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More sizzle for your steak

More sizzle for your steak

It's terrorists, it's the election, it's the economy . . . no, no, it's just the vibe.

While it may sound like a line out of The Castle, the simple truth of the matter is customers just aren't buying as much networking gear as they used to. Why not? Well, it's a good question, and one perhaps better left to academics that can draw the socio-psychological link between an individual's buying habits and his or her symbiotic relationship with the world's macro-economy.

But if the current IT economy is anything to go by, it doesn't take a fourth-year Harvard grad to deduce that customers simply aren't buying much of anything right now. It's across the board. Service providers aren't buying at the high end because there's a lack of investor confidence in the telecommunications sector (not to mention the monopoly). Mum and Dad aren't buying for their home office at the moment because they've got things like school fees and Business Activity Statements to worry about rather than spending big money on equipment they will never fully comprehend. And everyone in the middle is too busy trying to battle through another quarter.

So just how can resellers go back to their existing customers, or find new ones, with the promise of a brighter future that isn't going to get them kicked out on the street when the customer eyes the bottom line?

According to Mark Bochard, program director of global networking strategies for Meta Group Asia-Pacific, the crunch area for companies is the interface between the wide area network (WAN) and the local area network (LAN).

Bochard points out that most companies' LANs are running at 100Mbps or, if not, can be ramped up fairly inexpensively with the appropriate LAN cards and switches. The issue for companies is managing the jump from a 2Mbps WAN link to the 10/100Mbps LAN.

"There's a big mismatch from the LAN to the WAN," says Bochard. However, there are a number of ways resellers can improve a customer's WAN link without having to make the customer buy additional bandwidth.

In fact, it's spawned a whole subset of networking vendors that manufacture a combination of software and hardware products designed to prioritise the packets travelling across a network. The major vendors have also thrown themselves into the fray with Layer 4-7 switching.

The business case is simple. By looking at the packets travelling across a network, an IT manager can assign them a priority that ensures the most important applications, like financial apps or voice, have allocated bandwidth. This means a company doesn't have to go back to its service provider for a bigger pipe every time an employee starts streaming video of the latest CNN report.

Bochard claims there are generally two approaches taken by customers. A larger enterprise might be able to see clear to purchase a standalone box, while a smaller enterprise might just opt to switch on, or purchase, additional provisioning features to a router they already own.

Caching is another method that customers with a large Web presence are beginning to adopt. Instead of buying more bandwidth from a carrier or throwing more Web servers at a problem, Bochard says enterprises should cache information that its users frequently require. Once the information is cached, it can easily be distributed to the users on a corporate network without choking up the WAN link.

Content delivery networks, or enterprise content delivery solutions incorporating caching, provide companies with an alternate way of getting commonly accessed information out to customers or their own employees without hogging the all-important bandwidth.

Bochard says there is quite an art to developing content delivery solutions - an experienced systems integrator can add real value by designing, developing and implementing these on behalf of a customer rather than an enterprise trying to tackle it as a one-off project for the first time.

Gordon Vick, a former reseller and now country manager for network vendor Foundry Networks, says bandwidth requirements tend to follow vertical lines of business. A standard administrative network for an office environment will tend to run fairly smoothly, but a company that works in pre-press - where huge files are being pushed around the network very quickly - needs provisioning that reaches right down into the user level. Identifying which users are legitimate "power users" and which are simply hogging bandwidth for Web surfing or personal e-mail is essential.

Vick claims this type of bandwidth auditing can be a relatively straightforward service that resellers can offer as an adjunct to an existing service and support contract.

One of the keys with any service is to know the vertical market your customer plays in. It sounds like stating the obvious but, as Vick says, once you know the business requirements of a particular vertical then you can start hitting on some "hot spots" when you're talking to the customer.

The channel also has to play a key role in maximising the purchasing decision made by a customer.

"This is where resellers can show their mettle, as long as they approach it in an objective way," says Vick.

But as the market continues to stagnate, resellers face increasing pressure by vendors to meet sales targets to maintain a certain level of partner status. The fear is that resellers could push a solution towards a customer to make up the numbers rather than recommending a more appropriate product from a different vendor.

