NEWS
Arizona - Record Crowds Expected at System Builder Summit and VARVision Update
By ChannelMedia Staff
Next month, System Builder Summit and VARVision will bring together an unprecedented audience of Reseller Executives. The opportunity to meet with North America's premier System Builders and VARs - as well as the top VARs and Distributors from Latin America is considered the best opportunity to build channel partnerships across the Americas. VARVision draws top Decision-Makers from the channel's leading VARs. Attending by invitation only, these VARs from the United States and Canada provide complete hardware, software, and service solutions to markets such as government, education, SMB, manufacturing, and healthcare. VARs that attend VARVision sell into high-volume target markets, including global (56%), large (92%), midsize (96%), and small (88%). System Builders represent the sale of over 2.5 million units annually. 65 percent of the attendees' sales are end-user, with the remaining 35 percent having a primary focus on the wholesale white box market. More than 75 percent of the attendees have annual revenues in excess of $10 million. Microsoft, Intel, AMD are all expected to make major announcements. In addition, the Fall 2004 Event will feature leading VARs and Distributors doing business in Latin America, including Mexico, Argentina, Brazil, Chile and other major and emerging Latin markets. To maximize access for Vendors, these specially invited Latin American Resellers will participate in two dedicated Latin-focused Boardrooms. For Spring 2005, an executive-level group of Latin American System Builders will also be invited to participate. In addition, there will be a handful of top Gartner analysts providing their insights and available for consultations and Vendor-to-Vendor meeting opportunities to explore partnerships. Experience the IT channel's premier events in one of the great business and resort destinations of the American Southwest at The Westin Kierland Resort & Spa in Scottsdale, Arizona.
Executive Summary: IT Channel Organization Models, 2004
Michael Haines, Research Vice President, Verticals and Business
Strategies, Gartner, Inc.
IT Channel Organization Models Change to Enhance Productivity and Results
Historically, channel programs of IT vendors, especially large vendors that sell multiple products and services through the channel, have been fragmented, complex, and stove-piped in structure. Each product group in the vendor's organization would develop a separate and unique channel program and channel ecosystem to drive its product or service offerings to market. In an earlier era of the IT industry when a specific channel partner would be likely to engage a vendor for a particular product set (the 1970s and 1980s), such channel organization structures made sense. However, the market has changed and so have the channel programs of IT companies. As shown in Figure 1-1, the business models of different types of IT channel companies are starting to converge.
Figure 1-1
IT Channel Business Models Converge
Source: Gartner Dataquest (June 2004)
Traditionally, value-added resellers (VARs), independent software vendors (ISVs) and systems integrators (SIs) have operated with different models and provided different and unique offerings to clients. During the past two years, Gartner Dataquest has observed a gradual shift in the focus of these companies that is resulting in a convergence of their business focus and models toward the combined model of the IT solution provider (SP). To a great degree, these shifts are being driven by increased client demand for solutions, as well as the economics of the IT marketplace. VARs are enhancing the services and solution elements of their businesses, as are many ISVs. Concurrently, SIs are often required to provide the products and software required as components of the solution they are being contracted to implement and integrate. Thus, IT channel companies are now often representing and reselling several products and offerings of a particular vendor. In response to these changes, IT vendors are challenged to change the structure and organization model of their channel programs to ensure optimal productivity and results from their channel initiatives. Based on the feedback from this research, major channel organizational changes are under way in the IT market.
With this increased focus and change in the world of IT channels, Gartner Dataquest has recently conducted research with IT vendors to determine the state of IT channel strategies and organizational models, as well as anticipated near-term changes. The findings from this research are presented in two reports. This report documents the findings on the topic of IT channel organizational models and makes recommendations based on those findings. Another report ("IT Channel Strategies Evolve With Market Changes," G00121513) addresses the topic of IT channel strategies.
Key Findings and Recommendations
The research uncovered the following findings:
- The business models and focus of various IT channel companies are merging into a common model of a solution provider.
- Many IT vendors are simplifying their channel programs and collapsing their multiple (and often disparate) channel components into a single program.
- Many IT vendors are moving from a traditional strategy that promotes partners based on revenue, to a points-based system that rewards multiple areas of value and contribution.
- Concurrently, many IT vendors are migrating from volume-based channel organization strategies to value-based models.
- IT channel programs are increasingly finding the majority of partners residing in the middle tier of niche or solution-focused partners.
- Increasingly, IT channel programs are aligned by either global geography or vertical industry.
- IT channel programs are increasingly incorporating a solutions focus to the mix, as customer demand for solutions increases.
Based on these findings, Gartner Dataquest makes the following recommendations:
- IT providers should take steps to ensure simplicity and ease of engagement in channel programs. Disparate programs no longer work.
