Digital Planet Wants to Buy VARs, Integrators

Digital Planet Communications, Saint Paul, Minn., announced Tuesday it is seeking to acquire telecom and IT VARs and integrators to accelerate its plan to become a leading "communications technology solutions provider" nationwide by 2015.

Digital Planet President Shawn Schmidt told Channel Partners his company is prepared to spend as much as  $20 million over the next few years acquiring VARs and integrators that "share our vision and values" and "can be integrated into our model and culture quickly." Specifically, he identified companies with $2 million to $5 million in sales and located anywhere in the country except the Midwest where it already has a presence. Schmidt claimed Digital Planet, a privately held company, has annual revenue nearing $12 million.

The company has not yet made any acquisitions in furtherance of its nationwide expansion though it does have charter agencies — one current and two pending — as well subagents across the country. "Our only focus to date was to test, test, test and prove our business model," Schmidt said. "Once we perfected it, we can duplicate and scale it. We are there today."

Today Digital Planets designs managed professional solutions across voice and data networks, telephony equipment and information technologies, explained Schmidt. "In the near future, Digital Planet goal is to merge all communications technology into a single, unified solution without dimensions or barriers," he said.

Schmidt and Digital Planet Vice President Brent Killen, in a press statement, asserted that this approach is the model for the channel partner of the future, but it requires a transition that not all IT and communications VARs will make.

"As companies like Digital Planet have started to provide complete solutions to end users, rather than pieces of the solution, the folks that provide pieces will be greatly reduced," said Schmidt in a press statement, predicting the demise of the traditional VAR. "Simply put, if your company is in business today providing a communications technology item that resides on a LAN/WAN, but you dont provide or manage the LAN/WAN, you will not be around for long.”

Killen added in a press statement that Digital Planet’s ideal acquisition targets are those companies that today operate viable businesses and see the imperative to evolve, but for lack of tools, financial resources or skill sets are not able to do so on their own.  "There are good companies out there, with good employees, and for one reason or another they are not be able to evolve to the new economy, to the new technical world, without a catalyst for change. Digital Planet is looking for these good companies to bring them into our culture, to our process and knowledge base," Killen said.

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