April 2010 Archives

If you want to look for signs of recovery then some of the clearest can be seen in the M&A activity in the channel that has already started to pick up momentum this year with this week providing examples of consolidation at vendor and reseller levels of the channel.

The week will be remembered for the surprise caused by HP buying Palm, how those at InfoSec were starting to think of dismantling their stands when the news that Symantec was buying PGP and GuardianEdge came through and of course things started off back on Monday with the confirmation that 2e2 was buying Morse.

Those in the channel with reputations for being acquisitive, and I'm thinking primarily of Avnet here, have also indicated that they are not finished on the acquisition front.

Towards the end of the press release accompanying the distributor's Q3 results was an indication from CFO Ray Sadowski that there was still money in the pot to fund further growth. "We ended the quarter with $1.5bn in liquidity to support continued profitable organic and M&A growth," he said.

Consolidation is a feature of the channel just as much as margins and MDF but as we come out of recession there seems to be a pace to it that the channel needs to keep an eye on. Perhaps it is because there wasn't the volume of deals last year but it already feels different as we come to the end of the fourth month of 2010.

The challenge for all of us is to to try and quickly work out what the ramifications of these deals are for the rest of the channel. Some will spell opportunities but others will no doubt cause resellers some problems. The key is to find out which is which as soon as possible and be prepared to do it throughout the year because this wave of consolidation is far from over.

There are naturally those that look at Twitter with a great deal of cynicism and you can spot them because they roll their eyes and sigh when ever the subject comes up.

"It's full of people saying that are having a cup of coffee or are washing their hair," has been one comment I've heard made more than once.

But in a world where the speed with which news spreads round the world can be measured in seconds and minutes Twitter is proving to be a very useful way of keeping in touch. Michael Jackson's death was called on Twitter by as much as an hour before the traditional broadcast media were prepared to make that announcement. When news breaks on Twitter the community shares it, discusses it and spreads the message. Great when things are true and admittedly not so good when they are not. But so far most things have been true and the knowledge has been useful.

The latest example has to be the HP acquisition of Palm. What starts with a tweet from a news service simply stating: "BREAKING HP buys Palm" lights the blue touch paper and the next hour is spent with the news announcement being shared and then people commenting on it.

It keeps us as journalists on our toes because my colleague Alex Scroxton also went online to write about it and put more meat on the bones.

But from a reseller perspective how else could you walk into the office this morning not just knowing about the acquisition but also having seen some in the analyst community tweeting about it and getting a view that most of them don't think it will save Palm. An hour spent with news that is fresh, debate that is live is perhaps more valuable than catching up on a news bulletin broadcast on TV after the Champions League game, that is running film taken earlier in the day.

The way information is shared is changing and you can join in for free or sit on the sidelines and wait to catch up with the rest of the world.

Through the recession there wasn't a great deal that you could do to make life better so one of the subjects that vendor's liked to talk about a lot was 'skilling-up'. The idea was that although there might not be too much money around the sensible way for partners to spend the time in-between waiting for the orders to come was by improving their skills.

More evidence that this approach to the market is not going to go away has emerged with the Symantec announcement that its channel programme from October is going to lean on technology specialisms including the likes of data loss prevention.

Cynics, and I'm slightly dithering over whether or not to become one, might well see this as the latest trend in partner programmes which will have a shelf life of a couple of years before things revert back to either focusing on vertical markets or even the low maintenance pack and plaque option.

But regardless of how long the focus on tech specialisations lasts it cannot do much harm for resellers to improve their technology knowledge. It looks like they will have little choice if more, as they will, follow in Symantec's wake.

The annual InfoSec shindig at Earl's Court is a great visible reminder of just how well the security market has come out of the recession. Big stands with bright lights and some households logos could be found at this year's show as normal.

But in terms of finding news it was a slightly harder challenge. Plenty of vendors were providing 'updates' which of course means they were talking about news that had gone past its sell by date months ago. A few had some technology to talk about but for most there has not been a great deal of innovation during the downturn.

So what were the main themes that I managed to pick up inbetween being bombarded by requests from desperate looking pr people trying to get journalists to meet their clients?

Two words stand out in the memory - cloud and identity. Everyone is looking to the security industry to sort out the problems that are holding back wider spread of cloud adoption and so that involves different ways of getting user access with more dynamic tokens and a move away from traditional static two-factor authentication.

But of course key to making access to the cloud, or any other system for that matter, is the requirement of better identity checks. That will be one of the main challenges for the industry to get into a position of being able to prove that someone accessing data is who they say they are.

Those messages will be remembered along with the noise, the two odd men dressed as John Bull with union jack waistcoats and top hats and the resellers who were drinking on one distributor's stand at just gone eleven o'clock. That's the channel for you.

The best way to start a blog is for the author to set out the aims and ambitions and to try and tempt you into sticking with reading with it.

For those of you who don't know me my name in Simon Quicke, hence the play on my name in the title, and I'm the editor of MicroScope. As a result of being Editor it provides me with a position of being able to pull back sometimes from the coalface of getting news stories to look at the bigger picture.

Where is the channel going? where has it come from and what lessons can be learnt? are the sorts of questions I will be trying to answer. Hopefully as we start this journey you can climb on board and please feel free to comment and add your own voice to the debate.