David Tse, general manager of marketing for Logical, one of the larger resellers in the Asia-Pacific region, believes resellers must remain "multi-vendor" affiliated so as to be able to recommend the best product in any given situation. This differs from vendor independence, which implies the integrator is an expert across all technologies. While it might be possible for a reseller in a very niche market, it's simply not feasible in the world of networking, Tse says.

Secondly, Tse claims resellers must aspire to the highest level of certification possible for every vendor they represent. That way a customer can feel somewhat reassured that an integrator is recommending a product based on its merits rather than because the reseller gets points towards winning a vendor's accelerated sales scheme.

While Tse feels the cost of bandwidth hasn't lowered to the levels that were expected by industry commentators, he claims customers are taxing their networks more and more.

There are a lot more overheads on the network, he says, with everything from added security, increased functionality for wireless and virtual private networks to voice-over-IP. Company directors are also aware they can now be held legally responsible to shareholders and employees for issues like security. Directors without a lot of technical knowledge are liable to say, "you sort it out" to their IT managers without the additional budget to do so.

It's a sentiment that Foundry's Gordon Vick can relate to. He says that customers are wary of investing in anything when their network is only running at 15 per cent capacity, and with good reason. But once the business case demands a new technology platform - for example, a hospital wants to send X-rays via e-mail rather than couriering them between doctors - this puts extra pressure on the network. "Once there's a change in the environment all bets are off," says Vick.

While Tse is a strong advocate for getting maximum returns out of minimum investments, he warns against propping up a network with a product that has a limited life span.

"Don't invest in something you're going to throw away or take a hit on in two years," says Tse. "It doesn't matter if you pay for it now or later, you will pay for it eventually."

The beauty for resellers is that networking is a multi-headed beast with a plethora of ways in which resellers can add value to existing infrastructure. One such area that the channel can add value to is security, according to David Britt, country manager of vendor Top Layer Networks.

As security becomes more complex, so too do the solutions. Britt says there are a number of ways to augment existing network security infrastructure without having to invest an arm and a leg to do so. By purchasing a point product - in Top Layer's case it would be a firewall load balancer - customers can achieve greater performance without having to invest in a brand new silicon-based firewall.

The benefits appear fairly straightforward, but the challenge lies in how to convince the customer to purchase a point product when they have little intention of scaling up their infrastructure to begin with. In terms of security, Britt says the most common question asked by a customer is "Have I got a problem in this area?" So the sales methodology becomes a process of showing the customer what's possible and how their existing infrastructure fails to provide this.

Silicon-based firewalls, for instance, tend to start showing signs of performance degradation when denial of service (DoS) attacks get up to around 500 connections per second. Put in a firewall load balancer and it can increase the number of malicious connections to around 22,000 before the firewall begins to register a loss of performance.

Another option to maximise the investment that customers have already made is to look to the future.

Citrix has made no secret of the way it goes to market. In short, it feels pretty confident most enterprise customers in Australia have deployed Citrix somewhere in their organisation. The growth spreads virus-like as Citrix cross-sells its software into other divisions.

If a customer is looking to run the latest version of an enterprise software application in a company's finance department then users' desktop systems will have to meet certain requirements. The savvy reseller knows the customer just purchased those desktops 12 months ago. So, is the company going to do a special rip and replace of 30 or so desktops? Or will the reseller go in with a client-server solution priced on a per-seat basis that will provide access to the enterprise application, without the need to replace the PCs?

The sales technique involves a type of lead generation that uses the customer as its own reference site. And Gary O'Brien, Citrix's Asia-Pacific marketing director, says its indicative of how resellers can cross-sell products and services to their existing customer install base, despite the challenging economic environment.

"Reference selling is always a very good technique, but it's even better when the reference comes from within the customer's site," says O'Brien.

The central theme that kept emerging from all the industry pundits polled for this story was simply a return to basics. When the good times are rolling, companies are prepared to invest heavily on technology even if it's difficult to quantify the return on investment. The reverse occurs when markets contract, and the job of the reseller it to separate the "nice-to-have technology" from the "must-have technology". To fulfil this role and make money in the process, perhaps it's time for people in the channel to dust off their copies of Sales 101 and start leafing through the contents: "Know your customer . . . Cross-sell and up-sell . . . How to know when the timing is right . . . How to find the best . . ."


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