It's Time To Integrate Network Management Solutions
Software executives believe service revenue opportunities will grow for VARs with experience in network solutions.
VARs and integrators involved in networking should look into customer services for generating additional revenue. David Hochhauser, VP of marketing, Unicenter brand for Computer Associates International (Islandia, NY), believes services and network management are not going away and will always go hand in hand. "In most businesses the entire value chain is being automated and extended," he says. "The value chain includes suppliers, customers, and even mobile employees. Technologies that bring those components of the value chain together continue to move forward, and the network will continue to be a central component of that integration."
Hochhauser believes the trend toward resellers providing more services continues to grow as well. One of the key drivers of VAR and integrator services is skill limitations in end user companies. "You just do not find a lot of expertise inside companies anymore, especially in the areas of networking and network management," he says. "That is an area in which companies are going to need help. There are always new products and technologies coming on the market, and it is impossible for end users to stay up to speed on everything. Most customers prefer for their VAR to keep up on everything and train them on what they need to know."
Customers Require Integrated Network Solutions
Dwayne Melancon, VP of marketing for Tripwire (Portland, OR), believes the trend toward more VAR services has resulted from customers demanding additional integration of their products. This is especially true when it comes to network management. "Customers are concerned about the big picture," he says. "Customers have historically implemented network management point products that were a fix for what they were trying to accomplish. But they soon found a lot of those products are useful together but don't really interoperate. Customers are now asking for better and tighter integration."
Melancon believes there is a huge effort to try to integrate network solutions after the fact. "This is where there is an opportunity for someone to help customers tie their solutions together," he says. "Customers know how they want to run their networks, but they don't know what they need to buy, how to connect it, and how to best manage it. They want to spend their time running and managing their networks, not implementing them." Melancon adds that customers want others to do the work of getting everything to function together. "Customers understand how to run their businesses," he says, "but they do not necessarily understand how to use technology to help them do that. There is a lot of frustration and trial and error. That is where we look to our channel to add value."
Windows .NET Will Create New Opportunities
Kathy Wattman, senior VP of marketing for Executive Software (Burbank, CA), says there will be a lot of opportunity for VARs to provide services wrapped around the next generation of servers from Microsoft (Redmond, WA), called .NET Server 2003. "Many VARs and integrators cannot compete with the large reseller houses like CDW [Vernon Hills, IL] and ASAP Software [Chicago]," she says. "The large resellers houses are price-focused, and it is too hard for VARs to compete with them on price. What VARs end up doing is focusing more on services and niche markets. Microsoft is pushing .NET Server, and this will be a great opportunity for channel partners."
One of the biggest problems for end users is getting applications to talk to each other. Wattman believes many of those problems will go away with the launch of .NET Server. "There are millions of customers still using NT Server 4.0," she says. "Millions more continue to use Windows 2000. Microsoft is pushing heavily for all of those customers to upgrade to .NET Server 2003. If VARs and solutions providers can get themselves more involved in .NET, it could really pay off." .NET is basically Web services. The solution is based on XML (extensible markup language) technology and allows different applications to talk to each other. "This is a whole initiative that Microsoft will be rolling out over the next four or five years," adds Wattman. "VARs would be wise to get on that bandwagon."
Go Back To Your Roots
Chris Thompson, VP of marketing, Sniffer Technologies division of Network Associates (Santa Clara, CA), advises VARs looking for additional revenue to return to their roots. If they do so, they will find those roots planted squarely in services. "VARs may have missed a big revenue opportunity by not focusing on value-added services like training, systems integration, and presales consulting," he says. "That is how a lot of VARs in the early 1990s built their businesses. This is an opportunity that has especially been missed in the network management space."
Thompson feels there has been an assumption among VARs that just because a solution is browser- or Windows-based, it is easy to use. "Consequently, we find many customers purchasing these products do not get the results they expect," he says. Simply having a product is not good enough. Customers need to know how to use the products. "What we hear over and over again is that companies have acquired a lot of technology but are not seeing the returns they were promised. This is particularly true in the network management space. Customers continue to require network management tools, and VARs with experience in helping end users integrate solutions across the network will generate not only additional service revenue, but repeat business as well."