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Selling Core Services to Cloud Providers

January 18, 2011 - Article

Dany BouchedidBy Dany Bouchedid

There’s no denying it anymore. The cloud is hot. Whether it’s here now or a promise of things to come, few doubt the cloud is here to stay.

Quite naturally we are all scrambling to understand how the cloud will impact our channel sales businesses. Don’t be surprised if you see lots of articles and presentations about choosing and selling cloud products. That’s where the emphasis will be – how to add cloud services to your menu of products. You’ll see advice about how to find providers to partner with, how to integrate cloud products into your core offerings, how to identify prospects and cross-sell existing customers. You may be encouraged to participate and “grow rich" in this growing market or warned that embracing the cloud is the only way to ward off impending obsolescence.

So while the cloud presents challenges to what you sell and opportunities to sell new services, don’t forget that it represents a rapidly expanding market segment that needs traditional products channel partners sell.

Cloud services providers require physical infrastructure to support their expanding operations. Without real servers, storage devices, routers and switches housed and powered in secure data centers, and without ubiquitous fast bandwidth and connectivity, the virtual world of the cloud cannot exist.

What should you do?  Examine your existing client base for companies that may participate in the growth of the cloud market. Get to them early and help them anticipate and plan for their growing telecom requirements. This is a great opportunity to deepen your relationship with your customers and demonstrate how well you understand their businesses.

Also, stay alert for the new cloud-related startups in your territory. There’s nothing like establishing a trusted relationship with a small firm that has the potential to explode into an industry giant. You never know.

One of my company’s largest colocation projects in the last year came from a cloud computing startup. Our client needed to establish and maintain redundant facilities in several diverse geographic locations. This type of multisite engagement is particularly lucrative if for no other reason than its scale. But its complexity provided a special opportunity to add value and make the sale. Where an agent may not have an advantage competing against the direct sales forces of the several big colo players in a major market or the single large provider in a minor market, he or she can be key to the success of such a complex multisite deployment.

Of course not every agent has the expertise or resources to handle such a complex project. That’s where a relationship with an agency specializing in colocation can help. There are several agencies like ours that have referral programs for just this situation.

One reason sales to cloud service providers is attractive is that they have the potential to generate more commissions more quickly than sales of cloud services sale to end-users. Cloud providers must pay all the infrastructure costs up front producing high commissions immediately. In contrast, end-users using the cloud can deploy applications cheaply and pay for more capacity as applications ramp up, generating modest commissions until higher capacities are required.

Ironically, you could play both sides: as you earn commissions selling the cloud providers’ services to your clients, you also are growing your commission stream from the providers themselves.

Whether your agency’s core business is selling colocation, bandwidth or network services, there are opportunities to increase sales of all of those services by targeting users and providers of cloud services.

Dany Bouchedid is the founder and CEO of COLOTRAQ , a colocation, managed hosting and cloud computing sourcing company. He also is president of the board of trustees of the Technology Channel Association (TCA), the indirect channel industry’s first non-profit trade association. He can be reached at .

Looking for More?

Learn how “Connectivity Sales Are Key to Cloud Services" at the Spring 2011 Channel Partners Conference & Expo, March 13-15, in Las Vegas. For more information, visit

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