As Chief Strategist of the Worldwide Partner Organization, I often speak with partners about their value-add, differentiation, and profitability. Here are some thoughts on how the traditional partner differentiation model needs to evolve in the cloud market place.
Partner profitability has always been driven by the unique value that partners add to surround the offerings from their suppliers. This can be in the form of integration with other third-party products, their own pre- and post-sales services, or even custom service level agreements. The more unique this differentiation, the higher is the partner margin on the transaction; and the more relevant their proposed solution is for the customer, the higher is their probability of winning the order. It is not surprising to see two Cisco partners – one making 12% gross margin and the other making over 25% on similar transactions due to their differing value propositions. Both business models are valid as long as the partner is managing the overhead against the subject margin they are receiving.
Over the past decade, channel partners have typically created unique value propositions around the Customer Premise Equipment (CPE) they have been reselling to end customers. This proposition may include having the lowest price, providing fast delivery, conducting pre-delivery testing or configuration, on-site installation or integration, and many others. These CPE related on-premise value propositions are still relevant in the cloud builder role, but are often not applicable to a cloud services reselling role.
It is clear that the market is moving rapidly to cloud adoption based on new consumption models. According to UBM (United Business Media), 37% of all IT spend will be off-premise in 2013 and there will also be an 11% decline in CPE sales next year. Channel partners need to create new value propositions to differentiate themselves when they resell new cloud services instead of CPE to their customers. In some ways, this requires a return to basics: Read More »
With Cisco’s participation in World IPv6 Launch less than a week away, IPv6 is definitely top of mind. Those of us who work in the federal space are also focused on the IPv6 transition deadline that is coming up on September 30th, 2012. The OMB Mandate issued in September of 2010 by Federal Chief Information Officer Vivek Kundra states that the federal government must “Upgrade public/external facing servers and services (e.g. web, email, DNS, ISP services, etc) to operationally use native IPv6 by the end of FY 2012”. According to a Network World article written by Carolyn Duff Marsan, a whopping 99% of Federal Agencies have not yet met the conditions of the mandate.
Why has it been such a challenge for the government to meet this IPv6 transition deadline? And what needs to be done to help make it happen?
One of the problems is that there has been a lack of IPv6 support by government contractors, (including carriers ), content delivery networks and network equipment suppliers. Network equipment must be “IPv6 certified” to enable government customers to meet the deadline.
Cisco has been leading the way with IPv6 certifications, with a majority of products supporting IPv6 for well over a decade. Our USGv6 product list is testament to the fact that we are committed to helping our government customers succeed, but it will take more than just IPv6 certified network equipment to help the government successfully make the transition.
For those of you in the DC area, if you want to get a update on the outcome of World IPv6 Launch, and more information on how the Veterans Administration successfully transitioned to IPv6, please consider attending the Digital Government Institute’s Government IPv6 Day, where all these topics will be covered.
We’ve talked a bit before about Cisco’s revolutionary network Virtualization technology or “nV.” In case you aren’t familiar with it, nV technology on the ASR product family intelligently blends the network edge, aggregation and access layers into a single system. This can deliver up to 70 percent operational expense savings, increase network capacity and accelerate IPv6 service deployments (very important since we’ve got the World IPv6 Launch next week). nV therefore addresses some of our customer’s most important business concerns by:
Lowering capital costs by simplifying the network
Lowering operational expenses by scaling the network operational efficiencies
Increasing revenue by enabling them to better leverage network intelligence
But don’t just take our word for it. ACG Research has developed a Read More »
It’s no secret that people are forming personal attachments to their iPhones, Android phones, and other “smartphone” devices.
In fact, in a recent Pew Research Center study, respondents used adjectives such as “awesome,” “great,” “essential,” “indispensable,” “good,” and “excellent” to describe how they feel about their treasured mobile devices.
This love affair is driving skyrocketing sales of smartphones: by 2015, eMarketer estimates that 58 percent of all mobile users in the United States (149 million people) will own smartphones, while in the European Union, more than 50 percent will own them by 2014. Read More »