Approximately a decade ago, IDC predicted solution providers who did not embrace cloud would be falling off that preverbal cloud cliff by 2017. Well, it is 2017 and according to a new study by Westcon-Comstor conducted by IDC, found solution providers with cloud earn more margins and are growing their business faster than those without cloud services.
Other key findings include:
- As end-user demand for cloud increases, partners need to invest in cloud to avoid falling behind the competition;
- Solution providers selling cloud grow faster than those not selling cloud—with those selling a lot of cloud growing even faster; and
- Many channel partners struggle to find the expertise necessary to transform their business to cloud.
While solution providers investing in cloud are finding success, many channel partners have not fully embraced selling cloud solutions, according to the survey. Almost 60 per cent of partners said they do not yet have a cloud-focused sales compensation plan, 44 per cent do not offer cloud solution bundles and 22 per cent report no revenue from recurring cloud services. Nearly half of channel partners indicate that they are implementing plans to substantially increase cloud sales in the next one to two years, suggesting that many see the value in moving to cloud, but currently lack the resources and capabilities to capitalize on the opportunity.
The study also showed cloud sales have a demonstrable, positive impact on a channel partner’s business. Among respondents that derive 40 per cent or more of their overall sales from cloud, 77 per cent reported an overall increase in revenue.
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Meanwhile, only 59 per cent of those that sell no cloud reported an overall increase in revenue. One factor in successful cloud practices might be increased input from lines of business (LOBs) into the end users’ IT purchase decision-making. LOB buyers are involved in about 80 per cent of IT investment decisions now.
Pam Miller, director of infrastructure channels research for IDC’s Channels & Alliances group, with lines of business more directly involved in the purchase of technology today, it makes perfect sense that solution providers look to solve business problems by leveraging new cloud-based solutions.
AWS at Westcon-Comstor
Westcon-Comstor is now offering Amazon Web Services’ in Canada. This new offering is part of an expansion for the value-added distributor to provide high-growth cloud services for channel partners. The agreement follows up on Westcon-Comstor’s deal with AWS in Asia Pacific. Canadian solution providers using the distributor’s BlueSky cloud and service management platform get a set of services and capabilities including an analytics engine that provides visibility into cloud usage and cost, asset optimization recommendations as well as simplified billing.