Value Added Services – Build out to Cloud

Last week I described how in the mid 90’s I’d first started out in Channel sales and how I’d used that later experience to build a multi million pound revenue stream of my own through “emulating” the success story at Sage Software who had built a billion pound success story out of hard work and sensible business planning.

The computer industry at the reseller tier and especially the small to medium reseller level has changed beyond comprehension since the mid 1990s. Talk to any reseller who in the mid 1990s dealt direct with the end user SME or entry level enterprise making their first steps in providing services and network technologies. The emergence of Microsoft Small Business Server, Microsoft BackOffice and the crucial evolution of Netware 3.x to 4.0 and the realisation that IPX was replaced by the ubiquitous IP routing protocol.

Customers became more savvy, Dell and HP then became core gamechangers in their own right, HP with the acquisition of Compaq who had hoovered up DEC and Dell with their blossoming empire now emerging to take in servers, desktops, laptops and even printer technologies and all the consumables but with one major difference to ever before. Both allowed customers to buy direct, cutting out the reseller channel. Customers were able to order hardware themselves direct, no longer would customers rely on the reseller for end to end service management for their granular needs, they could go direct and get the hardware and start racking stacking, deploying and patching their own environments. This removed a major revenue stream from the reseller community whose traditional revenue stream had relied on the ability to deal with the Ingram Micro’s, the MicroPeripherals, the Northambers of the IT channel to buy hardware and associated software licences such as Netware, SCO and originally the Microsoft licences that were needed to provide the file and print operating system that bore the brunt of the workloads in the time before technologies initially such as PPTP and then IPSec allowed us to tie offices together over first dedicated connectivity and then the internet in its infancy inheriting the role as carrier of choice.

But there was another game changer, Linux.

Linux gave the ability to start deploying not just server technology but also embedded technologies based on Linux. Look at Barracuda, look at Fortinet, SmoothWall, Riverbed, all specialist niche vendors of hardware and software whose UTM devices take the power of Linux and use it often as a network boundary device, firewall, spam and mail filtering, and security enforcing functionality all developed around Red Hat based technologies.

Linux did something more important. It empowered individuals and talented resellers to start realising there was a new revenue opportunity to kickstart their business generation as Linux became a defacto standard for web workloads, and this continues where resellers are now able to be centres of excellence working with customers and the upstream channel to provide real world solutions that are engineered on a bespoke basis to deliver massive functionality.

Never more so is that more true in Cloud and virtualisation. Customers are capable, Linux and Open Source allows them to skill up, be more aware than ever that they can do a huge amount more now they can get under the bonnet to modify and reprovision but there is always room for the value added reseller with ambition.

From security and identity access management through to specialist audit and security advice around Cloud, application lifecycle management, JBoss development and certification, big data / unstructured data and GlusterFS, RHEL and RHEV. In a climate of change, economists talk about the emergence of green shoots of recovery, basic baseline growth and recovery in the IT sector. It’s fundamental that people start to realise that many of the resellers who have been working with Red Hat over the last four challenging years have seen consistent business growth, supported and promoted by a partner who cares passionately about their ability to succeed and innovate.

Cloud gives a reseller a new challenge, if they don’t grab it what will happen is that they in the long term will suffer more erosion both on margins and ability to compete and grow. The alternative is to talk with passion and authority about Cloud and to be supported by a market leader with a proven stack.

There has never been a better time to start thinking about business change, innovation is alive and well and wearing a red fedora. If you want to know more reach out to me directly or speak to your local Red Hat staff and we can continue the conversation.

It’s time to start thinking out the box more than ever before. The next five years of your business evolution relies on being able to innovate, to develop and promote services and solutions that offer flexibility to your staff and your customers. Inertia is the key, having a story to tell helps, we’re here to back you to the hilt. For another reason to take us seriously read what Marco Bill Peters has had to say about our innovation piece. Might be the most important link you read today.

Let’s talk business.