It's always a dangerous play in the channel to put too many eggs in one basket because this is a volatile industry where change is the norm. Building your entire business around a single product set, as Prism did with U2 UniVerse and UniData post relational database products, is akin to walking a tightrope.
A 'Dear John' letter has severed that rope and sent Prism heading for the floor without a safety net in sight.
For its part, IBM has made allegations that its master VAR acted in breach of its agreement. But, according to Prism, it has never been informed of any such breach and was simply told that Big Blue was rationalising its channel. If that is true, it is an incredible state of affairs.
You have to think it unlikely that IBM has taken this decision on a whim but using generalisations such as 'breach of contract' and 'channel rationalisation' doesn't shed any light on the matter. Lack of clear communication is one of the biggest gripes the channel has with the vendor community.
Resellers will now be seeking assurances from IBM that it is committed to the U2 market, something the vendor was at pains to point out in its statement to ARN. But words are all well and good. Only time will tell if the remaining master VAR, MBS, has the capacity to maintain service levels when it has another 60-70 dealers added to its books.
If not, IBM risks losing dealers and users to Microsoft SQL and other database vendors.
While the reasons behind the Prism termination remain shrouded in mystery for now, something tells me there will be more instalments in weeks to come. We will keep you abreast of any developments.
On a more positive note in the IBM channel, the vendor has announced plans to pick up the hiring tab on behalf of some large direct channel partners. It has placed ads with a couple of major recruitment agencies and will help with the interviewing process.
One employment specialist has suggested the program is likely to serve as a breeding ground for future IBM executives. But even if this is the case, it is better to have talented employees on board for a couple of years than not at all. After all, there are never any guarantees that people are going to stick around forever.
In other news this week, Dicker Data has big plans for the year ahead as it looks to win business from broad-based powerhouse, Ingram Micro.
It currently does a large majority of its business in the NSW market at present. Now that national expansion has been flagged, it will be interesting to see if distributors based in other states initiate a deal.
I am in no doubt that there are a substantial number of distribution businesses out there that are available for the right price. And in many cases, I don't think that price is very high.
Brian Corrigan is Editor of ARN. Reach him at email@example.com