As businesses across New Zealand commit to shifting IT needs off premise and into the skies, the future of cloud has morphed into a Kiwi reality for the channel.
“There’s nothing that cloud hasn’t touched in the New Zealand ICT industry,” observes Stephen Ponsford, Chief Technology Officer, Revera.
“And that’s not hyping the market up, it’s exactly what we have seen on the ground here.”
Across the land of the long white cloud, research analyst firm IDC claims the big winner for businesses will centre around cloud-based services, which will grow at 15–27 percent until 2019 at a local level.
Analyst reports aside however, the direction of travel is clear for businesses up and down the country, triggering a chain reaction throughout the Kiwi channel.
But as the partners fight for market share in an increasingly competitive world, and vendors readjust and realign along the way, distribution is also coming of age, painting a new channel picture in the context of cloud.
If distributors are to gain traction in a cloud focused channel economy however, a new market approach is required.
In association with rhipe, Reseller News hosted key vendors and partners to discuss the changing channel in New Zealand, assessing the true art of coopetition and the emerging value-added opportunities cloud brings to the market, at Artisan Restaurant in Wellington.
“As an aggregator and enabler, our responsibility is to work with channel partners to identify holes in their offerings,” says George De Bono, General Manager of Sales in Australia and New Zealand, rhipe. “We also work with our vendors to collaborate and build collective solutions to enable our downstream partners to add value to their customers.”
For De Bono, as cloud adoption accelerates in New Zealand, the conversations rhipe are having with the Kiwi channel continue to zone in around three core topics.
“Firstly, how do we help your top line?” he explains. “Secondly, how do we help you run your business more efficiently? And thirdly, how do we mitigate your risk?”
The art of value-add
Straightforward in delivery but hard-hitting in its reach, De Bono believes that if distributors are to gain traction in a cloud focused channel economy, a new market approach is required.
Traditionally speaking, channel partners have relied on distribution to augment the services they deliver, but as cloud continues to gain traction and acceptance in Kiwi boardrooms, a new type of distributor is emerging.
“Everyone talks about value-added distributors, and it’s a great phase to throw around, but the meaning has changed,” observes Derek Wilson, Country Manager, Red Hat. “If you look back to distribution, distributors shifted boxes, provided micro billing and offered credit but that is no longer good enough.
“And it is especially not good enough in the software space. What has changed is that the channel is now asking distribution to assist with the sales cycle, to find new partners and to source new customers.
“The notion of collaboration across the channel is also becoming more important by the day. Very rarely do we complete a sale that is purely a Red Hat only product, there is always something else added into the mix and this is a huge change for the market.”
Delving deeper, Wilson believes fostering a collaborative environment is key to the success of the modern day distributor, drawing on Red Hat’s recent partnership with Microsoft, once a long-time industry rival.
Reflecting the changing attitudes of both vendors, the new partnership is one of many examples of how cloud is shaking the status quo across all aspects of the channel, both locally and at a global level.
Today, vendors also understand the difficulty of embarking on a cloud strategy alone, creating new relevance for distributors in the form not only traditional reach, but through deeper partner mentoring and support.
“As a channel company, we rely heavily on our distributors in New Zealand,” adds Heather Gordon, SMB Sales and Marketing Manager, Microsoft. “As we’ve developed our cloud channel model, we’ve seen our distributors align alongside at a local level, and help push out our message to channel partners across the country.
“Cloud brings a frequency of updates and we have been working closely with our distributors to translate this to partners, ensuring they are kept up to date with every new release that comes to market.
“Where we see distributors add value is through aggregation and through a marketplace where a partner can come in, offer monthly billing to their customers with an aggregated view of services on offer.
“For partners who don’t have skills in certain areas of cloud, we are seeing strong uptake in white labelling products and selling on behalf of other partners and the channel is seeing a lot of value in this approach.”
As Gordon observes, the growth of cloud has triggered the emergence of new partners in the ecosystem in New Zealand, such as born in the cloud providers, start-ups and Independent Software Vendors (ISVs).