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Stand up for yourself

Stand up for yourself

Late last year, someone whispered in my ear that Compaq would soon open up a chain of retail stores and thereby go into direct competition with its retail channel.

Compaq denied it. My source told me they would, because the plans were being hatched in the US and local management wouldn't yet have heard about it.

The rumours got progressively stronger this year. Certainly the big retailers were well aware of the speculation.

One manager of a large retail outlet sent me a scathing opinion piece about vendors going direct and then asked that we not publish it because he had been assured by the vendor in question that it was not going into direct competition. I'm sure Harvey Norman computer manager Tony Gattari's famous threat on the front page of ARN earlier this year - if you deal direct, you're out - was made with the Compaq rumours in mind, too.

The question in my mind, after this week's revelation that a retail operation is imminent, is have Compaq's continual denials to both ARN and retail partners been sheer dishonesty or does the local operation just not have any say in its go-to-market policy here in Australia?

Compaq has continually maintained that the dynamics of the Australian market are different to elsewhere in the world, because the channel here is so strong. As such, it was unlikely it would follow in the footsteps of the European and US operations by launching direct retail and Internet operations, Compaq claimed.

With a retail operation imminent, how long before it unveils a direct-selling Web operation?

You'll then have a situation where Compaq competes with its retail partners with its own brand of Compaq stores; where it competes with smaller resellers via the Internet; and where it competes with larger resellers and integrators with direct selling into corporate accounts through its services arm.

The question now is what is the channel going to do about it?

The good news is that I don't think too many in the channel will be shocked. Only a month or so ago we ran a story where resellers were very sceptical of HP's claims that it would not go direct. Resellers, it seems, have accepted that vendors will go direct when it suits them.

But accepting it's going to happen and playing along with it are two very different matters. Co-opetition has certainly been one of the IT industry's favourite buzzwords of the '90s. Will resellers accept that their vendors will be partners in one deal and compete in another? Some will argue that has always been the case. However, the channel needs to remember that, according to Quadrant's research, you are the people who are the primary influencers of what IT managers buy. You're even more influential when it comes to consumers and small business.

You have the power to at least recommend brands that are doing the right thing for yourself and the channel. It's time to stand up for yourself.

Will vendors' direct strategies influence the brands you carry and recommend? Drop me a line and let me know what you think.


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