ASX-listed distributor Quadtel has announced that it will set up a new company to republish the antivirus software of European vendor, Panda Software.
Chief executive officer of Quadtel, Bruce Ind, said the deal with Panda Software was twelve months in the making and likely to be one of the largest re-publishing deals the company would tackle under its recently announced restructuring.
Panda Software’s antivirus products were among the best sellers in mainland Europe and seeing solid growth in both the UK and US, he said.
Late last year, the distributor lost the high-profile distribution of Network Associates antivirus products, citing the intense competition from broad-based distributor Tech Pacific as its downfall.
Ind said that some new republishing deals - whereby the company manufactures and distributes CDs loaded with software created and owned by other companies - would put Quadtel back on track.
The deal with Spain-based Panda Software sees Quadtel establishing a brand new entity, wholly owned by Quadtel, to manufacture and distribute the antivirus software. This separation allows Panda Software to more easily audit its Australian partner business.
Ind said Quadtel and Panda had not yet decided on a name for the wholly owned distributor that should be up and running by around the end of February.
The antivirus market was expected to yield about $110 million annually in Australia. To have even a small percentage of that market would be good for Quadtel, Ind said.
He estimated, conservatively, that Panda Software would gain about 2 per cent of that market within 12 months.
“Part of the arrangement with Panda Software is to reach a target of 1 per cent of that market within the first 12 months,” he said. “We have a good relationship with retailers, so that is not a big ask.”
Ind said having a republishing agreement, rather than purely a distribution agreement, would yield better results for Quadtel.
“It is a lot better for us because we get to control the entire marketing of the product,” he said. “In a standard distribution arrangement, there is not much margin for the distributor because the vendor is taking care of all the advertising and reseller rebates. Re-publishing means that we have autonomy on these products in Australia.”
The agreement with Panda demands that Quadtel hire some technical staff in Australia to specialise on the antivirus software. It is written in the contract that more technical staff will be required as Panda’s software increases its market share in Australia.