- IT providers should optimize involvement of channel partners across target market segments. Few, if any, markets can't be effectively augmented by channel partners.
- IT providers should improve channel program leverage for improved vertical and geographic market penetration. Clearly defined segmentation and pinpoint profiling are among the keys to success.
- IT providers should manage channel programs as a life cycle model. The growing importance of channel contribution demands no less.
COMPTIA--Breakaway Round Up
By ChannelMedia Staff
Breakaway is tailored to solution providers who are looking to grow their business and as a forum to connect vendor and channel participants to have an open dialogue and discuss ways of furthering their respective businesses. CompTIA organizers, leading vendors and resellers said that on both levels their recent event, held last month in Orlando, was an overwhelming success. "We were looking for qualified solution providers and we found them this year," said John Reardon, Senior VP, Marketing and Product Development, Konica- Minolta Business, USA Inc. He specifically mentioned contacts in the ASCII Group and White Box market. "We were very pleased with the quality. That's what it's all about. We also participated in two roundtable events and learned quite a bit. We were also able to discuss ideas and share with other vendors in a non-competitive way, validating some decisions. It was very favorable to us."
From my perspective the emphasis on skills development and training for the Solution Provider community is a big differentiator and a correct position, said Gary Gillam, VP, North America, Channel Sales, Xerox. The people I polled in attendance were there to take advantage of that, and make an investment to be there. These are the folks that the vendors want to work with; those who are trying to build themselves into trusted IT advisors in the SMB space. Todd Meister, VP of North America Channels at Avaya, was attending his first Breakaway conference and came away impressed. "The attendance was great, I wished I had attended in the past," Meister said. This really has let us reach out and communicate our best in class channel practices, including margin, soft dollar programs and other areas. I'm sure we will be back because we are working with the right qualified groups of VARs."
ChannelWave Selected to Power E-Commerce Operations for NEC Division
By ChannelMedia Staff
ChannelWave announced that nm-select, a wholly owned subsidiary of NEC-Mitsubishi Electronics Display of America, has teamed up with ChannelWave to offer end-to-end e-commerce solution for its top corporate customers. ChannelWave is powering nm-select online stores for employee purchasing programs as well as an outlet store for discontinued and refurbished displays. By outsourcing with ChannelWave's low-risk, shared success service model, nm-select has achieved significant savings on implementation and operating costs and anticipates profitable revenue growth driven by ChannelWave's tailored merchandising and marketing programs, custom catalog, pricing and order management tools, support for selling third-party accessories and real-time integration to distributors for more efficient and accurate multi-sourced fulfillment. "We chose ChannelWave because of its superior expertise in handling the complex challenges of managing orders and fulfilling hard goods for manufacturers at the enterprise level, as well as its shared incentive model for increasing site traffic, sales and margins," said Lisa M. Sons, program manager for nm-select. "We needed real-time capabilities, operational and logistical expertise and the flexibility to support our customers. ChannelWave demonstrated a unique ability to deliver on those requirements." ChannelWave's end-to-end commerce service allows nm-select to provide customers with an easy-to-use online store for purchasing its high-performance LCD and CRT monitors and complementary third-party accessories, as well as a centralized catalog system to manage over 80 branded employee purchasing stores. The commerce sites feature detailed product information, special discounts and promotions, enables customers to place and track orders, and manage payment, shipping, warranties and returns. ChannelWave also provides call center customer service support. The outlet store can be accessed at www.nm-select.com. "nm-select is an innovative, highly differentiated online service designed to give customers easy access to ordering flat panel displays and related products," said Rob Hagen, CEO of ChannelWave. "We are confident that moving their e-commerce operations to ChannelWave's managed services model will help nm-select to exceed the expectations of their customers, while improving efficiencies and increasing their margins on every transaction."
CHANNEL DIGEST
By ChannelMedia Staff
Intel has upgraded the wireless networking capabilities of its Centrino line of notebook computer chips to allow broader network access with improved security. The Santa Clara, California-based chipmaker also said it had developed new software to allow easier user configuration and troubleshooting. Centrino, the brand for Intel's portable computing
products, was launched in March 2003 with a major marketing campaign to
promote the company's Pentium M microprocessors and wireless networking
chips. The world's largest chipmaker has helped make Wi-Fi networking, a
wireless technology for connecting computers to the Internet, a phenomenon
in hotels, cafes, homes and businesses in cities around the world. By 2007,
there will be an estimated 700 million Wi-Fi users worldwide, according to
research firm Pyramid Research. Currently, Centrino-based notebook computers can connect to the two most popular version of Wi-Fi, known as 802.11b and 802.11g. The chip introduced on Thursday can also connect to 802.11a networks, which are far less common
but have advantages for both speed and interference avoidance. The chip also
includes a support for a wireless security technology called 802.11i, which
Intel said offers corporate users the best protection for securing
information flowing across wireless networks from hackers.
