Strong channel relationships remains important

The indirect channel will continue to play the main role in the Western European networking market. Research firm, IDC expects service providers to play a more important role within the single tier segment as they are looking for ways to leverage their customer base to become the single point of contact for networking solutions.

At the same time, the largest opportunity remains in the two-tier segment, especially for more mature technologies that are easy to deploy and manage and where the opportunity to add value by a partner decreases. IDC expects that some vendors will continue to expand on the number of resellers to grow their presence in Western Europe to be able to gain market share.

In recent years, the channel business model has migrated from the straightforward resale of equipment, to a much more service-oriented business model in which channel partners have added their own services and value to the hardware component.

To further support channel margins, some vendors have instituted various forms of rebate and other financial incentives designed to help support margins in ways that are less likely to be passed on to the end user to help secure the sale.

“Strong channel relationships remain important for a successful go-to-market strategy of networking products,” said Evelien Wiggers, research manager of IDC’s European Enterprise Communications Infrastructure service. “Despite the mature nature of the enterprise networking market, increased functionality and new technology developments such as unified communications, data centre technologies, wireless, and security will provide good opportunities for the channel partner.”