Menu
Cisco makes industry-defining distribution change in NZ

Cisco makes industry-defining distribution change in NZ

Tech giant rolls the dice and Westcon-Comstor comes up tops

Cisco International Ltd (Cisco) has overhauled its distribution strategy in New Zealand, parting company with Dicker Data and Ingram Micro in an industry-defining round of channel changes.

Reseller News can exclusively reveal that Westcon-Comstor has been appointed as the sole distributor for the tech giant locally, following a detailed six month tender process.

Labelled as the biggest change to Cisco’s go-to-market strategy across the country for over a decade, the deal stands to send shockwaves across the country.

“This journey has been over 12 months in the making,” Cisco New Zealand country manager Dave Wilson told Reseller News.

“This started with us changing our own business within Cisco after looking at the market and determining how we become better aligned to our partner network.

“We took the step of changing Cisco first, which has led us onto the next phase around how we better serve the channel through distribution.”

After first being reported by Reseller News on 3 August, the in-depth RFP process is now complete with Cisco informing all impacted parties, plus its partner ecosystem across New Zealand.

“We decided to optimise the current channel we have but this decision hasn’t been made because of any failings on the part of any distributor,” Wilson added. “This is purely part of Cisco’s strategy going forward and was a very hard decision to make.

“It’s one of the biggest go-to-market changes that we’ve made in New Zealand for 10-15 years, which is why we haven’t taken the decision lightly.”

Wilson told Reseller News that the decision was based on “six months of detail” with the vendor pushing the date back as the deadline loomed, to ensure a rigorous procedure was adhered to.

“There were no systemic failures,” Wilson stressed. “We have a great relationship with Dicker Data and a great relationship with Ingram Micro. This was about changing how we go-to-market and aligning with our customer needs and that of our own.”

From a trading perspective, Wilson said no date has been set for the closing of business from both Dicker Data and Ingram Micro.

“That’s up for negotiation because this isn’t down to any performance issues,” Wilson added. “Ingram Micro is a very important partner of Cisco’s globally, and Dicker Data is a very important partner in Australia so we are negotiating on how that goes.

“We need to do what is right by both parties and we also need to do what is right by the channel as well. We don’t want to disrupt the business of the channel nor ours.”

At Dicker Data, plans are already in place to sell down existing inventories and work to transition partners - during this period, back to back orders will also be fulfilled.

“It’s very disappointing, but we will respond aggressively, like we always do,” Dicker Data chairman and CEO David Dicker said.

Dicker said the distributor remains “committed” to the New Zealand market, and is “actively looking” to form new tier-one vendor relationships locally.

According to Wilson, the ongoing discussions around the Cisco Spark service, and its impact on Spark in New Zealand from a naming rights perspective, were not part of the distribution decision.

“There’s nothing to talk about right now,” Wilson added. “We have a great relationship with Spark, they are a great partner and we remain in conversation with them around a bunch of different things, but nothing to a point that would warrant any further conversation at this point.

“This is a process that started over 12 months ago and is nothing to do with Spark.”

Why Westcon-Comstor?

After launching a dedicated Cisco practice under the banner of Comstor in New Zealand during 2015, Westcon-Comstor has built a business on providing expertise across networking, collaboration, security and data centre solutions.

Going forward, partners will now be able to leverage the practice further, backed up by increased support and investment by Cisco.

“This will allow for combined focus and investment, which we will be able to put into the partner network,” Wilson added. “It just makes sense that we are focused, come together and become more open and aligned on strategies. For partners, I have no doubt that this will turn up in a greater way.”

The news will also be seen as a huge boost to NetApp, a vendor that has bet big on the Comstor business through its deepened partnership with Cisco, in relation to driving adoption of FlexPod technologies.

From a channel perspective, Wilson said the consolidation helps create increased investment for Kiwi partners, backed up by closer alignment around go-to-market strategies.

“The process was the most detailed I’ve ever been through with multiple different categories of past and present performances,” Wilson added “From the response of the RFP to the presentations, we had a panel of six representing multiple business units.

“First and foremost operational performance was key, through to areas around go-to-market strategy, sales, market reach and efficiencies, as well as future plans.

“We held lots of meetings internally at a global level and the feedback we have received both internally and externally suggests that this was one of the better RFP processes in the channel.”

Channel changes

On paper, the consolidation aligns with the common channel consensus that multiple distribution agreements in New Zealand are fading, with vendors seemingly preferring to back one industry player, rather than hedging bets across several providers.

Despite Dicker Data and Ingram Micro missing out on this occasion however, the reshuffle merely follows local market trends, adding to the list of major vendors readjusting distribution strategies in New Zealand.

And during the past 24 months, it’s been a case of swings and roundabouts.

Because it was EMC that kick-started the recent trend of changing distributors, moving away from Westcon-Comstor to strike an exclusive agreement with Ingram Micro in May 2015.

As a result, RSA soon followed in December 2015, with Dell also opting for an exclusive agreement with the global provider during the same year.

More recently however, the strategic review follows a busy year for the Kiwi distribution space in general, with a number of vendors either changing or adding partners in pursuit of greater market share.

Staying with Ingram Micro, the signing of Polycom added weight to an expanding unified communications portfolio, alongside the recruitment of specialist players Addcom Contact Solutions and Dahua Technology.

Coupled with the addition of Lantronix through the Connector Systems brand and NetEnrich, 2017 started with an exclusive agreement to offer Trend Micro’s commercial product portfolio in the perpetual license space across New Zealand.

Meanwhile, Dicker Data was recently appointed by Schneider Electric locally to replace Ingram Micro, following a partnership with TeamViewer in April, backed up by pre-Christmas deal with Lenovo.

Furthermore, the distributor also parted ways with Aerohive Networks in New Zealand, ending a distribution agreement that lasted almost two years.

In addition, Westcon-Comstor bolstered its capabilities across public cloud this year, targeting Amazon Web Services (AWS), Microsoft Azure and Google Cloud environments through a new software-as-a-service (SaaS) platform launch.

The launch followed a distribution deal with data migration software vendor, Datadobi, as part of a regional agreement.

Collectively, the Kiwi channel has witnessed 12 months of substantial change from a distributor and vendor standpoint, with the Cisco decision set to reshape the distribution landscape across New Zealand.


Follow Us

Join the newsletter!

Error: Please check your email address.

Tags Dicker DatasparkWestcon-ComstorIngram MicroCloudciscoData Centre

Featured

Slideshows

Meet the top performing HP partners in NZ

Meet the top performing HP partners in NZ

HP honoured leading partners across the channel at the Partner Awards 2017 in New Zealand, recognising excellence across the entire print and personal systems portfolio.

Meet the top performing HP partners in NZ
Tech industry comes together as Lexel celebrates turning 30

Tech industry comes together as Lexel celebrates turning 30

Leading figures within the technology industry across New Zealand came together to celebrate 30 years of success for Lexel Systems, at a milestone birthday occasion at St Matthews in the City.​

Tech industry comes together as Lexel celebrates turning 30
HP re-imagines education through Auckland event launch

HP re-imagines education through Auckland event launch

HP New Zealand held an inaugural Evolve Education event at Aotea Centre in Auckland, welcoming over 70 principals, teachers and education experts to explore ways of shaping and enhancing learning using technology.

HP re-imagines education through Auckland event launch
Show Comments