CHANNEL PARTNERS Partnerships between technology solution providers and telecom agents continue to generate significant business, with some companies generating up to three-quarters of annual revenue from these strategic and tactical collaborations, according to new research out today from Channel Partners and CompTIA.
Results of the second annual benchmarking report on IT-telecom partnerships are being released in conjunction with the Spring 2012 Channel Partners Conference & Expo, March 26-29, in Las Vegas. The study was a joint effort by Channel Partners, the leader in providing news and analysis to indirect sales channels serving the communications industry, and CompTIA, the nonprofit association for the information technology (IT) industry.
Significant change such as the emergence of cloud computing is impacting the channels of both the IT and telecom worlds,” said Carolyn April, director, industry analysis, CompTIA. These changes are sparking new partnerships among unlikely pairs while at the same time inviting new and different types of competitors to the field.”
Companies from both IT and telecom are generating business from their partnerships, with IT value-added resellers (VARs), solution providers and managed services providers experiencing a year-over-year increase in revenue. The study reveals that 43 percent of IT firms garnered between 50 and 74 percent of their total sales in the last 12 months from partnerships with telecom agents. Another 25 percent of IT firms reaped between 25 and 49 percent.
Among telecom agents, one-fourth said partnerships with IT firms accounted for 25-49 percent of revenue in the last 12 months, while about one in five telecom agents said they generated more than 50 percent of revenue from partnerships.
These positive results speak to the increasing convergence between traditional IT product and service models and the world of telecom services,” April said.
The Channel Partners-CompTIA study also asked companies about the drivers behind their decisions to partner.
When it comes to core services, 84 percent of telecom agents said partnerships are driven by a need to gain new customers. Creating new revenue streams was the second most cited reason. Among IT firms, two-thirds said the need to fulfill customer demand for services is the primary reason why they chose to partner. Nearly six in 10 said the desire to add new customers drives partner behavior; and nearly as many (55 percent) consider partnerships a way to fill skills gaps.
For emerging services, telecom agents said creating new revenue streams is their top reason to partner, though 74 percent also said it helps to fill in skills gaps. IT firms also cite financial considerations as factors in their partnering decisions. Six in 10 partners expect to save money on training and sales compensation, while half seek to create new revenue streams.
Beyond swapping leads, formal partnerships have been former primarily to facilitate VARs selling carrier network services through agents,” said Khali Henderson, editor-in-chief, Channel Partners. That remains the dominant mode, but emerging technologies are presenting more opportunities for reciprocal agreements.”
When identifying companies to do business with, survey respondents said factors that they most often consider include a companys reputation; quality of products, services and technical skills; understanding of business models; and financial health.
Factors contributing to successful partnerships include effective communications, lead generation, technical capabilities, marketing support and knowledge of emerging technologies, such as cloud computing and unified communications.
The second annual report, Partnering Trends Between Telecom and IT Channels, is based on separate January 2012 surveys to 100 IT resellers, solution providers and managed services providers and 100 telecom master agents. The research can be downloaded from the Channel Partners website by clicking here.
About Channel Partners
For 25 years, Channel Partners has been the leader in providing news and analysis to indirect sales channels serving the communications industry. It is the unrivaled resource for resellers, aggregators, agents, brokers, VARs, system integrators, interconnects and dealers that provide network-based communications and computing services, associated CPE and applications as well as managed and professional services. Channel Partners (www.channelonline.com) is the official media of the Channel Partners Conference & Expo (www.channelpartnersconference.com).
CompTIA is the voice of the worlds information technology (IT) industry. Its members are the companies at the forefront of innovation; and the professionals responsible for maximizing the benefits organizations receive from their investments in technology. CompTIA is dedicated to advancing industry growth through its educational programs, market research, networking events, professional certifications, and public policy advocacy. For more information, visit www.comptia.org or follow CompTIA on Twitter at http://www.Twitter.com/comptia.