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Channel Matters Blog > October 2012 > The oncomming storm of cloud opportunity

The oncomming storm of cloud opportunity

by David Perrett
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Recently the European Union has decided to invest in the emerging cloud market they feel could deliver 2.5 million jobs to the continent. Announcing plans to develop European standards and certifications to get business to join the cloud, Neelie Kroes told the Bangkok Post, "We want to make Europe not just cloud-friendly but cloud-active." Kroes goes on to state that the cloud could add €160 billion euros to the EU's economy.

Following suit, Intel revealed in a recent article that its latest server chips will be built to meet the needs of cloud services, and other high-performance applications.  In a related article, Cedric Thomas, CEO of OWtold Lissette Mercado of Cloud Computing Journal that the cloud will open the next wave of innovation in the technology space.  A simple Google search and you will find similar stories on websites all over the World Wide Web. 

For most companies who work in the space, one of the biggest obstacles is how to maximize your profitability with your cloud services.  If you are trying to gain partnership buy-in with your channel partners, it can be doubly hard.   Moving from selling a product, where you can easily show profitability on a deal by deal basis, to selling a cloud based solution with a monthly revenue stream for both the Channel Partner and Vendor, can be a daunting task.  According to Braham Shnider, founder and CEO of Channel Enablers, “one of the biggest issues moving from a product services model to more of an annuity based cloud model is that the channel managers don’t have the business acumen, and the partner influence skills to be able to convince a partner to sell cloud based services.  As a consequence, we see vendors using specialist teams or their higher up managers to communicate directly to their partners; and this doesn’t scale”. Shnider went on to say that the challenge for companies is to get their channel partners to move en masse from a products or license model to an annuity model.  Shnider said there are two ways to develop their channel managers. One, channel managers need to really understand the economics of the two different models, and two, they need to possess the core influencing skills required to drive the need home to the partner that selling an annuity based program is in their interest, by helping them make the appropriate investing decisions, where to invest, and in a way to mitigate risk as much as possible.

Channel Enablers tools and training can help your Channel Managers traverse the landmines of objections and resistance to change that inhibits both Vendor and Partner success.   In his article “Cloudy Financials For The Channel” Ian Moyse said, “teams will have to focus on communicating a different set of value propositions, with more emphasis on business credentials, levels and quality of service, total cost of ownership and quality of on-going customer support, rather than features and functionality or speeds and feeds”. Channel Enabler’s training can help get your Channel Managers on board, and help them frame a winning proposition to your channel partners so both you and them increase your profitability with a revenue stream that will grow year in and year out.

References

Bangkok Post. (2012) EU eyes a cloud computing heaven. Retrieved from: http://www.bangkokpost.com/tech/computer/314371/eu-eyes-a-cloud-computing-heaven

Hampton, T. (2012) Intel Targets Faster Cloud Computing with New HPC Chips. Retrieved from: http://siliconangle.com/blog/2012/09/21/intel-targets-faster-cloud-computing-with-new-hpc-chips/

Mercado, L. (2012) Cloud Computing: A New Wave of Innovation in Infrastructure Software. Retrieved from: http://linux.sys-con.com/node/2371967

Moyse, I. (2012) Cloudy financials for the channel.  Retrieved from: http://www.channelenablers.net/channel-matters-blog/item/160-cloudy-financials-for-the-channel?goback=.gde_129519_member_164475282

White, E. (2011) Monetizing the Cloud. Retrieved from: http://cloudcomputing.sys-con.com/node/2111842

 

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