In the second part of an in-depth interview with ARN's BRIAN CORRIGAN, IBM's Andrew Baker, talks about partner opportunities, the environment and Dell in the channel.
From a business perspective, what do you think are the big opportunities for your partners today? Andrew Baker, (AB): Providing solutions into SMB. That market here by our definition [sub-1000 seats] is worth more than $8 billion and it's growing up to 6 per cent. It's a large opportunity and those customers are buying solutions - nearly three-quarters of SMB spend is in solution as opposed to point products. That's a trend that has been ongoing for some time so our strategy to address the solution opportunity in SMB is around a couple of areas. The first is connecting ISVs with resellers or systems integrators to provide the opportunity for partners to complete their client value proposition. We have an ISV group that focuses on ISVs of all sizes and national origins; and we have a developer relations group that is working specifically with ISVs around porting their applications to IBM platform or Linux.
We are headed increasingly into a world where applications lead and solutions are increasingly designed for specific vertical markets. Major vendors like IBM and Microsoft have a huge role to play in putting resellers in touch with developers. What progress is being made? AB: It's not a project you ever complete and it needs continual focus. We don't set out to act as a marriage broker but we do look to create situations for partners to work together. One challenge is that the client base and taste is constantly changing. There has been substantial consolidation in the ISV space during the past couple of years so there are changes in ownership and that tends to unsettle relationships. That is challenging for the partners involved to stay wed, as it were. Our challenge is to stay focused on the task. Over the last year or so there have been a series of opportunities where we have brought organisations together through speed-dating sessions and PartnerWorld is largely focused on that activity.
The other thing we are driving into that market is Express Advantage. We launched Express back in 2002 as our strategy for SMB. Australia was one of 15 countries around the world to launch Express Advantage in April of this year. That is designed to make sure we have the right offerings for SMB delivered to clients that are in the market for those opportunities, through the company that they prefer to buy from, which we know is business partners. In many cases, while we are seeing commercial success, they are probably acting as door openers as often as not. We are able to equip partners with hardware, software and services combinations that they can take to their customers as IBM certified offerings, which I think is a good strategy.
Are you seeing greater interest from integrators to form alliances with software developers? AB: Absolutely. I think it's fair to say the reseller community has realised that it's time to move into solutions or services in some way and, of course, most have. That's been a progression over the past five years really. There's no doubt that traditional hardware-only resellers are largely a thing of the past.
There's a lot of environmental hype in the market at the moment, but do you think it is genuinely a factor in purchasing decisions? AB: Yes I do, because clients, especially those that are publicly listed, have a commercial need to do something about the environment, and to be seen to be making a contribution. There are all sorts of corporate social responsibility indices running. Corporations, large or small, are looking for a response; that might be something as simple as improving their power usage in the datacentre, which offers attractive savings; or, it might be a green asset recovery service. We are working on channel-enabling one at the moment through our Global Financing organisation.
There's a lot of talk at the moment about the possibility of Dell launching a broad channel strategy. Do you expect to see that soon and, if so, what impact will it have on the market? AB: Dell has been the one vendor that has been completely outside of the channel for reasons of their own and resellers have long distrusted them for obvious reasons. Business partners are cautious about vendor decisions and whether they are in or out of the channel business. I would imagine any business partner would be thoughtful about a relationship with Dell.