Storage solutions

Companies of all sizes are creating more and more data and the need for a comprehensive, scalable and efficient storage solution continues to skyrocket across the region. Little wonder that storage is starting to spark interest among the second tier channel players.

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By  Andy Tillett Published  May 29, 2005

Value of data |~|Gharaibeh_Qais_200.jpg|~|Qais Gharaibeh, Middle East partner sales manager at EMC|~|The Middle East market has an insatiable appetite for storage solutions if you listen to the corporate messages pumped out by the vendors, distributors and integrators plying their trade in this lucrative market sector. With companies of all sizes creating more and more data, the need for a comprehensive, scalable and efficient storage solution continues to skyrocket across the region. Little wonder that storage is starting to spark interest among the second tier channel players. Storage remains an all encompassing technology term making clear definitions of what constitutes a storage solution a contentious issue. At its most basic level, storage can simply be a piece of hardware that data is written on and kept. At its most complex, it can become an integral part of a full information lifecycle management (ILM) solution — a dynamic infrastructure sorting and prioritising data and allowing different levels of access. As the channel gets to grips with the complex world of storage one fact has become clear: storage is not purely a hardware, software or services sale; it is a solution. It is a solution that is mission critical to all companies that truly understand the value of the data they create on a daily basis. This is increasingly so in today’s age of information with factors such as compliance, corporate governance and the need to keep data for set periods of time driving investment in storage solutions. While the storage market has already enjoyed sparkling sales for several years, major vendors see no reason for the pace of growth to slow. “Worldwide the computing industry is increasing by 1%, while the storage industry is growing at 5% to 8% and we are seeing this growth reflected in the Middle East. The storage industry is growing at a much faster rate than the IT industry as a whole,” explains Qais Gharaibeh, Middle East partner sales manager at EMC. The growth rates observed by the vendors are reflected in the potential sales and service opportunities that exist for the channel. While complex storage solutions were once the preserve of the largest enterprises with bottomless pockets, rapid technological advances have simplified these technologies and packaged them in a manner that is now appropriate for the mid-market, small and medium business and even the SOHO market sectors. As the major storage vendors look down to the smaller customers, so the desire to build a comprehensive and structured channel capable of reaching this fragmented customer base grows. One that is not only capable of reaching the customer, but can also explain the benefits of the storage solutions on offer. “We believe in reselling solutions rather than individual hardware. The three key factors that businesses work to achieve through our programmes are information lifecycle management, infrastructure simplification and business continuance. Customers now want to buy a full end-to-end solution, they want guaranteed certification, compliance, and to make sure that everything fits under one banner,” reinforces Mohammed El-Shanawany, storage sales manager, Middle East and Pakistan at IBM. ||**||Tiered channel programmes |~|Mohammed_Shanawani_200.jpg|~|Mohammed El-Shanawany, storage sales manager, Middle East and Pakistan at IBM|~|A bevy of major global vendors continue to lead the way with IBM, EMC, Hitachi Data Systems (HDS) and HP all claiming to have the products, ecosystems and software alliances required to bring comprehensive storage solutions to market. For all these vendors, channel partners play a critical role in taking their solutions out to the widest possible customer base. This gives resellers an intriguing choice when it comes to picking the best vendor to work with. End user perception, channel programmes and the margin proposition on offer all play a role in the decision-making process. “Traditionally HP, which has an estimated 65% of the server market in the Middle East, has had a strong hold on the storage market. Over the last two years it has faced increasing pressure from EMC, which has been dealing with people’s perception of it as the ‘Rolls Royce’ of the storage market and brought out cheaper solutions to take on this perception, especially in the SMB sector. I think that HP’s main advantage is that its marketing is stronger. As solution providers I would put IBM, HP and EMC on a par with each other,” comments Wasay-A-Syed, operations manger at Al Futtaim Technologies, a Dubai-based reseller that operates across the GCC and Middle East. Vendors typically employ tiered channel programmes reflecting each partner’s level of expertise and target client base. The more skills a partner has and the more sales it is capable of making, the further it can progress within a vendor’s channel programme. Discount on products in direct correlation with status is the carrot that most vendors use to get partners truly focused on their products. Programme requirements typically specify a set number of trained technical and sales staff in order for a partner to be eligible for the upper echelons in terms of membership level. Because storage needs occur within customer of all sizes, vendors need to be innovative and proactive in the creation of programmes that appeal to channel partners of all sizes. Storage software vendor Veritas has two distinct channels, one focused on SMBs and small enterprises and another exclusively aimed at enterprise customers. ||**||Partner segmentation|~|Spurgeon_Katie2_200.jpg|~|Katie Spurgeon, channel manager for the Middle East and North Africa (MENA) area at Veritas|~|Katie Spurgeon, channel manager for the Middle East and North Africa (MENA) area at Veritas, explains: “In our channel for SMBs and smaller enterprises we have two different tiers, the ‘select’ and ‘premier’ levels. In the select level we recruit and we communicate directly with the partners and offer support. At premier level, partners need a member of their team to take a technical certification course and pass an exam. They also need to have a sales person trained. In our enterprise channel, to buy directly from us, partners must be either a premier partner or an elite partner. A premier