Networking distributor LAN Systems has entered into a distribution agreement with high-end Web switching maker Alteon, set to be formally announced this week, signalling the vendor's new strategic push towards a significant channel model.
According to Nick Verykios, recently appointed general manager of LAN Systems, the move to distribute Atleon arose through reseller demand in the Web switching market.
"There was a hell of a lot of need for it in the market," claims Verykios. "Our resellers were demanding the market leader in that Web switching space, and ironically, the market leader [Alteon] needed a channel."
An enthusiastic Verykios claims the decision was a logical progression for LAN Systems and believes the complexity of the Alteon product range ensures the channel will reap the benefits.
"It's a very complex product and the more complex the technology, the more resellers are protected from a commodity sell," Verykios said.
Recognising the true potential of the channel, Alteon's regional sales manager Australia/New Zealand, David Elliott, said: "We were looking for a real value-added distributor. The one in this country is LAN Systems. It's our way of getting to the channel.
The signing of Alteon also sparks an interest in the vendor's competition, with rival networking suppliers such as Cisco again distributed through LAN Systems.
But both Verykios and Elliott claim any competition issues ultimately lie with the customer. Furthermore, Elliott was quick to point out Alteon's product range as being very specific in the Web switching space, as opposed to Cisco, which offers a whole gambit of network switching product groups.
As for revenue projections, Verykios said LAN Systems is looking to scoop $10-12 million in the first year of distribution, which in turn carves out a $20 million opportunity for the channel.
The decision comes after six to eight weeks of discussions between the two companies, although LAN Systems has been supplying Alteon products on a limited basis for the past three months. Orders are currently being taken.