Avnet is taking the wraps off of its new services division, Avnet Cloud Services, aimed at taking hosted private Cloud solutions to the channel.
Avnet Asia-Pacific marketing and business innovation vice-president, Michael Costigan, said it is one of the biggest launches of recent company history. “This is a strategic push for Avnet; we’re steadily building up services.”
The idea is to offer partners a choice when deciding how to resell and/or build Cloud services (for example, white labelling the service for partners to take to market is one possibility), according to Avnet general manager of services, Adam Chicktong.
“We feel we can supplement the channel’s offerings,” he said, stressing the fact the company doesn’t want to go head-to-head with channel partners.
“What we want to be is ultimately flexible. If they want to resell an Avnet Cloud service, they can do that. If they want to brand it as their own, they can do that. If they want something in between, that’s not a problem at all. We want to give the flexibility there to allow the channel to do what they’d like to do.”
Revamp and rebrand
Chicktong said the new division is a revamping and rebranding of an itX arm of the company, formerly known as ICO.
“itX made an acquisition about four years ago of ICO, which was a Web hosting company. The key differentiator was high uptime, best uptime guaranteed around resiliency, redundancy and a real premium service aimed particularly at the SMB market, but certainly over the last couple of years we’ve moved up into the enterprise.”
And while ICO was previously a direct business, today’s iteration of the division will be 100 per cent channel-focused, he said.
“We never had a strong go-to-market strategy in the past because of the fact we didn’t want to upset the channel because ICO was a direct business previously,” he said. “Avnet has a very different take on things and they fully, wholly and solely embrace services, which is fantastic for me.”
Chicktong said he has worked over the last 12-18 months integrating the ICO business back into Avnet.
“We have been preparing for this over the past year or so and we’re a 100 per cent channel-focused business. The focus is essentially taking hosted private Cloud solutions to the channel.”
The services division should help alleviate some of the Cloud misconceptions, he said. “What we see out there is a heck of a lot of confusion in the channel. There is confusion on all fronts: confusion from the end users as to what the Cloud actually is because everyone markets themselves as the Cloud. From the channel’s point of view, they look at Cloud as a massive opportunity, but a lot of people look at it and say, ‘How does this help my business?’”
There is also vendor confusion with regards to which partners should be reselling and building Cloud services, he said.
“Cloud is not just something you can teach in a week’s training course. There are many components. It is not just virtualisation. There are many different components to building a Cloud solution,” Chicktong said. “The reality is with Cloud, one size doesn’t fit all. It’s the same with any service, you need a personalised service.”
At the moment, the Avnet services division consists of 35 people, 26 of them are engineering and technical staff.
“They are very technical people and they will be there to support the existing Avnet teams. The rest are operations and marketing staff. This is where we hope to differentiate ourselves in the market - by having dedicated services marketing, who can literally be on call from the channel partners if they need help with their services market. That is something this business has never had before in the past.”
Moving forward, Chicktong expects Avnet’s services portion of the business to become a significant proportion of the business – and to be able to grow the partner numbers from its stable of six.
“This is the fastest growing part of the business. Services now make up a very substantial part of the business,” he said.
“We don’t want to sit on the sideline and watch this pass us by – we feel that a distributor is actually a perfect place to aggregate products from. We have access directly to multiple vendors, and this is a space we can add tremendous value in.”
Over the next 12 months, the company will release three Cloud solutions to market.
“With our key vendors, we were looking at 12, but we have narrowed it down to three Cloud solutions. These are unique offerings that sit in an adjacent product line. But we will sell it in a different way – it will be a Cloud solution as opposed to a traditional distribution sale.”