Inside Information: Kevin MacRitchie

Kevin MacRitchie Cisco’s vice president for worldwide channel operations on what the vendor plans to do with Linksys and the SOHO space

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By  Mark Sutton Published  June 1, 2003

Inside Information|~||~||~|CME: Following the acquisition of Linksys, will you be building a retail channel for Linksys?

Kevin MacRitchie: Linksys already has its own separate channel. It is about 70% in the retail market space and about 30% in the SOHO end of the marketplace. The question will be if we can meet the types of cost model that Linksys has. We will maintain them as a separate entity within Cisco, you might see some Cisco branding on the box, but it will still be Linksys.

It is important that we make sure that we drive down to that market place, because if you can drive demand from the home, or the home business, you now have the opportunity to empower new applications in the home, around things like TiVo and Replay or around integrating with Sony and Sanyo in the entertainment space. Couple that together with some of the applications that allow employees to work from home—if we marry the capabilities to provide entertainment services with the business requirements I might need in terms of wireless access in my home, inclusive of my IP phone, now I start to make some business impact. That is what we want our partner community to deliver.

CME: Will that include making Linksys products available to existing Cisco partners?

MacRitchie: I don’t think that we will initially. [Linksys] has its own brand recognition, it has its own marketplace. Quite frankly, the cost to produce those products, to have our own account manager spend any time on it, it would not do anything in terms of increasing the value, the cost model is just too high for us to do that. The products are purely out in retail demand, so we would like to continue with the retailers. We could work with other retailers, to address how would [US electronics retailer] BestBuy or their equivalent help build the home office and entertainment suite? Let them drive that.

CME: How do these products fit with Cisco’s plans for the SMB segment?

MacRitchie: There is always the question of ‘what is the right delineation’—making sure we understand, based on the way the market would be segmented, how we cover that. Linksys—it is not cost effective for even a channel account manager or direct account manager to have a conversation with a person at home, that means we just lost money on the opportunity. That is what the retail guy does best. If we look at a company that is one to a hundred employees, there are great opportunities for the channel, where we are not involved. That is their market place.

CME: You have launched an enhanced Partnerview [partner portal], that includes tools to address this market. Can you get to a point where a partner is managed completely online?

MacRitchie: There is a relationship piece that is critically important, that I think you always want to maintain, the reality though if you take a look at the number of partners out in the community, globally, there is somewhere in the neighbourhood of 500-800,000 employees out there, in our partner community. Stacked up against our 32,000 employees and a channels force that is maybe around 1,000 trying to cover 500,000—that’s not possible.

You have to have productivity tools that empower partners, to get the things they need off the web. It is just like me going shopping—I don’t physically have time to go to the store, if I need something, I can shop online, I don’t have to an interface with them.

CME: One of your other responsibilities for anti-grey marketing—how do you counter it, how big a problem is it?

MacRitchie: We are still actually waiting for [KPMG’s grey market study]. Their information relative to Cisco says that they believe it is somewhere up to a billion dollars, but it is how you look at that information, what does that mean? How do you educate what really is grey or black, and which is counterfeit product. We face that from various parts of the world, it is an extremely small percentage, we do all that we can to stop that.

CME: Do you have full time resources dedicated to grey?

MacRitchie: Yes we do. The full time team has increased five-fold to ensure that we focus more on prevention and helping our partners identify it. The importance piece is we don’t want our partners to be in a situation where they feel they have to go after inappropriate discounts to compete against a grey market vendor.||**||

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