Channeling the Cloud

Tech Data's StreamOne Solutions Store Aims To Link Providers

The IT distributor is taking the effort it started with Software License Selector further into the cloud.

• By Jeffrey Schwartz
• March 01, 2012

The board of directors of IT distributor Tech Data issued a directive two and a half years ago that software sales should account for 25 percent of the company's revenues, up from 17 percent at the time. The reason was obvious: Tech Data wouldn't have to carry as much inventory, which was eating into its capital.

To get there, Tech Data knew it had to revamp its supply chain in order to connect software vendors and ISVs with implementation partners. Last year, the company launched its Software License Selector, a Web-based portal that allows systems integrators (SIs) and VARs to locate correct SKUs and place orders.

The Software License Selector lets Tech Data manage orders for hundreds of thousands of SKUs more quickly, accurately and with a much higher level of automation. Since its launch, 70 percent of orders are processed without human intervention, up from 30 percent, according to Joe Quaglia, Tech Data senior vice president of U.S. marketing.

Now Tech Data is taking that effort to the cloud. The company has launched the StreamOne Solutions Store, aimed at letting VARs procure cloud services and electronic software downloads (ESDs). StreamOne is a single platform that functions as an application store.

Once approved by Tech Data, cloud providers and ISVs can market their offerings on the StreamOne Solutions Store, and channel partners can resell, provision and bill their customers in an integrated manor. Later this year, Tech Data will allow partners to run their own rebranded, white-labeled version of the store.

All of the major distributors, including Ingram Micro, Avnet and Synnex, have launched programs to help connect solution providers -- VARs, SIs, ISVs and MSPs -- with cloud providers. An IDC study last summer found 28 percent of those solution providers surveyed have not reported any revenue from cloud services, and another 43 percent said less than 10 percent of their revenue came from cloud services.

"Clearly the upside is great and solution providers are looking to their distributors and vendors for assistance in capturing this market," said Virginia Shepherd Agee, IDC research director for infrastructure channels and alliances.

"With StreamOne, Tech Data is addressing that need and offering its partners access to a variety of proven, integrated cloud services for their end-user clients. Tech Data's resellers will be able to connect with suppliers of [Software as a Service], [Platform as a Service] and [Infrastructure as a Service] offerings that have been vetted by Tech Data -- and those suppliers, in turn, gain access to a vast network of resellers."

Tech Data says it has 60,000 active VARs that procure IT products through its distribution channel.

Time will tell if distributors such as Tech Data succeed in their quest to bring the channel together with cloud providers -- but, given the companies' track records, I bet they will.

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