IBM pursues direct dollar

While rumours have been reverberating for months within the channel, IBM will begin advertising its Internet sales site - which is already up and running - over the coming weeks.

IBM joins a host of vendors pursuing the direct dollar, including Compaq, NEC, Sony and Hewlett-Packard. But its personal systems group general manager Phil Bullock is at pains to tell the channel that the company will still rely on its support for most of its sales, despite the move towards a direct sales model.

"The marketplace is changing," he told ARN. "The Internet is playing more of a role and the traditional manner of buying technology has changed. In a way, we mirror that marketplace."

While the move is hardly new - IBM has been selling direct in the US since 1998 - it is the first time such a model has been implemented in Australia. As late as March this year, the company was playing down any plans to sell directly over the Internet, but it now plans to conduct around 30 per cent of its sales via the direct model.

"We have been very methodical about our movements because our relationships with our partners is very important to the company. Many have a significant amount of their business tied up with IBM," Bullock said. "We don't expect the decision to be welcomed with open arms but we must understand that the market has changed irrevocably. It is not going back, and we are taking advantage of the changes in the marketplace."

Bullock has spent the past few months talking to IBM's partners around Australia about the strategy. "Our primary source of sales will still be through our partners," he said. "I believe those [companies] that provide choice will be strong in the marketplace.

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