Credit Squeeze Could Lift Hosted Sales say Nortel

Speaking to Comms Business Magazine, Tony Bailey, Nortel VP Channels, UK & Eire, says a possible UK credit squeeze could play right in to the hands of hosted services suppliers.

“Nortel has completed a successful year with a strong financial performance. We set out to achieve a number of objectives including a strengthening of our distribution business where we had identified a gap for a focussed SMB distributor in the telecoms channel.

Our appointment of Rocom has worked really well for both companies with the distributor opening up new channels for our products – adding both value and real incremental sales.”

Bailey defends the role of distributors quite strongly and says that they have a key role to play in developing new markets for Nortel. There are three other Nortel distributors in the UK; Crane/Westcon, Azlan, and Clarity which are clearly addressing a more data centric channel.

“”2007 saw an increasing number of customers adopting unified communications, says Bailey, “They are beginning to understand the business case for UC rather than buying in to the technology push which has been coming their way. The year also saw Nortel smash their data centre products sales targets as regulatory compliance hit home with companies in the financial services sector.”

Looking forward to 2008 Bailey says the market is relatively buoyant at the moment but cautions that a potential credit squeeze may impact prospects for the year.

“One result of a tightening of credit may be a move from CAPEX to OPEX based solutions with applications such as hosted or managed services based telephony gaining more traction. Nortel is of course well placed in the hosted telephony market having CS2000 and AS5200 platforms available and deployed by companies such as BT, Viatel and Timico.”

Bailey says that all these factors combine to provide a launch pad for Nortel in 2008, which in common with other vendors these days, includes a significant degree of emphasis on green issues.

“We are looking to move away from technology led issues and focus more on applications which impact upon an organisations carbon footprint such as unified comms, collaborations, video and remote working.”

Bailey says that mobile and wireless will feature strongly in 2008 with 4G, WiMax leading the way for an ‘un-wired office.

Nortel remains very channel focussed and will be helping our channel partners to develop more new business through a number of initiatives.

“The opportunity for resellers in 2008 is to lead with applications such as UC, contact centre and IVR, talk solutions to their customers on a horizontal or vertically led basis and ‘pull through’ sales of IPT, LAN and security products.”

At the Enterprise level Nortel will continue with their channel centric high touch approach. In the mid market they will be seeking growth from what they term as their ‘developer channels’ whilst they will be looking to develop their SMB business on the back of their BCM products and recruit more resellers.

The new reseller marketing initiative announced at the end of November whereby Nortel will make available marketing collateral for reseller branding in sales campaigns is aimed at the mid market.

Here Bailey recognises the strength of the channel lies with their sales skills so what he is trying to do is create more opportunities for his channel partners to sell Nortel products.

“All resellers need to do with our new marketing collateral is ‘tie in’ their own brand and follow up the sales leads we can provide them with.”

Nortel will be seeking to ensure they all products, sectors and geographical locations comprehensively covered by their channel partners and will be encouraging their resellers to select tightly targeted prospects to avoid channel overlap.

Bailey concludes by saying the special relationship Nortel has with Microsoft will bear further fruit in 2008.

“We continue with joint R&D plans and the channel will see more evidence of new product emerging from the partnership with Microsoft as well as witnessing a more common go to market strategy. New services will also emerge which will be complimentary to the channel.”