Agilent announced that NVIDIA selected the Agilent 93000 SOC Series for testing its current PCI Express-based devices. The BIST Assist 6.4 solution, an extension to the 93000 SOC Series' single scalable architecture, enables NVIDIA to benefit from the industry's lowest-cost test solution for high-speed interfaces such as PCI Express and maximizes its investment in test equipment. Traditional at-speed test approaches of automated test equipment (ATE) and bench instruments offer the highest fault coverage but at a price that is not competitive for volume manufacturing of cost-sensitive consumer devices. BIST Assist 6.4 combines the fault coverage of traditional ATE and the low cost associated with loopback. This allows for a scalable, cost-effective, high-speed serial link testing solution that maximizes capital equipment investment. Agilent BIST Assist 6.4 enables signal integrity testing of high-speed serial interconnects up to 6.4 Gb/s using a cost-effective loopback/BIST (built-in self-test) and reduces costs by more than 50 percent over conventional at-speed production solutions. "By using the Agilent 93000 SOC BIST Assist 6.4, NVIDIA can unleash the full performance potential of the high-speed PCI Express interface in our graphics processors," said Keith Katcher, director of test and product engineering, NVIDIA Corp. "BIST Assist 6.4 is an example of our commitment to extending test capabilities that maximize capital equipment investment for our customers," said Tom Newsom, vice president of Agilent Technologies and general manager of Agilent's SOC Business Unit. "As designs become increasingly complex, Agilent is dedicated to continuous innovation for delivering next-frontier testing solutions that allow our customers to benefit from technology advances."
Art Technology Group (has agreed to buy Seattle rival Primus Knowledge Solutions for about $31 million in stock. Primus sells customer information systems for use in call centers and other customer support functions, competing against RightNow Technologies, eGain Communications and ServiceWare Technologies. For the year ended June 30, the companies had a combined annual revenue of more than $90 million and employed 479 people. They expect to cut $10 to $15 million in costs as a result of the merger, which they plan to complete by the end of the year.
AOpen announced its newest entry in the small form factor barebones PC arena -- the EZ661 series of the increasingly popular AOpen XC Cube product line. The XC Cube EZ661 series of barebones PCs supports Intel Pentium 4 Prescott CPUs of up to 3.4GHz with Intel's Hyper Threading Technology, and has an external bus speed of 533/800 MHz. The EZ661 also features a powerful 275-watt power supply as well as two S-ATA connectors. "AOpen has developed a special 4-way voltage technique to efficiently stabilize the CPU," said Chris Liu, Senior Director, XC Cube Business Management, AOpen Inc. Additionally, the XC Cube EZ661 uses a patented heat sink engineered with four copper heat-reducing tubes to efficiently cool the CPU, and ultra-thin copper heat-dispersing fins with a side-blowing fan to vent hot air out through the ventilation holes of the system. This advanced breakthrough reduces the chance of overheating and affords customers a greater degree of reliability. "With AOpen's innovative cooling technology, the CPU can reliably perform with continuous stability for long hours and at high speeds. And, with the CPU running at full speed, AOpen's unique SilentTek silencing technique provides a low-noise, pleasant and quiet working environment," Liu went on to say. The XC Cube EZ661 is specifically designed for home and office use and includes: Built-in 5.1 channel sound; onboard graphics; built-in 1GB/sec high-speed internet support; four USB ports, three IEEE 1394 ports; two 3.5" hard disc drive bays and a 5.25" drive bay; as well as AGP and PCI slots. The entry-level model EX661L is very similar to the EZ661, but supports either Pentium 4 or Celeron CPUs, features a smaller 220-watt power supply and does not come with S-ATA connectors. The stylishly designed AOpen EZ661 and EX661L both come with a one-year limited warranty and will be shipping to customers in North America by mid-September, 2004. The EZ661 has an MSRP of $250 USD and the entry-level EX661L has an MSRP of $200. For more information on this exciting product, contact Michele Sun at: 408-232-1253 or by e-mail at: Michele_Sun@aopen.com.
