IoT and learning machines started to present ROI in the global market in 2018

At the same time the U.S Congress began convening developers of solutions in regard to data security, the investments in artificial intelligence, IoT and learning machines have started to get the expected returns in the global market. The security systems sales in the USA have also seen an increase in consciousness about security-related vulnerabilities, and the machine learning industry shows the need for uninterrupted defense against potential threats. To top it all, giants such as Comcast, Windstream, AT&T, CenturyLink and China Telecom, which launched SD-WAN offers in 2017, are leveraging the market competition, as well as creating new deals, increasing profit and providing relevant management of the connectivity of the 30 billion IoT devices planned worldwide by 2020. With a unification of platforms, the companies will profit by offering SD-WAN (“Defined Software Networks”) as a wide area network service, simplifying both management and corporate governance.

Among the trends that are already affecting business this year are the CPaaS (Communication Platforms as a Service). Lisa Simpson, vice president of channel sales and distribution of Alcatel-Lucent Enterprises, defines CpaaS as “Offerings that integrate into industry specific business workflow tools and also integrates with the telephony systems deployed within the customer network.”

In the virtual reality era, IoT will drive a demand for network technology to ensure better performance and many channel resellers should opt for specialized management and mentoring from distributors.

As a result, the network market, primarily dominated by Cisco, followed by Aruba, a Hewlett-Packard Enterprise, will have more players in 2018. This will lead to a Battle of Titans and a need for chain planning, which is one of the industry’s biggest challenges by 2020 according to the vice president of Solution GTM’s Global Channels & General Business of SAP North America, “We have the ability to tap into intelligence all along the supply chain and having this data at a client’s fingertips will become more and more critical to their ability to compete”.

Value

In a scenario of total digital convergence, the outlook for 2018 is still one of the most optimistic for VAR (Value Added Reseller) dealers and VAD (Value Added Distributor) dealers who add value to the sale offering solution management as part of the service package.

One of the largest VADs, Ingram Micro, works in collaboration with partners to facilitate the transformation of the now service-focused business. “We have a three pronged approach in providing (1) proactive enablement for all our partners, (2) platform and automation technology that is scalable and (3) an infinite ecosystem of managed cloud solutions”, comments Tim FitzGerald, vice president of Ingram Micro’s Cloud Channel Sales, North America. In order to create one of the most robust ecosystems in the industry, with a comprehensive portfolio supporting the transition to the SaaS model from its 44,000 resellers in 160 countries, Ingram Micro has become a relevant player for manufacturers and developers. “We work closely with over 90 vendor partners to ensure their cloud services are available to reseller and solution provider partners with ease and all the information needed to deliver end-customers the solutions they need, when and how they need it”.

Not bad for a market that expects providers to fill the roles of Managed Service Providers (MSPs) in 2018, which means selling and providing a full service cycle that includes mentoring, a recurring revenue model that will provide more stability as well as the opportunity to move faster among customers, increasing sales volume.

Protection

IT infrastructure security remains a key element affecting business in 2018. “Due to the state of the world, the overall security market will continue to increase in importance. As a result, customers will likely have larger budgets for security solutions. Security is a vital part of a customer’s total solution, now more than ever”, explains Greg Dixon, CTO of ScanSource. Headquartered in South Carolina, VAD serves approximately 33,000 reseller customers.

After global malware attacks like Petya and WannaCry surprised the market, Shuttle Computer Group also saw the demand for a solutions increase. Accordingly Robert Garcia, manager of channel sales of Shuttle Computer Group, says, “It has become mandated for hardware to have native support for security platforms that are intended to be used by our military, corporate, and education customer bases. These attacks showed vulnerability in network environments and helped to see the benefits in cyber-attack detection, mitigation, and recovery”.

An important change that must occur in this area is the expansion of the hardware and software tests used by third party players with cybersecurity experience, as well as the analysis of the profiles and identification of connected IoT devices. According to Lisa Simpson (the Alcatel-Lucent vice president), “This brings an extra level of assurance that the IT infrastructure does not contain unknown backdoors, unpatched vulnerabilities, etc.”

Among the major changes in the industry, ScanSource’s Dixon believes that the global market will continue to see Cap Ex move to OpEx through cloud delivery, as well as SaaS growth with virtually everything associated with the services component. He explains that in the U.S, resellers have expanded their portfolios through the understanding that leveraging the model expands their revenue streams. To do this, you need to invest in both team training and the relationships with solution providers to be considered a relevant distributor in the process, especially focusing on cloud demand.

Challenges

In the context of cloud offerings, VADs play a key role and must make it economically viable for solution providers to transform their own enterprises by 2018, notes Terri Snell, Vice President, Solution GTM, Global Channels & General Business of SAP North America. “Distributors can help their solutions companies with the challenges of capitalizing on the digital revolution. This should encompass facilitating the cloud transformation in their partner companies as well as helping each to find their own unique niche. On the sales side, consensus buying is here to stay, and helping their partners to be armed and ready to take advantage of this trend is an important component to a successful distributor”.

Channel Manager of Shuttle Computer Group Robert Garcia believes that by 2018 the distributor and channel team must be equipped to take care of a value line that sells solutions and not volume of items considering their personal and professional skills. “A team needs to be built with people that are passionate and communicate well; while there is often brilliant individuals that overcome difficult obstacles, it is important to hire people that will bring something new. This team needs to include technologists, sales specialists, and people who understand business aspects to bridge gaps and ultimately provide a usable and functional end product”.