Cloud Computing: The Channel Connect
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In spite of the worldwide economic downturn, the Indian economy showed strong resilience compared to many of its western counterparts. During FY 2011, India’s GDP grew by 8.5%. According to World Bank estimates published in June 2011, India’s GDP growth rate will moderate to 8.0% in 2011, recover to 8.4% in 2012 and may rise to 8.5% in 2013. These developments and sentiments are expected to have a direct and positive ‘rub-off’ on Indian business enterprises, in turn fueling growth of the domestic IT and telecoms industry. In this scenario, growth of ‘game changing’ technological trends such as Cloud Computing hold out a new opportunity for the India ICT channel partner community.
As large Indian enterprises have matured and expanded over the years, they have shown a greater appetite for customized IT solutions to support business growth and geographical expansion. Increased sophistication among SMB enterprises has led to demand for more complex solutions and services from this segment of users as well.
The India ICT channel partner community has leveraged this growth opportunity by effecting suitable changes in business strategy, as well as in their portfolio and product mix. Channel partners in India have steadily shifted their focus away from hardware and peripherals / accessories to software solutions and services over the years.
While software and services have become more integral to the ICT channel partner’s business portfolio, Software-as-a-service (SaaS) is expected to progressively gain traction and mindshare amongst end users in the new ‘cloud’ regime. Channel partners can continue to further show healthy organic growth in revenues as well as higher margins in the new ‘cloud computing’ value chain.
Some cloud vendors initially focused their efforts on direct sales through the web, on the assumption that channel partners are no longer required, but this assumption simply does not hold true. Customers need channel partners’ expertise in picking the right solution. This gives resellers a chance to become consultants to end-user customer organisations. Integration of a SaaS solution, usually with a customer’s own website or enterprise intranet also presents an opportunity to channel partners to build expertise and extend their role as system integrators. Training is yet another area that channel partners can tap for business growth. Many customers would need training and support of the reseller / system integrator channel partner to help them effectively deploy and use a new application.
Therefore, as it becomes increasingly apparent that cloud computing is not a fad and here to stay, the shift to a more ‘business goals oriented mindset’ from the traditional ‘technology solution vendor mindset’ will make a big difference to the fortunes of the Indian channel partner community, going into the future.
As channel partners and end users become more comfortable with cloud-based services, the former can profit by offering both SaaS and IaaS solutions to the latter. These can be run either on the channel partner’s own infrastructure or on infrastructure rented from hosting companies. This would help an end-user business enterprise to obtain all cloud services from a single source.
Currently and in the near future, the trend is still likely to be a combination of both conventional and cloud based applications. But channel partners need to be prepared to take on the challenge and develop new skills that will make them a valuable participant in the emerging cloud-based IT solution provider ecosystem.
To sum up, cloud computing channel partnerships can be a “win-win-win” arrangement for all parties involved. Resellers gain an entry into a ‘hot’ new market segment without making huge investments, cloud providers (vendors / OEMs) increase the visibility and attractiveness of their offerings, and end users get cheaper IT without having to learn the intricacies of developing or managing applications to run in the cloud.