Saturday, 17 November 2007

Channel vision

I've talked before about Cisco and how they hit the market at exactly the right time with the right product. But these guys never needed distribution networks like the UK channel, they created the UK channel. The world NEEDED Cisco kit. There was nothing else, computers were booming and networking was king. The channel sprouted up out of nothing almost overnight to cope with demand, pure and simple economics.

I've mentioned Juniper and a million other "second phase" technologies as I will now be referring to them as. These are the ones who took advantage of the newly created channel of distributors and resellers to sell a whole new set of technologies, built on the holes in the existing ones. Now the economics began to work differently, the channel had to get smarter, employ people who understood the technology and 'add value'. How many distis and resellers are now called 'value added distis or resellers'?

Many of the people driving these sales from the US had been responsible for at least part of the first phase too. This is where they cut their teeth, watching the millionaire being made, and doing it for themselves in the second phase. The second phase is now mature, many technologies are being acquired, resellers and distis too as everything amalgamates into a giant Googlemonster. However, this leaves us with an interesting development.

When I left the channel some months back, despite some great people and reasonably interesting technologies, I felt as though the brakes were on. I thought there was more value in being a technology leader. I aimed way over the top as it happened, too visionary for the UK market right now at least. All this did was confirm one thing, the channel was too 'safe', or as I said back then, stagnant.

The problem is, the people who have come in under the value added generation have been led to believe that there is a set way of doing things which just works. And to an extent it does. Juniper did very well out of the current distribtution model for example. However, Juniper are now the Cisco of yesterday, becoming self sufficient. There is very little value that the old-style channel can add.

So what happens? The channel gets bloated and filled with marginal value adding, carrying already fat technologies because the status quo isn't being changed.

My friend wants to change that, and so do I. They are bringing new technologies in in the old way, helping small companies to grow, not already established ones. The new way is just the old way in a new hat, but it took it being waved under my nose to recognise it.

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