PIPE DREAMS: The new e-business channel - telcos

You could argue the advent of new Web-based business models is making the IT channel too confusing. We've seen many channels diversify away from being nothing more than sophisticated warehouse and order takers to complete IT solution partners. And as the Web continues to penetrate the wider business community, new channel partners such as Web application builders have emerged.

But what about a telecommunications carrier as a channel partner? Telcos need a new breed of channel partner as they seek to enter the e-business world.

This issue revolves around the e-business challenge when applications drive customers' business strategies and infrastructure issues become costs centres.

In the past, vendors judged their partners' merit simply by counting the money they brought in each quarter. Now many vendors evaluate business partners differently. Vendors such as Microsoft are overhauling their programs to weigh in customer testimonials for e-commerce systems. In the same way, telcos need a new channel -- channel X -- to find particular technical expertise and develop applications.

This is an exciting time for the channel when volume sales are no longer the key. As services become more technical and complex, and involve multiple databases, partners must deliver solutions or face heat from customers. Telcos such as Cable & Wireless Optus are looking not just for industry expertise in implementing solutions and technical depth in their development skills but also extensive service level agreements.

In the new e-business world, telcos must look outside the square to meet specific customer needs and develop some very new initiatives. For example, a-Services, the global joint venture between Cable & Wireless, Microsoft and Compaq, allows partners to deliver an end-to-end solution. If solutions partners can sell a-Services directly to the end user, these partners can earn commissions on each seat sold, in addition to ongoing revenues associated with hardware or network upgrades. As a result, new revenue opportunities are extremely attractive and easy to achieve. In fact, the opportunities are such that there are claims that a-Services could become bigger than Cable & Wireless itself.

In addition, CWO is forging ahead with its own plans to deliver additional ASP-type services to business, including a strong commitment to e-commerce services and sophisticated hosting infrastructure solutions.

The market opportunities are immense. As Web developers move away from creating traditional brochureware, graphic designers have moved to working solely on the Web. There will be a real shift - from glamour sites to those that help pay bills, manage GST, procure, manage customers, and deliver fully online customer service environments. And these services need teams of Web developers on projects that require months of planning, design and testing.

As the Web gets serious, it is an exciting time for the channel to act - and telcos like CWO want to be part of the solution.

Rita Arrigo

Industry Development Manager

e-Solutions Cable and Wireless Optus

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