Services lead channel charge

Services lead channel charge


Latest figures from channel research specialist Inform Business Development reveal channel services revenues have overtaken hardware revenues for the first time.

David Hancock, Inform's director, told guests at ARN's industry breakfast last week that services revenues witnessed much faster growth between 1998 and 1999 than any preceding year since the research started in 1996. Services grew from 37 per cent to account for 42 per cent of all revenues, while hardware fell from 39 to 38 per cent over the same period.

"I didn't expect it to jump that much," he commented.

Hancock said one explanation for the growing importance of services is the move by many channel companies to bring more of their business online.

Hancock also revealed a divergence of revenue spending expectations between senior IT managers and the channel when it comes to services.

The channel expects around 43 per cent of revenues to come from services, while MIS/IT managers expect to spend over 25 per cent on services over the coming year. Hancock said the difference can be accounted for as the users may only have responsibility for a proportion of a company's overall IT budget. However, the same research figures showed both IT managers and the channel expect exactly the same hardware revenues at about 30 per cent.

Meanwhile, Inform's latest research on revenue source by customer revealed the leading group at 34 per cent are small organisations, classified by the Australian Bureau of Statistics (ABS) as containing between one and 50 staff. The second largest group, coming in at 19 per cent, are medium organisations, which the ABS states contain between 51 and 499 employees.

According to Hancock, this combined SME group accounts for a total of 53 per cent of all IT revenues, which gives credence to a number of vendors who are ramping up marketing activities in this segment.

In the marketing stakes, resellers voted Tech Pacific the most effective marketer at around 28 per cent, followed by Express Data at 15 per cent, while Digiland, ITG and Dicker Data registered under 5 per cent of the vote for the best marketer.

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