EMC World 2016: How are Aussie distributors handling the Dell / EMC merger?
- 04 May, 2016 03:15
Michael Dell - CEO, Dell
As the Las Vegas sunset turns its iconic strip a pale tint of orange, and the dust settles on Day One of EMC World 2016, the Australian channel awakens some 12,000 km away.
While rising to a tide of new products and technology announcements, coupled with a new name in Dell Technologies, the partners of Darwin, Perth, Sydney, Melbourne, Brisbane et al seek a different type of clarity.
With Dell CEO Michael Dell outlining the eventual unification of a combined channel program - drawing on the best parts of both EMC and Dell programs - the Australian market now looks to distribution to articulate a strategy, which is set to evolve over time.
Heavily cited as a key cog during the $US67 billion acquisition wheel, distributors Avnet and Ingram Micro - in holding both Dell and EMC product portfolios - will be the key facilitators of such change across the country, as work begins to strategically align the combined technologies of two tech titans.
“Like most people, we are waiting for the dust to settle on something that will fundamentally change the vendor landscape as we know it, before making any decisions about how we manage the business moving forwards,” Ingram Micro, General Manager of Advanced Solutions, Jon Fox, said.
Speaking to ARN on the ground in Las Vegas, Fox believes that as the companies move closer together, and strategies start to take shape, distribution will ultimately act accordingly.
As the market waits for further clarification, Fox’s sentiment is shared by Avnet Vice President and General Manager of Australia and New Zealand, Darren Adams, who continues to reposition local business divisions to better accommodate the upcoming change.
“Avnet has aligned our leadership, business, sales, marketing and technical teams across Dell, EMC as well as VMware, to assist our partners in driving end to end Enterprise solutions,” he added.
Despite the 14,000 strong turnout of partners, customers, users and developers, only a few insiders know how Dell Technologies new channel strategy will truly play out across the industry.
But as the market adapts accordingly, in Australia, both Avnet and Ingram Micro are working to capitalise on the ability to offer both Dell and EMC portfolios to partners, heightening the opportunity to cross-sell through a range hardware and software offerings.
“Having both market leading brands within the portfolio allows us to present integrated best of breed solutions to market,” Adams added.
“The sales and technical experience Avnet has with both suppliers enables us to provide our Business Partners with unique offerings.
“Our Powered-by-Avnet solution will be expanded to include Dell and EMC as a combined and customisable offering.”
Across the distribution fence, Ingram Micro is appears equally equipped to handle the acquisition, which is expected to close towards the end of 2016, although no set date has been confirmed.
“I believe it’s certainly an advantage for us as a distributor of both vendors as it means we already have the skills and infrastructure in place already to help service our partners both pre and post merger,” Fox added.
“As a reseller partner though, whilst obviously it would be great to have an existing relationship with both vendors today, I genuinely don’t believe it is an inhibitor moving forwards for them, more a massive opportunity to partner with the other side of the fence and complement whichever vendor they currently partner with.
“Either way, the opportunity for the reseller community to partner with what will be a formidable force in IT is obvious.”
When speaking to ARN in Las Vegas, EMC Vice President and General Manager of Channel APJ, Joergen Jakobsen said that specific to Australia, having both local distributors already selling Dell and EMC portfolios will be key to ensuring a smooth transition in the coming months for partners.
“The key is to look at how they can cross-sell products across both portfolios,” he explained. “For the distributors who are not selling both, we are receiving requests to see if they can be a distributor and the same applies for the Dell distributors.
“Typically, we are going to wait and see but over time we will look at how we best come together, especially across distribution.”
Speaking at a regional level, Jakobsen did not rule out a potential distributor review once the combined company is operational, but was quick to stress that no plans are in place at present, especially in Australia.
“First and foremost, we are not yet even allowed to share data points between the companies,” he explained. “As we start to delve into that we will review the landscape and assess our options but again, that depends on the country.
"I wouldn’t necessarily say we are heading in that direction as such, because for some countries there will be no need for change, but in others, there could be.”
As rival vendors fight to question the proposed merger from a channel perspective, throwing the usual complexity and confusion arguments across the table, Michael Dell was quick to allay such concerns during Day One, when speaking to media during a Q&A session with EMC Corporation CEO, Joe Tucci.
“Across both companies we have a number of people with significant channel experience,” he said. “We’re seeing that Dell and EMC channel partners have already completed the integration process and are out there in the market selling Dell, EMC and VMware together as one solution.
“It’s will be an important part of the Dell and EMC combined business. We believe the Dell and EMC channel programs are very similar, so we plan to combine them together and have one overall program.”
Going forward, partners can expect to see the new program take shape in 2017, but from a distribution perspective, the exact mechanics behind the shift remain unclear.
“I’m sure it’s something that will be at the top of their priority list as they look to continue to strengthen their already mutually strong channel businesses,” Fox observed.
“Obviously with anything like this there is a little trepidation among partners, but I think everyone sees the benefits of the merger and I think if you look at the two businesses, it’s clear to see the similarities in culture and strategy and so I think we’ll see a swift and clean transition with minimal partner impact.”
For Adams, local partners have “embraced the announcement” in equal measure, as Avnet continues to assist the channel build skill and capabilities to better align business models.
“The fact that both Dell and EMC have committed to merge the best elements of both channel programs has helped with that,” Adams added.
“Both Dell and EMC operate under transparent business models which are focused on embracing and building a healthy and profitable channel model.
“For example, both companies have solid deal registration programs for channel partners and by having that operate as one in the future it will simplify and speed execution.”
As outlined by EMC Senior Vice President of Global Channel Sales, Gregg Ambulos, the combined company will eventually roll out one common approach to deal registrations within the next six months.
In addition, Dell Technologies will offer “robust incentives” to staff to cross-sell, with a new channel structure designed to “ensure consistency worldwide”.
At present, such an approach mirrors how EMC currently goes to market in the channel today, both locally and globally.
“In the same way as Ingram Micro act as an aggregator of best of breed vendor solutions, having Dell and EMC merge together under Dell Technologies, along with the other areas of the portfolio, will create an end-to-end behemoth that can only help the Australian partners better serve their customers,” Fox added.
James Henderson is attending EMC World 2016 as a guest of EMC.