OPINION

Channeling New Cloud Opportunities

THINKstrategies, the Cloud Computing Showplace, and Rising TideMedia hosted our second annual Cloud Channel Summit earlier this week, giving executives fromleading cloud and channel companies a peer-to-peer networking forum where they could share perspectives on how to forge successful partnerships to capitalize on theunprecedented opportunities created by the cloud.

This year’s event attracted more speakers, sponsors, partners and attendees than our firstevent. More importantly, it brought together a greater mix of channel companyexecutives to interact with those from various cloud companies.

Cloud company executives were the primary participants in our first Summit a yearago. They talked about what it would take to gain the trust and participation of existingand emerging channel partners to extend the reach of cloud services into new marketsegments. However, there was just a handful of channel company executives at the eventbecause the vast majority of channel companies were not ready to respond to the growinginterest in cloud alternatives.

Critical Role

At our second Cloud Channel Summit, held on Monday, a larger contingent of executives from awide array of channel companies were on stage and in the audience. They shared informationand insights about their rapidly evolving initiatives to respond to the rising demand forcloud solutions from customers of all sizes and across nearly every industry.

The Summit attracted executives from major distributors and resellers like Avnet,Ingram-Micro, Insight and Tech Data, as well as IT firms, cloud consultancies and managedservice providers (MSPs) such as All Covered, Centerbeam, Cloud Sherpas andSpiceworks. Hosting and other service providers such as Comcast, Savvis and Rackspacealso spoke.

What did they all have to say?

Although their cloud initiatives are still embryonic, all of the executives who participatedin the Summit agreed that the channel must become more actively involved in the cloudmovement for it to sustain its current growth rate and expand into new geographic andvertical markets.

The channel plays a critical role in educating customers, designing and deliveringspecialized solutions to meet their unique needs, and responding to their day-to-daysupport requirements.

Disruption and Transformation

However, the established channel companies are contending with the same challenges faced bylegacy hardware and software vendors before them.

First, they must accept that the cloud fundamentally disrupts their traditional businessmodels and be willing to take actions that will significantly change their currentoperations.

Second, they must recognize that meeting their customers’ rising expectations requires transforming their go-to-market strategies and services. Itchanges the skills required, the sales tactics, the value propositions and service deliverymethodologies. These changes will inevitably lead to structural and staffing shifts.

Third, migrating to cloud services will impact their financials, converting productrevenues into subscription service fees that place greater economic pressure on the waychannel companies operate.

Despite these significant challenges, the channel companies that participated inthe second annual Cloud Channel Summit were proud of their progress and happy toshare their experiences and success stories. They were also committed to making furtherinvestments into converting their operations to become more efficient and effective cloudservice providers going forward.

Jeff Kaplan, managing director of THINKstrategies, is the founder of the Cloud Computing Showplace and host of the Cloud Channel Summit conference series. He can be reached at [email protected].

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