EMEA reseller channel remains strong, despite IT industry downturn, says Canalys

Canalys today announced at its annual Channels Forum EMEA that, despite the IT industry’s worst performance in three years, the EMEA IT reseller channel performed above expectations in the first half of 2012. Many channel partners registered around 10% growth, benefiting from a transition to a more software- and services-led business model. The overall EMEA IT industry grew only 6% during this period, propelled by Apple, which accounted for half of that increase. As a result, IT distributors recorded zero growth, leading to long-awaited industry consolidation.

With the theme of ‘smarter mobile enterprise’, the Canalys Channels Forum EMEA is focused on how channel partners can continue to thrive in a time of industry turmoil for many of the larger, more traditional vendors and distributors. Canalys is emphasizing the need for partners to capitalize on the convergence of mobility, wireless, business analytics and the cloud as the principal path toward future IT channel profit. In particular, the analyst company highlighted apps, an $18 billion sector in 2012, as perhaps the single largest growth opportunity for channel partners in the coming months.

‘The last decade was about people-driven services, such as call centers,’ said Canalys CEO Steve Brazier. ‘Now, apps are replacing people to give the end user a do-it-yourself solution to everything from booking a taxi to IT security. We recommend that channel partners recruit developers now to ensure that they can take full advantage of this trend.’

In an increasingly mobile world, Canalys also pointed to security as another key growth area for channel partners: ‘Remote workforces, new devices and consumer-driven user behavior increases the security challenge for any enterprise,’ said Canalys Analyst Nushin Hernandez. ‘As the world goes more mobile, the typical IT manager approach of saying “no” to employees using private devices for work and downloading their own menu of apps is quickly disappearing. IT managers who stand in the way of perceived innovation and productivity will not survive, whereas channel partners capable of tackling these new mobility-related security dilemmas as part of a comprehensive solution stand to gain.’

The analyst company also signaled the transition to wireless as the primary business network as another opportunity for channel partners. With the roll-out of 802.11AC, offering gigabyte-sized connections, the LAN will be relegated to supporting no more than IP telephony in many offices in the future. Channel partners providing wireless networking services will not only remain vital but also have the potential to expand their businesses by offering related solutions, such as security.

Meanwhile, while still a source of potential channel profit, the hype around cloud computing has subsided, and will continue to do so, according to Canalys: ‘People now recognize that the cloud may be the right move for applications that target consumers, are new, or manage traffic or internal service issues, for example,’ said Brazier. ‘But it makes no sense to take IT that already works and move it into the cloud, just for the sake of it.’

Microsoft readjusted to this cloud reality, after experiencing poor sales of Office 365. The new version of Office 365 acknowledges the vendor’s strength in the PC market, by allowing a hybrid approach. The primary tool now focuses on office apps run locally on the PC, while the cloud-based version targets secondary purposes, where collaboration is required.

The new hype term of 2012 – ‘big data’ – does however offer a real opportunity for channel partners. With the increasing hardware and software capacity to examine the explosion of data, both structured and unstructured, channel partners have the chance to sell this infrastructure. Canalys predicts that the most astute channel partners will set themselves up as analytics service providers, bringing different sources of data together, aggregating information from different companies, and allowing all members of the value chain to make better business decisions.

‘The old regime of IT heavyweights has become less relevant in today’s IT channel,’ said Brazier. ‘We no longer live in a Microsoft-driven industry, with the vendor’s share falling to just 30% of all intelligent devices – smart phones and PCs – worldwide in 2012. We see those more nimble players – both vendors and channel partners – capable of embracing the concept of the ‘smarter mobile enterprise,’ as the true engine of IT industry growth in the years to come.’

About the Canalys Channels Forum 2012 events

The Canalys Channels Forum EMEA runs from 8 to 10 October 2012 in Barcelona. The APAC event runs from 30 October to 1 November 2012 in Singapore. The forums, in their fifth year in EMEA and running for the first time in APAC, are the only independent events that unite senior managers from leading technology vendors, distributors and channel partners to discuss industry trends, forge new business relationships and create sales opportunities. In addition to vendor keynotes and theater presentations, the events will feature more than 2,000 senior one-to-one meetings and prestigious gala dinners, among other networking activities. The events are open to senior business managers, both from IT vendors and channel partners. Journalists should contact press@canalys.com to learn how to obtain a press pass. More information about the events can be found at www.canalyschannelsforum.com.

About Canalys

Canalys is an independent analyst company that strives to guide clients on the future of the technology industry and to think beyond the business models of the past. We deliver smart market insights to IT, channel and service provider professionals around the world. Our customer-driven analysis and consulting services empower businesses to make informed decisions and generate sales. We stake our reputation on the quality of our data, our innovative use of technology, and our high level of customer service.