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Editorial: For services rendered

Editorial: For services rendered

At the start of last week, I was talking to an IDC analyst about latest developments in the digital home market. Without giving too much away, because the interview will appear in next month's addition of ARN Home, he painted a picture of how he sees that market developing during the next few years and what it will mean for traditional IT resellers with a focus on selling to consumers.

He made some very interesting points about how these businesses will coexist with the mass merchants, consumer electronic retailers and an increasingly important service provider industry. Put in a nutshell, he suggested Harvey Norman et al are always going to have an important role to play in creating desire for these products because they have the floor space to paint a picture for consumers. But he also highlighted a growing opportunity for resellers to help people get these technologies working effectively once they get them home and take them out of the box.

This isn't a brand new idea but it is gaining traction all the time. I mention it now because of the announcement that Netgear has signed up a local installation and maintenance franchise to support its low end range of ADSL modems, broadband routers and wireless adapters. Netgear sells through leading retailers - including Harvey Norman, Officeworks and Retravision - as well as the country's largest independent reseller group, Leading Edge. If the Troubleshooters franchise can get its services promoted by those organisations, its fleet of 'one man and his van' operators will be laughing all the way to the bank.

Netgear isn't the first cab off the installation services rank because D-Link started offering third-party installation services back in August of last year. But, if memory serves me right, the D-Link services are offered through a large national outfit. The most interesting aspect of the Netgear announcement is that it is feeding opportunities back to the grass roots of the channel.

While D-Link and Netgear should be applauded for helping to define new revenue streams for the channel, their manoeuvres look likely to create some channel conflict. Both vendors have been quick to promote these installation services as an additional level of support for smaller resellers that want to sell a box and wash their hands of what happens next.

But what about those that have invested valuable time and resources into gaining network accreditations in order to build services into their business model? Surely these resellers will be much less excited to hear that their main competitive advantage over mass merchants is being eaten away.

It is impossible to please all of the people all of the time, but the way this consumer installation and maintenance services market develops is going to be fascinating to watch. With the going rate somewhere in the region of $100 an hour, there are undoubtedly plenty of dollars to be earned for those who get it right. But anybody intent on winning a slice of the action should be putting their plans in motion sooner rather than later.

On a separate note, hats off to Alstom IT for the growth it has recorded since completing its local management buyout in October. Last week's column discussed the growing trend for distributors to offer renewal services to resellers and failed to mention Alstom despite the fact that its service was up and running two months ago.


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