Are Channel Partners a Bottleneck?

Enterprise technology vendors traditionally have relied on channel partners to sell, procure, and implement solutions. However, now that we live in a virtualized and software-defined world, these same vendors are struggling to compete with smaller competitors who opt to forgo partners and instead sell direct.

This is especially true when it comes to small and medium-sized businesses that want enterprise-grade equipment but requires little fine-tuning or complex configuration. Let’s look at some examples of situations when buying and selling direct does or does not make sense.

Makes Sense: When on-premises technologies shift to software-based models

Over the past decade or so, many on-premises technologies have migrated to the cloud by way of a software as a service (SaaS) model. Business voice is a perfect example of this. What used to require intricate hardware setups and configurations are now far easier to set up and requires no on-site equipment. Instead of working with a channel partner to purchase, install and configure a voice system with business-centric features such as automated attendants, extensions and phone setups is now far more streamlined, and configuration can be accomplished with little in-depth training.

Additionally, a shift away from physical desk phones to softphones means that a business can be up and running in a matter of hours as opposed to weeks. The SaaS model removes complex barriers and redundant systems where partners once thrived.

Makes Sense: When innovations make complex configurations easy

In addition to cloud-capable enterprise services, on-premises equipment such as network routers and switches are getting to the point where most IT professionals can build a fairly large and robust LAN. The old, sophisticated command line interface setups have shifted to graphical interfaces with setup assistants and automated tuning. In this space, we see a growing number of enterprise organizations wanting to use a specific technology vendor’s hardware equipment, but they require little help with the integration piece. Instead, they want to perform the setups themselves in a cost-saving move to avoid the service-led channel partner markup.

May Not Make Sense: Situations where partners are necessary

Of course, there are plenty of situations where partner involvement remains a necessity. Situations that involve emerging technologies, challenging setups or those that must adhere to regulatory requirements are tops on that list.

Examples of this include internet of things (IoT) and industrial IoT solutions that are in a still-evolving technology market. These segments of IT may require external expertise to find the right products and implementations. Additionally, some solutions, such as with private 5G in the US, demand that the equipment be set up and tuned by a certified professional installer. This is to ensure and certify that Citizens Broadband Radio Service (CBRS) channels can be used in a specific physical location and won’t cause interference with neighboring spectrum users.

Justification for channel partner integrations can also be made for traditional enterprise Wi-Fi deployments. Partner architects and integrators are often well-versed regarding the planning, testing and troubleshooting of newly deployed Wi-Fi systems so that dead spots are eliminated, and that signal is propagated only where it needs to be.

May Not Make Sense: When technology vendors struggle to sell direct

In some respects, the disruptive shift in ease of setup and simplified management has caught some technology vendors off guard, and they’re struggling to reposition. While these vendors often allow enterprise technologies and services to be sold direct, many prospective customers don’t realize it’s an option. Zoom was a perfect example of this phenomenon during the pandemic.

While recognized video conferencing companies such as Cisco and Polycom had well-established solutions for companies to use, a large number of enterprises went with Zoom due to the ease at which they could get new work-from-home employees up and running. Established vendors, on the other hand, are doing little to promote this model. Most buyers assumed that they had to order through a partner to get the software and licenses. With Zoom, it was just a matter of purchasing directly on their website who offered scalable month-to-month pricing options.

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