The A Consulting Team, an end-to-end IT services and e-services provider, today reported financial results for its second quarter ended June 30, 2004. Revenue for the second quarter increased 9% to $6.3 million from $5.8 million in the first quarter and 20% from $5.3
million in the second quarter of the previous year. TACT reported net income
of $298,000 or $0.14 per basic and $0.13 per diluted share. This compares to
net income of $220,000 or $0.10 per basic and diluted share for the first
quarter of 2004 and a net loss of $(221,000) or $(0.11) per basic and
diluted share in the second quarter of the previous year. The Company's
gross margin was 30% during the second quarter, compared to 29% in the
previous quarter and 25% in the second quarter of 2003. Selling, general and
administrative costs increased to $1.4 million during the quarter reflecting
the Company's decision to increase its sales and recruiting staffs to
support improved customer activity. This represents a 17% increase over the
previous quarter level and a 12% increase over the second quarter of the
previous year. "We have now posted five consecutive quarters of revenue
growth. Our pipeline remains strong and we are optimistic that our third
quarter will be another solid quarter," commented Shmuel BenTov, TACT's
Chairman and CEO. "In order to accommodate an improved market demand with
the level of quality service that our customers have come to value and to
effectively pursue business opportunities, we have selectively added to our
sales, recruiting and professional staff." Richard Falcone, TACT's Chief
Financial Officer, added, "At the end of the second quarter TACT's book
value increased to $2.52 per share from the previous quarter level of $2.28.
Our current ratio also improved to 2.83 from 2.52 and we continue to have no
long-term debt. Financially, TACT is very sound. We emerged from a difficult
economic cycle stronger than when we entered it and we are profitable. Our
operational strategies that navigated TACT through this cycle, have
positioned us to benefit from a market strengthening." We expect our sales
force will provide us with the opportunity to continue our top-line growth
into 2005."
CDW recently announced average daily sales for July 2004 were $22.7 million, an increase of 32 percent compared to average daily sales of $17.2 million for July 2003. Total sales for July 2004 were $478 million based on 21 billing days. Total sales for July 2003 were $378 million based on 22 billing days. Strong double-digit growth was generated by both the corporate and public sector segments in July 2004. In addition, double-digit unit volume growth was achieved in most product categories. Notebook CPUs, notebook accessories, desktop CPUs,
server CPUs, software, and data storage unit volumes increased more than 30
percent for the month on a year-over-year basis. "Our July sales results
demonstrate the dedication of all CDW coworkers to continue to outperform
the market," said John A. Edwardson, chairman and chief executive officer.
"We remain well positioned to continue to gain market share and grow
profitably."
TECH DATA AND EMC CORP TEAM UP -- Federal government contracts can be extremely lucrative to any reseller with the appropriate mix of product offerings. Tech Data, a national distributor, has recognized this and has expanded its relationship with EMC. Tech Data is now offering additional EMC products solely for federal IT contracts. The range of products includes the EMC CLARiiON networked storage solutions, EMC Centera address storage systems and finally EMC software. Tech Data's expansion of EMC products allows the national distributor to provide resellers with more leverage to win those highly sought after government contracts.
Verio announced an incentive program for viaVerio business partners that offers extra commission on the sales of IntelliSecurity Managed Solutions. Verio will pay an extra five percent commission, above normal contractual commission percentages, on the monthly recurring revenue of the IntelliSecurity component of each deal sold during the promotional timeframe. The incentive is available to viaVerio business partners who sign on to the viaVerio partner program between August 31 and September 30, 2004. With regulatory compliance standards, services such as IntelliSecurity Managed Solutions can help viaVerio business partners deliver a range of security options, including managed firewall protection, intrusion detection services, and a range of professional services such as security audits, penetration testing and vulnerability scans designed to ensure businesses meet these new requirements and effectively safeguard their data. In addition, managed services such as IntelliSecurity help partners expand their core competency and contribute to a recurring revenue stream. According to a recent report issued by the Yankee Group, the market for managed security solution providers (MSSPs) will reach $3.7 billion USD by 2010. Commission of sales of IntelliSecurity Managed Solutions applies to the life of the original contract signed and is available to contracted viaVerio Business Partners, either direct or master agent, who have IntelliSecurity sales between the contract sign date and December 31, 2004. Minimum qualifying monthly recurring revenue is $500 USD. Information about the viaVerio Partner Program may be found at www.verio.com/partnerprogram.
