Your channel partner must step up to the cloud: IDC

Vendors and resellers have to step up their game in keeping up with cloud computing services if they intend to keep their enterprise customers

As cloud computing becomes more popular, resale margins for those IT resellers knocking on your door, calling your business are deteriorating.

According to a study released by IDC Asia-Pacific on cloud impacts on the channel partner business model, vendors and resellers will need to step up to the plate in adding value to cloud computing services over the next four years.

The study found as public cloud services become more prevalent in the market, customers will be able to access more products directly from vendors, possibly cutting out channel partners from the business model - a fear many have held for some time.

IDC analyst, Chris Morris, said that spending on public cloud services are expected to make up 10 per cent of total ICT expenditure throughout the region by 2013.

The study also concluded that most enterprise-level companies would evolve over time to using a hybrid of public and private networks for cloud computing.

According to the IT services survey conducted by the market intelligence company in 2009, 75 per cent of IT executives indicated that they had a good relationship with local channel partners and were satisfied and comfortable with the quality of services and goods provided by local IT vendors. However, satisfaction levels for competing multi-national corporations (MNCs) are quickly catching up.

In an online presentation held on the study, IDC analyst, Philip Carter, said that most companies preferred to continue having good relationships with their local IT vendors, but that over time, local channel partners must be able to build out new skill sets in order to cater for clients that will be implementing cloud technologies and services.

Carter also stated that channel partners will have to to invest in cloud computing early, but should be expected to wait two to three years before seeing any return on investments (ROI).

While 50 per cent of resellers see cloud computing as an opportunity, vendors have been slow in adopting cloud technology services, with only 21.15 per cent of those surveyed offering any cloud computing services.

Resellers would also be expected to add value to the cloud services they offer, moving from collecting one-time fees for recommendations to being held on a monthly retainer.

IDC analyst, Sureshpal Singh said that despite the possibility of losing business to MNCs, there were still abundant opportunities for the channels in the private cloud space.

"Public cloud vendors are also realising that they do need the local channel community because they are major influences in end-user decision making." Singh said, "End users are going to rely on the channel partner that they've been working with for years to give them recommendations on the best approach forward and want their channel partners to be involved in what they do."

Aside from changing the channel ecosystem, cloud computing will also have a big impact on the legal landscape.

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