partner requires two certified technicians and two certified sales staff and an elite partner requires four of each.” Other vendors — particularly those focused on the high-end of the storage sector — will frequently be very selective in terms of the partners they work with to ensure service and skill levels are maintained. Hitachi Data Systems currently works with a limited number of integrators and complementary vendors in the Middle East. “Partners need the right status and need to be established with the right contacts alongside good systems integration skills and experience in a data centre,” comments John Bentley, sales director at Hitachi Data Systems (HDS) Middle East. The decision that resellers face, when choosing a vendor to work with is influenced by several factors: the discounts on product they can gain by becoming a partner, the training requirements to become certified, the opportunity for moving up the partner chain and the amount of focus the vendor wants from them. Resellers also need to decide whether they can reap the greatest rewards from focusing on the enterprise clients or by targeting the mass market. The higher up the chain you go, the more value data has and the more customers are prepared to pay for peace of mind. This means that at the enterprise level, cost is not necessarily the main issue. ||**||Value of a solution |~|JC_ericson_200.jpg|~|Ericson Correa, product manager at Middle East storage distributor and integrator FDC|~|“It’s frequently about how good a solution provider is that matters at the enterprise level. If one partner can beat his competitors by a hundred dollars, it is not going to be that advantageous if he is perceived as being a weaker outfit. Reputation and the quality of products and services that you are offering are what matters,” claims Ericson Correa, product manager at Middle East storage distributor and integrator FDC. EMC’s Gharaibeh admits the price of a solution remains a consideration in this region, but believes that concepts such as return on investment and total cost of ownership also play their part in the customer decision-making process. Bentley at HDS agrees: “The value of services, the value in a solution and the value of working with a particular partner are all very big issues in Europe, whereas in the Middle East, the focus is still sometimes very much on price. I would say, in that sense, we are still three or four years behind some more developed markets.” While enterprise level clients typically have the internal IT resources to manage complex IT systems, the same cannot be said for the midmarket and SMB sectors. Bearing this in mind, it is little wonder that enterprise clients can pay more attention to the technical nuances of a particular solution while smaller clients are more interested in the ease of using a solution, its reliability and the service requirement it involves. It is an area where the skills and reach of channel partners can come to the aid of vendors. “There is only a limited amount of enterprise companies in any market. Everybody knows who these are and targets them. Underneath this, there are the small to medium enterprise and business markets where we are just scratching the surface. Companies want to know about [storage] but they don’t have the understanding. We need a channel in the middle to educate them,” says Spurgeon. ||**||Growth potential |~|John_Bentley2_200.jpg|~|John Bentley, sales director at Hitachi Data Systems (HDS) Middle East|~|It is a fair point but for some of the smallest resellers operating in the Middle East, finding the resources to build up their own internal sales skills in order to proactively go out and hunt storage business can in itself present a financial challenge. It is a challenge that was tailor made for value-added distributors (VADs) to address and the numbers of players in this category working with storage vendors continues to grow. Specialist VADs like StorIT have developed a complete portfolio of storage-related sales, integration and service skills internally. These skills are put to good use educating StorIT’s reseller base. Alternatively, resellers that sell a storage solution but do not possess the necessary internal skill set can draw on StorIT’s service capabilities to sell through to the customer. “We offer pre-sales consultancy, design and architecture of solutions and give after-sales support if our resellers can’t. 60% of our portfolio requires some or all of these services. We pick our partners by identifying those who have a good reputation and are dedicated and committed to storage solutions. Then we look at who has a good relationship with the clients. We then give resellers the initial training on the product and the sales side of storage solutions,” explains Suren Vadantham, managing director at StorIT. When storage vendors get a toehold in an account — even at an SMB level — they are anxious to keep hold of it, even as the client’s storage requirement grows. To achieve this aim many storage solutions offered by vendors are modular. This way, as businesses grow, they can easily upgrade their existing storage solution, rather than facing a ‘rip and replace’ scenario. For those companies active in the storage sector the only way is up when they assess the growth potential of the Middle East markets. “If you look at enterprises in the past ten years and talk to them about what they have done in terms of networking the picture becomes clear. Today, they’ve done everything they want to do about networking, and yet continue to invest in that area. They have optimised their computing efficiency and now they are looking at storage. The way they looked at networking is being replicated in terms of storage,” explains Gharaibeh. “We have been developing our channel for the last six years. Today more than 33% of EMC’s worldwide revenue comes from resellers. We realised that the functionality is needed in the SMB and commercial sector, so now we have a commercial organisation focused outside of the enterprise sector. If resellers don’t have the right coverage they’re not of much value to EMC or anybody else. But if they have the right coverage, the right solutions and the right products that compliment the vendor’s offering, then they are the right partner for EMC,” he added. Selling storage is certainly not for everybody, but increasingly it is becoming an integral part of any comprehensive IT system. With a multitude of vendors to choose from, integrators and resellers need to carefully assess each vendor’s position and sales potential. ||**||

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