Editorial: Cellnet finds its missing link

Editorial: Cellnet finds its missing link

Given the relatively strong performance of HP in the computer hardware channel in recent quarters, its decision to add another distributor to its personal systems group (PSG) has come as something of a surprise (see page 1 of the April 12 Edition of ARN Magazine).

It did drop two percentage points in IDC's most recent quarterly notebook figures but such fluctuations are the norm at the moment and are expected to continue for the foreseeable future. If you look at overall PC hardware sales during the past couple of years, HP and Acer have been winning market share at the expense of Dell and Lenovo (formerly IBM).

HP is a massive appointment for Cellnet when you consider that it already carries Acer, Toshiba, Lenovo and Apple. In terms of personal computing, HP was quite simply the missing link.

While it is aiming to position itself as a distributor that straddles the converging worlds of technology and communications, Cellnet has earmarked IT as its major growth market.

It now has more than 20 blue-chip vendors in its IT&T camp (although it only has access to limited product lines with some of those). The addition of PSG will go a long way to establishing the company as a credible competitor to Ingram Micro.

The next step for Cellnet would be to get the other half of the HP pie - its imaging, and printing group (IPG). Dicker Data will testify that this has not been an easy nut to crack but, with a new IPG boss coming on board this month, both distributors will be putting their hands up for inclusion in any shake up.

The PSG announcement will be welcomed by many resellers because it gives them another option when looking to purchase HP product. In the short term, existing distributors will be working extremely hard to retain existing customer loyalty and dealers can expect to see some pretty lively pricing as the relative distribution marketing machines wage war on each other.

But the appointment of Cellnet is not good news for everybody and HP's official reasoning is difficult to swallow. It said the decision was based on the distributor's strength in the SMB market and its strong channel relationships. You would imagine all distributors of any scale could boast strong channel relationships because it would be difficult to stay in business without them.

It looks much more like a Queensland play from an outsider's point of view. Ingram and Dicker are both strong in the SMB market but neither has anything to match Cellnet's customer base in the Sunshine State. Dicker does the majority of its business in NSW and Ingram has dropped the ball to some extent north of the border by closing its Brisbane warehouse.

When you consider that Synnex was only given access to HP notebooks back in November, the vendor has doubled its number of portable computing distributors in less than six months.

While the local notebook market is still demonstrating good growth, Ingram Micro and Dicker Data will be less than delighted at having it opened up to two more players in such a short period of time. From a Synnex perspective, its executive will be asking why it was only appointed to carry notebooks when Cellnet has also been given access to desktops, tablet PCs, workstations and monitors.

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