregg Lalle, VP, international sales and strategy, ConnectWise

“ConnectWise saw solid growth across all of EMEA. From our perspective, most people have taken a “business as usual” approach and our second-quarter prospects look equally bright. We continue to see our partners maturing operationally and, in turn, selling cloud solutions and services more effectively. We just don’t see it slowing down at the moment.

Many of our partners understand that they are in business to leverage technology to produce business outcomes. They are aligning more closely with their customers to create a shared vision and execute on that strategy.”

Dave Sobel, senior director, MSP evangelism, SolarWinds MSP

“Uncertainty is now the status quo. Even if Brexit is causing some people to worry about purchasing decisions, this is overridden by the need to carry on and get on with work that needs to be done. Security threats and privacy concerns continue to rise and are having a much bigger effect on businesses and the market than current political turmoil and are therefore overshadowing the unpredictable ups and downs of Brexit. The net result is that companies need technology solutions more than ever before to keep their companies secure and help run them.”

Jason Chester, director of global channel programmes, InfinityQS

“The first quarter of 2019 represented a very strong start for the InfinityQS Partner Program and continues to build on a very successful 2018. Our commitment to entering into new and innovative strategic alliances with a select network of partners is helping many clients to fast-track their digital transformation initiatives. Although manufacturers across all sectors and all geographies are increasingly turning to digital transformation to address deep operational improvements in efficiency, productivity and agility, it can be a complex undertaking and requires support from technology and services across a broad range of domains. 

“As a result, our partner strategy has focused less on building a more traditional reseller and VAR network, but in forging more strategic partnerships with complementary service providers in sectors such as industrial automation and control, manufacturing consultancy and industrial IT services.”

Ian Ashworth, channels director EMEA and APAC, Netwrix

“From our perspective, it was a strong quarter, despite the current uncertainty over Brexit. We’ve seen a significant uplift in opportunities to work with our partners in the UK, and remain focused on expanding our partner base to allow for more strategic relations as well as new routes to market.

Digital transformation is continuing to drive opportunities, simply because of the challenges the process introduces for organisations. Indeed, as IT infrastructure complexity increases, organisations require expertise and advanced technologies that can be easily integrated with existing systems, enabling them to view and control their entire enterprise environment. Ensuring that digital transformation projects are conducted successfully, without compromising data privacy and security, is of course front of mind in the era of GDPR. ”

Neil Walker, channel marketing manager, PFU EMEA

“We’ve had a really successful first quarter at PFU in the UK. Despite market changes, the importance of digital transformation to businesses remains strong. We have outperformed our goals and increased the number of resellers trading our technology significantly. The number of resellers selling our flagship ScanSnap devices has grown 26% year on year, and we’re seeing sales growth as a result.

“The growth has come alongside continued partner engagement with our channel and loyalty programmes. In the last 12 months, we registered 77 new resellers to our Imaging Channel Program, and year on year saw a 30% growth in partners signed up to our loyalty programme.

“Digital transformation remains the main driver of customer purchases. The core of our ScanSnap range is targeted to the small/home office and prosumer market, and these products are continuing to see sales growth, suggesting digital transformation is becoming ever more important to smaller organisations, and no longer solely the staple of big enterprises.”

Paul Derry, sales director, ASL Group

“Consolidation continues in the channel and this year we will see this trend carry on. In terms of OEMs, most of the key partners ASL deals with have seen growth. ASL has continued to grow organically, which is pleasing. We are reaping the benefits from the full integration of two acquisitions last year – ICA and Geerings Digital. The managed print market is still providing opportunity for growth, particularly for businesses like ours that offer a full suite of services, including unified comms and IT, which allows the customer to deal with one supplier.

Despite Brexit, in terms of our day-to-day sales, it is very much business as usual. However, our fear is that the continued uncertainty and delays over Brexit could affect the future trading environment more than at present. Companies are delaying investment decisions now which could possibly affect business further down the line.”

Steve Harrington, managing director, EMEA, Masergy

“Digital transformation is a definite priority for IT leaders of innovative businesses – our research shows that four out of five say it is imperative for survival. Enhancing customer experience (CX), moving to new network architectures that include SD-WAN, migrating business communications and contact centre applications to the cloud, and IT security are all hot-button items for CIOs. There is huge opportunity for channel partners to grow their revenue by partnering with the right managed service provider to help businesses with their digital transformation agendas.”

Alp Kostem, director channel sales, Exponential-e 

“Despite challenging market conditions, it has been a good quarter. We are 20% up from where we were at the end of Q1 2018 and 8% ahead of target for this year as a whole. Importantly, sentiment within our channel community remains positive. We have countered the effects of Brexit well by diversifying our partner base – a priority over the last two years. As it stands, no one partner accounts for more than 3% of our revenues.”

Christian Nagele, interim head EMEA at Datto

“Q1 was an exceptionally strong quarter for us, the strongest quarter ever for Datto EMEA. This is predominantly attributed to the ongoing buoyancy of the wider MSP market, the increase of SMBs engaging IT service providers to help them navigate the digital transformation landscape, and the relevance of the Datto portfolio to MSPs. The looming prospect of Brexit seems to have done little to dull the rapid growth in the wider MSP market, and our increasing investment to rapidly build out a wider European presence solidifies our commitment to supporting all of our existing partners through the Brexit transition, as well as making our technology available to a wider audience.”

This was last published in May 2019

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