Exploiting new networking opportunities
From contracts to acquisitions, the networking channel continues to redefine itselfThis was the year the networking channel did its own networking. Consolidation of the market has seen network integrators' services offerings overlap with those of large outsourcing players as the two company types continue to redefine their role in the market.
The year has also seen resellers change their businesses to reflect customer needs for tailored, specialist services.
The "end-to-end" solutions concept has well and truly matured, while the types of services on offer have developed from straight integration to widespread adoption of complex network management solutions. In particular, remote network monitoring from data centres such as those operated by Com Tech and Getronics gathered customer momentum.
In the past couple of months, voice/data convergence has been a topic of talk, with the channel looking at how it would approach offering these solutions to its customers.
The opinion from both the vendor and network integrator perspective seems to be that the channel will initially make an approach through partnerships with companies who have the required skills, later looking towards mergers and acquisitions to skill up in the necessary areas.
Vendors also seem to have reassessed their strategies during 1999, defining what product areas they focus on and fighting pricing wars. For example, Nortel has dropped the prices of its routers in recent months, and one of the markets 3Com has been targeting is SMEs, by releasing a range of products specifically aimed at this market.
As always, the networking channel has also been pursuing and winning big contracts with customers.
Also, not to be forgotten is the Y2K issue. This includes the continuing debate as to the extent of customers locking down on awarding contracts in the latter part of 1999 and what will happen during the changeover period.
The issue will continue into next year concerning what will be the next big focus of spending in the networking arena. Opinion in recent months has been that security, GST and e-business could be among the areas to keep an eye on.
In a decisive thrust aimed at carving a slice of the growing SME workgroup switch market, Xylan and LAN Systems launch a joint initiative, offering two new products and a number of programs specifically designed for small-to-medium enterprise network solutions.
Southmark Solutions, a Melbourne-based systems integrator, continues its success in the tertiary educational networking market with a contract to install Australia's first university Gigabit Ethernet backbone at The Box Hill Institute.
Compaq looks to convergence between computing and communications, in contrast with most networking vendors who are focused on the marriage of voice and data.
Network connectivity specialist Nbase-Xyplex sets up shop in Australia with the help of two distributors and a wide reseller base.
Network integrator NetStar moves into offering security consulting and integration, in what it believes is a largely untapped Australian market and a huge opportunity for the channel.
Communications integration specialist Scitec edges out local rivals to score a lucrative network upgrade project with West Australian farmers Co-operative Bulk Handling Limited.
A group of Victorian IT businesses defeats IBM and Compaq in a $15 million hospital integration deal, touted as being one of Australia's first serious converged voice and data projects.
Small business networking specialist Linksys moves into the Australian market in a bid to infiltrate the home connectivity market.
Madge Networks strikes a serious blow to competitor Olicom, when it announces the acquisition of Olicom's token ring business for over $US15 million.
Network bandwidth rental becomes the latest opportunity to hit CHA's national network after the distribu- tor signs a distribution agreement with Internet infrastructure provider VivaNet.
Com Tech Communications announces its South African parent company, Dimension Data, has acquired the European networking business of South African competitor Comparex Holdings for around $2 billion.
Cisco announces it plans to buy between 20 and 25 companies over the next year with potential acquisition targets located around the world, not just in the US.