ChannelAdvisor announced the availability of the configurator functionality for PowerSellers and top eBay sellers. The ChannelAdvisor Configurator enables sellers to embed an applet in eBay listings that allows a buyer to create and dynamically customize, and then purchase the new customized listing. The ChannelAdvisor Configurator will be offered as part of the ChannelAdvisor Merchant software platform, which is designed to meet the needs of eBay's top sellers. "The ChannelAdvisor Configurator will help me dramatically increase my sales. I'm looking forward to having this up and running by the holiday season," says Chase Elliot, Manager of 47 St. Photo. "This is another example of why ChannelAdvisor is the thought leader in the channel management space and continues to offer the best product on the marketplace." The ChannelAdvisor Configurator provides sellers with many benefits such as allowing sellers to effectively and economically offer their entire catalog on eBay, enabling buyers to create and find the exact item they want and transactions close on eBay through a cost-effective eBay store listing. "ChannelAdvisor continues to develop and enhance the functionality that is essential for top sellers on eBay to stay competitive and take advantage of the upcoming holiday season as well as the longer-term opportunities," says Scot Wingo, CEO and President of ChannelAdvisor. "Adding the configurator capability to ChannelAdvisor Merchant allows our clients to dramatically increase their sales by enabling buyers to customize or configure the exact product they are looking for and also gives our customers a clear competitive advantage." Not all eBay categories are currently approved for use with the configurator. Some categories, which are tentatively approved, are: computers, electronics, cameras and photo, sporting goods, and automobile/boat parts. For sellers in other categories, ChannelAdvisor will work with eBay on a case-by-case basis in order to get program approval.
Sterling Commerce announced today that its July value-added network (VAN) volumes hit an all-time high, due in large part to retail industry growth and the company's overall market leadership. With 75 of the top 100 U.S. retailers using Sterling Commerce's VAN, Sterling Information Broker, the company has experienced an unprecedented growth in transaction volumes, which reached more than one hundred billion characters in both June and July. Top retailers such as Wal-Mart, The Kroger Co., and The Home Depot use Sterling Information Broker to track and handle vast amounts of transactions daily, control inventory, enhance production planning and manage their trading partner communities. Sterling Commerce's network momentum, combined with its position as the top provider of data synchronization solutions to the retail industry, has the company poised for further success in a rapidly growing market. "While we're pleased with our network growth rates, we're certainly not surprised at the correlation between the record-breaking growth of our transaction volumes and the rise in retail sales," said Nolan Rosen, chief marketing officer, Sterling Commerce. "Sterling Information Broker is a centralized intermediary enabling the integration of business information between retailers and their manufacturers, shippers and banks." Sterling Information Broker volumes rose in July to more than one hundred billion characters, representing a 17 percent increase over volumes in July 2003. Additional figures show that Sterling Information Broker experienced growth rates of four percent in 2002, seven percent in 2003, and 16 percent year-to-date in 2004. The company expects to see these rates climb as companies continue to implement radio-frequency identification (RFID) systems. "RFID implementations require that a vast amount of data be exchanged on each pallet, carton and individual item sent to every retailer, and Sterling Commerce's ability to not only handle this data, but to decipher and communicate it electronically across diverse environments has us well positioned to continue our leadership in the retail market, providing a comprehensive, integrated set of network and software solutions," said Rosen.
WatchGuard has joined forces with 1NService to offer WatchGuard's line of integrated security appliances designed for small- to medium-sized enterprises through 1NServices' consortium of value-added resellers. The partnership is a significant extension of WatchGuard's channel network, and enables 1NService to expand its offering of network security solutions for the SME market. 1NService is a consortium of 18 VARs across the US and Canada with aggregate revenues of over $250 million. Through its network of 3,000 technical personnel, six training centers and multiple network operations centers, the organization provides a range of security, networking, IP telephony, wireless and ebusiness solutions to more than 30,000 customers, including many small- and medium-sized enterprises. WatchGuard's Firebox X line of integrated security appliances with full model upgrade capability will be made available to 1NService's network of solution providers and their customers. The Firebox X line combines firewall, VPN, application layer security, intrusion prevention functionality, spam blocking, Web filtering and authentication in a single appliance. Together with 1NService's expertise and resources, including support, training and implementation services, the partnership will give VARs access to a comprehensive security solution that they can offer to growing businesses at an affordable price point. "When choosing a partner, we look for companies that understand our value proposition and have the right balance of products, services and target market knowledge. WatchGuard fits that model extremely well," said Rob Savette, president of 1NService. "WatchGuard recognizes the specific needs of SMEs more than most vendors, and that is reflected in their product and service offering. The model upgrade capability, for example, makes Firebox X ideal for the growing business, while the ability to offer add-on services and features via a software license key is appealing to both VARs and their customers." "Having had relationships with several 1NService members in the past, we expect that this partnership will help us continue to grow our business in North America," said Dale Bastian, vice president of worldwide sales at WatchGuard. "It also allows us to expand the services available to Firebox X customers through 1NService's extensive range of complementary offerings. In this way, the partnership strengthens our commitment to helping businesses meet evolving security challenges."
