Cisco and Datatec ready to dance again in Dubai

Global networking services group Datatec is set to resume its distribution relationship with Cisco in the Middle East by launching a Dubai subsidiary of its Comstor division, focusing purely on the vendor’s networking equipment. The move means Cisco and Datatec are back working together in the region after a gap of more than two and a half years. Back in 2004 Cisco cancelled a distribution contract with Datatec — then selling Cisco through daughter company OnLine Distribution — following an investigation into the implementation and management of Cisco rebate and incentive schemes in the region, which focused on multiple Cisco distributors and staff within the vendor itself.

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By  Andrew Seymour Published  December 6, 2006

Global networking services group Datatec is set to resume its distribution relationship with Cisco in the Middle East by launching a Dubai subsidiary of its Comstor division, focusing purely on the vendor’s networking equipment. The move means Cisco and Datatec are back working together in the region after a gap of more than two and a half years. Back in 2004 Cisco cancelled a distribution contract with Datatec — then selling Cisco through daughter company OnLine Distribution — following an investigation into the implementation and management of Cisco rebate and incentive schemes in the region, which focused on multiple Cisco distributors and staff within the vendor itself. The new Comstor UAE operation, which will be responsible for providing Cisco with coverage across the entire Gulf region, will be headed by former Tech Data Middle East chief Steve Lockie. He recently quit his post at the broadliner’s UK arm in order to accept Datatec’s offer and will officially take the reins in April 2007. “This is the first of many planned steps towards achieving our objective of increasing our exposure to emerging markets by working closely with key vendors,” said Datatec CEO, Jens Montanana. “Steve Lockie’s considerable experience in IT distribution will enable us to identify and capture new opportunities in this fast growing region — we are glad to have him on board.” Comstor Middle East claims it will support the reseller channel by providing product availaibility, technical tools and financial services in addition to rolling out its OneDefense and OneVoice channel programmes in the region. The sales, marketing and logistics activities of the company will also be supported by sister company Westcon Group, which carries a number of vendors complementary to Cisco. Willem de Haan, chief business development officer for Westcon and Comstor European Operations, commented: “The emerging markets experience of our parent company Datatec, combined with our expanding European operations, will be instrumental in accommodating Cisco’s fast growing drive in this burgeoning region. Based on a long business relationship with Cisco, we believe that building and enabling unique and effective routes to high growth advanced technology markets is key to ensuring fundamental growth for customers,” he concluded. The appointment of another distributor is likely to receive a lukewarm reaction from other wholesalers selling Cisco kit in the Middle East. However, a source at one distributor with a strong networking business, claimed there is enough capacity in the market to support an additional player. “Cisco is growing at such a high pace and the distribution market is not necessarily catching up with this so it needs more distributors," he said. "There are a lot of big infrastructure projects coming up in this region and Cisco requires the extra bandwidth to support these.” In the six months to 31st August, South Africa-listed Datatec recorded an operating profit of US$43m on sales up 16% to US$1.67 billion.

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