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Should resellers worry about telco clouds?

Should resellers worry about telco clouds?

'Ultimate advantage of resellers is their ability to service customers better than to vendors or telcos'

It’s one of the channel’s biggest clichés – the cloud rising through Australian businesses to take work from resellers. But with telco giants, Optus and Telstra, bringing out cloud solutions of their own, can the (relatively) little guy still make a profit?

In Telstra’s case, the reseller becomes part of the solution and onsells the telco’s packages with a cut for itself. But with Optus, partners have no chance of joining in the fun because wholly-owned integrator, Alphawest, is servicing all customers directly.

While these moves can easily be seen as telco toes in the water for now, will they eventually crowd out the software and infrastructure channels by going direct? And what happens when more telcos join the game?

EMC Marketing CTO, Clive Gold, is one of many vendor representatives that see cloud as being the next step. His company joined with VMware and Cisco to provide Optus with the technology behind its solution and is shopping it around to other telcos.

According to Gold, moving to the cloud and joining with service providers is a survival method aimed at keeping vendors relevant and alive in the post-cloud era.

“This is a fundamental shift so there’ll be new winners and there’ll be IT providers that disappear,” he said. “In driving some of these technologies, I really think we’re going to be one of the winners.

“Back in history when there were changes like this, big names disappeared… look at Compaq or Digital Equipment.”

But the CTO was also keen to point out the potential was there for carriers and telcos to offer his consortium’s solution as wholesale providers, instead of taking the Optus approach.

“One of the places this could go is they could whitebox it,” he said. “We may see service providers like Optus allow resellers to brand it for themselves.”

Data#3 managing director, John Grant, acknowledged the telcos had the natural advantage of owning much of the infrastructure needed for the cloud. But he said there would always be a wholesale provider of cloud-based services and cited Telstra’s software-as-a-service offering as an example.

“Nothing’s unfair in business life and it’s an advantage that they have,” he said. “But there are other providers who are also making those sorts of thing available through the reseller community.

“Even if resellers don’t [offer cloud services] themselves, there will be wholesale providers of infrastructure-as-a-service and I wouldn’t be surprised if some were telcos.”

Grant believes the ultimate advantage of resellers is their ability to service customers better than to vendors or telcos, even when they work together.

“The reseller’s strategic advantage is that they work person to person and face to face with the customers…[vendors] will all retain a go-to-market that incorporates the channel,” he said. “The thought that just because you put a website up and start to do some e-marketing that people will flock to you doesn’t happen.

“The customer will need advice, guidance and design and implementation and subsequent support services so the smart vendors and telcos are going to nurture the reseller community in order to provide that full range of deliverables.”

Jasco director, Jason McClintock, said was watching the trend with great interest. But he claimed dealing direct on software and infrastructure was not the telco’s natural domain.

“I’m not worried because it’s not the telco’s traditional business,” he said. “Optus has invested in Alphawest and Telstra has made some in Kaz and while there’s a segment of the industry that works well for I’m not sure that systems integration component scales right across the industry from SMB right through to Enterprise.”

But McClintock acknowledged there was change on the way and that the latest development added to the existing uncertainty about how the cloud would affect resellers.

“The issue that may exist will be around people who have partnered with Optus and I’m sure they’d have a level of uncertainty on what it means for them,” he said. “I think there’ll always be a place for system integrators. That landscape is going to change and I’m not sure anybody knows what it’ll look like.”


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Tags TelstraData#3optusalphawestEMC Marketing

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