PeopleSoft announced that more than 40 leading organizations worldwide have selected PeopleSoft's Human Capital Management (HCM) Recruiting solutions in the first two quarters of 2004. New customers including Ingram Micro (NYSE:IM), British Telecom, and the AUS Department of Education are using PeopleSoft Recruiting to improve talent planning, talent acquisition, and on-boarding. "Ingram Micro selected PeopleSoft because best practice talent management is important to us," said Diana Janis, director of human resources and compliance, Ingram Micro. "PeopleSoft's recruiting solution will help streamline our recruiting process, and give us the additional resources and freedom to attract and qualify candidates from around the world via the web." PeopleSoft Recruiting solutions facilitate the hiring process with web-based tools that track and reward employee referrals, generate job requisitions, and automate resume processing by creating a searchable index of submitted resumes. The solution is enabling recruiters to expand their talent pool through the branding and customization of on-line career centers, and allows candidates to more easily apply for jobs on-line, review the status of jobs and inquire about new employment opportunities. Companies including the Borgata Hotel Casino and Spa and Vail Resorts have used on-line career centers and kiosk based employment stations to reduce their time to hire by as much as 50 percent.
Black Dragon Software announced its Black Dragon Channel Partner Program for value-added resellers, systems integrators and IT service providers. Margins are available from a base 20 percent to 38 percent on business generated under $1 million. Black Dragon's Partner Program is a means for Black Dragon to help the channel jointly market, sell, and support the company's security risk measurement appliance, proVizor SRM. proVizor SRM uses proprietary
"Time-to-Defeat" metrics to simulate attacks on the network in order to
identify and then measure the resulting IT security risks.
Early resellers and integrators that have signed up for the Black Dragon
Partner Program include: AppTech of Tacoma, Wash.; NetStar Corp. of Detroit,
Mich.; Paladin Technologies Inc. of Chicago, Ill.; r@eTECH of Tustin,
Calif., and in Europe, Alpha Sistemi, based in Rome, Italy.
Within one week of signing up to the program, IT services provider r@eTECH
deployed Black Dragon's proVizor at FFF Enterprises Inc. of Temecula,
Calif., the nation's largest distributor of human plasma products and
biopharmaceuticals. r@eTECH deployed proVizor to analyze FFF's network for
security vulnerabilities in order to ensure the most secure IT environment
possible. "How can you defend your network without knowing where to defend it?" said
Robert Caggiano, vice president for Security Practice at r@eTECH, the
Tustin, Calif.-based IT solutions provider that deployed Black Dragon's
proVizor at FFF Enterprises. "FFF is at the vanguard of IT security risk
measurement, a concept new to the IT industry and the only known way to
literally quantify your risk, giving your security policies new meaning and
relevance they heretofore never had before."
The program comprises four tiers: Platinum, Gold, Silver and Bronze, with
various discounts offered depending on volume sold. A 20 percent discount is
offered upon obtaining up to $199K in revenue; The Silver program applies a
25 percent discount, and Gold offers a 30% discount. Platinum VARs can
receive up to 38 percent discount for obtaining over $800K in revenue.
To join the program, interested VARs must first purchase the proVizor SRM
appliance but at a significant discount.
RESEARCH
Studies Show Trend for Growing Workforce Optimization Market Moving Toward Software and Services
Witness Systems a global provider of performance optimization software and services, announced that its eQuality software suite and tightly coupled Witness Consulting Network exemplify the growing trend in which Global 2000 and small and medium-sized businesses prefer to purchase software and services separately from their hardware. Industry analyst research shows an increasing independence of software from underlying infrastructure and hardware. "Changes in the mix of hardware, software and services sold provide an encouraging outlook for the continuing diversification and higher-value activities being engaged in by recording vendors. A slight increase in the proportion of revenues from services confirms Datamonitor's expectation that software and services are set to take an increasing proportion of this market's revenue," said Evan Kirchheimer, lead analyst and manager for Datamonitor's CRM practice. "Datamonitor's expectation remains unchanged that vendors will continue this move into higher-value quality management and eLearning solutions."
eQuality's browser-based enterprise collaboration architecture serves as an integrated, closed-loop workforce optimization solution that enables companies to record, evaluate, analyze and learn from customer contacts. "We have long recognized that customers do not want to be tied to proprietary hardware when purchasing software and services for contact center performance optimization," said John Bourne, senior vice president of product management for Witness Systems. "Our strategy is to provide our customers with software solutions that are truly hardware and operating environment independent." Research from Tern Systems and COMMfusion in its study, "Voice/Data Call Recording Markets, Products and Suppliers," reports that for the quality monitoring and call center logging markets, software licenses and services accounted for 87 and 88 percent respectively of the total 2003 revenue for these markets, and is projected to grow 15-18 percent (CAGR) through 2008. "The proportion of hardware cost is relatively small and declining, primarily because products are based on open architecture, which yield multiple suppliers, competition, and lower price," said Tern Systems Founder, Walt Tetschner.
