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The Changing Channel

Dispatch from ChannelCon: ChannelCon-fused

As Howard finds at this year's CompTIA partner convention, yes, there's still a channel. But there's also something else.

Greetings from CompTIA ChannelCon in sunny Orlando, Fla. This annual convention for members of the Computer Technology Industry Association (CompTIA) is attended this year by over 1,100 people. There are also 147 exhibiting vendors, terrific classes given by inspiring instructors and meetings of the various CompTIA communities.

We've discussed associations before here in The Changing Channel. We've talked about the various kinds, including distributor-owned, vendor-focused and the truly vendor-agnostic -- like CompTIA. It is of, by and for the channel. It funds itself through its various educational and certification offerings, including the industry-standard A+, Network+ and Security+ certifications, and the various TrustMarks. Its board of directors comes from every part of the channel community, including vendors, distributors, solution providers, resellers and more.

We've also talked about whether or not there really still is a channel anymore.

Having spent three days among these remarkable people at ChannelCon, I'm happy to report that there most certainly is. The channel is alive and well and moving boxes -- or shifting kits, depending on which side of the pond you come from. In the Channel Chiefs forum at ChannelCon, Toni Clayton-Hine, vice president of global channel marketing at Xerox, referred to vendors who have "units to move." 

I think she meant that to be somewhat pejorative, but you have to ask yourself what manufacturer doesn't have units to move. And that's where the quandary begins.

Of MSP and MSP
Many of the attendees here are asking questions about their businesses. The old models aren't working as well as before. 

One longtime industry veteran pointed out to me that we came from the era of the generalist, where you did everything your customer needed. But today, there are much larger companies with far greater economies of scale that will always beat you on price and offer what look like far more extensive resources. So you need to specialize.

Perhaps the biggest question is, "What should I specialize in?" Should you be a value-added reseller (VAR)? An integrator? A managed services provider (MSP)? A cloud services provider (CSP)? A solutions provider? 

Listening to the Channel Chiefs, it starts to become obvious that the choice is between MSP or MSP -- managed services provider, or move some product.

What Are We?
The reality is that it's hard to determine what kind of association CompTIA really is and needs to be. Is it a trade association, or is it a professional association? With 147 vendors giving out tchotchkes and talking partner programs, it would seem like this is clearly a trade show, showing attendees what great products they can add to their line cards.

But the session content is all about how to incorporate cloud services, mobility services, security services and other services into your business. Can any one association support both the reselling of products and the improvement of technical and professional skills for the development of professional practices?  Should it?

The Right Track
Personally, I think CompTIA is more on the right track than any other association I've been involved with. Distributor-owned associations like VTN, TechSelect or Varnex create too much of a captive community. Vendor-focused associations like the International Association of Microsoft Channel Partners (IAMCP) become shills for the vendor and simply extensions of the vendor's marketing. 

CompTIA has done its best to remain vendor-agnostic and focus on the development of communities -- not by geography, but by focus. Geography-based chapters have the recurring challenge of succession planning. When a leader emerges, the chapter is strong. When that leader moves on, the chapter often collapses.

The communities here are focused on different types of services, not different types of products. That creates a serious disconnect with the vendors that are here to find partners who indeed can move those units.

Solution?
VAR stands for "value-added reseller," which is a completely antiquated concept that can no longer be supported. Nobody can afford to simply "add" value when product margins are all but nonexistent. 

Today's solution provider adds product, sometimes, to the value that it sells in the form of professional and managed services. No longer does the product pull through the services. These days, the services create the need for products. The sooner manufacturers grasp that concept, the sooner they'll learn to better leverage their channel. How?

Stop putting marketing people in front of us as "channel chiefs" who can only echo what they think are the relevant buzzwords, like "adjacency" and "recurring revenue model." Let's face it -- they've never worked in the channel and have no real clue about what channel companies do. 

My recommendation? Go back to the old Microsoft and Citrix model, where they understood that the more they could help us master technical services and hone our professional skills, the better we were are helping them fulfill their objectives. Build a service delivery arm, not a sales arm. The services will indeed pull through their products.

About the Author

Howard M. Cohen is a consultant to IT vendors and channel partner companies and a board member of the U.S. chapter of the IAMCP. Reach him at hmc@hmcwritenow.com.

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