What will 2014 bring to the IT Channel?

By Tony Lock

This is the time of year for looking back at what has happened in the previous 12 months, but for many organisations selling in the IT Channel it’s also when it makes sense to look forward to gauge what, if any, new opportunities are worth considering for the months ahead.

Channel margins remain under pressure for hardware based offerings. This places a greater onus on channels to look at software and services-based offerings. Even more importantly, the trend of customers wanting to acquire ‘solutions’, rather than products they put together themselves continues to grow in popularity. Vendors that have traditionally supplied point products now even more than before have to be ready to move outside their traditional comfort zones.

But which solutions will clients be looking to purchase in 2014?

On the face of it this is a very tricky question to answer. By combining insights, however, from the many surveys we run each year, it is possible to make a stab at picking a few areas likely to see significant client activity.

One area that is almost certain to continue to prove impossible to avoid for organisations is the purchase of storage solutions. There is no doubt that the majority of organisations, large and small, are having to store expanding volumes of data generated by both their enterprise applications and by their users. As has been the case for most of the last decade, the number of files created and their richness grows day by day, placing increased pressure on storage systems to hold the information and ‘data protection’ solutions and to ensure these are backed up / replicated to provide recovery.

Looking beyond basic ‘storage platforms, I expect to see users acquiring solutions which provide them with more effective storage/ information management capabilities. Such solutions could well include those explicitly seeking to minimise the growth of primary data stored (such as data deduplication etc.). In addition I expect to observe a slow but steady increase in the use of content management and archiving solutions to enable organisations to limit data growth on cheap-to-acquire but costly-to-operate storage arrays. Many such management and archiving solutions offer the opportunity to improve classification of the data they possess in order to inform operational business decision making.

The second area I see generating significant interest in organisations involves the management of mobile devices and securing the corporate information they hold. Many employees now expect to be able to use their personal devices, especially smart phones and tablet systems as well as the well-established ‘home PC’, to access an expanding portfolio of corporate services, applications and data.

The challenge for many organisations is that they have limited experience of existing Mobile Device Management offerings, never mind the new ones that seem constantly to emerge. This means that many remain unclear as to the capabilities of the many offerings on the market. With mobile usage highlighted as a major area of expansion in many organisations, the channel is likely to have plenty of opportunities if you can identify effective solutions and explain to potential customers the advantages and limitations of each.

The continuing growth in the use of ‘virtualisation’ solutions in mid-market organisations and its slow penetration in smaller businesses makes this an area that will also attract customers. Research carried out by Freeform Dynamics over many years highlights that, while the benefits available from simple x86 Server virtualisation are well understood, few companies have managed to put in place the good operational processes supported by effective management tools to keep virtual servers operating securely and in a manner which optimises resources. Thus solutions, potentially including those based on managed services, could be areas for channel partners to explore and benefit.

The adoption of Desktop Virtualisation solutions to serve a wider range of use cases is a related extension to this, and is another area that could well grow in the next year or two. Research performed by Freeform Dynamics shows continuing interest in the possibilities. Yet few organisations seem to have a good understanding about which type of approach will suit their use cases and users.

Until recently many potential use cases foundered as the costs, notably those associated with back end storage, severely limited adoption to those where Desktop Virtualisation’s benefits, notably in terms of enhancing ‘security’ or providing significant support benefits or additional flexibility, could justify the expenditure. The costs, however, associated with delivering suitably performing solutions have decreased steadily making the investment hurdle much less of a potential inhibitor. Channel partners have, therefore, considerable opportunity here, especially as many of the incumbent software vendors are keen to promote adoption of these solutions.

A final area where customer organisations can reasonably be expected to need to enhance their existing capabilities is ‘Security’. This particularly applies to information management where external regulatory and compliance directives will continue to demand more of enterprises of all sizes. It is likely that a full panoply of ‘Security’ solutions could come into play, ranging from basic data protection through to full scale encryption and network enhancements.

Indeed, numerous organisations talking to us already report that they see many facets of ‘Security’ as areas they will need to address in the coming year. Once again, channel partners will have to be prepared to guide potential customers on which solutions are appropriate for their needs as well as potentially taking on routine administration of such solutions for customers which lack the skills, or inclination, to do this for themselves.

This raises a related area where channels should spend time deliberating. It concerns offering and supplying managed services (including ‘cloud’ solutions) to customers. Multiple studies that Freeform Dynamics has completed in 2013 show that small and mid-sized business will consider buying managed services delivered by their channel partners if it removes an operational burden. Indeed, one study highlighted that small businesses would prefer to take ‘cloud services’ from their usual channel partners rather than going directly to large or global cloud vendors. The challenge for channel partners is first to find cloud suppliers with business models which suit channel resale and then for the channel business to be able to support its customers’ introduction and usage of such solutions.

In summary there are likely to be significant opportunities for channel partners to develop business in 2014. The key will lie in providing solutions which deliver clear customer benefits and come with excellent support and ongoing service. In some areas, channel partners must be prepared to ‘educate’ the customer base about which solutions will fit what usage cases. But there is scope to grow, and grow profitably.

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Tony Lock

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Tony is an IT operations guru. As an ex-IT manager with an insatiable thirst for knowledge, his extensive vendor briefing agenda makes him one of the most well informed analysts in the industry, particularly on the diversity of solutions and approaches available to tackle key operational requirements. If you are a vendor talking about a new offering, be very careful about describing it to Tony as ‘unique’, because if it isn’t, he’ll probably know.