Interview: Ingram looks outwards and upwards in 2010

Interview: Ingram looks outwards and upwards in 2010

Greg Spierkel and Jay Miley discuss investment, strategy for 2010, channel evolution and the cloud

Ingram Micro's Greg Spierkel (left) and Jay Miley

Ingram Micro's Greg Spierkel (left) and Jay Miley

What does Jay’s report card look like for his first year heading up Australian operations?

GS:I’d give him high marks. He has had a very busy year. There has been restructuring efforts, a greater emphasis on certain business units and differentiating us in the market on a number of fronts. We secured two acquisitions last year – one covering multiple countries, the other in NZ. There’s a lot going on in a market that hasn’t been supportive of the top-line for Ingram, or the industry generally. But, that’s where we start saying we’ve come through the worst and are a strong company for that. I think we’re in a good situation given the changes Jay has made, to get even stronger.

Are you seeing increased investment from vendors in the channel? GS: Yes, they are. Microsoft has never been more channel-centric than I have seen them in the last six months. It starts in part, at the CEO or COO level – Kevin Turner [Microsoft COO] is very engaged on leveraging that jewel much more differently. You’ve got EMC going downstream with a number of partners, and VMware going downstream with partners. From that point of view, there are a number of vendors that were more direct with their business models before, but are now leveraging distribution to go reach new customers and build capabilities.

You look at HP and what Mark Hurd [CEO] is trying to do at his company – he wants to use the channel even more than he was before because it costs less to push the product through. HP does the branding, messaging and marketing, but if you execute well, HP can take cost out of the organisation and put more emphasis onto the channel. Some of the bigger vendors are seeing greater opportunity with channel than they used to see, because they have pressure in their own companies.

JM: If you look back at early 2000s, the whole debate was around whether the channel would survive – disintermediation because of the Web.

Aren’t we having that same debate now around cloud computing?

GS: If you look at what happened with the Web, there was a lot of work to put Web infrastructure in place and we were part of the route to market. As people started to put Web selling capabilities in the IT universe, we were the fulfilment for that. And if you look at the ecommerce players and Web stores that exist for our vendors, we are a big fulfilment agent.

Take the cloud: Tons of hype, very little revenue in it now. I think revenue will grow faster in that universe than the core on-premise IT business will over the next 3-5 years, but it’s still in the early adoption stage. Vendors are already saying ‘you need to get this business model down into the SMB market, because. I can’t reach that end-user on my own. They also have a lot of other applications that have to integrate with my PC and competency, which may be CRM or storage. The VAR is still the trusted IT department.

JM: And for the same reasons with cloud. We have been talking about disintermediation for some time now, but for the same reasons that the channel wasn’t disinter mediated then, I don’t believe it will in the future. At the end of the day, the VAR is the trusted advisors to these SMBs.

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Tags MicrosoftIngram Microjay mileyGreg SpierkelKevin Turner

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