In the past two months I’ve spoken to an audience of channel partners, had 6-7 lunch roundtables with channel partners in the U.S. and Canada, and I’ve met with a few channel partners in Europe. Two things are becoming increasingly clear to me: the channel will be critical in broader adoption of cloud computing (and private cloud), and the channel is not ready to do this. The channel needs to be rebooted. Until they are, the midmarket, in particular, will leverage cloud computing in a slipshod and hit-or-miss manner. Likewise, channel partners who don’t reboot and adjust to the new reality (that more and more IT capabilities purchased by the midmarket will be coming from the cloud, and not through hardware and software sales) won’t survive for long.
I see three clear, broad opportunity areas for the channel with respect to cloud computing (I’m sure there are more):
(1) Assessments. Basic education. What is it, and what does it mean to a customer? What could leverage cloud computing, and what can’t? Where should an organization focus their cloud efforts? How do they get started? Private or public or both? The assessment helps put the channel partner into the decision-making process – rather than find themselves disintermediated and locked out.
(2) Transformation. Helping an organization (business and IT) change. Process change, management changes, organization and skills changes, culture, politics – this is a broad area, and one in which goes beyond the skill base of most VARs and resellers. Application re-design fits here, too. And designing private cloud with hybrid in mind. Technology changes are easy, it’s everything else that is very, very hard.
(3) Broker. Assessments and transformation are large areas of opportunity, but once complete, the channel is no longer needed – unless they take on a broker and aggregation role. Most companies leveraging cloud computing will have several – perhaps many – providers. The channel has the opportunity to aggregate those services, provide value-add integration and other services, provide insurance, deal with failures, monitor SLAs, be a single throat to choke. The white box for cloud providers. For private cloud, the channel can smooth the way to hybrid cloud computing, and remain the broker in the equation.
Is the channel ready for any of this? No way! Are the provider and vendor business relationships with the channel making this easy? No way (vendors/providers are completely unclear whether they want to own the customer relationship or not)! Will the midmarket be able to adopt cloud computing in large scale without the channel? I don’t believe so. Cloud is simply too hard, too paradigm-shifting, too “cloudy”.
Time to start rebooting. Or watch the rest of the channel re-invent themselves for cloud computing and leave the rest in the dust clouds.