IP PBX Systems See Growth
By Dell'Oro Group
A newly published report from Dell'Oro Group reveals that the market for large IP PBX systems expanded by 17 percent to $367 million in the second quarter of 2004. The report also indicates that nearly 34 percent of total large PBX line shipments worldwide are IP PBX lines, up from only 16 percent a year ago. According to the report, Cisco total PBX revenues, which are derived solely from IP PBX, grew 17 percent to $78 million during the quarter, further closing the gap with the major incumbent PBX manufacturers, Nortel, Avaya, Siemens, Alcatel, and NEC, which were flat to down during 2Q04. "This is the first time that a new entrant has been able to successfully enter the top tier vendors," said Steve Raab, Director of IP Telephony Research at Dell'Oro Group. "Established manufacturers have an advantage because they can offer customers a migration path from traditional PBXs to IP PBXs, while newer entrants offer only IP-based solutions. Despite this perceived disadvantage, Cisco is steadily gaining share."
Total Worldwide PBX Lines Shipped (IP PBX + Traditional PBX + Traditional Key System)
|
| Total Market |
2Q04 |
Qtr./Qtr. Growth |
| --------------- |
----------- |
---------------- |
| Line shipments |
11.1 M |
-1% |
|
| Vendor |
Rank |
Growth |
| --------------- |
----------- |
---------------- |
| Nortel |
1 |
-11% |
| Avaya |
2 |
1% |
| Siemens |
3 |
-1% |
| Alcatel |
4 |
2% |
| NEC |
5 |
-16% |
| Cisco |
6 |
16% |
COMMUNITY
Software…Always Almost Ready for Prime Time
By G. A. "Andy" Marken, President, Marken Communications
Apple took it on the chin when they had a "minor" heat problem with their Powerbook system. Compaq bit the bullet when they had an input device problem. After weeks of denial, Intel admitted to 486 problems and finally offered to replace millions of chips in the field.
We won't compromise when it comes to hardware quality. However, install a new software program, from almost anyone, and you know you will be looking at weeks and months of work disruption.
Today's software firms are almost proud of the fact that their products never finished and are always new. Translation ... you're running your business on partially complete products. That's akin to an auto manufacturer selling cars based on a rough design and customer complaints. Each one that is shipped is improved based on the input and experiences of people who purchased the car last week. As your new car proceeds down the assembly line, they make "minor" enhancements like brakes, engine, electrical, etc., based on customer beta testing and feedback.
While we won't tolerate problems with other products we buy for the home or office, we've come to expect problems with each new software release. We don't even call them problems anymore. They aren't bugs. They're "undocumented features." ...more
Many people relish the fact that they are the first in their group to purchase these untested, unproved and problem-riddled products. For more than three years as Microsoft struggled to develop "Win '95, the next-generation operating system." People around the globe clamored to be the first to use the evolving beta software. Microsoft handed out millions of copies of the software. IS and network managers as well as technically sophisticated individuals provided Microsoft testing and trouble-shooting services at no cost. They used the software, documented the problems and forwarded them to Seattle. As soon as Win 95 was "relatively stable" Microsoft released it to the world.
When Win '95 was released, people stood in lines in front of stores so they could rush in and be one of the first to purchase the new operating system--despite the fact that the press had been documenting the problems for more than six months. Rather than find and fix all of the problems themselves, Microsoft sold millions of copies of the software.
They were so successful that the software industry followed. They realized they were wasting time, money and effort trying to deliver a finished package. They saw that people were actually willing to purchase something that wasn't quite ready to use. In fact, people actually relished the idea of getting software that was buggy, flaky and constantly hanging up or crashing.
Rather than pay for expensive test programmers and engineers, they realized it would be much more cost-effective to let users determine what needs to be fixed.
Few of us would actually put down hard cash for a car for business that is "pretty close to right." However, for applications that we use to run our companies on a daily basis ... it's a great decision.
At shows like COMDEX and NetWorld+Interop, people stand in line and vie for the honor to take home beta software so they can become no-cost guinea pigs for software companies. While the volunteer test engineers usually get the products for nothing, it is becoming so "acceptable" that developers have even begun charging for the partially complete product.
Putting a new spin on the problem software publishers now proclaim that their products are never finished and always new. Users are expected to have problems with each new product release. Publishers send out products knowing that over the next weeks and months, they will have to send out patches and "fixes."
The exception has become the rule.
If the trend is going to continue, it is a strong case for returning to the mainframe era or, as we now call it, thin clients or NC systems. Then, users won't have to purchase and install new software. Instead, it can reside on centralized corporate computer systems. Then, firms will be able to do a better job of coordinating their "upgrades and enhancements" and simply pay per usage.
