Bright outlook for regional channel

In spite of the geo-political instability in some countries in the Middle East, the regional channel remains in buoyant mood for the year ahead. Most pundits are predicting 2015 to be a bumper one for the regional channel.

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Bright outlook for regional channel
By  Manda Banda Published  February 22, 2015

Although the overall business climate in the regional channel continues to improve, there is still some elements of uncertainty especially in the PC segment, where sales of desktops and notebooks had stagnated for seven consecutive quarters before reporting growth in sales, with research firm IDC reporting that sales of PCs in the Middle East and Africa grew 2.2% from Q2 2013 to Q2 2014, to total of 4.5m units shipped in the second quarter last year.

For many channel players, the first half of 2014 was steadier and showed a lot of promise although that buoyant mood seemed to have ebbed towards the end of the year.

Despite this, the spread of new technologies, a business landscape that has become increasingly consumerised in its use of IT gadgets and applications, and the impact of big data, cloud computing, and virtualisation on enterprise computing models, is leading industry pundits to predict a bright outlook and a bumper 2015.

In fact, most commentators are forecasting steadier conditions, greater investment in innovative technologies and business strategies across government, public and private sector in 2015.

“I feel the channel on all levels, vendor, distributors and resellers, have again started to invest into new businesses, assess parts of their business and ‘changed the switch’ for better prospects. We have all become entrepreneurial again and all of this has created focus and specialisations. We can all be proud of what we have achieved in 2014 and looking positively into 2015,” said Mario Veljovic, VP, Solutions MENA at Global Distribution FZE.

Veljovic said the political stablility in countries in MENA, such as Morocco, Tunisia, Saudi Arabia, Qatar, UAE and Oman will prove strongest in 2015 in terms physical security, analytics, BI and virtual desktop infrastructure (VDI) will dominate the headlines this year.

Stephan Berner, managing director at systems integrator Help AG, said a simple reason for optimism in 2015 has to do with the growth of the regional channel last year. Berner added that last year, there was a lot of instability in some countries in the Middle East, however, on the whole, the effects remain concentrated with minimal spillage into neighbouring regions. “In 2013, Help AG posted over 80% year-on-year growth in revenues and also managed to double its employee count. We are on track to post similar figures for 2014 as well,” he said.

In fact, Berner added, the growing threat for cybercrime being carried out by hacker groups and state-funded players is actually creating new opportunities for business. “In our own experience, we are not seeing any instability at all as the economic performance of many countries in the region has been strong and the strategic initiatives around information security have been well-funded by enterprise and government organisations.

Khwaja Saifuddin, senior sales director, Middle East, Africa and India at storage solutions vendor WD, agreed and said indications are that most of the MENA countries will see a surge, and this is being led by the absorption of new products and technologies across segments including consumer, SMB and enterprise. Saifuddin said the UAE will continue to be a strong market for WD thanks to a healthy spending power, high-speed fixed and mobile broadband connectivity, the adoption of mobile computing devices and the need for storage solutions, such as NAS devices, to seamlessly store, share and protect content. “Demands for increased security in homes and offices is also driving the demand for surveillance solutions, which - like most home and SMB NAS systems - are sold without built-in storage,” he noted. It’s for this reason that we expect NAS hard drives and surveillance drives to be implemented in homes and SMB offices in the region.

Indeed, SMB spend on IT held up throughout 2014 and channel partners that have started to respond to global trends such as cloud, big data and BYOD with tailored bundles of services are beginning to reap considerable benefits.

Mario Gay, general manager at regional distributor Mindware, said the Middle East has witnessed a marked growth in the SMB sector largely due to the many infrastructure projects being rolled out that are filtering through to small and medium-sized business.

Gay said this trend is positive not only in the UAE, but the Middle East as a whole because small firms in different market verticals are showing willingness to invest in the growth of their businesses. “As opportunities open-up for channel partners in the Middle East, resellers should identify areas where they would like to grow their business and invest in skills development,” he said. “Doing so will ensure that they capitalise on the many opportunities in 2015.”

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