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In unified comms, channel partners rule, says Telsyte

IT Industry - Strategy

According to market research firm Telsyte, vendors' channel partners are taking the dominant position in providing telecoms solutions to medium and large enterprises: because of the value add they are able to provide in delivering and implementing complex unified communications systems.

"Australian businesses, especially in the mid-market and large enterprise market segment, are looking for channel suppliers that can provide end-to-end services for UC implementation, opting to bypass traditional consultants for even the business requirements gathering phase" said Gary Tsang, Telsyte enterprise communications analyst.

Telsyte's comments follow those last week from Frost & Sullivan  which claimed to have identified a shortage of systems integrators with the skills needed to implement unified communications in enterprises.

Tsang added that, in order to capitalise on these opportunities "channel partners need to get involved from the beginning, in the requirements gathering and design phases, all the way through to post implementation, by providing quality post-deployment and ongoing support services."

But, he says, this will not be easy. "Channel partners are faced with many challenges... including the increasingly narrowing hardware margins and cost pressures from having to up-skill to remain relevant in the complex multi-vendor UC ecosystem."

Typical channel partner gross margins, determined by vendors have been falling steadily over the years, Tsang said. "On average gross margins in 2004/05 [fell] from 33 percent to less than 20 percent in 2006/07. Telsyte estimates that in 2007/08, the gross margin had further declined to around 15 percent, half of what it was 2004/05."

Telsyte holds up the failure of Commander Communications, in the wake of its acquisition of Volante, and the restructuring of Kaz under Telstra's ownership as a warning to other would-be UC systems integrations.

"The situation at Commander and KAZ highlights the need for more stringent assessment of the strategic fit, at all levels of acquisition targets and the importance of a well planned and executed integration," said Tsang.

"While from a back office perspective having shared services can lead to a reduction in operating costs it does not always provide cross selling and bundling benefits, particularly when dealing with products and services that have differing economic value, when transcending from Telecommunication to IT."

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