It's a unique, revolutionary concept that we haven't seen for nearly 25 years
A problem may arise. IS and network management may be slightly less willing to license the beta software. They may insist that software publishers actually finish a product before they begin working on the next version.
If people stop buying work-in-progress software packages, perhaps we'll be able to produce the workflow improvements we were promised. ...more with computers. We'll have the time needed to master the software packages we have before the next rev is released.
And when we receive the software, we won't have to be test engineers for software publishers and can focus on getting work completed.
CompTIA Says Channel is Bullish on Market Conditions
By ChannelMedia Staff
Companies in the information technology industry channel are bullish on
business conditions for the next 12 months, according to a new study
commissioned by CompTIA, the Computing Technology Industry Association. Nearly 90 percent of the more than 500 companies that participated in the
study expect revenue growth of 10 percent or more in the next year. Better
than half (53.9 percent) of respondents said they expect revenue growth of
20 percent or more. Just 9 percent of firms expect to experience a decline
in revenues. "Revenue growth will come about the old fashioned way, through increased
sales, not through mergers or financial engineering," said David Sommer,
vice president, e-commerce, CompTIA. "The difficult market conditions of the
past few years prompted many firms to reduce overhead, streamline business
processes and sharpen their focus on sales and service delivery."
The channel is shifting resources away from product sales and towards
services, especially targeted to small and mid-sized business customers, the
study found. Services such as support outsourcing, systems integration and
network security often offer higher margin and less competition.
But while IT channel companies expect brighter opportunities in the next
year, respondents said the challenges of obtaining new business and trying
to maintain existing relationships are more difficult than ever. Among the
factors affecting profitability:
-- cut backs in support from vendors, who often are competing for the same
services business;
-- more competition;
-- increased expectations from customers who do not understand technology;
-- lack of client loyalty; and
-- difficulty finding and keeping employees with the right combination of
technical and communication skills
"Most companies agree that hiring truly qualified salespeople is one of
their biggest challenges," Sommer said. "They need qualified salespeople
that have technical proficiency as well as the business and communication
skills that are necessary for performing their jobs and serving clients
successfully. The single most repeated theme in this study is the importance
of effective communications with customers, partners and employees."
The IT channel study, conducted for CompTIA by the Yankee Group, identified
key business challenges facing IT channel companies today and over the next
12 months. The Yankee Group is the global leader in communications and
networking research and consulting.
More than 500 individuals participated in the study, which targeted decision
makers from IT resellers, value-added resellers, service providers, and
systems integrators in North America. Respondents were primarily small firms
(75 percent employ fewer than 100 people) with a local or regional customer
base (49 percent sell into one metro area).
A summary of the IT channel study is available on the CompTIA web site.
Continuous revenue program allows resellers to offer software or managed backup services for multi-site storage environments

Top-Selling Software Week of August 15 – August 21, 2004 |
| All Categories |
| 1 |
Norton Antivirus 2004 |
Symantec |
$41 |
| 2 |
Norton Internet Security 2004 |
Symantec |
$68 |
| 3 |
MS Office 2003 Student/Teacher Ed |
Microsoft |
$132 |
| 4 |
Doom 3 |
Activision |
$53 |
| 5 |
Quicken 2005 Deluxe |
Intuit |
$59 |
| 6 |
MS Windows XP Home Ed Upgrade |
Microsoft |
$97 |
| 7 |
Spy Sweeper |
Webroot |
$29 |
| 8 |
Norton System Works 2004 |
Symantec |
$69 |
| 9 |
VirusScan 8.0 |
Network Associates |
$49 |
| 10 |
Spy Sweeper JC |
Webroot |
$12 |
| |
| Business |
| 1 |
MS Office 2003 Student/Teacher Ed |
Microsoft |
$132 |
| 2 |
QuickBooks 2004 Pro |
Intuit |
$274 |
| 3 |
AD Guard |
Valusoft (THQ) |
$16 |
| 4 |
QuickBooks 2004 |
Intuit |
$200 |
| 5 |
Norton AntiSpam 2004 |
Symantec |
$36 |
| 6 |
MS Office 2004 Student & Teacher Ed |
Microsoft |
$143 |
| 7 |
MS Office 2003 Pro Upgr |
Microsoft |
$305 |
| 8 |
MS Office 2003 |
Microsoft |
$386 |
| 9 |
MS Office 2003 Pro |
Microsoft |
$473 |
| 10 |
1000 Best Fonts JC |
Cosmi |
$8 |
| |
| List is based on units sold by twenty-three channel partners. For more information, please contact The NPD Group at (703) 376-6226. |
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